On today’s episode of Found, Dom and Becca talk to Markus Witte, co-founder of Babbel, a language learning app that had been operating since 2007. Babbel has become one of the most prominent language-learning apps but their first product was essentially just a vocab game and they quickly discovered that a multi-modal way of learning will always be more effective. Markus also talked about why he decided to step down as CEO and take on the role of chairman and how all four co-founders have worked together to stick to the original mission of Babbel even after nearly 20 years.
On today’s episode of Found, Dom and Becca talk to Markus Witte, co-founder of Babbel, a language learning app that had been operating since 2007. Babbel has become one of the most prominent language-learning apps but their first product was essentially just a vocab game and they quickly discovered that a multi-modal way of learning will always be more effective. Markus also talked about why he decided to step down as CEO and take on the role of chairman and how all four co-founders have worked together to stick to the original mission of Babbel even after nearly 20 years.
They also talked about:
Becca Szkutak 0:02
Hello and welcome to found TechCrunch podcast that brings you the stories behind the startups from the folks that are building them. I'm your host, Becca scatec. And I'm joined by my spectacular co host, Dominic Midori, Davis. Hey, Dom, I have a question for you. Can you speak any other languages?
Dom Davis 0:18
I speak a little bit of French I speak okay. If you dropped me in France, I can get around. Okay, what about you?
Becca Szkutak 0:23
I have like a baby understanding of Polish. I've been trying to learn it for years. I always say that, like, I couldn't do a conversation. But when I get my hair done at the Polish hair salon, I know, they're not talking about me. So I know like a no. Okay.
Dom Davis 0:37
Yeah, I think I did like four years of Spanish and I can't say anything.
Becca Szkutak 0:41
I did five years of Mandarin Chinese, and I only recognize the numbers. That's it. Just not that helpful.
Dom Davis 0:48
Why do you ask?
Becca Szkutak 0:53
I asked because today we have Marcus with to the co founder and chairman of Babel, which you probably already know. But if you don't, is a language learning platform that uses things like lessons, online classes, games and podcasts to teach its users how to speak a new language. We had a great time talking to Marcus about the long journey they took a building Babel and how all the co founders are ensuring the mission of Babel stays consistent, even though they have all moved on to different projects. And
Dom Davis 1:19
of course, we have our new segment two truths and a lie, where I'm going to tell you two truths and a lie. And then after the episode, you have to tell us what was the truth? What was the lie? All right, so here we go. What was the lie in this episode that no founder has ever sold a share that Marcus is a big believer in the CO CEO model, or that the Bible team has been working on incorporating machine learning from day one. Day
Becca Szkutak 1:44
one can remember his company started back in 2007. Those are really the good ones. So you guys should listen to the conversation to find out which one is true and which one is not. And here is our conversation with Marcus.
Hey, Marcus, how's it going? Very good. back. Hey, thanks so much for coming on the show today. I'm really excited for this one, because I think me DOM and some of our listeners already familiar with your company. But for those that are not, maybe if you want to start there, tell us a little bit about Babel.
Markus Witte 2:20
Babel is a language learning company. It all revolves around an app. But now it is even an ecosystem where you can learn in very different ways in live classes through the podcast, whatever you choose. And what we try is to help people connect and understand each other through language. I
Becca Szkutak 2:39
know you guys have been around for quite a while, as far as startups go, maybe if you want to talk a little bit about the founding story. And I know there are three other co founders how you guys all got interested in this idea to begin with?
Markus Witte 2:51
Yeah, we have been around since 2007, actually. So quite a while launched the app in 2008. How we found each other was through a company we all worked in, in the music software world. So we all built music software products, that was actually what we ventured into and wanted to do build a prototype for an online sequencer, a SaaS product if you want. And before we even launched that product, while we were still working on the product, however, one of my co founders wanted to learn Spanish, and came to the conclusion that you can't learn a language on the internet, which was a complete surprise to us at the time. So we thought ultimately, that is a problem we could solve in a way we were wrong, because we didn't have the knowledge or expertise to do this, but like to happen. So often. Once you start into something, then you find the means to make it happen. Ultimately, that's
Dom Davis 3:45
very interesting. Now I'm thinking like, what was it like in 2007? I don't know how you would learn like, I guess you had to do it the old school way. So when you're starting a company like this, what is the first thing that you do to make language on the internet? And like digitize language? What's the first step to doing that?
