By
On March 14, 2012

We are at page 32, and our two options are:

A) Become part of the development for the Barack Obama reelection campaign. The largest campaign in history. Solid salaries, measurable impact.

or

B) Continue working on your untested, unfunded, shoe-string budget startup. Small salaries, unknown potential impact.

—

For those that have been around in the tech community for a long time, you’re likely familiar with leechers. These are the people at networking events that have no experience with startups, no technical background, and in the back of their minds want to “create an app.” Essentially, they aren’t very useful. Potentially useful, yes; currently useful, no.

In early 2010, Mike McGee and Neal Sales-Griffin, the cofounders of Code Academy, fell into this category. However, they weren’t content to sit still and wait for direct-to-brain education, and instead decided to figure out how to program the hard way.

Having both graduated from Northwestern University, they were reluctant to enter a formal training program. Instead, Mike and Neal dove into the e-learning movement. According to the two, they read just about everything there was to read about Ruby on Rails, paid for a number of books, went to conferences and weekend tutorials, and generally retained one-tenth of the amount of information being thrown at them.

The entire time, the two were coming up with ideas for startups. At the end of a year, they had north of 60 ideas they wanted to make, but one stuck out: simplifying their year of pain for other people who wanted to learn how to code. So they began to formulate a plan, a plan that would eventually end up as Code Academy.

—

In early 2011, the two cofounders were approached by the Obama for America campaign, and were asked to join the team. Having a modicum of experience in the public realm — both had been student body presidents at Northwestern — they were ideal candidates. Both supported the reelection campaign, both had some formal work experience, and both were up and coming developers. That on top of the fact that becoming a key part of the Obama development would give the co-founders an immensely large network of potential clients to work with in the future. Sounded like a dream.

The problem was that the team was being put together for Code Academy, the founders were looking for funding, and a few investors were interested. So the choice came down to two options: go with the Obama campaign, or go with the possibility of $250,000 in seed stage funding.

With the Obama campaign, the founders would be working out of the headquarters in Chicago alongside the people behind the largest campaign in electoral history. With the seed stage funding, there was the possibility it would fall through, and the possibility that the startup would fail, leaving everyone at square one.

In what is one of the best examples of entrepreneurial conviction I’ve ever heard of, the team decided to turn down the offer.

It was off to the races.

—

While the team was entirely convicted of the need for solid education in the coding space, they were far from ready for launch. They needed to figure out how to make money or get funding, they needed to come up with a curriculum, find teachers, buy equipment, and attract students. All with the vague goal of starting the first class for the fall semester.

The team found an all-star leader for the education part, in the form of Jeff Cohen. Cohen, along with a number of other mentors and long-time programmers and designers, all contribute heavily to the program. In fact, at the admission of Sales-Griffin, the program wouldn’t even be close to the caliber of quality if Cohen was missing.

Combined with a developing curriculum and the backing of a very tight Chicago ecosystem, the team thought that they had all they needed to launch. Everything, that is, except for the money needed to lease space, buy equipment, and become a company.

To help them out, an investor syndicate decided that they would give money to the company. Absolutely, no ifs, ands or buts about it. Well, kinda. The syndicate promised the money verbally, and then followed it up with the due diligence. By the time the class was prepared to start, the investors had finally been won over and were ready to sign a check for a quarter of a million dollars.

At that point, Code Academy didn’t need it.

—

Spreading purely by word of mouth, Code Academy saw a number of people apply immediately. With classes that cost $6,000 per student, per class, you may think that it would be a risk to sign up for a largely untested program. Frankly, it was a risk, and it largely still is.

That didn’t stop people from not only applying, but also paying the $6,000 up-front. Students signed up from all over the world — as far away as the Phillipines —  looking for a quality computer science education. Not just paying for a weekend class, but fully relocating to Chicago for 11 weeks.

In the weeks leading up to the launch, the company confirmed 35 students, all paying $6,000. This gave the team enough money to afford a number of computers, as well as the ability to sign a sub-lease in the Groupon building. Seeing that the company was so successful at the very onset, the investors that initially were playing a game of cat-and-mouse with the founders decided that it was time to invest. The founders, following the tradition of bootstrapping and Chicago, said no.

—

Since the beginning of the semester last year, the company has seen over 100 applications for the next class. They now have a design class, in addition to the regular programming classes, and are building out an alumni network. This begs the questions of what will be next.

The founders are adamant that they do not want to raise funding, and that they are focused on quality over quantity. This means that they are turning away potential customers for the higher quality students, and that they are turning down offers to open in other cities. This isn’t a permanent stance, but for now, if you need a Code Academy lesson, you will have to relocate to Chicago.

Now that we know the end of our “Choose Your Own Adventure,” it really is a hard choice to make. The Obama campaign is just getting into action, and is still on track to be the largest campaign in history, while Code Academy is doing what startups are meant to do: kill it.

What would you choose?

[Image Credit: Paxton Holley]