More than 150 companies have hired from Praxis — why the college alternative is scoring high marks with employersView transcript
Until recently, a four-year college degree was a necessity if you wanted to be consdered for a good job. But skyrocketing costs of tuition and crushing loads of student debt in the U.S. have spurred many would-be college-bound Gen Zers to rethink that value proposition.
Employers have started to question it, too. Despite the cost, university degrees do not always provide the training and skills needed for graduates to succeed in the workforce — contributing to the rise of internships as a "must have" on resumes.
Enter Praxis. The eight-year-old company offers high-school graduates, college drop-outs and early-career professionals what it considers to be a more efficient path to the American Dream. Founded by Isaac Morehouse, the company essentially offers a one-year program that includes a remote bootcamp and an apprenticeship at a high-growth startup, mainly in the tech sector. The whole package costs $12,000 for apprentices, or just a fraction of the current average yearly tuition of $38,185 for private universities. (The annual tuition for out-of-state students at public universities averages $22,698 and averages $10,338 for for in-state students at public universities.)
The benefits are clear when you consider that the average load of student debt in the U.S. is currently about $30,000, for a total of $1.73 trillion nationwide. Rather than graduate swimming in debt and struggling to find work, Praxis participants have relatively low overhead and get paired with a potential employer immediately. More than 150 companies have hired Praxis apprentices, including tech unicorn PandaDoc, nonprofit fundraising firm Good United, and tech private equity firm Xenon Partners.
We talked with Praxis CEO Cameron Sorsby, who is himself an alum of the program, about what it can offer participants. As a student, Sorsby loved to learn, studying philosophy, political science and economics, as well as volunteering for a political campaign in the 2012 election season. But he didn't love the rigidity of formal instruction. He interned for Morehouse during his senior year of college, as Morehouse was working on the education startup. Sorsby was so enthusiastic about the concept that he joined the first-ever cohort.
Here is more from our interview with Sorsby.
This interview has been edited for length and clarity.
Hacking college, and why it's a "low bar" to stand out to companies00:00:00
Business of Business: So thanks for joining us here at The Business of Business. I’m really glad you could take the time to speak with us. Why don't we begin by having you just give us an overview of what Praxis is and what it does, and how long it's been at it?
Cameron Sorsby: Yeah, for sure. So Praxis is a business apprenticeship program, and it's for hardworking, ambitious young adults that are looking for a more direct path to getting their career started than the traditional college route. Eighty percent of our participants are doing Praxis instead of going to college at all, or they're dropping out of college to pursue Praxis. How the program works [is], we put them through a six-month professional development boot camp that helps them kind of figure out what early career interests they have and develop skills through a project-based curriculum. Essentially, they're getting ready to go into entry-level, full-time positions at growing companies, whether it's tech startups or growing small businesses, so they spend six months at those businesses. The vast majority of the time, they stay with those companies after they graduate [from] the program, and then Praxis kind of turns into a long-term professional network for them.
Fantastic. And so how long has Praxis been operating?
We started the company in 2013; [we] started running our very first cohorts of apprentices in early 2014. So we're coming up on eight years of running the program.
And so whose idea was Praxis? Are you familiar with how it got off the ground?
Isaac Morehouse is the original founder of Praxis. He was very entrepreneurial himself. He also grew up homeschooled. The typical school system—both K-through-12 and college—was not natural to him. So kind of taking that with his more entrepreneurial experience, he wanted to essentially figure out, how can I help smart, ambitious young people get started through real-world experience? Also, through his work before he started Praxis, he was working a lot with successful entrepreneurs, business owners. The constant feedback on that side of the market was, “We're starving for hungry new talent. It's just really hard to find people that we have confidence [in who] can come in and create value for our business.” So he started Praxis kind of taking those two pain points, seeing more and more young people dissatisfied with [the] college experience and more and more business owners dissatisfied with young professionals, the talent pool and everything.
Okay, that's interesting. So would you say that there is actually a large cross-section of employers in the business community who are actually willing to hire smart, talented, hard-working young applicants who may not have gone the traditional college route? Because I remember when I first heard of Praxis, that was my main concern.