Markus Witte 4:01
I think it has dramatically changed what you do today, if you start a company. And what we did back in 2007, what we did was to imagine a product that is actually usable. And that worked well from a tech perspective. And that was mainly a vocabulary trainer. It wasn't a very good product in terms of learning a language. From a tech perspective and usability perspective, it was pretty good. So how you do that is you sit down and code and that's what we did. There wasn't so much more magic to that that was what we were used to do. And we just got together and said the common direction and then coded until we had something that we were still ashamed about, but happy to show it to everybody.
Becca Szkutak 4:42
Now it's so interesting to think about building something to help people learn something you guys were struggling to learn on your own or your co founder was because so often you come across founders who are like, Oh, I'm building in this area because I have expertise here or I have this 20 year career in this specific industry. So it's so interesting to hear your story of trying to solve your own problem, but not having experience in that area. And I know something that's interesting about getting launched that early. So much has changed in the tech ecosystem. Since then, I was the app store even launched in 2007.
Markus Witte 5:15
No, there was no app store. That was the first iPhone, that was not really something you wanted to have. I wasn't a Google G one following the first two years of existence of Babel. So no, that was pre AppStore.
Becca Szkutak 5:28
So what has it been like building since then, because I know not only has tech changed, and sort of like how people interact with technology, people are more on snaps. Now, of course, back then it was probably more web based, internet based. And there's also been a lot of competition come into this space as well, since you guys launched and like, how has it been? Of course, obviously, Babel is still known, people are still using it today. What has it been like navigating the changes outside of your control? Since you guys got started back in 2007, the
Markus Witte 5:57
changes were pretty dramatic. I think the biggest one was the launch of the App Store and the success of the app stores on the web, people didn't really search for language learning. So nobody very weirdly, nobody had the idea, they could learn a language on the internet. So the search volume was almost zero. Once the app store got going, people got used to doing everything on their phones, including language learning. So there was for the first time a demand for online language learning, which completely changed the whole equation of how you get a product to learners to users, that was a huge difference. And of course, the whole product needed to change to work on such a small screen. And admittedly, we first thought, oh, no, you can't run a language learning app on a phone, it's impossible, it will never work. But we had to learn it the hard way that does work. That was a very dramatic change in our direction distribution, the tech stack was different, and the whole product needed to change. And I don't think competition wasn't a big thing for us. One very, very big change was introducing subscriptions in 2009. So rather early, when it comes to subscription, that was not the solution for every business back then, for us, it was in way necessary to stay aligned with our users. And we thought advertising and our own product is just unthinkable for us. Just ethically didn't work. So it was mainly the only path open. And that for us was a huge change. And back in 2009, when it was so funny talking to investors who didn't at all get the math around subscriptions, we really had to explain the whole statistical models around it. And now it's the most common thing in the world. But back then that was really challenging. Yeah, that's interesting. So the whole business model change. And no, of course, is the second change that is as fundamental as the change to phones. And that is AI as a driver for extreme change in the whole industry.
Dom Davis 7:54
Yeah, I was actually going to ask you about that, like going back to investors, what was it like trying to get capital to get this business off the ground,
Markus Witte 8:03
we were lucky in two ways, in one way that we had worked before, had put a bit of money on the side and could find us the company for the first 18 months out of our pockets, and even beyond that work without a salary. So that was a privilege that we had very helpful to not need investment from day one. After that fundraising was terrible, because like Berlin was not a good place for a startup back then. And if at all startups were about online commerce, so ecommerce was the big thing. Everybody understood, but language learning product that was really out there. And we had to really look for investors for quite a long time. Our series A was we built a million dollars. So that was the one time fundraising wasn't fun for us.
