https://www.duolingo.com/davidvdb

For everyone wondering what Duolingo's money source is...

davidvdb
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Duolingo's new way of earning money came in the news all over the world!

Duolingo, the free language learning service co-founded by reCAPTCHA inventor Luis von Ahn, today announced that it has raised a $45 million investment round led by Google Capital. The company’s previous investors, which include the likes of Union Square Ventures, NEA and Kleiner Perkins Caufield & Byers, as well as Ashton Kutcher and Tim Ferris, also participated in this round. This round brings Duolingo’s total funding to date to $83.3 million and the company says its valuation is now around $470 million.

Read an article about it in one of these languages!

3 years ago

22 Comments


https://www.duolingo.com/turbofred
turbofred
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Interesting. I always thought Duolingo was involved in some criminal activity. You know, bribing politicians, racketeering, money laundering, extortion, violent clashes and shootouts with developers of rival educational apps, that sort of thing.

My alternate theory was that they hired a wizard who transformed users' frustration coming from all the A/B tests into money.

But it turns out I was wrong. Thank you, kind sir, for having disabused me of my erroneous beliefs. :)

3 years ago

https://www.duolingo.com/Treegarden
Treegarden
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what A/B tests? I use this app since late 2015 every day and not much has changed for my language. I am getting actually sick of it never changing.

1 year ago

https://www.duolingo.com/voxlashon
voxlashon
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That's not "a way of earning money", i.e. a revenue stream, it's a capital investment.

The question is still up in the air how they're going to establish a maintainable revenue stream. I'm guessing eventually: (a) advertising (there's an A/B test for adverts on some mobile platforms); (b) a premium subscription service; (c) purchasable features (this last one is already possible—you can buy exams and stuff through Duolingo)

3 years ago

https://www.duolingo.com/remoonline
remoonline
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Right now the main source of revenue seems to be the Test Center. As per Luis's statement, Duolingo will always remain free and there will never be any advertisements.
https://www.duolingo.com/comment/9043350

3 years ago

https://www.duolingo.com/voxlashon
voxlashon
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If you type this into your browser's development console, it will give you a list A/B tests: duo.user.attributes.ab_options

One of those is this: web_mobile_app_ad_experiment

I could be wrong, but I think that is a test of advertising on some mobile platforms.

3 years ago

https://www.duolingo.com/remoonline
remoonline
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This test is for advertising Duolingo's mobile apps on the website.
https://www.duolingo.com/comment/8983121

3 years ago

https://www.duolingo.com/Allegiant4

Right, but Luis was on here sometime in the past few days, and said that they might do something like have advertisers sponsor a skill and you'd get a 'Marvel Superheroes' skill to work on or something to that effect. It's not advertising in a bad way, it's more like product placement, but it's still advertising.

His comment is at the following link:

https://www.duolingo.com/comment/8987397

3 years ago

https://www.duolingo.com/SydneyAndrews

FWIW, the 'ad' string in 'web_mobile_app_ad_experiment' can mean almost anything.

I'm a programmer by trade, and in my department a/d has a few meanings (not the least of which is ascending/descending, which is used in various tests & reports).

3 years ago

https://www.duolingo.com/voxlashon
voxlashon
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Interesting. So they're doing a bit of (c), and they may extend some services with a mixture of (b) and (c). But looks like I was probs wrong about (a).

3 years ago

https://www.duolingo.com/MaZwa
MaZwa
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You are not wrong voxlashon. I was a test subject os this A/B teste recently, because for some time I received ads in my mobile app, right after completing each lesson.

1 year ago

https://www.duolingo.com/EvilMelon

Nice to see he kept his word...

1 year ago

https://www.duolingo.com/french4lcc

I like the part where von Ahn says that his aim for Duolingo is to be more about education than profit. That he took the company from just being about being a translation-for-businesses company and refocused it more for education. Very cool.

