• Josh Giegel joined SpaceX in 2009 and worked there for 3 years. He says the equity he received has been "liberating."
• Giegel's SpaceX equity has allowed him to put a down payment on a house and help pay off his wife's student loans.
• "The equity also allows me to take a lower salary at my startup," Gambit, he said, and that means he can hire more people.

This as-told-to essay is based on a conversation with Josh Giegel, the 41-year-old cofounder of the AI startup Gambit, who lives in Los Angeles. It's been edited for length and clarity.

I was in grad school at Stanford, finishing my master's and wanting to do a Ph.D.

I had worked at NASA the previous summer, and one of the women I worked with was also a Stanford graduate, and was like: "You're going to be so bored at NASA. Why don't you check out this small space company in Los Angeles called SpaceX?"

I applied and interviewed in the two weeks between flight three and flight four of Falcon 1. I interviewed with Elon; he was still interviewing pretty much everyone at the time. I remember going back to my advisor and saying, "There's nothing I'd rather do on the planet than what he just described."

My Master's ended at the end of 2008, and I began in 2009.

I was on what's called the propulsion analysis team, which was four or five people. Our responsibility was: How do you design the first reusable rocket engine? A very small group of us was responsible for the initial stuff that was on Falcon 9.

I started there when I was 23, and I left when I was 27. It was a little bit of naive immaturity. I knew I wanted to start a company one day, and SpaceX was growing like crazy. I wanted to be on a founding team. I still love the company; I almost went back two or three years later before I ended up starting a company of my own.

The IPO is pretty cool. I'm on a bunch of text threads with guys who were there around the same time, and a couple of them are still there. It's cool to see just how big it became.

When I got there, and they gave the offer, there was an equity component. I remember the HR woman who was going over it with me saying, "We think some day, in 10 or 15 years, this might be worth $250,000-300,000." I distinctly remember her saying, "It might get you a nice down payment on a house in Los Angeles."

We all laugh about it now. But, at the time, the saying was: the fastest way to become a millionaire in space is to start as a billionaire.

Buybacks have been really regular for the last 10 years. Every now and then, we'd take a little bit out. For example, we paid off my wife's student loans a number of years ago. We put down a down payment on a house.

I joke: We did actually get a down payment on a house! She wasn't lying when she said that. It's a house that, on our normal salaries at startups, we wouldn't have been able to afford without that additional windfall.

We also love traveling. We've got a seven-year-old and a one-year-old. We're going to go on slightly more adventurous trips because of it.

My wife is also thinking of doing a larger career change that would come with a decent salary reduction, which she probably wouldn't have been able to do without something like SpaceX.

Professionally, I've always been risky. If the majority of your net worth is tied up in a rocket company, you must be a risk-tolerant individual.

Gambit is a VC-backed company. We've raised about $15 million to date, and there are a couple more investment rounds that are coming. The IPO puts you in a position where folks with a substantial amount of equity could be interested in becoming investors.

At least ten of the people I worked with intimately have started their own company. There was a band that I played in with five SpaceX people; four of us started our own companies. I played guitar.

That whole ecosystem can fund its own endeavors and each other. The quantum of capital that they can put in is not like your typical family and friends round. That's typically $20,000, $50,000, maybe $100,000. Here, that could be on the order of $1 million, maybe $2 million per check.

You also become a bit of a mercenary, asking, "I don't need a paycheck from what I'm going to go do, so what am I going to go do?" It's liberating.

The equity also allows me to take a lower salary at my startup, so that I can go out and hire more people to make my company more successful.

• Private student-loan collectors penalized for claims of misleading behavior could work with borrowers again.
• It's part of Trump's transfer of defaulted student loans from the Education Department to the Treasury.
• It could expose borrowers to high collection fees and repayment challenges.

Private companies penalized for their student-loan collection tactics may be making a comeback.

As President Donald Trump transfers federal student loans from the Department of Education to the Treasury Department, defaulted borrowers will be routed through the Treasury's "Cross-Servicing program," which uses private contractors to collect federal debts. Two agencies in that system, Pioneer Credit Recovery and Transworld Systems, were previously sued or fined by federal watchdogs for "misleading" or "abusive" practices.

Lawmakers and administration officials in Trump's first term pushed to terminate contracts with private collectors over high costs and accusations of predatory behavior. Former President Joe Biden ended their contracts in 2021. Now, with student-loan defaults at a record high, education policy experts say bringing private collectors back could expose borrowers to higher collection fees, confusion, and greater risk of falling back into default.