Becca Szkutak 8:52
Yeah, cuz I noticed looking at your fundraising history. And maybe, of course, this is also just a difference in the startup market today versus 10 years ago, where companies now raise seemingly like every year, you guys have only raised a handful of rounds, sort of very spaced out, which isn't as common anymore. And was that were you guys lean by design? Or was that kind of playing into this where fundraising was also just really tough for where you guys were? We
Markus Witte 9:15
will also lead by design. We wanted to live off our users rather than from investors money, but it was a deliberate choice. We were cashflow positive from 2011 onwards. So rather early in the journey, and we got there with this very tiny series A and a bit of debt. So very minimal capital, I think we burned below 2 million to get to cashflow breakeven, but that is more the spirit than necessity because once we got traction, all the follow up rounds were so easy to raise because we had proven that this is something that works. And we didn't have to explain for very long that language learning is a large market. Everybody understands that right away.
Dom Davis 9:55
I see that you got covered in TechCrunch in 2008. And so I just wanted to I just want to ask, how did you get into TechCrunch? I mean, because I don't know, I just, there's no right way to phrase that. How did that work?
Markus Witte 10:07
Back then it was the was like winning the lottery. For us, it was the game changer 15th of January 2008, I still remember it. Oh, my God. It was the first day we were online. And what we did was to just TechCrunch had a forum and online forum where you could submit your press release. So we drew up a crude self made press release that nobody reviewed with ever done PR. And we uploaded it to TechCrunch. And somehow, it caught somebody's attention. And we found ourselves prominently featured on TechCrunch. And then, of course, accordingly, on other media, which totally exploded our servers, we were, I think, they to add the triple of our total objective of users that we had for the first year or so. So it was just totally out there. The interest was so high in language learning once you put it in front of people. So yes, TechCrunch is the beginning of the part of Babel, that is a success story. And
Becca Szkutak 11:10
you've mentioned a couple of times now about how large the language learning industry is, and the demand there. And maybe if you do want to talk about that a little bit, because I can like kind of think about what this would look like. But I don't really have a concept of how much demand or how large the market would be for these language learning products. And how much has it changed.
Markus Witte 11:29
So that's different ways of looking at the market, you can look at the current market volumes, or how much revenue is made in language learning, most of that is still online or in live classes. So rather traditional methods, online self learning is a fraction of it, it's maybe 10% of the whole market as of now. And we already have a good portion of that another way of looking at it is how many people in the world throughout their lives, learn language? And how often do they get back to it. And that is huge. It's incredibly big, how many language learners there are in the world. So if you have a good solution for that, and if you can help them on the way the market is massive way beyond what we currently see in compound revenue figures. But if you look at app based online language learning, it's a comparatively small market, single digit billions. Definitely.
Dom Davis 12:20
You mentioned AI. So I'm trying to now think because I guess like in the beginning, you were talking about how you coded all the languages? How was aI change that in terms of getting languages on the platform, I obviously, I'm not a coder. And so I'm just like, how, how is AI changed all of that. So
Markus Witte 12:37
we were used to the good old machine learning because one of my co founders specialize in machine learning, even in the 90s. So so that was something we worked with on different areas. But what has changed in the last 18 months is that we can now use generative AI to help teachers build lessons to understand user demands and needs way better. And to dynamically deliver parts of conversations, our speech recognition is now at a complete new level using today's AI tools. And this is just the beginning. So it's a bit like the early days of the iPhone, where you have this shiny thing that is, in a way very interesting. But you haven't figured out that you can use it to book a taxi and revolutionize the taxi industry, for instance. And I think that is in the AI, we're at a point where everybody kind of understands changes coming. And this is very powerful. But we're just scratch, we all just scratching the surface of it. And the interesting part is how we use that for new products that we haven't thought about yet. So I think we're doing a lot of the stuff that is pretty clear and almost obvious. We've gone beyond that with a couple of product features and ideas in some areas. But again, the journey just starts. And I don't think anybody already has figured out how to use or what the limits are for deploying AI in absolute language learning.