My question was, how many employers out there are actually looking for—or even merely willing to take a chance on—non-college-educated applicants? I think there's a widespread perception out there—shared by me for a long time—that a lot of people feel like they have to go to college in order to climb the corporate ladder, because employers insist on it. So is it really the case that there are that many employers who are willing to go an alternative route?
At Praxis, specifically, we focus on tech startups, tech companies [with] anywhere from 10 to 15 employees up to 500, 600. That's kind of our range of types of businesses we work with. Before I became CEO, I was leading our business development and placement efforts, so I was the person reaching out to new companies. I probably had 500-plus phone calls with companies at this point, talking about talent needs and everything. And I can remember [only] two specific times where the conversation ended because [they said,] “Nope, sorry; we only hire entry-level candidates with college degrees.”
“I really believe the necessity of the college degree is a myth at the end of the day. Businesses do not care — just black and white — whether you have a degree or not.”
I really believe the necessity of the college degree is a myth at the end of the day. Businesses do not care—just black and white—whether you have a degree or not. What a business cares about is, can you come in and create value for their company? Historically, we've used the standard undergrad college degree as...a signal that you're at least worth considering, essentially. So if you're a smart, capable young person, instead of spending four to five years pursuing that degree and [saying,] “Okay, I have my stamp of approval from an educational institution,” there's many, many ways to hack that process.
“How can I prove to an employer that I can be valuable [to] them?” That's the question you're trying to answer as a young professional. So during our boot camp, they're working on projects every week. Those projects are helping them figure out what they're interested in pursuing. But of course, they're [also] building relevant, tangible skills, and they're able to point to their projects and the content they created during boot camp. [They can say,] “Hey, I'm interested in content marketing,” instead of having a degree and saying, “I was a marketing major and I have a certain GPA.” [They can say,] “I can show you three to four real-world projects that tell you directly [that] I can do the type of work you're looking for.” And then it becomes about, how can you get connected at companies—how can you bypass that initial gatekeeper and the application process, where you're submitting your resume and you're supposed to have your education and work experience status.
There's a lot of different creative ways where you can kind of bypass that or supplement that initial online application to get in touch with companies that are looking for talent. But at the end of the day, it comes down to [whether] you can prove to a company that you can create value for them. Then they're going to want to hire you, regardless of your degree status. And the bar is super low. People treat the hiring process so passively: “They're asking for a resume. I'm going to submit my resume and then, fingers crossed, somebody wants to talk to me.”
If you put a little additional effort and, instead of applying to 100 companies and just getting [your] resume out to as many places as possible, take a few companies [where] you're legitimately interested in the work that they do and you're sincerely interested in working for them. Do your research [into] the company, learn about their product(s) and services, learn about the company's culture, and pitch them on why you would be a good fit for their company, why you're interested in them, and show them, through something tangible, “Here's me proving to you [that] I can come in and do the job that you're seeking.” If you put in just a little bit of effort, you're going to be ahead of the curve of 90% of job applicants. So it's a low bar to stand out to companies.
Feedback from companies hiring Praxis apprentices00:12:15
Interesting. It's just funny, because it reminds me of a speech that my alma mater’s current president gave a few years ago, where he was sort of promoting the enduring value and virtues of a college education (surprise, surprise). I remember him citing some statistics about how...highly successful people still tend to have college degrees, and getting a college degree statistically increases your likelihood of earning above a certain income threshold in your life by however many percent, and things of that nature.
I was wondering whether, even just in terms of the employers, the number of employers that Praxis itself has worked with—would you say that there has been growing interest in [terms of] the number of employers who are willing to work with Praxis to recruit young hires? Does that support or bolster your theory about the myth of the necessity of a college degree?
We've seen tons of growth. We've placed our apprentices at more than 150 companies at this point. And when we first started out, you know, we were a brand-new business ourselves that didn't have a track record yet. Every year, we would get more and more interest. Probably 50% of the companies that we work with are referrals from other companies that have hired Praxis participants. They've had a great experience with the talent they've hired through the program, and they're sharing it with their friends working at other companies and stuff.
