Duolingo’s Billionaire Founder Is All In On AI
itting in Duo's Taqueria, a dimly-lit upscale Mexican restaurant in Pittsburgh, Luis von Ahn contemplates the end of work as we know it. In between bites of al pastor tacos and sips of a margarita, Von Ahn, founder and CEO of the language learning app Duolingo, talks about how AI will make some jobs disappear, and workers will need to be retrained.
He speaks from experience: Late last year, Duolingo decided not to renew the contracts of about 10% of its contracted workforce who did translations and lesson writing, instead opting to use AI for those tasks in some cases. "Our stance as a company is that if we can automate something, we will," von Ahn said now of the dismissals. "A full time employee's job is very hard to automate. But we had some hourly contractors who were doing pretty rote stuff."
While he firmly believes it was the right call for his company, he's cognizant of the broader problems AI will bring. "It's a tough situation that'll affect the poor, the less educated," he said. "And not just in the U.S., but in poor countries."
From a table in the back of the restaurant, which was originally designed by Duolingo as a place where diners could practice their Spanish, he notes it will require smart regulation from world governments to make sure AI is equitable. But he doesn't have much faith in the U.S., which will have to "get their head out of their ass" to do it. "It's just very hard right now to imagine that the U.S. is going to legislate this well, given that they can't agree on anything."
"It may put one-on-one human tutors out of business. I understand that. But I think net-net it is better if everybody has access to one."
Luis von Ahn, CEO of DuolingoBut longer term, von Ahn is optimistic that AI could unlock new possibilities for learning, bringing high-quality education to the masses. He thinks languages can help lift people out of poverty, noting that, for non-native speakers, learning English instantly broadens a person's earning potential and opens up a whole new world of jobs. He sees Duolingo on the forefront of the transition to AI-powered learning, with the ultimate moonshot of creating an automated AI tutor that can teach anyone a foreign language.
"That would be generally good for the world," he said. "It may put one-on-one human tutors out of business. I understand that. But I think net-net it is better if everybody has access to one."
Von Ahn isn't afraid to voice strong opinions. He delights in memes that Duolingo's owl mascot (named Duo) might break into the houses of users who missed their language lessons, a corporate brand he calls "wholesome unhinged." He was a staunch critic of Alejandro Giammattei, former president of his home country Guatemala, who he decried as corrupt (he's also the biggest donor for Giammattei's replacement Bernardo Arévalo, who took office in January). And he has said that he thinks AI will make computers better teachers than humans .
On Tuesday, Duolingo unveiled its first step in that direction: An interactive feature in which users partake in "video calls" with Lily, one of Duolingo's beloved mascots — a purple-haired, sarcastic, cartoon woman. Chatting with Lily allows people to practice conversing in other languages as if FaceTiming with an AI friend, with dialogue generated by OpenAI's GPT-4o model. It's part of a $30 a month subscription tier, called Duolingo Max, which the company debuted last year for its premium AI features, including one that tells people why they answered a question wrong during a lesson. Another new AI addition is a mini-game called Adventures, which puts users in interactive situations to practice their language skills, like ordering a coffee from a cafe or getting their passport checked.
The new features are the latest wave of tools from a generative AI push the company began last year. "In my mind, the personalized AI tutor is less like a particular feature that we're building," Klinton Bicknell, Duolingo's head of AI, told Forbes. "And more just kind of a vision for what the whole app as a whole becomes."
The AI push by Duolingo, which went public in 2022, has translated into a surge in users and revenue: Almost 104 million people take language, math and music lessons on the app each month, up 40% year over year. This past quarter, revenue hit $178.3 million, up 41% from last year. The company's stock hit an all-time high on Monday of $270, vaulting the company to a $11.75 billion market cap. Von Ahn, who owns roughly 10% of the company, is now a billionaire, along with his cofounder Severin Hacker.
"It cannot see if a student is experiencing frustration. It cannot see body language. It cannot see joy."
Elizabeth Birr Moje, University of MichiganAnd while business is booming right now, competitors are also investing in AI. Babbel, for example, last year debuted a speech recognition feature that learns a user's voice to evaluate their pronunciation. Rosetta Stone also added AI-powered language assessment exams, used in enterprise settings.
Elizabeth Birr Moje, dean of the University of Michigan's Marsal Family School of Education, said she's excited about the possibilities of Duolingo's new AI features. But she doesn't believe an AI tool will ever be able to replace the intangible skills of human tutors. "It cannot see if a student is experiencing frustration. It cannot see body language," she said. "It cannot see joy."
The Education BillionaireVon Ahn grew up in Guatemala City with his single mom and grandmother, immigrating to the U.S. in 1996 to attend Duke as an undergraduate math major. He then attended Carnegie Mellon University in Pittsburgh for his PhD, where he co-invented the CAPTCHA verification system that distinguishes humans from robots online. He spun the project into a company called reCAPTCHA and sold it to Google for an undisclosed amount in 2009. Two years later, he started Duolingo, along with cofounder Hacker, a Swiss computer scientist he tapped as the company's CTO.