Becca Szkutak 14:03
I was just gonna ask one last question, focus on the actual product. Because I know you mentioned when you guys got started, it was sort of like a vocab training exercise, which I know from attempting to learn the language online, you can find a lot of those resources. How did you guys decide to add these different products that you have expanded into? Like you mentioned lesson plans that teachers can use and things like that? Why did it make sense to kind of add these things? And are you guys going off of what consumers are asking you for existing users? How do you guys decide to expand to these different areas?
Markus Witte 14:33
So that goes back to how and why we started? So we started basically as users of our own product, and more with a question and with an answer. I think that made us more flexible than a couple of other teams because we didn't think we know the solution. We're still searching. What is the best solution to that language? I think that will be an ongoing search. The first step was we build a product that we saw a lot of interest for and Then we saw that you can't really learn a language with it. And that was a bummer, because we didn't want to keep people busy. But to actually help them learn a language, like looking back solutions are sometimes obvious. So the obvious thing that we did was to hire people who actually know how people learn a language. For tech people, it's not always the first step to ask people who know their field. But very often we reinvent stuff or feel like, Can we do this using machine learning. And that was a game changer. Bringing educators on board was a complete game changer helped us to completely revamp the product. And in 2009, we launched a product was everything, but just a vocab trader. And then over time, we of course, kept interviewing our users, how they can use their language skills in real life. Because what you track in your app, in terms of success metrics is a closed feedback loop. If you optimize your app for stuff that you can measure in the app, you end up building a game, people get better at using your app, not necessarily, in speaking a language in the real world. So we had always did panels with real world users and and tried to understand what do they need to get conversation to get to their learning objectives? And the answer was consistently, yes, I used multiple methods, I used the app. But I also went to language classes, I watched movies in the learning language, I did games and whatever, right, we first thought, oh, we have to overcome that and build an app that can do all that, but then gave in to the fact that a multimode way of learning is always more successful than just using one, one mode. And if you're learning a language, the one thing that you can always use together with every other mode of learning is a mobile app, because it's affordable. And it doesn't take up a lot of time. And it's kind of the centerpiece of a digital language learning journey.
Becca Szkutak 16:53
No, that's so funny to hear you say that, because I just got this morning, my dad has been learning French for a couple of years on Duolingo. And he's sent his like, Duolingo, wrapped or whatever, but he keeps, he's learning French, and he keeps going to France, and then getting too afraid to talk to people while he's there. So it's like he's like, not trapped in the app. He's looked at taking classes and stuff like that. But it's so interesting to hear you say that, because it's definitely true, he's been learning for a while and still gets scared to talk to people. That's like, just try it.
Markus Witte 17:22
And that is a huge, huge advantage of apps that even for those of us and I'm definitely in that camp, who are more on the shy side, we can try in a safe environment where nobody's laughing about what we try to do. But eventually we will have to get out of the closet. And I think the challenge for us as a language learning provider is to make these steps not too big to give like a step by step opportunity to try a bit more first things speak to just to speak recognition, but get speaking and then be in a maybe in a one to one with a real teacher, and then maybe in a class, and so on and so forth. So not just throwing people into the deep right away, it's the best for most people.
Becca Szkutak 18:05
And now we're gonna take a quick break, but we'll be right back in a second.
Dom Davis 18:14
I wanted to switch gears just a little bit, because you spoke about starting the business and the journey of running the business. When did you know it was time to step down as CEO and let someone else take over?
