Ad-free subscription-based service adds $75m to Duolingo’s earnings

If people find an app useful, they are willing to pay for it. That is one of the lessons from the success of Duolingo, the language learning app that received $35 million in funding a few days ago. It is currently valued at $2.4 billion.

According to its founder Luis von Ahn, one of the company’s key moves towards profitability was offering an ad-free subscription-based service.

In an interview with Monocle, Von Ahn, a former computer science professor, said, “We started by putting a very small banner at the end of every lesson. Then we had people asking if they could pay to remove the advertising, so we added a subscription service. In 2019 we made about $90 million and $75 million of that came from subscriptions.”

Duolingo is popular not just with language students and professionals, but also travellers. Von Ahn said that despite the lockdown, users of the app had increased, as they were preparing for future trips.

“We’re seeing an increase in people signing up to learn for school, which makes sense given all the closures. But surprisingly, we’re still seeing people sign up for travel reasons too. They want to prepare for trips they plan to take in the future,” Von Ahn said.

Von Ahn created Duolingo with Severin Hacker, a computer scientist who was one of his students at Carnegie Mellon University. Von Ahn is from Ecuador, where poverty is high. His aim was to create something that would help people educate themselves.

"I wanted to do something that would give equal access to education to everyone," Von Ahn once told the BBC. "And then I focused on languages because growing up in Guatemala I saw that everyone wants to learn English. Knowledge of English in a non-English speaking country can usually mean that your income potential is doubled. I mean, you literally make twice as much money if you know English. So that's kind of where the idea came from to have a free way to learn languages."