The company helps a number of universities, from UNC to Boston College, bring their curriculums online and attract virtual students for nearly the same tuition cost as those who are on campus.
According to its S-1, 2U generated $83 million last year, up from $56 million the year prior, but it isn't profitable. It lost $28 million last year and it isn't exactly trending toward profitability either. While it onboards universities, creates compelling curriculums for them, and helps market the programs to students, 2U expects expenses to be high.
"We have incurred significant net losses since inception, and we expect our operating expenses to increase significantly in the foreseeable future, which may make it more difficult for us to achieve and maintain profitability," the company states on its S-1.
The promise of 2U is great though. Universities are only able to enroll a limited number of students per semester due to space restraints on campus. With strong online curriculums, universities can accept a larger number of students and increase revenue by charging virtual students equally-high tuition. 2U's solutions also offer students the flexibility of a quality degrees from the comfort of home.
2U was founded in 2008 and has hundreds of employees. It has raised nearly $100 million from Redpoint Ventures, Bessemer Venture Partners, Highland Capital Partners, and others.
The exit is a prominent one for the crowded education-tech startup space where there are few IPOs. Many entrepreneurs have tried to innovate in the space, from peer-to-peer teaching company Skillshare to "Blackboard" killer Coursekit, but few ever gain traction or meaningful revenue.