Markus Witte 18:25
I took the decision in the late part of 2018. But I didn't feel it was time it was a different thing. It was very, very personal decision. As a CEO, I became more and more effective, the more the company grew. It's kind of the reverse of many founders experienced. But I was kind of the weakest of the founders in the first part, because my coding was kind of not as good as the others. I wasn't a designer, my marketing skills were more mediocre. But it turned out that I worked out as the CEO. And the point was really a personal thing that this job felt like such a good fit. And I felt it's so relevant what I do that I wanted to know who am I without this job? What is the core of my personality, if I subtract this kind of exoskeleton of relevance that I have through this large organization, and that was already 500 People that curiosity was was a big driver. And the other driver was pretty clear that from a certain step on, I needed to decide do I want to be the chairperson or the CEO, and I felt the company should have a founder chairman, and just to keep air cover and I had fantastic successor in the company. It's a complicated decision, I think, but it was not an obvious one at the time. And
Becca Szkutak 19:45
saying on the succession piece for a moment. I wrote a story a couple months ago about founder succession and how this current market some founders who are planning to maybe take on a chair role after the company went public and now plans are kind of out Have whack with timelines and things like that, and how this is just like a part of the venture ecosystem that people just don't talk about as much, despite the fact that if you join a public company, you have a succession plan from day one, you mentioned finding, having a really good successor, when you did decide to step down, maybe if you want to talk about a little about what that process was, like how you guys navigated finding that next person to take Babel to that next
Markus Witte 20:22
step, to be totally honest, I was more lucky than than it was designed. So I had brought on somebody in 2015, he back then was like, his first job was CMO. And I rather quickly understood, wow, this guy can do a lot more. And he has such a deep interest in the mission of the company a deep interest in what the product does. He's not just a CMO. But did I hire him for that? No. So I can't find myself with having thought about this. At least once he was there, I saw like, okay, if I'm hit by a bus, he's the one who who should take over the wheel. And that was, for the first time absolutely abstract, because I thought I'm gonna do this forever. It's the best job in the world, it was kind of the best job in the world. And that was exactly why I gave it up, which is pretty weird thing, I think, for a lot of people, but that's what it is. So I was lucky. Nowadays, I work with founders on their path, I'm mentoring them a bit the growth stage. So it's an important advice, or one piece of advice that I give founders. And I think it's important to identify people that can take over and might not be a part of your hiring. Because usually in a startup environment, you try to keep things from falling apart, you don't usually solve problems that are kind of three or five years out. But once you've you have somebody that could be a successor, you should definitely keep an eye on them and foster them. Something else I
Becca Szkutak 21:53
wanted to ask you about is this, you were a co CEO. And I know there's been lots of thought leadership, I guess, would be the best way to put that about how either the CO CEO model really works, or the CO CEO model really doesn't work. It seems like people are like very much on one or the other side of the camp. And no one's like, oh, it sometimes works. Sometimes it doesn't, which you could say that about all leadership structures, essentially. But why did it work for Babel? And kind of why did you guys decide to do the CO CEO model to begin with? Well,
Markus Witte 22:22
it wasn't a co CEO model, really, it was the face over. So it was for, I think, six months or so in 2019 on and I decided that before he takes over as CEO, he wants to be in the with everything. So to stage it a bit, we have recreated that role. And it was kind of a weird setting, because we didn't have two co CEOs, but one CEO and one co CEO, like a pilot and a co pilot, it was that kind of setup that the successor got the opportunity to look into everything and be part of everything like a co pilot is and then take over. So it was just a phase over idea. If it comes to shared leadership. On the top level, I'm not in the camp of CO CEOs being a good solution. I'm rather skeptical. I mean, there are case as you said, there are cases where it works. But I would be rather conservative there.
Becca Szkutak 23:17
Yeah, there not many cases where it works, works for some people, but doesn't seem that broad of a solution. But speaking of like multiple people being involved, I know you guys also have four co founders, which is quite the group. And sounds like you guys are all still involved in some way with the company. Well, we
Markus Witte 23:35
are all, nobody ever sold a share. So we are all still meaningful shareholders in the company, which is great. I think none of us is operative in the company anymore. Promise was the last to leave this year, we're still very, very much aligned. So as shareholders founders always have one position or battle, which is I think remarkable. We blindly trust each other, which is also remarkable working together was not always easy, which is I think fact for every founder team. So over time, people decided to step down. One was the first he's the techie as of the tech guys, and his journey was more into crypto stuff and other things. Apple
Becca Szkutak 24:15
coin maybe?
