2U (company)

2U, Inc.

Company type	Public (until 2024 bankruptcy filing)
Industry	Educational technology
Predecessor	2tor
Founded	2008 (2008)
Founder	John Katzman, Chip Paucek, Jeremy Johnson
Fate	Filed for Chapter 11 bankruptcy protection in 2024; plans to operate privately
Headquarters	Lanham , United States
Area served	Worldwide
Key people	Kees Bol (CEO as of January 27, 2025)
Products	Online degree and certificate programs; owner of edX
Owner	ARK Invest (largest external shareholder as of 2023)
Website	2u.com

2U is a U.S.-based educational technology firm that collaborates with non-profit higher education institutions to create, deliver, and maintain online degree and certificate programs. It is the owner of edX. The current CEO is Kees Bol.

History

Established in 2008 by John Katzman under the initial name 2tor, Katzman brought on co-founders Chip Paucek and entrepreneur Jeremy Johnson. Katzman served as CEO until 2012 before transitioning to chairman, with Paucek assuming the CEO role.

In 2009, Katzman introduced 2U’s inaugural online teaching degree program in partnership with the University of Southern California. The collaboration expanded in 2010 to include an online social work degree. In 2022, students filed a lawsuit against both 2U and USC related to these programs.

By 2011, Georgetown University’s School of Nursing and Health as well as UNC’s Kenan-Flagler Business School launched online degree offerings through 2U. That same year, the company secured $32.5 million in Series C funding, bringing total capital raised to $65 million.

In February 2014, the board welcomed former Bank of America and Citigroup executive Sallie Krawcheck alongside Earl Lewis, president of the Andrew W. Mellon Foundation. On March 28, 2014, 2U went public by issuing 9.2 million shares at $13 each, raising $119 million. By mid-2014, partnerships extended to institutions like Syracuse University, Northwestern University, and University of California, Berkeley to offer online graduate degrees.

March 2015 marked a collaboration between Yale University and 2U to deliver a full-time online master of medical science degree. By this time, enrollment across partner programs reached around 12,300 students.

Expansion via acquisitions (2017–2021)

Starting in 2017, 2U broadened its business approach by acquiring education firms such as GetSmarter and later Trilogy Education, which specialize in short-term non-credit courses. That year, CEO and founder Christopher "Chip" Paucek completed an MBA online through 2U’s partnership with the University of North Carolina at Chapel Hill. Former Obama administration official Valerie Jarrett joined the board late in 2017, adding strategic expertise.

In 2018, together with Harvard University, 2U launched the Harvard Business Analytics Program aimed at seasoned professionals with tuition set at $50,000. Early in 2019, new collaborations were established with Mexico’s EGADE Business School and Washington University School of Law to provide online MBA and master of laws degrees, respectively, extending 2U’s international presence. August saw the introduction of its first undergraduate program—a data science and business analytics degree—offered through the University of London and London School of Economics, competitively priced at $26,000 for a three-year duration.

In September 2019, 2U unveiled its "Framework for Transparency," pledging to disclose data regarding university governance, accessibility, quality standards, and outcomes to enhance credibility and market position. During 2020, amidst congressional scrutiny over compliance by online program managers with consumer protection regulations, the company committed $3 million in scholarships aimed at underrepresented groups to support growth in technical training sectors. Additionally, partnerships were formed with Netflix and Norfolk State University to provide free technology bootcamps.

That year also saw the release of 2U’s inaugural transparency report highlighting $1.3 billion invested in nonprofit partners’ degree offerings and a graduation rate of 72%. The COVID-19 pandemic accelerated demand for digital education solutions, driving increased gross revenue while reducing debt levels; by late 2020, over 275,000 students were served through its programs. Interest grew among clients for its revenue-sharing model during this period. Furthermore, the London School of Economics expanded its engagement to include undergraduate degrees in mathematics and finance. In September, a new partnership was announced with Columbia University’s engineering school to launch an online Artificial Intelligence Program tailored for working professionals.

Ahead of the 2020–2021 academic year, Simmons University expanded its portfolio of online degrees via a revenue-sharing arrangement with 2U that introduced lower-cost options targeting non-traditional learners.