More than 10 million student-loan borrowers are in default or delinquency, Department of Education data shows. Involuntary collections, which include wage garnishment and federal benefits seizure, have been paused since January while the department prepares for major repayment changes. The department has not specified when the pause will lift, and did not comment in time for publication on the extent to which Pioneer and Transworld would be involved in collections once they resume.

"No reasonable person would expect that these companies are going to be doing what they're supposed to be doing and going to be effectuating borrowers' rights," said Bonnie Latreille, a former official in the Education Department's Federal Student Aid office.

The Trump administration says that the Treasury is best equipped to manage collections. Treasury Secretary Scott Bessent said in a March press release that the agency has "the unique experience, the operational capability, and the financial expertise to bring long overdue financial discipline to the program and be better stewards of taxpayer dollars."

A troubled student-loan collection history

The Consumer Financial Protection Bureau, which began supervising private collectors in 2013, found that they made various misrepresentations to defaulted borrowers, such as implying they'd be sued when that wasn't certain, and pushing more expensive repayment pathways.

Lawmakers later said private collection agencies "receive more than ten times as much" money for steering borrowers into their preferred repayment option, despite high redefault rates. "The Department is rewarding these agencies for behaviors that work in opposition to the prospect of student borrower success," they said.

In 2017, the CFPB sued Pioneer for engaging in "deceptive" and "abusive" practices and violating consumer protection laws, including by steering borrowers into costly forbearances instead of more favorable income-driven repayment plans. The court ordered the company in 2024 to pay $100 million to affected borrowers. Also that year, CFPB fined Transworld $2.5 million for filing debt collection lawsuits without proof that the debt was owed.

Transworld said at the time that it settled with the CFPB to avoid costly litigation. Navient, which oversaw Pioneer, denied any wrongdoing.

Because the Treasury already uses these companies to collect other payments, like taxes, using them is "the most straightforward way" to resume collections on defaulted student loans, said Colleen Campbell, former executive director of Federal Student Aid's loan portfolio management office under Biden. Simplicity for the administration doesn't necessarily mean clarity for borrowers.

"It just gets a little bit more complicated when there are more entities and agencies involved in what happens with the borrower," Campbell said.

Collecting on defaulted student loans requires specific knowledge of student-loan borrowers and policy, said Sara Partridge, the associate director of higher education at the left-leaning think tank the Center for American Progress. There's no evidence the Treasury has the necessary expertise to oversee these agencies, she said.

With private collectors returning, borrowers could face high collection fees, a harder time getting complaints resolved, and potential redefault, higher education policy experts said.

Campbell added that private companies were previously criticized for their variable fee structures. For example, the conservative think tank American Enterprise Institute said in a 2018 report that "harsher penalties are imposed on borrowers who quickly repay their loans in full after defaulting than on those who engage in a lengthy, bureaucratic 'rehabilitation' process but make no progress in paying down their debts."

Another concern is potentially poor coordination between agencies as the transfer happens, Campbell said.

"What you don't want is for somebody to go through all of the steps of getting out of default, only to have them feeling like they're lost in the process yet again because of the handoffs that have to happen between vendors," Campbell said.

Partridge added that the shift could make it harder for borrowers to get repayment help because two agencies would be responsible for managing accounts.

The Department of Education did not specify a timeline for the transfer to the Treasury, which will begin with defaulted borrowers before expanding to the broader federal loan portfolio. Undersecretary Nicholas Kent said during a fireside chat in April that it's "undeniable" that the Treasury is well-equipped to manage federal student loans.

"We want to make sure that we're developing best practices, along with our Treasury colleagues, to be able to service that debt in a much more effective way than we ever have," Kent said.

• The Department of Education announced its final rule for its student-loan repayment overhaul.
• The rule includes new repayment plans and borrowing caps for advanced degrees.
• The changes will be implemented beginning July 1.

It's official: millions of student-loan borrowers will face sweeping repayment changes this summer.

On Thursday, President Donald Trump's Department of Education announced its final rule for its student-loan repayment overhaul, which includes new borrowing caps and repayment plans that will go into effect on July 1.

Nicholas Kent, the department's undersecretary, told reporters on a press call that the final rule includes four key provisions: the elimination of the Grad PLUS program, new loan limits for graduate and professional students, allowing schools to establish their own loan caps "that match the true value" of the programs they offer, and the creation of two new repayment plans.