"My net worth growing up was probably close to zero. So was my mom's," said von Ahn, who holds dual U.S. and Guatemalan citizenship. Reflecting on his billionaire status: "It feels cool. But it's not something I think about all the time. I'm proud of it." He's one of few Guatemalan-born individuals to reach the billionaire milestone, including Mario Lopez Estrada, a telecom tycoon who died last year.
Von Ahn's 87-year-old mom Norma now lives with him in Pittsburgh. He said she doesn't realize how much money he has, even though he reminds her they are financially secure. "She asks if it's too expensive to call Guatemala," he said, laughing. "I tell her, call whoever you want!" In 2021, he established the Luis von Ahn Foundation, which seeks to protect and support women and girls in Guatemala, among other causes, and has donated around $13 million so far. One program, called the Visionary Awards, honors individuals making an impact in Guatemala in areas including health and nature conservation, granting them each a $20,000 cash prize.
But his higher profile has also brought some new precautions. He's famous in Guatemala, often getting recognized on the street and stopped for selfies. And because he's been so outspoken about the country's former president, he's also gotten death threats. Now when he visits the country, he travels with the same security detail used by the United Nations mission, which carries packets of blood on hand that match his blood type, in case he gets shot.
"They think that it makes me feel better," he said. "That does not make me feel better. That makes me feel worse."
The Chance Of Going 'Haywire'From the rooftop at Duolingo headquarters, where employees sometimes eat lunch on sunny days, you can see the University of Pittsburgh's Cathedral of Learning, a 42-story Gothic revival church converted to classrooms and labs. It's a distant reminder of Duolingo's roots in academia — von Ahn was a mathematics professor at rival Carnegie Mellon when he incubated the company out of the university, which at one point owned $150 million in Duolingo stock, before divesting after the company went public, von Ahn said.
In addition to its AI tutor efforts, the company has made another big AI investment in its Duolingo English Test (DET), the app's version of TOEFL, or the Test Of English as a Foreign Language, which is widely used to certify English proficiency for university admissions or visa applications. The DET, which costs $59 and first launched in 2016, gained traction during the pandemic because it could be taken remotely. Duolingo now uses AI for every element of the DET exam, von Ahn said, from generating the questions to making sure people don't cheat. One security feature, for example, uses facial recognition to make sure a test taker isn't looking offscreen at notes. Right now, the test accounts for 10% of Duolingo revenue, and von Ahn wants it to become a bigger part of the pie as the company focuses increasingly on non-English speaking users.
"We're prepared. Not in that we have major contingency plans, but I'm prepared for it to happen."
Luis von Ahn, CEO of DuolingoBut creating high-quality AI tools will be a long process. Von Ahn said the company is experimenting with new characters for lessons, created by AI video-generation models, though they are in early prototyping stages. There's also room for improvement with the newly announced "video call" feature. In recorded demos, Lily's voice sounds slow and robotic, and there is sometimes a lag before her response loads. But the dialogue seems natural and casual — important groundwork for von Ahn's vision for a fully automated tutor.
Bicknell, Duolingo's head of AI, said there are three qualities of good private tutors that the company is trying to emulate as it builds out its products: Knowing exactly what the student knows, and how to teach them effectively; being adept enough to answer all of the student's questions; and keeping them motivated to come back.
The video call feature is already trying to tackle the first point. Like a human tutor, the feature learns more about the user with each session. For example, if you told Lily about the wedding you attended during your last call, she might reference that in future calls. Duolingo also tries not to discourage users by having Lily correct their pronunciation or grammar, noting that people get discouraged by their fear of mistakes. As long as the AI "understands" what the user is saying, conversations continue without those reprimands. The company said it intentionally keeps conversations short to keep people engaged, capping them at about one minute for beginners and two and a half minutes for more advanced users.
Von Ahn knows things could get messy. He is concerned an AI tutor could go "haywire," and start "getting into, say, I don't know, some Nazi stuff," he said.
Von Ahn said he's "come to peace" with the possibility of backlash set off by one of the company's interactive AI features. "We're prepared. Not in that we have major contingency plans, but I'm prepared for it to happen," he said. "And that's okay." For the video call feature, the company says it has specific prompting techniques and content moderation guidelines to keep AI responses on the rails.
Matt Skaruppa, Duolingo's CFO, said the company doesn't have to worry as much about pitfalls other companies face when they delve more into AI, because Duolingo is using the technology in a more specialized way. "Our mission is not to solve AI for the world. It's to apply a certain set of things to education," he told Forbes. "So it's a very focused effort we have when we use AI."
Still, von Ahn isn't shying away from the inherent risks — whether that's automating away jobs, or facing down the possibility of its AI saying something inappropriate. "We'll probably have to stick our foot in our mouth," he said. "The benefits outweigh the potential problems."
MORE FROM FORBES WeWork Founder Adam Neumann Brings 'Conscious Community' Real Estate Startup To Saudi Arabia The Library Of Congress Is A Training Data Playground For AI Companies Forbes Sustainability Leaders The Cybertruck In The Room: Why Elon Musk Isn't On The First Forbes Sustainability Leaders List
