The Past and Future of Upstart and Income-Sharing Agreements with Dave Girouard and Tonio DeSorrento

Erik is joined in this episode by co-host Tonio DeSorrento (@TonioDeSo), CEO and co-founder of Vemo Education, and Dave Girouard (@davegirouard), CEO and founder of Upstart.They have a lively discussion about the history of income-sharing agreements, the forms in which they exist presently, and how the agreements might change or expand in the future.Dave gives us an overview of Upstart and why he says they are like “Kickstarter meets LendingClub.” Although Upstart is thriving now, it wasn’t always that way. In the early days of the company, they tried to pioneer the idea of a generalized income-sharing agreement. Dave runs through why that didn’t work out and how they got to where Upstart is today. Dave and Tonio share some stories about their early work on income-sharing agreements and compare theories on how these agreements might evolve and spread to different areas in the future. They talk about how income-sharing agreements align incentives between two parties and help quantify the value that one party provides another. They lay out a map for how something like an income-sharing agreement could be of assistance to a manual laborer deciding on a hospital in which to have a knee surgery.They also contemplate the future of higher education, which Tonio points out is a $500 billion dollar industry that has 19 million students enrolled in any given year, and whether disruption will come from outside or from within the institutions themselves. Tonio also explains why income-sharing agreements and the data they produce are so helpful to people trying to decide which education institution to attend.Thanks for listening — if you like what you hear, please review us on your favorite podcast platform. Check us out on the web at villageglobal.vc or get in touch with us on Twitter @villageglobal.Venture Stories is brought to you by Village Global, is hosted by co-founder and partner, Erik Torenberg and is produced by Brett Bolkowy.