The language learning community Babbel receives 1 Million Euro Funding from the European Regional Development Fund and the State of Berlin. There will also be an investment of 200.000 Euro from the Babbel Team in their company. That’s what I call dedication to your project! Chapeau.
The Babbel Team wants to use this funding to invest in the infrastructure, new courses and materials like grammar lessons and vocabulary packages.
In their blog post Babbel makes a valid point that even I did not notice yet. Other than their main competitors Livemocha and Busuu Babbel shows no advertising on their platform.
The idea is to keep up the quality of the content with an eye to Babbel.com’s 500,000+ users, and not to advertisers.
They also admit that up to now the costs are still higher than the revenue.
Not exceptionally in the world of young internet companies, up until now our earnings have been significantly less than our expenses.
That is basically what I was expecting from all start ups in the online education sector but Babbel is the first one to write it on their company blog.
And I think this is important for many people to know, especially online teachers. And it should re-adjust their view on the whole online education market. If a popular platform like Babbel with more than 500.000 users is not profitable yet you don’t have to ask yourself why other platforms are not working.
As they seem to be closest to the customers needs and expectations right now due to their number of members it will be really interesting to see the strategies Babbel and the other language learning communities will develop to monetize in the coming months.
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