"Collectively, our changes will ensure students continue to have the access that they need for federal student loans, while helping prevent borrowers from taking on unmanageable debt levels that they may never be able to repay," Kent said.

The changes stem from Trump's "big beautiful" spending legislation, and were negotiated with stakeholders, including industry representatives and borrower advocates, at the end of 2025.

The new borrowing caps are among the most discussed changes in the overhaul. The Department of Education is setting a $100,000 lifetime cap for graduate students and a $200,000 cap for professional students, and it narrowed the definition of "professional" to 11 programs, including law, medicine, and dentistry. That means previously eligible programs, like postgraduate nursing, are no longer eligible.

Some students and advocates have raised concerns that the caps could push students to seek additional financing in the private lending market or forgo their programs altogether.

Additionally, the department is capping Parent PLUS loans for the first time, which allows parents to borrow the full cost of attendance for their kids' programs. The new cap for parent borrowers will stand at $20,000 annually.

The department will also be rolling out a new Repayment Assistance Plan, replacing existing income-driven repayment plans, including the SAVE plan, which the administration is eliminating. RAP would waive unpaid interest and set monthly payments at a minimum of $10, which is less generous than the terms of existing plans. This will increase borrowers' monthly payments, according to Federal Student Aid projections, sometimes by hundreds of dollars.

Have a story to share about student loans? Contact this reporter at asheffey@businessinsider.com.

• A federal watchdog reported diminished oversight over federal student-loan servicers.
• It comes as millions of student-loan borrowers on SAVE will soon have to transition to a new plan.
• Lack of oversight could put those borrowers at risk of billing and account errors.

The student-loan repayment roller coaster keeps rolling.

Over 7 million borrowers who were enrolled in former President Joe Biden's SAVE student-loan repayment plan will soon have to transfer to a new plan after a court approved President Donald Trump's legal settlement to eliminate SAVE.

While the Department of Education has not yet released its guidance on next steps for SAVE borrowers, the transition is set to be a major operational task for federal student-loan servicers. That could be a problem given diminished servicer oversight, a recent report from the Government Accountability Office said.

In addition to the lack of oversight, the Department of Education announced on March 19 that it would begin moving defaulted student-loan borrowers' accounts to the Treasury Department in a new partnership — part of the Trump administration's broader goal to dismantle the Department of Education. Borrower advocates said the move could put millions of accounts at risk of payment errors.

The GAO's report, released in early March, found that the department's Federal Student Aid office stopped assessing the five major federal student-loan servicers on accuracy and call quality in February 2025. The lack of oversight leaves FSA without assurance that servicers are billing borrowers correctly and providing them with accurate information.

"FSA is missing opportunities to ensure that servicers are providing borrowers complete and accurate information as it implements major statutory changes to student loan repayment options affecting millions of borrowers," the report said. Advocates pointed to the elimination of SAVE as a reason the discontinued oversight could harm borrowers.

Aissa Canchola Bañez, policy director at advocacy group Protect Borrowers, said in a statement that the GAO's report "could not come at a worse time, as millions of SAVE borrowers will be forced out of their repayment plan and have no other choice but to rely on their servicer to maintain access to an affordable repayment option."

The SAVE plan, introduced by Biden in 2023, intended to give borrowers cheaper monthly payments with a shorter timeline to debt relief. It's been blocked since the summer of 2024 due to litigation. While Trump's "big beautiful" spending legislation planned to phase out SAVE by 2028, the approved settlement eliminates it ahead of schedule.

It's not only SAVE borrowers — federal servicers will have to oversee the creation of new repayment plans from Trump's spending bill. It includes a standard repayment plan and a new Repayment Assistance Plan, which would allow for forgiveness after 30 years of payments. Rep. Bobby Scott, top Democrat on the House education committee, said in a statement that the GAO report should serve as a "flashing red warning sign about what is to come" as the administration implements the federal repayment overhaul with diminished servicer oversight.

Richard Lucas, acting chief operating officer of FSA, said that the agency has other metrics it uses to evaluate servicer performance, including through surveys that "score the servicers' performance across five measures each for borrower communications, contact center, and website support, as well as six measures for the servicers' management of loans."

It's unclear how soon SAVE borrowers will be required to transition to a new plan and likely face higher monthly payments. The settlement said that the Department of Education would not enroll any new borrowers in SAVE and would deny all pending applications while it moves forward with the repayment changes.

Have a story to share? Contact this reporter at asheffey@businessinsider.com.