I think a really good example of why somebody should question “Do I need a degree or not?” is one of one of our largest hiring partners. Today, if you go look at their Careers page, you'll see some kind of “College degree preferred” or “College degree required.” [But] it's just a standard HR practice at most companies, and they kind of just include it in job descriptions, honestly, without ever thinking about it. And then, when our candidates go and apply for those jobs—without even us making a direct connection, not knowing they're coming from Praxis, they're getting interviews because of what they present up front. Ultimately, the way I see it, it's an out-of-date HR [practice] that has lasted on legacy more than anything.
You can look around—and it's not just with smaller companies and startups that are a little bit more modern. There's been a huge push over the last decade for corporations to move away from degrees as a set requirement. You see it all the time. Sometimes it definitely feels like lip service and a PR play where Google, Starbucks, firms like Ernst & Young, the Big Four accounting companies will come out like, “We're no longer requiring college degrees.” Because Ernst and Young, as a consulting firm, you're going to get people coming from college. That's just how that talent pipeline works. But I think more and more cutting-edge industries are ahead of the curve on this stuff.
My personal experience has been [that] companies come to us and they know [a] little about Praxis. They're not asking me what the education status[es] of our participants are. They're asking me, “Do they have the skills—the hard skills and soft skills and intangibles—that they're looking to hire for?” If we can convince them of that, then they're not even going to ask about their degree status.
How does it work—especially when it comes to a new employer who's just now starting to work with Praxis to recruit some of these applicants? I mean, you mentioned referrals earlier as well. Do they typically approach Praxis and say, “We're interested in participating in your program”? Or do you typically reach out to them—or is there some balance between the two?
It's a little bit of both. Like I mentioned, probably half of our new hiring partners come from referrals from either companies that are already working with Praxis or just other contacts in our network [who] are recommending Praxis to them. And then we also reach out to new companies ourselves. Our goal is always helping our participants find really high-quality, early career job opportunities. So we're always researching and staying up-to-date on what newer companies out there are starting to really grow and take off that could use the kind of talent that we have to offer, and we'll reach out to them. We'll obviously do our due diligence on them up front, and then we have kind of a vetting process to make sure it's a good fit.
Beyond the specific types of roles, we really focus on more business-focused roles, like sales, marketing operations, or maybe a hybrid of those things. The program's business-focused, a little bit more entrepreneurial. So it's not a tech [or] coding boot camp. It's for people [who] are intellectually curious, smart, [who] probably have some interest in business, but don't quite know what they want to do. That's why they're coming to Praxis.
And then on the employer side, they're typically thinking, “I need someone [who] can come in and help [with] sales and marketing,” or “We're we're starting to build out our sales or account management team,” or, “Hey, our recruiting team could use an entry-level coordinator position” Those kinds of roles give our participants really good initial experience in the business world. And those companies also offer a longer-term upside. So they're not short-term internships; they’re full-time positions.
“Why companies love our participants mostly comes down to the attitude and mindset of the individuals.”
Why companies love our participants mostly comes down to the attitude and mindset of the individuals. They want you to have some basics, so that they know you're not going to be entirely lost on Day One or in the first few months. But really, they're hiring you for your projected value over 6 to 12 months and [to] know if you're capable of learning on the job and you're capable of providing really great customer service, if you work well on a team. They almost prefer to teach you the specific skills you need on the job, because every company does things a little bit differently.
You also did mention some specific companies just now. I mean, are you at liberty to mention any of the particular employers that have worked extensively with and how many placements they've gotten out of working with you guys?
Yeah, so PandaDoc—that's our big company we love to brag about. They've hired over 30 participants from the program over the past four years or so. When we started working with PandaDoc and sending talent to them, they were around like 65, 70 employees and they've grown to over 500 employees. They just [did a] Series C fundraising round, and they're now valued at over a billion dollars.
Our participants—especially the ones that started there early on—they kind of rode that whole growth wave that PandaDoc has been on for the last three or four years. [In the case of] our very first participant that got hired there, things were moving so quickly at PandaDoc that she started in an entry-level sales development representative position—which is like your kind of standard, entry-level sales position in a software company—and within two months, she was promoted to an account executive. So she was closing sales deals now. That was partially because there was an internal need at the company because they were growing so quickly, as well as [because] she was really strong from the get-go; she was ready to fill that kind of position. But now we have Praxis graduates working inside PandaDoc and pretty much all aspects of the business now, from product to finance to sales and marketing.