3 years ago

https://www.duolingo.com/scilling
scilling
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That could well be von Ahn’s aim, but it’s unlikely to be the aim of Google Capital, Union Square Ventures, New Enterprise Associates, and Kleiner Perkins Caufield Byers — for them, education is the means to an end, not the end itself.

[…] Google Capital’s objective is to triple its money from each investment over the course of five to seven years, [Google Capital head David] Lawee said. […] And they have one other thing in common [with Google Ventures]: the goal of making money.

“Nothing matters if we don’t make returns,” Lawee said. “Building a successful investment firm that leverages the insights of Google and all these things we are talking about — that’s like a 20-year vision.”

The complete article can be found here.

3 years ago

https://www.duolingo.com/french4lcc

Yep. I'm hoping von Ahn can get funded enough to eventually become independent of Google Capital. I'm not happy with much about Google anymore beyond their search engine. (And I even use alternate search engines now, more privacy-based.) My point is strictly regarding von Ahn's aims as he states them, truly people-centric, education-centric. Well...let's just wait and see how this all eventually goes down regading Duolingo's future.

3 years ago

https://www.duolingo.com/scilling
scilling
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Duolingo as it currently exists makes use of JavaScript from the following Google sites:

Independence of Google Capital is some distance from independence of Google.

3 years ago

https://www.duolingo.com/french4lcc

It's all Google-related, and ties in together, no matter how they split it up. Plus, von Ahn used to be (or still is maybe) with Google. I don't think that "total" removal from Google is doable yet. Meh...I ain't no dreamer. It's just that von Ahn has lofty ideals, but I'm not sure how lofty those ideals can stay with Google's hands in it, whether from near or far. We definitely need more room for competition in big business. Which involves money - lots of it.

3 years ago

https://www.duolingo.com/LeIouch

Well at least we know Duo has no shortage of cold hard cash. But I'd like to know what does Google get out of investing 45Mil, do they get shares in Duo or..something else?

3 years ago

https://www.duolingo.com/MFiftyOne

I wondered this as well.

Other investors: Union Square Ventures, New Enterprise Associates, Ashton Kutcher, Kleiner Perkins Caufield Byers, Tim Ferriss. From https://www.duolingo.com/info

What do they get from investing in Duolingo?

3 years ago

https://www.duolingo.com/AureliaUK
AureliaUK
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Usually venture capitalists realise their profits on either (a) a market float or (b) a sale of their interest to another business, often another venture capital organisation.

TBH I struggle to see how an essentially philanthropic longterm business plan is compatible with that, because even in a free market float the vast majority of shares end up in the hands of other institutional investors such as insurance companies and pension schemes or worse.

3 years ago

https://www.duolingo.com/Lorel90
Lorel90
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There was a discussion about the original article as soon as it came out and Luis himself answered questions including responding to my comment. The discussion is somewhere in the forums.

3 years ago

https://www.duolingo.com/CaptainDaisy

I clicked on the French link and could understand most of the article :)

3 years ago

https://www.duolingo.com/IanEvison

I have no idea what is true here. I do know that one asks where the money came from and someone replies, someone loaned it to me, that only changes the question to how that person is going to repay the loan. Most of these businesses who had given Duolingo money have charitable arms. In my understanding this is not the part of those companies who have given Duolingo the money. So, if the question is "what is the business model?" then presumably the answer can't be "take out loans which we have no expectation of ever being able to repay." And, money from a venture capital group is more like a loan than it is a charitable contribution. Most popular idea about the business model is that the education part of the business be kept free to maximize the number of people helping with the translations for which there is a charge. If is this model, it is one that is fine with me. Duolingo has taught me a lot. Glad to pay for it by doing a little free translation work (except that Danish doesn't have that feature....). Why not just say, that Duolingo doesn't charge for the language education in hopes we all will get far enough to do a little free translation work: http://www.forbes.com/sites/parmyolson/2014/01/22/crowdsourcing-capitalists-how-duolingos-founders-offered-free-education-to-millions/

3 years ago
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