Natural language

Duolingo, the language learning service, raises $20 million

February 18, 2014: 11:00 AM ET

A princely sum goes to the company with a mission to teach the world a new language.

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FORTUNE -- Duolingo, the company and free application that teaches people languages through game-like activities, announced on Tuesday that it raised $20 million in a funding round led by the Silicon Valley venture capital firm Kleiner Perkins Caufield & Byers.

The service, which launched in 2012, is now used by 20 million people, 10 million of whom are active. Co-founder and chief executive Luis von Ahn -- who teaches computer science at Carnegie Mellon University and also happened to co-invent the reCAPTCHA anti-bot tool -- said there is one goal for Duolingo: To provide free language education to virtually everyone.

Von Ahn said the new injection of funds will be used for product development, not promotion. "We don't advertise. I'm a pretty strong believer that our product should speak for itself," he said. In 2013, Duolingo was Apple's App Store choice for "App of the Year." It's also a top Android app in the Google Play store. Just one week ago, Duolingo won the award for "Best Education Startup" at TechCrunch's Crunchie Awards.

Von Ahn, 34, is originally from Guatemala, where access to well-paying jobs is largely dependent on the ability to speak English. Classes and language certification tests, however, can be costly and difficult to get to, especially for individuals who live far from major cities.

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Von Ahn and his co-founder Severin Hacker saw Duolingo as an opportunity to make language education accessible and to indirectly stimulate economic development. Learning another language can help people graduate to the middle class, they say. Though Duolingo's English-learning courses are its most popular, there are also courses in Spanish, French, Italian, and German, with several others still in development.

For some jobs, simply saying you've learned a language isn't enough; you may also have to prove your competency with a certification test, most of which run around $250. "In some places, that's an entire month's salary," von Ahn said. In the coming months, Duolingo plans to provide a $20 accredited certification test that can be proctored remotely over a person's computer, saving the expense of traveling in person for an exam.

The app teaches vocabulary and grammar in increasingly difficult stages, using a blend of audio and visual matching and translation to teach. People who use the app can compare their scores for the exercises, adding a dose of competition to the mix. "Duolingo won't be called a game," von Ahn said, "but we want to make it as fun as a game."

The company's researchers said there is a strong correlation between the app's gaming methods and users' retention of new language skills. Indeed, "gamification" is something of a recent buzzword in many business circles. "The more fun and meaningful you can make something, the easier it is to learn," said Larry Dailey, a professor at the University of Nevada, Reno who teaches a course in serious game design, a field that uses games to train or educate people rather than only entertain. "For example, why do cats chase string? Two reasons. One, it's fun. And two, it helps them develop skills to catch mice later. Games can be extraordinary tools for learning."

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Kleiner Perkins partner Bing Gordon said that he has had an interest in the reinvention of education for some time. KPCB has invested in the companies Coursera, Codecademy, and Remind101. "Duolingo has the pole position to be a thought leader and a market leader," Gordon said. "They're the missionaries of a good cause."

Duolingo is not yet profitable, but von Ahn is not concerned. "We made the decision that our immediate goal is not to be profitable," he said. "It's to be the best de facto product for language learning." Still, the company has found an innovative way to bring in money that doesn't involve display advertising. Like reCAPTCHA, for which people retype words scanned from printed documents as a security check, Duolingo offers to partners such as CNN and BuzzFeed translations of their articles culled from the responses of its learning users. In exchange for top-voted translations, Duolingo makes a few cents per word from its partners.

Von Ahn said he wants Duolingo "to be fun but not a waste of time." With an additional $20 million on hand, he'll have lots of time to figure out how best to achieve that goal.

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