All right, we want to switch gears here and talk about Dual Lingo. AI innovations powering Dual Lingo to all time highs. The company revealing this week two new AI powered innovations to the platform, which of course teaches over forty languages as well as math and music. Now, since the announcement, the Saka Sine price target hikes from both evercore and need them and for more. I am thrilled to say we are joined now by Luis van On. He is the co founder, CEO and chairman of Dual Lingo.
So of those two innovations, let's start with video call with Lily. My understanding is basically it's a video call and I will be speaking with one of your characters. She has purple hair, her name is Lily, and the goal really is conversation. And with that in mind, are you trying to target more advanced language learners who maybe already have a handle on conjugations and how to ask for the check.
Yeah, we're trying to target everybody.
The idea is, historically we haven't been able to get people to practice conversation very well with couters, but now with AI, you actually can have a conversation with a fully automated character, and the character adjusts to your level. Now, what we're really excited about is that it turns out most people, actually, when they're just language beginners or intermediate, they don't want to have a conversation with another human because.
They're too shy about it.
But having a conversation with an animated character actually allows them to practice their conversation. So we're hoping this will really bring to a lingo to the next level in terms of teaching languages.
It's fascinating, of course, the human psychology element and the decision to keep an animated character there as the voice and face of Lily. So my understanding is that Video Call with Lily basically it falls under your due Lingo Max subscription thirty dollars a month. You just started rolling that out in April on With this in mind and with the launch of Video Call with Lily, should we be expecting any upgrades to your forecasts here?
Well, I'm not really going to talk about forecasts or anything, but we're really excited about, you know, about the uptake.
I think people are really loving being able to.
Practice their conversation, and this is particularly true of English learners. So people who are learning English, they really care a lot about conversation.
So we're excited about that.
And I mean to the point on English when we spoke a couple months ago, I believe less than fifty percent of your daily actor users we're English learners. I know that is a big initiative for you. So with that in mind, where are you when it comes to reaching that fifty percent threshold.
Yeah, Actually, the threshold we want to reach is about eighty percent. It turns out that the number of people in the world, the fraction of people in the world that are learning a language, that are learning English is about eighty percent, whereas of our daily active users this is under fifty percent. So we're hoping that, you know, it'll get to eighty percent. This will take us a while,
but you know, we're doing everything we can. And one of the important things is are these AI innovations that allow us to practice more natural conversation.
I think what's interesting also about this AI revolution, and as it pertains to language and companies that work on language like you do, is what it takes to get there and advance and grow. What's fascinating about dual LINGO to me is that you guys have a nearly thirteen billion dollar company that at the end of the last year only had about or less than rather eight hundred people working at it. What does it mean for the workforce for you to be expanding this way in AI?
Yeah, we're quite lean.
We still have about it's a little over eight hundred people that we have working on due LINGO, and most of them are working on the actual product, so mostly are their engineers. It just turns out that, you know, engineers are quite scalable, and it's getting even better with a lot of THEAI improvements because a lot of the coding that used to be done entirely manually now can be done in part with the help of a computer.
So we're going to continue growing the number of employees, but I don't think you should expect us to quadruple the employees anytime soon or anything like that. Is going to slowly engine because we get a lot of efficiencies with AI.
Well, continuing along these lines, it's interesting. Late last year, of course, you just decided not to renew the contracts about ten percent of your contracted workforce, opting instead to use AI in some cases and with that in mind, of course, AI not just enhancing the product that you offer, but maybe enhancing the productivity of your workforce you expect to grow the workforce. Where are you hiring right now?
I mean the main places we're hiring are highly skilled engineers, product managers, and designers. I mean, the way we see it is, you know, there's some road work that can be entirely substituted by AI, But for the majority of our employees or the types of works we do, what's going to happen is we're just going to be able to see each one of them get more efficient. So we're not going to be doing anything like layoffs or anything.
We're just going to get a lot more efficiency because what happens is somebody who used to be an animator now can still be an animator.
They will be working on.
Kind of the more conceptual stuff as opposed to having to spend a lot of time on you know, tiny little movements of the characters, which now can be done mostly by AI.
I'd love to go back to Katie's point a little bit as well about kind of the higher price tiers that you're offering people. What do you find people coming to do a lingo for I'm a user myself. I want to learn Spanish. I use it every so often. I'm not using it in my job every day. Do you find people learning at these higher price tiers to get different jobs across the world? And are is that a rationale for why people are willing to pay for it? Will employers pay for it?
Yeah?
So there's there's many reasons for learning a language. The two big ones that we have among our users, and they're about half half. One half is hobby. These are people who don't actually need to learn a language, but they just think to themselves, well, uh, you know, I used to, I don't know, play a lot of candy crush or do a lot of Instagram, and now I'm using Duolingo and at least I'm learning.
In some Spanish. That's one group.
And then the other big group are people who are doing this to actually learn a language and doing so for either school or work. And usually those are people who are learning English. And so those are the two big buckets. It's easy to see that the people who are learning English are willing to pay because they really,
you know, they actually want to get a result. But it turns out that the people who are hobbyists are also interested in paying, because, as with all hobbies, you usually get started with something you know, you get started small, but as you get more and more into it, you want to have more features and then you end up paying. So we're seeing appetite to pay in both big groups.
I'm glad you brought up candy Crush. I'm not much of a candy Crush player. I really like two dots, but that's a different conversation. But as part of of course the innovations that we're announced this week, we mentioned video Call with Lily. There's also Adventures, which are a mini game Louis. So it's interesting that you're also trying to tap into that gaming mindset. Maybe people on the subway just want to have some fun here.
Yes, it's always been gamified, and I think that's one of the big reasons why we've grown so much. It's because it turns out that learning a language and do ling is easy and fun. But we're really leaning into it, and it turns out there is one aspect of learning a language, which is these situational things where you're you know, you may have to buy a croissant, or you know, whatever it is get yourself out of trouble, that you can really turn into a little bit of an adventure game.
So some of the lessons are now going to be as opposed to just having to do certain you know, translations or listening to things, You're going to be put into a full screen where you're in a situation where you may have to buy something or you know, clean up something, or ask for directions or something, and you know, it's a whole game that you can that you can fail, and it's pretty fun.
And we don't have.
Much time left, but I do want to talk a little bit about the stock movement. Of course, do a lingo shares hitting an all time high this week, up mightily for the year. You take a look at what that means for market cap. Ashanal I mentioned you're close to thirteen billion dollars in market cap right now. You were under seven billion a year ago. I know that you have plans to hire more, but is there any potential M and A in your future?
I mean, look, we're always considering, you know, how to expand to different things, as you mentioned, we are you know, we historically have mainly taught languages. We of late now, also teach math and music. We're always seeing what other subjects we can teach, and there may be some M and A opportunities there. However, you know, there's there's nothing
very specific that we're looking at. I mean generally, we're just doing our thing and you know, getting better at our main market, which is teaching languages.
All right, Louis, that's a good place to leave it. Really appreciate your time today. That, of course is Louis von On. He is the CEO of Doueling Go