In June 2021, a strategic partnership was established between 2U and education benefits provider Guild Education, enhancing access to adult education markets. Concurrently, the acquisition of MOOC platform edX for $800 million in cash significantly broadened its product offerings and market footprint in digital learning. That same month saw Netflix and 2U extend their bootcamp initiatives to include Talladega College, St. Edward's University, Marymount University, and Edward Waters College, supporting workforce development efforts.

Downsizing and restructuring (2021–present)

Valerie Jarrett stepped down from 2U's board in October 2021. The following month, The Wall Street Journal highlighted concerns regarding 2U’s aggressive recruitment tactics for USC’s master’s program in social work, emphasizing the burden of significant student debt paired with comparatively low earnings among graduates.

Throughout 2022, 2U encountered scrutiny related to its contracts with online program managers and recruitment strategies. Bloomberg revealed that the Indian edtech company Byju's was in talks to acquire 2U, offering more than $1 billion by mid-2022. On July 28, 2022, CEO Chip Paucek disclosed plans to reduce the workforce by 20%.

In December 2022, a class action lawsuit was filed against 2U and USC, alleging deceptive practices involving inflated program rankings. In early 2023, 2U initiated legal action against the U.S. Department of Education challenging new regulatory oversight for third-party education service providers; these regulations were eventually withdrawn in October 2024.

On September 28, 2023, Paucek announced additional job cuts as part of ongoing organizational adjustments. By November 9, 2023, USC terminated most collaborations with 2U—including the social work program—resulting in a sharp decline of 57% in 2U’s stock value. Subsequently, on November 17, CFO Paul Lalljie succeeded Paucek as CEO, with Matt Norden stepping into the CFO role.

Chief Revenue Officer Harsha Mokkarala resigned in January 2024. Andrew Hermalyn and Aaron McCullough were appointed presidents overseeing degree programs and alternative credentials, respectively.

As of 2023, ARK Invest remained the largest external shareholder in 2U. Despite not having posted an annual profit yet, the company pursued profitability through strategic initiatives such as refocusing efforts around edX.

On July 25, 2024, 2U filed for Chapter 11 bankruptcy protection, erasing over $450 million in liabilities while planning to operate privately moving forward. Paul Lalljie resigned as CEO on October 4, 2024; Matt Norden served as interim CEO until Kees Bol was named CEO on January 27, 2025.

Business model

Functioning as an online program manager (OPM), 2U had approximately 250 institutional partners by 2024, including elite universities like Harvard University, Yale University, and MIT. The company generally enters into long-term agreements—often spanning a decade—with these academic institutions. Students pay tuition rates set by their universities directly; meanwhile, 2U generates revenue through a shared revenue arrangement.

GetSmarter

Established in 2008 in Cape Town, South Africa by brothers Sam and Robert Paddock, GetSmarter specialized in delivering online short courses tailored for working professionals through collaborations with universities and industry experts. The firm experienced rapid growth from an initial team of five to around 400 employees by 2016, serving roughly 50,000 learners and achieving R227 million in revenue that year. Among its principal investors was Digital Growth Africa Middle East (DiGAME).

By 2017, GetSmarter had formed partnerships with leading institutions such as Cambridge, Harvard, MIT, along with South African universities including the University of Cape Town and Stellenbosch University. It provided approximately seventy continuing education courses worldwide from dual headquarters located in London and Cape Town.

In May 2017, GetSmarter was acquired by 2U for $103 million—including a $20 million performance-based earn-out—marking the first acquisition for 2U. This move facilitated swift international expansion and entry into the short-course market segment. Post-acquisition, GetSmarter has maintained operational independence while complementing and broadening the scope of 2U’s global offerings.

edX

In 2021, 2U completed the acquisition of edX, a digital learning platform originally launched by MIT and Harvard in 2012. edX broadened its curriculum by adding professional certificates, MicroMasters, and MicroBachelors programs, thereby strengthening 2U's suite of offerings within the online education sector.

Recognition in the media

In May 2012, Forbes identified 2U as one of ten "Start-Ups Changing the World." Two years later, in 2014, Inc. Magazine featured 2U among ten "Tech Companies Helping Humanity." Additionally, the company earned the title of "Most Innovative Company" from Fast Company in both 2017 and 2022, highlighting its visionary leadership and significant impact on educational technology.

See also

• For-profit higher education in the United States