Chit Chat Stocks - Duolingo (DUOL) with Sean Emory

Episode Date: January 27, 2022

Duolingo is a language learning app. The company offers over 40 different languages to learn from. Duolingo specializes in the gamification of language learning. Listen as Brett and Ryan ask Sean Emory questions about the company, its business model, and valuation. Enjoy the show! This episode is sponsored by Stream by Mosaic, the highest quality expert network library. Sign-up here:  https://streamrg.co/CCM Subscribe to 7investing with the code "CCM" and get $10 off: https://7investing.com/subscribe/aff/4/ Want updates on future shows and projects? Follow us on Twitter: https://twitter.com/chitchatmoney Interested in more of Sean's work? Follow him on Twitter here: https://twitter.com/_SeanDavid?s=20 Contact us: [e-mail]  Timestamps Duolingo | (3:53) Valuation | (17:52) Disclosure: Chit Chat Money hosts and guests are not financial advisors, and nothing they say on this show is formal advice or a recommendation. Brett Schafer and Ryan Henderson are general partners and portfolio managers at Arch Capital. Arch Capital and its partners may hold securities discussed on this show. Learn more about your ad choices. Visit megaphone.fm/adchoices Learn more about your ad choices. Visit megaphone.fm/adchoices

Welcome to Chit Chat Money. Today is Thursday. This is our deep dive episode. And today we have on Sean Emery. He is the CIO over at Avery & Co. We've had him on the show a few times. First of all, if you're an investor, individual investor, go ahead and check out the Avery & Co website because it's really informative and it's just chock full of good information. And I think his holdings are on there. Am I getting that right? Potentially. I don't know if they do a full disclosure, but they do talk about stuff they own or stuff they're researching all the time. So pretty good information. Okay. And highlights, I guess I should say, we're talking about Duolingo today, which is a really interesting company. It's one we've

looked at before on the Not So Deep Dive. Any highlights from the interview? Yeah. So this is a great pair with the Not So Deep Dive we did. He goes through more of the in-depth stuff of why he thinks that they'll grow and have good margins over the long term and why it's a good investment right now. Let's see. We talked about the importance of the English test. I think that was a good highlight for me. Cleared up all the importance of that, exploring, moving into non-language or non-language learning stuff. That was important as well. And then going through the unit economics of why they've been so efficient with their marketing dollars as a percentage of revenue over the last, or since they've been

founded. Yeah, those are all good points. And I think it's funny how something that seems so, I guess, gimmicky can actually make a good business. It kind of feels, a good comp kind of feels like Candy Crush, where it can really generate cash at scale. And so, just, I guess, listening to him go through it, it's an interesting business to study. Before we move to the interview, though, we want to talk about our sponsor for this week's episode, Stream by Mosaic. They are an expert interview transcript library. They cover industries from tech, media, consumer goods, industrials, real estate, pretty much anything you want. I bet Duolingo's on there. I'm sure they are. There's a high chance. And they add about 300 expert interviews per week. 70% of

their experts are found exclusively on stream. You get a ton of color, a ton of commentary that you might not get on investor presentations or typical investor relations website. Sometimes you come across interviews and you're like, wow, I'm glad. You almost feel like you have an edge after reading it. It's perfect for people that like scuttlebutt investing. Yes, exactly. They have 8,500 plus call transcripts available. I'm sure that's higher now because I got a note sheet from a while back. So they're adding 300 a week. I'm sure it's just going to keep getting larger and larger. If you're interested in signing up for Stream by Mosaic, go to streamrg.com. That's S-T-R-E-A-M-R-G.com. And you can sign up for a 14-day free trial using promo code CCM. Without further ado, let's get to the interview. Welcome to Chit Chat Money. On this show, hosts Ryan Henderson and Brett Schaefer interview industry experts and riff on the world of investing. As a quick reminder, Chit Chat Money is a CCM Media Group podcast. Ryan and Brett are also general partners at Arch Capital,

and Arch Capital may have positions in the securities discussed in this podcast. Anything discussed on Chit Chat Money by Ryan or Brett or any other podcast guests is not formal advice or a recommendation. Now, please enjoy this episode. Okay, today we are welcomed by Sean Emery. He is the founder and chief investment officer of Avery & Co. based in Miami. We have had you on the show, I want to say, four times now. I think it's the fourth time. Yeah, Capri Holdings. Square away back in the day when we were less of a professional show, and now we're talking Duolingo. That's right. And so I guess, I guess, uh, for anyone that