Another cool company is called Good United; they're based out of Charleston, South Carolina. So they're not based in San Francisco or New York or anything, you know, [a] typical tech location. They're a little bit off the beaten path. But [it’s a] really cool company. They do software and account management to help nonprofits fundraise on social media and stuff. They hire our participants for account manager positions and analytical roles where you're doing a deeper dive into the weeds on how to help their customers and client base, you know, increase performance with fundraising campaigns and everything. They've hired five or six participants over the past 18 months.
One other one I'll mention...a private equity firm called Xenon partners, and they actually use Praxis to hire entry-level talent at all of their different portfolio companies. You know, it's essentially providing us a network of 8 to 10 companies that are always looking for different entry-level roles. Some of our participants have gone and worked for Xenon, itself, not at a portfolio company.
I think the other nice thing about Praxis is [that] it's not limited to just tech startups. As long as you have a general inclination [towards[ business, there's all different kinds of industries that you can jump into.
How the business works00:16:42
How exactly does your company's...revenue structure work? Who pays you? Is it the employers? Is it the applicants? Is it some combination of the two, and how, I mean, without necessarily giving away too much about your actual finances and so on how viable a business has Praxis been? So?
95% of our revenue comes from participant tuition. Tuition is $12,000. You can either pay it up front, or we have a loan plan with a lending provider where you can put down a deposit of $1,000 and then start making monthly payments about halfway through the program. So it gives participants more flexibility, makes the program accessible for those [who] just aren't in the position to drop $12,000 on tuition. Our participants, through the apprenticeship that they land, they're starting at, on average, $35,000 to $40,000. So you're earning more in the first six months on the job than you pay in tuition in total.
We [also] collect placement fees from our core business partners that we work with on a regular basis. That can be anywhere from $1,500 to $3,000 that they're paying Praxis to hire someone from our program. So that gives them private access to our talent pool, they get a first look at our candidates, etc. But the vast majority of our revenue comes from participants; that's where our bread is buttered. If we're not providing a great program experience to our primary customers, the individuals doing the program, then everything breaks down from there. So we're very much obviously accountable to them.
As far as the business goes, since 2016, we've been self-funded and profitable. We've grown from doing 15, 20 participants in our first couple of years on an annual basis. We're now doing 100 to 120 participants a year, and every year there's more people seeking out alternatives to college. So [we’re] really excited about the next three to five years and the decade ahead. Everything to do with COVID has kind of accelerated that trend of individuals moving away from college. Over the past year, since last summer, when it became clear [that] the whole “Zoom University” situation was going to continue going into fall semester last year, we've had more high-quality applicants than ever. [...] There's more and more people [who] are just open to pursuing other alternatives than just feel like college is the only option if you want to be successful in life.
Looking ahead, you've talked about how you guys focus [on] tech startups and so on. Praxis—obviously, you’re a business, and the bottom line matters. But it sounds like you're all also kind of on a mission to open up a lot more alternative paths to success for young people that go beyond spending four years in the...I guess you could call it the academic rat race [laughs], and jumping through a lot of a lot of the hoops that come with that, and spending a lot of money on higher education. How viable do you think that is for young people who want to go into different fields?
For example, if you're a high school graduate who's not crazy about the idea of going to college, but you're not trying to go to work in the business world, necessarily. You're more interested in doing—I don't know, it could be something more in the arts, or architecture, or some of those professions that are traditionally understood to require a college degree just as a credential matter, or as a matter of getting the licenses that you legally have to get. For example, I went to law school before I went into journalism. Not necessarily in terms of how you scale your business, Praxis in particular, but in terms of the overall vision that it represents: How widespread do you see it becoming in society as a whole? Is it more just a question of, “College is right for some folks and not right for some others, and we're just in that niche where we're trying to appeal to those for whom college isn't the best choice, but to each, his or her own”?
