Babbel dumps freemium for language learning: "it just doesn't work"

[Germany] The new version of Babbel, the language learning startup, is released today, but there’s a sting in the tail for the existing 500,000 users who thought it was a Freemium service: they will now all have to pay to use it. “Babbel is now a paid service. Freemium doesn’t work for us,” confirms managing director Markus Witte. Now only the first part of any given course can be taken for free, as a trial demo. Full access now costs between $6.65 and $11.95 per month.

Babbel won investment from Kizoo AG and VC Fonds Berlin in the summer of 2008 and then in 2009 secured 1 million Euros financing from the Berlin ProFIT program (which draws funds from the European Union’s EDRF). The Babbel team currently consists of thirty-five full-time and freelance employees.

That does of course mean the site will now be ad-free. “The users are our customers, not the ad providers,” says Witte. “We actually tried to launch Babbel 2.0 as a partly ad-sponsored service but it just doesn’t work.”

The company behind Babbel, Lesson Nine, has revamped the learning material and technology of the site to reflect this new model. As well as the Basic and Advanced Vocabulary courses, the new site has new courses and exercises. Much of the material is now licensed from well-known publishers or produced by teachers and language experts. Babbel hopes this increase in quality materials will mean its users stay on board, rather than skipping back to free language sites again.

Users can can continue using their vocab and the community features on Babbel as they did before, but this now becomes the demo version.

It’s interesting that Babbel has made this move to monetise. Assuming they end up with a possible 10 per cent subscribing at the base rate they’ll get $332,500 a month, which is not amazing for the size of team they have. We’ll be watching to see what happens next.

New in Babbel 2.0:

Babbel 2.0 Screencast (Short Version) English from Babbel on Vimeo.