Markus Witte 24:19
Well, I'm not sure if cryptocurrencies is the hottest stuff right now. So fun was definitely the or is a deep tech person and, and the first 18 months or so it was fun for him. And then we've got like bread and butter from a tech perspective. Lawrence is the early stage inventor founder zero to one person and he founded his company, which was also successful. In the meanwhile, I think for every founder, there's a moment where for whatever reason, they decided to do something else. And that was the case for us. I think what I'm so extremely thankful for is that we never got into fighting with each other but resolved all the friction that occurred in a very kind and thoughtful way, and always had real deep trust in each other. Speaking
Dom Davis 25:10
of shares, can you talk a little bit more about the decision to I guess, postpone that IPO in 2021? Yeah,
Markus Witte 25:18
you'll remember that markets were at a certain point quickly deteriorating, there was a Chinese company called Evergrande, that immediately cause havoc in the market. So the climate had changed. And we saw that the path forward was not very sunny on the public markets. If you look at it now, we are so happy that we're private. And we were late enough in our process to see this coming. You could take both views like if we had been earlier, we would have done a successful IPO. Would we be in a very good position right now as a public company will be in a better position than as a private company? I don't think so. So I'm pretty, pretty happy we took that decision. Am I happy that the markets deteriorated? No.
Dom Davis 26:06
So you're probably going to stay private for a while?
Markus Witte 26:08
I would guess so there's not really a public market for education companies are for everything that sounds like education. So no, I don't think so. I don't think that we're going public anytime soon. Um, for me, personally, that's not the biggest question. So I'm always more interested in the past the company takes than what happens with the ownership structure, somebody needs to own it. But over time, I got so deeply attached to the company, its employees, and its mission, that that is the main thing that I care about. And honestly, that wasn't the case. In the very beginning, we started as just a startup, but over time, it really got very, very dear to us.
Becca Szkutak 26:48
And since you mentioned that caring more about where the company has, as opposed to necessarily who's owning it, what are you hoping for Apple for the next five years? You guys are close to that 20 year mark four years away? So like, how do you guys feel about the next five years of the company,
Markus Witte 27:04
I would measure the success of the company in number one, how much learning success can we deliver to our users. And that depends on how good we are in evolving the product or products, using AI and other novelties and really extend what we call the ecosystem of learning experiences. That is the key, we try to measure learner success. And that's the North Star for us. And that's where I would see this going. And I strongly believe that the way forward is to find the best learning experience for each user. Because as language learners, we're unsure how to learn, it's very hard for us to say, oh, yeah, I need this way of learning language class would be the right thing for me. We don't have that expertise. But as battle, we have the expertise, and we can see patterns. And I think it's on that level that we can be most helpful. The other parameter that I would look at is the team. I'm so proud of the team that we and the culture that we have built, how inclusive it is, how diverse it is, I still meet all the new joiners, and I'm so I'm so humbled by the reasons why people join battle, it's the first thing that I do with every new genre, I ask them, Why of all companies did you choose this one? And for me, part of the success of the company is to keep and and evolve this inclusive, diverse culture that we have. Now that's awesome.
Dom Davis 28:34
Did your co founder ever learn Spanish?
Markus Witte 28:40
Well, to certain degree, the fun fact is that I only was able to use our own product in a meaningful way after I stepped down from my CEO role. Because if you're using your own product, and if you're a manager in this company, everything that you come across is meaningful. You come across an error, you end up writing an email to somebody and it's so hard to really focus on the learning experience versus focus on Oh, how does this happen? We need to change this and so on. So you're always on the meta level and for for Laurentiis peaks, a bit of Spanish now, but I wouldn't say he blew it out of the park. And while we are our own users, it's honestly really hard to do this. Now. I can do it. Now. I am really using Babel quite a lot. But it's a different perspective. It's not your day job anymore.
Becca Szkutak 29:32
Well, I think we're pretty much at time. But thank you so much for coming on. Marcus. This has been a lot of fun. Thank you
and that was our conversation with Marcus DOM. What did you think?
