Appraising one opportunity: evidence of the outcome, not the promise of it

Before paying for a course, qualification or programme, look for evidence that people like you achieved the outcome you want, check completion and employer demand, and compare cheaper routes.

12 min read · Level 1

The point

I think the most reliable evidence about a self-investment is almost never the provider's. Job listings, people who quit the programme, and people doing the job you want without the credential all tell you more. Education sold on outcomes deserves the same scepticism as any investment sold on returns, and for the same reason: the seller sees the winners.

What is it?

A useful appraisal asks six questions:

1 Outcome evidence what happened to people like you who took it 2 Completion rate how many who start actually finish 3 Employer demand do job listings in your target role ask for it 4 Full cost fees, forgone earnings, time 5 Alternatives cheaper or faster routes to the same outcome 6 Reversibility how much you lose if you stop partway

Outcome evidence needs care. Marketing often quotes the best results, or the average salary of graduates without saying how many graduates found jobs, or what those graduates earned before. Look for figures that include everyone who started, not just those who finished and replied to a survey.

Completion changes expected value. If 60% of students finish a programme and non-finishers gain nothing:

Expected after-tax gain if you finish 4,200 a year Probability of finishing 60% Expected gain 4,200 x 60% = 2,520 a year

Employer demand is checkable. Reading 20 job listings for the role you want and counting how many mention the qualification is a quick, independent test.

Why does an investor care?

Because the education and training market has strong incentives to sell hope. Survivorship bias - hearing mainly from those who succeeded - makes many programmes look better than their typical result.

And because an honest appraisal often reveals a cheaper route. The goal is the outcome, not the particular programme.

Educational, not personalised financial advice. Nothing in the Investor Academy is a recommendation to buy, sell or hold anything — what is right for you depends on your own circumstances and the rules where you live.

Example

A 9,000 bootcamp advertising an average graduate salary of 65,000.

What the investor checked Found Share of starters who finished 55% Share of finishers employed in the field in 6m 70% Salaries before the course many already earned about 55,000 Job listings for target role mentioning it 3 of 20

Of 100 starters, about 55 finish and about 38 get jobs in the field (55 x 70% is 38.5). The salary figure mostly described people who were already well paid. And most employers did not ask for the credential. The investor instead built a portfolio of projects using free and low-cost material, and applied directly.

The common mistake

Trusting a programme's headline outcome figures without checking who is included, what they earned before, and how many people started but did not finish.

How it works

Step 1: Ask for outcomes of everyone who started

Request completion rates, employment rates and earnings changes that include non-finishers.

Step 2: Check what employers actually ask for

Read at least 20 job listings for your target role and count mentions of the qualification or skill.

Step 3: Talk to people who did it

Find past participants independently, not only through the provider's testimonials.

Step 4: Compute expected value with completion risk

Multiply the expected gain by your realistic probability of finishing and using it.

Step 5: Price the cheapest credible alternative

Identify free, employer-funded or shorter routes to the same outcome and compare.

When to use this

Before paying for any course, qualification, bootcamp, coaching or programme sold on its outcomes.

When not to use it

Do not demand the same evidence for low-cost, low-commitment learning you can stop at any time. The appraisal should scale with cost and commitment.

How investors actually did it

A recurring pattern: regulatory action against misleading education claims

The U.S. Federal Trade Commission has taken action against for-profit education providers for misleading claims about graduates' job placement and earnings, including a widely reported 2019 settlement with a large for-profit university company over advertising that implied partnerships and job prospects that did not exist.

Outcome claims in education marketing can be wrong, and regulators have acted on it. Verify them independently.

Do this now

Read 20 job listings for the role you want and count mentions of the qualification
Ask a provider for the completion rate of everyone who started

Create a free account to read the rest and apply it to your own investing.

Related lessons

What you were told, what you inferred, and what you checked — Almost everything that later turns out to be wrong was never actually verified - it was assumed, because it arrived alongside things that were true. (10 min)
Survivorship bias — Almost every success story you can read about was selected for having succeeded. The ones that would have made the lesson honest are not in the sample. (8 min)
The real price includes the income you give up and the years the skill stays valuable — A self-investment's full cost is fees plus lost earnings plus time. Its value depends on how large the earnings difference is and how long it lasts before the skill ages. (12 min)