2U Stock

2U, Inc. operates as an online education platform company.

As a trusted partner to top-ranked nonprofit universities and other leading organizations, the company delivers technology and services that enable its clients to bring their educational offerings online at scale. Through edX (edX Inc. and its wholly owned subsidiary, edX LLC), the company’s education consumer marketplace with 48 million registered learners, it hosts a comprehensive range of education offerings, from free courses to degree programs.

The company serves more than 230 top-ranked global universities and other leading organizations and, together, the company offers more than 4,000 high-quality online learning opportunities, including open courses, executive education offerings, boot camps, micro-credentials, and professional certificates, as well as undergraduate and graduate degree programs. The company’s offerings cover a wide range of topics, including technology, business, healthcare, science, education, social work, and sustainability. The company’s platform provides its clients with the digital infrastructure to launch world-class online education offerings and allows students to easily access high-quality, job-relevant education without the barriers of cost or location.

Business Segments

The company has two reportable segments: Degree Program and Alternative Credential.

In the company’s Degree Program segment, the company provides technology and services to nonprofit colleges and universities to enable the online delivery of degree programs. Students enrolled in these programs are generally seeking an undergraduate or graduate degree of the same quality they would receive on campus.

In the company’s Alternative Credential segment, the company provides premium online open courses, executive education programs, technical, skills-based boot camps and micro-credential programs through relationships with nonprofit colleges and universities and other leading organizations. Students enrolled in these offerings are generally seeking to reskill or upskill for career advancement or personal development through shorter duration, lower-priced offerings. In addition to selling these offerings directly to individuals, the company sells to organizations and institutions, including employers, non-profits, governments and governmental entities to enable upskilling and reskilling of their workforces.

Platform

The company’s platform consists of a seamlessly integrated ecosystem of technology, people and data. Through its platform, the company provides the tools and services its clients need to bring their education offerings online, at scale; and the company provides learners with flexible, high-quality learning opportunities across an expansive range of topics to support their educational and career goals.

edX

edX.org provides access to the full catalog of online offerings that the company enables, ranging from free offerings to graduate degrees. This thriving marketplace allows the company to connect a large base of learners with the company’s comprehensive range of high-quality education offerings and identify new high-intent learners efficiently.

Technology and Technology-Enabled Services

In the Degree Program segment, the company offers its university clients a broad set of technology and services spanning the student journey from pre-enrollment through graduation. Clients can utilize the entire bundle of technology and services that the company offers, or a more flexible set of services under the company’s flexible degree model. In the Alternative Credential segment, the company provides technology and services to enable the company’s clients to provide a range of non-degree credentials and other courses to learners.

Technology

Learning Technology – For many of the company’s offerings, including all of the company’s open course and micro-credential offerings, the company’s clients leverage an open source learning technology platform (the ‘Open edX Platform’). The company has customized this learner-centric, scalable learning platform to enable the company’s clients to easily build and launch offerings on edX. For certain degree, executive education and boot camp offerings, the company uses other learning platforms that provide an integrated hub for students to access coursework and learning modules, interact with tutors and peers, attend live classes, and review assignment grading and tutor feedback. The company’s STEM-based education tools and collaborative annotation technology significantly enhance the learning experience for students and the instruction capabilities for faculty.

Integrated Learning and Business Systems – The company uses a variety of proprietary technologies to streamline the launch of the company’s degree programs at scale across multiple schools. Prior to the launch of new degree programs, the company also tightly integrates its systems with its university clients’ systems by building integrations and data connections. These integrations facilitate the secure bi-directional exchange of data to support the company’s degree programs and to automate a variety of processes on an ongoing basis, including admissions and live class scheduling. The company also integrates its systems with those of the company’s enterprise clients to allow for secure access to the company’s catalog of offerings directly through the company’s clients’ corporate learning management systems.

Data and Analytics Support – The company’s platform enables it to measure user interactions from their first introduction to the program all the way through completion. This allows the company to analyze and understand the types of offerings a given student will be most successful in and helps the company determine the level of support they need. In addition, instructors and faculty are able to leverage platform tools so they can better understand how their students are performing and who may need additional help.

Technology-Enabled Services

Student Engagement Services: The company provides a broad scope of services to support students at each stage of their learning journey from the enrollment process through post-completion career services.

Pre-Enrollment – The company provides prospective students with transparent information regarding admissions and enrollment requirements, the application process, curriculum, tuition, and time to completion.

Student Support – In many offerings, the company provides students with best-in-class support by assigning a dedicated advisor that is focused on retention and graduation. These advisors provide individualized non-academic support throughout their program by using data analysis and proprietary tools to create personalized coaching plans for students, and ensure student questions on asynchronous content or coursework receive a timely response from an advisor or teaching assistant.

