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2U Inc., the virtual education startup that acquired an online platform jointly launched by Harvard and MIT, filed for Chapter 11 bankruptcy protection on Thursday, the company announced in a press release.

Harvard and MIT sold edX — a joint venture established in 2012 to expand education access — to 2U for $800 million in 2021. But almost immediately after the sale, 2U saw the price of its shares plummet by 86 percent and had multiple rounds of layoffs.

The decision to file for bankruptcy protection raises further questions about the long-term sustainability of edX — which continues to offer free, on-demand courses taught by faculty members at Harvard — even as 2U insisted that all of its educational platforms would “continue seamlessly with no interruption for partners or learners.”

Vice Provost for Advances in Learning Bharat N. Anand ’88 wrote in an email to Harvard faculty members on Thursday that the University’s digital learning initiatives were “anchored in the creation of high-quality learning.”

Anand added that 2U’s restructuring “avoids impacting students, courses, programs, and university partners.”

The bankruptcy filing represented the latest development in the rapid and dramatic fall of one of the powerhouses in the world of online education. 2U, which boasted a valuation of $5 billion in 2018, was worth less than $35 million in May 2024.

Founded in 2008, 2U partners with more than 250 universities around the world to offer online courses, certificates, and degree programs. In 2021, it purchased edX, which at the time had grown to partner with 160 universities in offering 3,300 courses, including CS50, Harvard’s flagship computer science course. By 2022, edX became 2U’s flagship brand and platform.

At the time of the sale, Harvard leadership said 2U’s ownership would bring new investments in technology and marketing that would expand the platform’s user base and equip it to compete for for-profit platforms.

“The agreement with 2U ensures the sustainability of the edX mission—including continued access to low-cost and free courses—through capital investments at the level required to reach learners globally with a wide range of courses across multiple disciplines and fields,” Harvard’s top leadership wrote in 2021.

Instead, the edX sale straddled 2U with almost $5oo million in debt. And though the purchase helped expand 2U’s course offerings, many valuable partnerships with other universities began to end as the company struggled to turn a profit.

The company has also faced accusations that it prioritized profits over the quality of some of its paid course offerings. It is also currently facing a class action lawsuit that alleges 2U relied on manipulated data to attract students to a paid program co-hosted with USC.

A representative for 2U did not respond to a request for comment on the suit.

Meanwhile, Harvard and MIT used the proceeds from the sale to launch Axim Collaborative in spring 2023, a nonprofit dedicated to supporting innovation in education. Axim has funded 15 partnerships with universities around the country in the last year, according to a Harvard spokesperson, including with community colleges and historically Black colleges and universities.

In an agreement with creditors, 2U’s debt load of nearly $950 million will be more than halved, and it is slated to receive approximately $110 million in a cash injection. The deal must be first approved by a U.S. bankruptcy court.

Paul Lalljie, 2U’s chief executiver officer, said in a press release that “new capital and a healthier balance sheet will enable us to continue our long-standing mission.”

“We are steadfastly focused on what matters most: our partners and learners,” Lalljie added.