One of Chipotle’s recruiting flyers features a burrito above the words “Start Your Career Rolling.” It’s cheeky, comical—and perhaps even a little controversial. Yet the fast-food chain is not confining its employees to a lifetime of tortillas and guacamole. In May, the company announced a partnership with Guild Education, a Denver-based startup, through which employees can take college classes at a discount and earn accredited degrees.
These offerings are the beginning of an employer trend that Rachel Carlson, Guild’s co-founder and CEO, dubs “education as a benefit.” The goal, she says, is to provide education pathways to working students who may otherwise not have the time or money for school. Carlson is not alone in this effort: Starbucks offers a similar arrangement with Arizona State University to help its employees pick up new skills and trades.
EdSurge sat down with Carlson at the ASU+GSV Summit, as part of our Thought Leader Interview series on the future of education. Below is an edited and condensed version of the conversation—or watch the full interview.
EdSurge: The name—Guild—evokes historical connotations. Did that play a factor in naming your company?
Rachel Carlson: Back in the twelfth, thirteenth, fourteenth centuries, guilds were organizations that predated colleges that helped people upskill and advance in their career without the support of formal institutions. Folks in medieval communities would come together and build a blacksmith’s guild or a farming guild of people who were practicing the same skills and advancing one another. Colleges are seen as the 2.0 of guilds.
So we think that in some ways it’s a return to thinking about: How do we work together with both employers and higher education, rather than separating the two, to support people as they advance?
What do you think the skills—you mentioned blacksmithing many centuries ago—that are in very high demand these days?
Service—plain and simple. Robots are going to learn how to code well before they learn how to manage people and support people. When we look at the skills that all of our students are going to need in order to survive and thrive in their jobs and as they look upward in their career trajectories, often they revolve around service and supporting people. That’s healthcare, that’s hospitality, that’s retail. It’s those industries where we as humans work together and manage one another, and that’s why a lot of our focus and courses are focused on helping frontline employees become managers and manage others and manage progress.
Tell me more about how the Guild model operates. It seems like you sit at the bridge between the employers and the colleges. What are the incentives for companies and schools to work with Guild?
We’ve tried to align all of those incentives. When you think about what both universities and employers are worrying about most, they’re thinking about recruitment, retention,and success. Universities are asking, how do we find the right students? How do we expand in this ‘new normal’ student population of younger, lower-income millennials? How do we retain them as they succeed class over class, and how do we get them to graduation day?
Employers are thinking about a very similar set of challenges, which is: How do we recruit these workers, how do we support them in their jobs, how do we retain them, and how do we help them either progress up our pyramid or into other roles? Many companies are very open about the fact that they have jobs that might be the right fit for someone for two, three years, but won’t be the fit for a full career. They want to support people to find the next skill set to move on.
The way that we work is we sit at the intersection of those two: helping the company to offer education as a benefit to their frontline workers, and working with both universities and employers to help retain the students as they move through school and move through work. Our coaching team’s main goal is to think about that dual metric of work retention and school retention.
How does the business work? How do the dollars flow from a company, to you?
Eighty-seven percent of the Fortune 1000 [companies] have a tuition assistance or a tuition reimbursement model, but most have not used it to focus on the frontline worker. So when we work with a company, it’s normally the first time they are thinking, “This isn’t just for accountants who are earning MBA, this could be for our frontline folks who are working hourly.”
So they give the tuition reimbursement to their frontline workers, and they can choose to spend it at universities or learning providers. We have revenue shares with those partners to pay for the coaching and advising that we provide.
Tell me a little more about your deal with Chipotle to illustrate how the model works.
We got to know Chipotle through a random connection. We had reached out to one of their folks who had written an article about their education program, and we sent them a Linkedin message. What took shape was building a partnership where all of Chipotle’s employees around the country are eligible for education programs. If you’ve been at Chipotle for a year or have reached their frontline manager role, you are eligible for up to $5,250 of education benefits from the company.
When the employee then chooses to spend those education benefits, they can go on Guild’s platform and see a whole variety of options—everything from a GED program to an ESL class, math or English class, a full Associate’s degree, a Bachelor’s degree, and even a Master’s.
Then they work with our coaching team to figure out, “What’s the right program for me? When and how should I manage going back to school?” Our coaches help them get on the path and then check in with the employee every week.
Why can’t or why aren’t companies providing what Guild is offering by themselves?
Resources. I know one large company that’s doing it themselves, and that meant hiring 32 full-time employees to build one partnership with a university. That’s a lot of work, obviously, and something each company has to figure out if that is the right path for them. We love when companies are innovating in this space, but we’re thrilled to be the partner for companies that don’t have that resource.
One would figure that when you get your education degree, that you’re more likely to move on and do something else.
Yes, but our companies are surprisingly supportive of that, and it took me a little while to understand that. Companies have a large majority of entry-level roles, and then fewer management roles above them. Many of our companies understand that this is only going to be the right job for someone for two, three, maybe four years. They can retain that worker while they earn a bachelor’s degree and either move up into that management role or move on to become an accountant or a teacher or a nurse. That’s actually a huge win for our companies.
[From the audience] How do you address this particular fear when you are dealing with these companies who do worry about turnover and employees leaving?
It starts with helping make sure we have an honest conversation with the company about their annual turnover cost. In the U.S. today, at the very low end, you see a company having about a $3,300 turnover cost for their frontline workers that may be making eight dollars an hour. In healthcare those costs may be $10,000 to $16,000. So one really thoughtful chief learning officer put it this way to me: Guild simply has to be more affordable than the cost of watching that employee walk out the door, and the cost is anywhere from $3,000 to $16,000.