Dom Davis 29:49
I loved it. I loved hearing about him. But before we dive in, I gotta give the lie data. Did you guys identify give the listeners what they want? You identify what the lie was y'all Okay, so clearly the lie is that Marcus does not believe in the CO CEO model at all.
Becca Szkutak 30:05
No, which I think is fair, because yeah, sure it works for some companies. I say that, but I can't think of one off the top. Yeah,
Dom Davis 30:14
that model has worked. Yeah. No notes. I agree.
Speaker 1 30:17
But yeah, what else did you find interesting for the conversation,
Dom Davis 30:21
I just loved hearing about how one of the reasons it started was because one of his co founders wanted to learn Spanish. And then in the end, he still doesn't really speak it.
Becca Szkutak 30:29
Now. That's so funny. It's like, you can make so many jokes about that. It's so funny to be like, oh, I want to learn this thing. So I'm just gonna build a company to teach myself how to do it. Like, it's just like, Man, there
Speaker 1 30:38
are a lot easier ways to do that. Probably. He's
Dom Davis 30:42
like, I wanted to learn Spanish, and I built this multimillion dollar company to help me learn it. No, I
Becca Szkutak 30:49
love that. It's so funny to think about that, obviously babbles like, most people know it. And it's a big company, as you said, and a lot of people use it and probably have learned languages on it. So it's so interesting. That's such a big part of the origin story.
Dom Davis 31:03
Yeah, it's also interesting to see how this is basically like the OG language learning app, and they've been around for so long. In the beginning, I guess you couldn't how were people back in the day, just learning languages? Like I could not imagine just when did those languages for Dummies, books come out? Like, how were people doing this?
Becca Szkutak 31:21
I feel like it must have just been like Rosetta Stone, right? Like those CDs,
Dom Davis 31:25
I think forgot about her. Yeah, I
Becca Szkutak 31:27
haven't. I remember we'd never own them because they're really expensive. And you had to buy so many to like, actually learn a language. It's like, you can't just buy like one CD and just learn pleasantries and then like nothing else. So it's like kind of a big commitment. But I just thought what was so interesting about that part of it, too, is the fact that they watched it as a subscription, or added a subscription model, like very early, which is so interesting, the way he talked about it being like, oh, yeah, and at the time, people were like, Why would you do a subscription model? I'm like, Why does that make sense? Whereas like, now, it's like, that's like every VCs favorite business model.
Dom Davis 32:02
I know, his company is really like a snapshot in what everything was like in 2007 and 2008. Because obviously, now the things that are just so obvious for a lot of startups to have, you know, these subscription models, even like Ed Tech, the ad tech spaces, you know, it's doing it's pretty good. So hearing, like back in 2007. Berlin has a capital like, it's like a big VC hub. Oh,
Becca Szkutak 32:23
I know. That surprised. Me, too. I was like, Yeah, I've always thought of Berlin as being like one of the hubs in Europe, like London, Berlin, those are like the top two. Yes.
Dom Davis 32:31
And parents that like that, even like in 2007. It was like a little challenging to fundraise. I'm like, things are so different now.
Becca Szkutak 32:38
Yeah, it's funny, too. Because like the same theme, he talked about how they've been using machine learning the entire time. I'm sure a lot of companies from that time have as well. But because we like didn't talk about machine learning and AI the way we do now. It's like, we wouldn't know that. But it's just like, Yeah, of course, we were using that from day one, which like makes sense to think about now. But it's funny to think about how much it's changed how we talk about that. I
Dom Davis 33:01
know, it's another one of those companies where I'm like, oh, yeah, AI was not invented two years ago by I don't know Elon Musk at all of them. It was clearly it's been around for a while, because I'm thinking like, of course, a machine learning model would need to be used for this app. Because otherwise, like, how would it work? Like? I don't know, right?
Becca Szkutak 33:20
No, exactly. It's a good reminder that there's more of this tech than we like, talk about. Yeah, but
Dom Davis 33:25
you know, I also really liked he was, we were kind of talking about this before, where he was, like, just very European, in terms of how humble he was talking about his company.
