Tag Archives: PlaySay

Babbel playsay

babbel.com enters US Market through Acquisition of PlaySay

Babbel playsay

Now that is indeed something that does not happen everyday. A German startup acquires an US based startup for parts, in this case language learning startup babbel.com from Berlin the user base of San Francisco based PlaySay which is pretty telling as neither the PlaySay team nor the technology will be integrated into babbel.com products. Only PlaySay’s founder Ryan Meinzer, whom I interviewed in October 2011, is going to join babbel.com in the role of an advisor for the US market.

So let’s break this one down. PlaySay started at TechCrunch Disrupt as a Facebook application for learning Spanish, and eventually pivoted its way to a mobile application to learn Spanish. It even ranked #1 in the education category of the iTunes Store in ten different countries including the US at one point.

But babbel.com does not seem to be interested in the technology or applications but merely in the PlaySay users who now have 45 days to switch over to using babbel.com instead.

babbel.com is part of a group of three language learning startups which all emerged at about the same time and have battled to become the next Rosetta Stone. Besides babbel.com the others are Livemocha out of Seattle and busuu who just relocated their HQ from Madrid to London after raising a Series A round.

While Livemocha and busuu chose and continue to rely on a freemium model as their business strategy, babbel.com decided to switch to a premium model rather early on. Whereas this might have contributed to slowing down the startup’s growth in terms of users compared to Livemocha and busuu, it has certainly helped substantially in terms of revenue generation and breaking even.

Similar to busuu, babbel.com did not take on tons of funding at this point which probably helped the team a lot to figure out the business model and how to sell best. A strong factor in the growth of both busuu and babbel.com have been the respective mobile applications. In fact, babbel.com’s first acquisition was the mobile app developing startup that had built the first babbel.com applications.

The only real problem babbel.com seems to have had is growing its footprint and finding success in new territories. Both Livemocha and busuu succeeded early on to grab market share in key markets like the US and South America.

Taking all this into consideration I suppose that babbel.com got PlaySay for a pretty reasonable price as the press release states

Deal fueled from operative cash flow.

PlaySay have only raised $820k since 2008 which means that even if babbel.com paid a bit more, like in the range of $1.5m to $2m it was still kind of cheap. It also shows that PlaySay did not manage to get enough traction to make it worthwhile for the founder and his team to keep on working on the product or to raise another round of funding. I think the following sentence from the press release why PlaySay sold to babbel.com is pretty telling.

“It’s fun, social and mobile, just like PlaySay…only better!”

I don’t know how many users PlaySay actually has in its database but if we assume that 1 million people have downloaded the application or signed up for the Facebook application at one point, babbel.com may have paid about $2 per user. I am also not sure what the cost per acquisition for a language learner is these days but I guess it’s much higher, maybe in the $10 range.

Of course, babbel.com can’t be sure that all of the PlaySay users will happily switch to the new service and then also pay for it but in the end it might be enough to get the babbel.com Spanish app ranking in the US iTunes Store which will eventually lead to better exposure and new users.

EDUKWEST #78 with Ryan Meinzer of PlaySay

Ryan Meinzer PlaySay

I would like to start off the new week at EDUKWEST by sharing my talk with Ryan Meinzer, the founder of PlaySay with you.

As some of you might know already or even watched live like myself, PlaySay launched their product at TechCrunch Disrupt mid September.

Already before, in February 2011, the company raised some substantial funding of $1.3 million. What PlaySay have come up with is an application for Facebook which enables learners to learn a language based on pictures their friends post on the platform.

Now, if the learners want to comment or form a sentence in the target language, the team have developed a mechanism to deconstruct and reconstructed the original comment on the individual picture and thus help the learner identify key elements of a sentence but also go in more sophisticated tasks and translating different tenses for instance.

The app is currently available in an English – Spanish version only, but I’m certain as soon as the team will have figured out what the customers exactly want, there are more languages to be released soon.

So far, I have only heard or read pretty clear opinions about the product, meaning people either really like it or don’t understand it at all which is a point we also address in the interview.

I have been thinking about that a bit myself and came up with the theory that learning products are sometimes (not to say often) harder to pitch to a more general tech audience. It seems to me that education technology is a micro-cosmos for the good as well as for the bad, and that things follow different rules than in general tech startups, but this is something that belongs over to the Kirsten Winkler blog.

For now, I leave you with the PlaySay interview and would be happy to hear your opinion about it.

vodburner600x40

Audio only:

EDUKWEST #78 with Ryan Meinzer of PlaySay

Additional Links:

Homepage: http://playsay.com
PlaySay on Twitter: @playsay
PlaySay on Facebook: http://facebook.com/playsay
PlaySay on AngelList: http://angel.co/playsay
Ryan on LinkedIn: Ryan Meinzer
Play

After Hours #1 – September 16th 2011

after hours edukwest

News in education 2.0 that EDUKWEST did not cover this week in a separate blog post.

  • Giana Bianchini launches new startup Mightybell
  • Magoosh launches video library for revised GRE
  • PlaySay launches Facebook application for language learning
  • Imagine K12 graduates first class of 10 education startups
  • Mozilla launched Open Badges Program
  • McGraw-Hill seperates into McGraw-Hill Markets and McGraw-Hill Education
  • TopicMarks launches Google Docs integration
  • Pearson acquires Connections Education
  • YongoPal turns into Wander
  • TenMarks raises $3 million
Music by: Web Surfing on the Lounge by Scomber
Picture by: Guidoblock