A (long) welcome from First1000
I have been at Duolingo since 2022, starting my journey on the growth retention team (think streak, notifications, etc.). My timing could not have been better; a few months into the job, we got connected to the folks at OpenAI who were working on a very secret project where Duolingo would be one of 5 partners (that project was GPT-4, and ChatGPT didn’t exist).
The most obvious use case was Duolingo notifications—our biggest growth lever—and, lucky me, I owned it. I ran probably the first GPT experiment in the world… at least that I know of, given how panicked OpenAI was when I told them that we wanted to use this in production (but wouldn’t tell anyone, since GPT-4 wouldn’t launch until 9 months later).
From there on, I moved to monetization, where I spent most of my time. Monetization was my calling. I worked on our New Year’s promo, owned the purchasing experience, and most of our subscription hooks. At some point, I owned surfaces my team was responsible for that generated 50–60% of the company’s revenue. It was a huge responsibility and quite a ride. I made the company probably something like $50–100m in incremental revenue and then went on to work on Ads.
Ads were interesting because they were our biggest bookings business that we didn’t have a team to own. They were really important for our margins, which became more and more important as we: 1) went past the ZIRP era and public investors cared more about bottom lines than growth; 2) AI costs started creeping up as we integrated AI into every part of our business, putting pressure on our bottom line.
Everyone else at the company, CEO included, hated ads because of the poor experience and brand misalignment of advertisers coming from programmatic auctions. It was the one part of the Duolingo user experience we had very little control over, and if you ever used Duolingo, you could tell how much we sweat the small details and cared about making users feel delighted and motivated using our app. Ads were the opposite of that.
I am currently working on ads and it has been a journey. I built a new modular ads system that helped us use AI to bring our characters to life. It was really fun working with animators, illustrators, and writers who could have worked at Pixar but, by some miracle, chose to work at Duolingo. We had fun; we created bits and developed our characters’ backstories through ads (my favorite was how we took our bear, which was barely visible, and made him into this creature that roasts humans for making dumb decisions)
Modular ads (“Mads”) made it so in 5 minutes you can generate an ad for Super Duolingo with our characters saying stuff and place them in different environments (see example). Before, it took us a quarter to produce an ad, and it was way less effective. That turned into one of our biggest monetization levers; we produced hundreds of ads and built machine learning systems to deliver the right ad to the right person with the right message at the right time. It was beautiful 😍.
From there, we hired an OG ads sales person who ran ads for Buzzfeed, built infrastructure to allow other companies like Universal and Marriot to use our characters to advertise on Duolingo. It took this new ad format, that helped us built our brand outside the app, and sold it directly to external partner. This new format help us attract the right partners and co-develop IP with them, beat every benchmark we could find on performance ads and gave Duolingo control over the thing we hated the most…ads. And of course, made us a ton of money.
But throughout that journey, I saw Duolingo and the world around us change with AI. Since I saw the first GPT-4 demo before the world took notice of OpenAI, it was extremely obvious that this thing would change how we generate content and enable new capabilities to do things like Mads (with text-to-speech, script generation, and programmable animations). It was not obvious that it would change every aspect of what it means to build a product.
In this newsletter, I explore my journey on tinkering with AI to build products. Expect the first issue around this renowned focus to come out at the end of the year.
In the meantime, feel free to explore the pre-AI era archive about how companies got their first 1000 customers