Becca Szkutak 33:34
No, I know. And like the thought of stepping down because the job is like, too good. It's like, I don't know, I just can't imagine doing that. But like, I like get where he's coming from the sense of like, okay, well, I've done this for a long time and like to get comfortable, I get that. But like, Would you step down from a position like that, where you're like, I have the best job in the world, like time to go?
Dom Davis 33:52
I don't know, because he was asking philosophical questions. He was like, Who am I without this job? You know, I want to experience life again. And I was like, okay, that's kind of a slay. I was like, Yeah, you know, I support that totally. But I'm also thinking, like, you have to be probably so mature. And so not obsessed with, like greed and hyper growth to come to a conclusion like that. Yeah. Because a lot of times ego is like a big part in starting and running a business. And so for him to say, You know what, someone else can run this, I'm gonna live my life a little bit. I was like, okay, I can get behind that for sure.
Becca Szkutak 34:28
And it's especially super interesting to to What do you remember like the context of them specifically, they haven't sold any shares. So like, Marcus hasn't sold any shares. So it's not like, Oh, I'm leaving my job because this company has already made me very wealthy and I can kind of just like, hang out now and like, pass the torch or whatever she left. And it's like, he still owns the same stake and as doing other things, they didn't get that exit yet.
Dom Davis 34:51
Yeah. Because you know, I bet you they could have IPOs in 2021. And I bet you they would have hit like a nice billion dollar valuation, but it probably would have crashed very soon after. But I bet you like he easily could have walked away with like a lot. It was really smart for them to say No, maybe not right now. And
Becca Szkutak 35:09
his again was like what you're saying just like so European. So just like not the like money hungry power hungry American sort of front of it's like there's nothing wrong with that either but him just being like, Oh yeah, IPO didn't happen, but like, I don't care who owns the company as long as it's like still moving in the right direction. It's just like so against the narrative we hear here. And I
Dom Davis 35:31
also love the old school TC shout out, oh, I don't like 20 Post 2008 The articles and so we have the article. And it just says contributor like who wrote this? If you wrote this article, please email us who wrote the stories? Let us know. And I love how it's like, it's just like this app exists. And it totally changed everything. I love hearing when TC articles do that for a company. Oh, I
Becca Szkutak 35:53
know. Because it's like, easy to feel like you're in your own world when you write this stuff sometimes. So it is always fun when like a good company that deserves like good recognition is able to get it. And
Dom Davis 36:04
also I think I feel like I also have to note that when you mentioned Duolingo he didn't even flinch. I know.
Becca Szkutak 36:08
He's like probably scared of that owl like we all are. I just didn't want to say anything.
Dom Davis 36:15
I just have like images in my head of that apple being me. Like I'm so scared of that owl. I
Becca Szkutak 36:20
know. That's why he probably knows better than to say it. He doesn't want that all of a sudden came later I get it.
Dom Davis 36:25
He's like I'm not even going to acknowledge something I meant to ask him was what was the first language on Babel? I assume it was Spanish but I don't do we know?
Becca Szkutak 36:34
Oh, that's such an interesting question. Yeah, yeah, I wonder if it was Spanish Abacha it just like wasn't just really built the full company Spanish and just did not
Dom Davis 36:44
know. They built this multimillion dollar company to teach them Spanish and the first language is like Dutch or something like they don't even get to Spanish for a while. That would be really funny. Yeah. Oh, so Okay, so we just got confirmation. It was Spanish. All right. So he was trying. He was trying. Yes. We
Becca Szkutak 37:01
love to see it. We love to see it. Sound is hosted by myself. TechCrunch Senior Reporter Becca Skuta alongside Senior Reporter Dominic Midori Davis founders produced by Maggie Stamets with editing by kelp. Our Illustrator is Bryce Durbin phones, audience development and social media is managed by Morgan Liddell Alisa stringer and Natalie Kreisman TechCrunch is audio products are managed by Henry pick of it. Thanks for listening, and we'll be back next week.
Transcribed by https://otter.ai