My hope—and this is a hope that I'm optimistic about—is that over the next decade, you're going to start to see more and more viable options to get into different types of career paths. Right now, it's college, and then maybe trade school, essentially. Or maybe you're some entrepreneurial prodigy and you just go off and do your own thing—you know, the next Steve Jobs [or] Bill Gates, that whole stereotype and what not.
First of all, college isn't going anywhere anytime soon. I think there's definitely potential for it to lose its market position. If you look at how to get your career started, college as an institution essentially has a monopoly on that for most people. I think you'll start to see more and more formal programs. What's the Praxis version of people trying to become, you know, get into architect[ure], or pursue arts and stuff. I believe you'll start to see more and more alternative programs pop up. We're starting to see that already. I think it's easiest to kind of start in the business world, in the tech world, because they have pretty low barriers to entry. There's no legal barriers to entering the business world; if you can program, then you can go work at a tech company as a software engineer. [So] I think you'll start to see more and more options.
When we think of college, we think about who's a good fit for college. [The thinking is,] “If you're smart and you have any level of ambition, you should probably go to college.” And [when it comes to] the people that we think about right now that shouldn't go to college, it's like, “Oh, you're you're not intellectual enough, or you're not gonna be successful in college. You can go find a trades job or do something, you know, like that.” I think you'll start to see, on an individual basis, more people that historically would be the types of people who would go to college, no questions asked, just opt out and just start working and figuring things out on an individual basis and not necessarily go to a formal program as a college replacement. Maybe they'll take some online courses here and there to learn specific skills. But you know, I think it will be just less institutionalized.
“I wouldn't be surprised if, over the next decade, we see tons of colleges shut down...it's insane how many universities and colleges exist in the U.S.”
But I mean, college will be here. Especially in the US, a lot of small-to-medium-sized private liberal arts universities are definitely in financial trouble with the pandemic and everything. So I wouldn't be surprised if, over the next decade, we see tons of colleges shut down—and then you kind of see the big prestigious schools [and] larger state universities survive, but there could probably be a contraction of the number of universities. It's insane how many universities and colleges exist in the US; I don't think people realize just how many there are.
I'll say it this way: When Praxis started, it was very much seen as this radical thing to opt out of college and not go that route for the typical person that you think about that's a good fit for college. I think over the next decade, it will become normalized, and you won't be looked at as a total weirdo or crazy person if you're doing something other than college. So I think that's the first step in normalizing it. Ideally, that would put pressure on college[s] to step up their game.
I think people don't do enough to question, What are the actual outcomes of college? From a debt perspective, the average student debt in the US is $37,000, and on average, it takes people 20 years to pay off that debt. That's a huge handcuff as you get your life started. Most people don't graduate if they go to college. I was reading the other day, over 40 to 45% of 2020. college grads are still looking for full time employment. That's a huge percentage! So I think there [are] more people just looking at college, and...it's not even about, “Oh, I don't like school; I don't like the environment.” We're getting more and more applicants that are just [coming] from a pragmatic perspective. It's like, “Yeah, college doesn't seem like a worthwhile investment to me. I feel more confident [that] I can figure things out without spending the four to six years that it takes to graduate and...going into the debt and stuff.”
So it's, it's already starting to happen. It's crazy how much the trends have shifted since we started Praxis versus now. We have more parents reaching out to us than young adults that would be doing the program, because they're trying to help plan for their teen’s post-high school plans and everything. And I think we're starting to see parents of teenagers now have the experience, the negative experience of college debt [in] their own lives, so they're more likely to consider other options for their family. When my parents were going to school, college was extremely affordable. And so, even if it wasn't necessarily what made them successful, it wasn't necessary. It was a safe bet to go; you're not going to be harmed [by] college. Whereas I know plenty of people [who] are smart, talented, [and] they're...delaying typical life milestones like getting married, buying a house, having kids, because they have student debt to account for.
And even if it's not that, most people coming out of college have to take certain salaried positions because you have that debt to start paying off now. So you're going to be funneled into larger corporate jobs rather than...pursuing your own personal interests—or maybe taking that risky job at a smaller company where they can't pay you as much, but hey, you don't have a lot of expenses right now, so now's the time to do that. Now's the time to prioritize pursuing your own interests and learning new things, etc. So I think the biggest advocate for not going to college is college right now.