Deep Dive: Sean Emory Discusses Duolingo Stock
This week it was our pleasure to welcome Sean Emory from Avory & Co. back on the show to discuss his research into Duolingo stock. Here are some questions we asked about the company:
What is Duolingo? How did you find it?
Can you explain its business model?
How important is the conversion from free to paying users?
Duolingo is founder-led. What do you think about current management? How does it impact your thesis?
Valuation discussion. It trades at a sales multiple of around 15. What sort of growth are you expecting to get acceptable returns over the next X years?
The company is moving to expand beyond just language learning. What are your thoughts on this strategy?
It has many other products including classrooms, social connections, and in-app purchases/ads. Which of these do you think has the most potential to drive shareholder value over the next few years?
From your view, what is the biggest risk to Duolingo’s business right now?
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Disclosure: The author and podcast guests are not your financial advisors. Ryan Henderson and Brett Schafer are general partners and portfolio managers at Arch Capital. Clients of Arch Capital may hold securities discussed on this show.