A Berlin-based startup that has built and grown a successful online language learning platform based on live teachers and virtual classrooms is today announcing funding to continue growing its business.
Lingoda, which connects students who want to learn a language – currently English, Spanish, French or German – with native-speaking teachers who run thousands of live immersion classes around the clock and 7 days a week across a range of language levels, raised $68 million (57 million euros). CEO Michael Shangkuan said the funding will be used both to continue to improve its technology platform – with more tools for teachers and additional asynchronous hardware – and to expand its footprint in more distant markets such as United States.
The company currently has some 70,000 students and 1,400 teachers and runs over 450,000 classes each year covering approximately 2,000 lessons. Shangkuan said his earnings rate was 10 times higher than a year ago, and his customer base had grown 200% with students in 200 countries, so he’s no stranger to posting. scale because it doubles on the model.
“We want the whole world to learn languages,” Shangkuan said. “That’s our vision.”
The funding is led by Summit Partners, with participation from existing investor Conny Boersch, founder of Mountain Partners. The valuation is not disclosed.
Founded in 2013 by two brothers – Fabian and Felix Wunderlich (now CFO and Head of Sales respectively) – Lingoda had only raised around $15 million before, a sign that the company was quite capital efficient.
“We only offer cost-effective courses,” Shangkuan (who is from the United States, New Jersey in particular) said in an interview. That being said, he added, “We can’t answer if we’re profitable, but we’re not hugely UNprofitable.” The global language learning market is around $50 billion, so this is a great opportunity despite fierce competition.
Much of the innovation in edtech in recent years has focused on automated tools to help people learn better in virtual environments: technology designed at scale, better analytics or acquisition knowledge in mind.
So it’s interesting to come across edtech startups that can use some of these same tools – all of Lingoda is based on Zoom, which it uses to run all of its classes online, and it’s keen to bring more analytics and other technologies into the equation to improve learning between lessons, to help teachers better understand student engagement and progress during lessons – but fundamentally retain one of the more traditional aspects of l learning: humans teaching other humans.
It’s very intentional, Shangkuan said. At first, the idea was to disrupt in-person language schools, but while the startup had already considered how and if it would move to more automated courses and eliminate teachers from the equation, it decided not to. wasn’t worth it.
Shangkuan – himself a language enthusiast who moved to Germany specifically to immerse himself in a new country and language, from where he then sought employment – noted that his students’ comments showed a strong inclination and a preference for human teachers, with 97% saying language learning in the Lingoda format has been more effective for them than the wave of language apps (which include Duolingo, Memrise, Busuu, Babbel, Rosetta and many more). others).
“For me, as an entrepreneur trying to deliver a great product, that’s the barometer, and that’s why we’re focused on realizing our original vision,” he said, “a vision in which it takes quality teachers and real experiences and being able to repeat that online. Indeed, it’s not the only tech startup that has identified this pattern: VIPKid in China and a number of others have also based learning around live teachers.
There are a number of reasons why human teaching may be more suited to language acquisition – starting with the fact that language is living knowledge and therefore learning to speak it requires a level of commitment. quite fundamental on the part of the learner.
Added to this is the fact that the language is almost never spoken in real life the way it is in textbooks (or apps), so hearing a range of people speaking the language, just like you do with the format Lingoda, which isn’t focused on pairing a student with a single instructor (there’s no Peloton-style tracking around instructors here) works great.
As far as teachers go, it’s an interesting format that taps into the concept of the gig economy a bit, even if it’s not the same as being employed as a delivery driver or cleaner.
Lingoda notes that teachers set their own schedules and call classes themselves, rather than being ordered to them. Meanwhile, students pay for lessons on a sliding scale based on various factors such as whether you opt for group or private lessons, how often you use the service and the language you are learning, with prices per course generally varying between $6.75. and $14.30 depending on what you choose.
Students can request a teaching level if they wish: there is always a wide choice, but with dozens of levels between basic skill A1 and advanced skill C1, if you cannot find what you want and you order it, it can take between a day and a week to come to fruition, usually with one to five students per class. But in any case, a teacher must define the class himself. This format makes it fall into more standardized language learning work patterns.
“We closely mirror the business model of traditional (bricks and mortar) in-person language schools, where teachers work part-time in accordance with local laws and have the flexibility to schedule their own lessons,” a spokesperson said. “The main difference is that our model offers in-person classes online, but we still follow the same local guidelines.”
Once students complete a course, Lingoda provides them with a certification. In English, you can take a recognized Cambridge assessment to check your skills.
Lingoda’s growth comes at an interesting time in the world of online education, which has been one of the big behemoths of the past year. Schools closing in-person learning, people spending more time at home and the need for many of us to feel like we’re doing something at a time when so many restrictions have all caused people to move on time learning online have all pushed edtech companies to grow, and the technology that is used for the purpose to continue to evolve.
To be clear, Lingoda has been around for years and hasn’t grown out of pandemic conditions: many of the learners it has attracted are those who might otherwise have attended an in-person language course led by one of many small schools you might come across in a typical city (London has hundreds), learning because they are planning to move or study abroad, or because people are new to a country and need to learn the language to get by, or they have to learn it for work.
But what’s been interesting over the past year is how services created for one type of environment have been integrated into our “new normal.” The classes offered by Lingoda are becoming the promise of a time when we can once again visit more places and hopefully order coffees, chat with jaywalkers, and chat with strangers here and there a little easier.
“The language learning market is increasingly turning to online offerings that provide consumers with a more convenient, flexible and cost-effective way to improve their foreign language skills,” said Matthias Allgaier, MD at Summit. Partners, in a statement. “We believe Lingoda has developed one of the most comprehensive and effective online language learning solutions in the world and is positioned to benefit from the continuing and accelerating trend of digitization in education. We are delighted to partner with the entire Lingoda team and are excited about the future of this company. Allgaier joins the Lingoda board with this round.
Updated with an additional investor and a slight change in funding amount due to conversion rates.