Post-Completion – The company provides students and alumni of the company’s clients’ offerings with access to industry-aligned resources designed to support students in achieving their career goals following program completion through the company’s Career Engagement Network. These services include resume and interview tools, live coaching and workshops, as well as career fairs and employer referrals to the company’s strong network of employer partnerships around the world.

Curriculum and Learning Services: The company’s platform enables faculty of its university clients to author and publish high-quality content for their offerings efficiently. The company provides course strategy and design consultation services and other self-help resources to assist faculty in creating engaging course content. For certain offerings, the company’s learning design and development experts collaborate with faculty to produce high-quality, engaging, online coursework and content for the company’s university clients’ offerings. The company uses a variety of technology tools that allow the company to scale its curriculum and learning services, including a learning management system to author and host asynchronous learning activities and make real-time updates in certain quickly evolving fields. The company also uses tools to streamline scheduling, grading and student collaboration in the virtual learning environment for students and professors. The company also recruits, hires, and trains faculty to teach the executive education and boot camp offerings for the company’s clients.

Marketing Services: The company’s marketing efforts center on using the strength of the edX brand and the popularity of edX.org to enable learners to find the company’s offerings through free or low-cost acquisition channels. The edX platform gives the company access to a large global audience, a comprehensive library of educational content, and a trusted brand with significant consumer recognition. Through data analytics and machine learning techniques, the company connects learners with the appropriate high-quality learning experiences based on their skill sets and learning goals. The company also deploys program-specific marketing campaigns, primarily for the company’s university clients’ degree programs. These campaigns leverage the company’s university clients’ brands and approved messaging to generate interest in a particular program.

University and Faculty Support Services: The company provides a range of other services to enable the success of the company’s university clients’ online degree programs and allow them to focus on their core academic functions.

Admissions – While the company’s university clients are solely responsible for setting admissions standards and making admissions decisions, the company provides technology-enabled services to streamline the admissions process by assisting prospective students in the application process and organizing and routing completed student application packages to the university’s admissions office.

Placement – Using the company’s global network of clinics, hospitals, schools and other sites, the company’s field placement team secures local placements for students enrolled in degree programs, such as nursing, social work, teaching and other programs that require field placements to satisfy curriculum and accreditation requirements. The company has integrated placements into the company’s learning technology to enable students, faculty and field placement supervisors to monitor completion of student field work directly from the company’s platform.

Faculty Success – The company provides a dedicated team to support and train university administration and faculty on how to use the company’s platform to facilitate high-quality live instruction. In addition, the company helps its university clients succeed by assisting with faculty recruiting efforts, including attracting, cultivating, and vetting a pool of faculty candidates for the company’s university clients.

Growth Strategy

The principal elements of the company’s strategy include adding offerings and increasing enrollments; adding new offering types; broadening enterprise channel; and expanding globally.

Clients

As of December 31, 2022, the company had more than 230 clients with more than 4,000 offerings. Its clients are nonprofit colleges and universities, as well as leading corporations and non-profit entities.

Seasonality

The company experiences seasonality in its marketing and sales expense in both its Degree Program segment and its Alternative Credential segment. The company typically reduces its paid search and other marketing and sales efforts during late November and December because of less demand during the holiday season.

Intellectual Property

The company relies on trademark protection in the United States and various foreign jurisdictions to protect its rights to various marks, including 2U, NO BACK ROW, GETSMARTER, EDX and other distinctive logos associated with its brand. The company continues to evaluate developing and expanding its intellectual property rights in patents, trademarks and copyrights, as available through registration in the United States and internationally.

Education Laws and Regulations

Although the company is not considered an institution of higher education and the company does not directly participate in Title IV programs, the company is required to comply with certain regulations and guidance promulgated by the U.S. Department of Education (DOE) as a result of the company’s role as a service provider to institutions that do participate in Title IV programs. These include, for example, regulations governing student privacy under Family Educational Rights and Privacy Act, or FERPA, and the DOE’s recent guidance regarding third-party servicers. While online executive education courses and boot camps are typically not eligible for Title IV aid, when offered by or on behalf of Title IV eligible institutions, many education laws, such as FERPA, remain applicable to the company or its university clients even in the Alternative Credential segment.

The company’s activities or those of its university clients are also subject to other federal and state laws. These regulations include, but are not limited to, consumer marketing and unfair trade practices laws and regulations, including those promulgated and enforced by the Federal Trade Commission, state and federal consumer lending laws, including those enforced by the federal Consumer Financial Protection Bureau or state agencies, student accessibility requirements, federal and state data protection and privacy requirements and foreign and the U.S. anti-corruption regulations.

History

The company was founded in 2008. It was incorporated as 2Tor Inc. in the state of Delaware in 2008 and changed its name to 2U, Inc. in 2012.