Company Steps in to Ease Transfer-Credit Friction

When Aaron Rasmussen was growing up in rural Oregon, his performance on the Armed Services Vocational Aptitude Battery test suggested he had potential as a film director. But with four siblings and two parents living on a schoolteacher's salary, he also had limited means for vocational training or higher education. Blue Mountain Community College was 34 miles away, in Pendleton, Oregon, but 12 of those miles were covered in ice in winter, which would have made commuting difficult. Instead, he headed to Boston University on a Pell Grant. To help minimize overall college costs, he took summer classes at Blue Mountain, though he only breathed easy once the courses credits successfully transferred to Boston University.

The armed services test was not wrong. Rasmussen is best known for co-founding MasterClass, an online course subscription platform in which a wide range of experts and celebrities like Gordon Ramsey and Usher teach their crafts through pre-recorded tutorials and lectures. He is now the founder and CEO of Outlier, a company that produces cinematic college-level online courses with rockstar academics like mathematicians Hannah Fry and John Urschel. The courses, which cost $400 and grant credit through the University of Pittsburgh at Johnstown, offer students the opportunity to earn college credit in general education courses intended for transfer to home institutions.

"Potential is evenly distributed, but opportunity is not," Rasmussen said. "This is my shot at going back and trying to fix what I was missing growing up and making it available to other people."

This week, Outlier formalized a transfer network of 18 colleges, including the University of Massachusetts at Amherst and Bellevue University, that "makes public and accessible the course equivalencies involved in transferring credit from Outlier.org courses into the institutions that are part of the network." (Institutions in the network may have different course-equivalency agreements with Outlier.)

The company is part of an emerging trend in which businesses choose to partner with universities in an attempt to fix a broken system of transfer credit equivalencies. Too often, courses are not accepted for transfer credit, or courses are accepted but the credits are not applied toward a degree program. Several of the companies operating in this realm focus on technology designed to smooth out the transfer process, such as CollegeSource Transferology and AcademyOne. Companies such as StraighterLine and TEL Education are in the space Outlier seeks to fill, trying to create lower-cost pathways for students to transfer to four-year universities.

Among students who start at community colleges, lower-income students are half as likely as their higher income peers to have transferred to four-year institutions (24 percent versus 40 percent) and to have earned a bachelor's degree within six years (10 percent versus 21 percent), according to a 2021 National Student Clearinghouse Research Center report. The COVID-19 pandemic has made navigating traditional transfer options especially difficult for disadvantaged populations, according to another Clearinghouse report. Institutional efforts to mitigate those challenges have proved limited.

"That's a big driver of the debt-but-no-degree problem," said Anjuli Gupta, Outlier's head of partnerships. "We're creating an institutional response and network for transparency that's really student focused."

Outlier offers its courses in conjunction with the University of Pittsburgh's Johnstown campus, which provides students with a vehicle for transfer credit. (Pitt's main campus originally provided its stamp of approval for the company's courses.) The company also lists colleges and universities, including some highly selective institutions such as Princeton University and the University of California, Berkeley, that have accepted its courses for credit, according to Outlier students.

But that list could be misleading, according to Janet Marling, executive director of the National Institute for the Study of Transfer Students at the University of North Georgia. Marling points out that the decision of whether credit will be accepted for transfer and whether it will count toward a degree program is the purview of the receiving institution. In addition, the decision of whether or not to accept transfer credit is often left to the discretion of officials in the appropriate academic department, which can produce inconsistent results.

"We haven't been able to verify this assertion," Michael Hotchkiss, Princeton's director of media relations, said after some effort to verify the claim that Princeton has offered its students credit for Outlier courses. Instead, Hotchkiss pointed to Princeton's webpage that lists its transfer credit criteria.

"The outside course must be offered by an accredited four-year institution," the Princeton webpage notes. Depending on one's point of view, this could be a gray area since the for-profit Outlier delivers the course while the University of Pittsburgh verifies it with a transcript.

Some universities, including the University of Massachusetts at Amherst, are satisfied that that Outlier courses are offered by an accredited four-year institution.

"Regional accreditation is the gold standard, and this checks that box," said Morgan Donovan-Hall, director of transfer admission at UMass. There's no hesitation for us to take these credits as if they were offered by the University of Pittsburgh." Donovan-Hall noted that the University of Massachusetts' decision to join Outlier's transfer network aligned with its mission to "break down transfer barriers."

But other institutions on Outlier's list, including UC-Berkeley, express concern about the accreditation status.

"While we have accepted such credits [from Outlier] in the past, we are not doing so going forward," said Janet Gilmore, senior director of strategic communications at Berkeley, who noted that university officials could not match or find the courses to their satisfaction.  

To be fair, Outlier's target student is more likely to attend a community college than Princeton or Berkeley, though Rasmussen acknowledged that highly selective institutions lend credibility for prospective college partners.

Experts say companies like Outlier are getting important pieces of the transfer-credit equation right. For example, Outlier provides students with a "transfer credit toolkit" that includes, among other items, e-mail templates for how to communicate with the receiving institution's advising or registrar's office about transfer credit.

"They're letting students know that they will have to take responsibility for contacting their receiving institution and are giving good advice around doing so early -- before they're committed to taking the class," Marling said. Outlier's new transfer credit network also promises to ease burdens and worry for in-network students. Also, since the network relies on articulation agreements, a receiving institution would presumably need to alert the company of any changes to its transfer credit acceptance policy, avoiding situations like the one with Berkeley.

For now, companies like Outlier do not yet appear to have scaled for the masses. When pressed for information about impact, Rasmussen said that they "tend not to be super public about their numbers" but that enrollments are "getting noteworthy." As the University of Massachusetts prepares to launch an Outlier partnership this fall, Donovan-Hall suggested that "20 students would be a good start." She noted that the numbers are less important than the opportunity to "break down barriers that should have been broken down a long time ago." Outlier is one of many transfer credit pathways the university offers.

Despite bumps on the road to acceptance, for-profit companies that partner with nonprofit universities are helping to drive forward an overdue conversation about reducing transfer-credit friction.

"This won't be the last company we'll see," Marling said. After all, Rasmussen may not be the only entrepreneur out there with an aptitude for film directing and a deep commitment to education.