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Tom Siebel, 66, whose fortune Forbes pegs at $2.9 billion, is announcing today that his company, C3.ai, will cover the total cost for employees to earn a master’s degree in computer science online. Those who complete the degree get three more big perks—a $25,000 cash bonus, a guaranteed 15% raise and a stock grant. “In this new economy where people are talking about digital transformation,” says Siebel, “for companies to stay at the top of their game they need to have state-of-the-art continuing education programs.”
Siebel got his own master’s in computer science from the highly ranked program at the University of Illinois at Urbana-Champaign, the school where his employees can earn the same degree. In 2007, he pledged $100 million to support science and engineering there. The gift paid for the Thomas M. Siebel Center for Computer Science and contributed $25 million toward the school’s Thomas M. Siebel Center for Design, which is under construction now.
The computer science master’s, which is offered through online higher ed provider Coursera, costs $21,000. Employees of C3.ai will have to apply for the competitive program, where most applicants have GPAs of 3.2 or higher. The acceptance rate is 30%.
Based in Redwood City, California, C3.ai has a workforce of 330, which Siebel says is slated to grow to 700 next year. More than a third of the company’s employees already have advanced degrees. Siebel says he expects a range of employees to be eager to try for the computer science degree, everyone from software engineers to customer service staffers. Founded by Siebel in 2009 as a clean energy firm called C3 IoT, the company has shifted its focus to a cloud-based platform that helps its enterprise customers distribute artificial intelligence and big data applications company-wide. (See Forbes’ story about Siebel and the company here.)
Siebel says he is foregoing federal tax benefits that give employers a break when they pay for employees’ continuing education because he would have had to require them to cover their own tuition up front and then reimburse them later. Instead, C3.ai will pay the University of Illinois directly.
At a time when an increasing number of American companies are offering employees education benefits, Siebel’s perk appears to be raising the bar to a new high. “This is the most generous incentive of which I’ve heard,” says Paul LeBlanc, president of Southern New Hampshire University, which has partnerships with more than a dozen companies that offer SNHU courses as employee perks.
Among the most high-profile higher education benefits offered: Starbucks covers a portion of the tuition for its baristas and other employees who earn online B.A.s from Arizona State University. Walmart’s 1.5 million employees can pay $1 a day to earn online associate’s and bachelor’s degrees in business and supply-chain management at three different schools, in a program launched in 2018. Yesterday the company announced it is adding 14 technology degrees and introducing an education benefit for high school students that includes free SAT and ACT test prep. Last month Disney announced it was expanding a higher ed benefit, begun last year, that includes an online master’s in hospitality and tourism management.
While Walmart said yesterday that it would offer $1,500 cash bonuses to some workers who finish degrees, Siebel’s employees are the only ones who will receive guaranteed raises when they complete courses or degrees.
A former salesman at Oracle, Siebel made his fortune at Siebel Systems, a customer service software company he launched in 1993 and sold to rival Oracle in 2006 for $5.8 billion. He founded his latest venture in 2009 in San Francisco eight months after he was attacked by an elephant in the Serengeti and nearly lost a foot. According to Pitchbook, the company is valued at $2.1 billion.
Siebel says the money his company will spend on employee degrees and cash bonuses are “a drop in the bucket when you consider how much we spend on human capital.” When you add in other benefits and travel, he says each employee already costs the company more than $350,000 a year. “If someone is increasing their skills, advancing their career, setting themselves up for multiple promotions, providing better service for their customers,” he says, “in that context the amount we’re spending on this benefit is nothing.”
June 5, 2019 at 08:00AM
Forbes – Entrepreneurs