doesn't know, can you kind of describe what Duolingo is and then how did you come across it in the first place? Yeah. Um, they're a language learning app, right? So it's a way to learn a language, um, predominantly through a mobile app. So it's the number one, uh, education app in the app store. It's kind of been that way for quite a long time now. Um, the way we found it is, obviously, it went public here in July of 2021. I've known the company for quite some time, and they've been one of the unicorns that have sat in the private markets for quite some time. I think they were born in 2011. So, 10 years old and now a public company. We have different categories that we focus on. Structural growth is kind of an area, and ed tech

and the revolution happening in education, predominantly before COVID, but also accelerated by COVID, as technology would continue to move into this space and make things a little bit easier for the average person. One, democratize costs and reduce the cost to potentially zero. We see that in things like YouTube and Coursera and some others where it's either cheap or zero, and Duolingo is one of the products and platforms that we think will continue to succeed. Okay. And I guess our next question was explaining the business model. But I think before that, maybe a good overview, because some people might not understand listening to this kind of what Duolingo's special sauce is. What makes them better and the number one app out there compared to all the, I'm sure there's tons of other options. Yeah, there's a lot of other options. The thing is, is actually there definitely is a big gap

between them and the others, the Babel and Rosetta Stone. And then there's a series of other language learning apps. And depending on which region you're in, there's different focuses. Now, their special sauce is their ability to kind of connect and gamify. I think what they've done really, really well is build out a platform built on content.

So they have characters. Duo is their main character, but also below that, they tell stories inside the app that attracts a lot of people in terms of building that connection directly with the characters inside the product. When you go to the other products, they don't really have that. They're much more what we think about education as it relates to somewhat boring and something that doesn't motivate you to continue. That's been their special sauce, both mentally and then also how they delivered that in the product, which is creating an app which motivates you to come back.

So that gamification, as we experience in games, is what they've really, really built. They have tons of data that they've built from the early days that allows them to provide a personalized experience for everyone inside the app. So if you speak, if you're trying to learn English or whatever language you're trying to learn and they know something in your learning experience isn't working well based on what you got wrong, but they also have many other users that have come before you, they essentially correlate that data to essentially build up your acumen in that space. So their special sauce is really around their data advantage, in addition to the gamification of the app, which brings people

back on a habitual basis. So 9 million users using it daily, 40 million using it monthly. and we're at that early stage of kind of building these, these models around it. Okay. And, oh, Ryan, do you have a follow-up on that? I was going to say, are you an MAU? Are you a monthly active user for Duolingo? So I'm a daily active user with my son. Um, and Duolingo is the, is the, is the, uh, language learning, uh, side of the equation. Um, I do get prompted to continue to learn languages, uh, for myself and for my son, Duolingo ABCs, which is a product that they launched in 2020 is also a, we're not talking about it, but it's an app that's done incredibly

well since its launch. And it's more around learning words and, and, and literacy for younger children kind of in that two to five age realm. So daily, our streak, I think is 108 days. um uh my son is three and a half and absolutely loves duo uh he calls it the bird game um and we play it every single day before he goes to bed for literally three minutes um and he sees it and it's a totally independent app yeah it's totally independent it totally focuses on a different realm and it's much more uh for the for the younger age bracket so okay okay and i guess and then a lot of people are probably thinking okay this app's free it's free to download how does Duolingo actually make money? Can you explain their different business models that they have?

Yeah. So a freemium model, obviously, the first thing you think about is ads. So they started monetizing the app with ads. That is around 15% of total revenue today. Now, I'll go to another side of how they make money, which is the English test, which is a test that Duolingo built out essentially like five years ago to allow users to take an online-only English test. And it's a proficiency test. So a lot of people that move to the US or live internationally tend to have to take an English test to prove that they know English, to go to university, to work in certain jobs. And what that means is there's two other main companies that focus on this, think of like the SAT for all of us, similar type of DNAs within those

companies. Again, going back to Boring and what we think of as it relates to those organizations. But Duolingo's test, their English proficiency test, they've been able to build that, again, And pre-COVID, in 2019, they had roughly 13,000 tests that they gave out. In 2021, they had roughly 300,000 tests taken here. And then after that, they expect to grow it by 50%, so 500,000 tests. So you saw this massive surge in adoption. So now there's three large players that are actively in this English proficiency test category.

Duolingo is the only one that's online only. It's also the only one that is $49, so $50. So it's the cheapest one, fastest one to take. And it's also being recognized globally with over 4,000 schools now accepting it, all the top 25 in the US. It's 10% of revenues today. You would have thought potentially that this would have been something that was a flash in the pan just because of everyone shifting to online only for a moment in time. However, what we've seen is that sustain here. The importance of that as it relates to the subscription category is that as you take the proficiency test, and a lot of people come to these apps to learn a language and then take a test to highlight and prove that they learn, they know English. The reality is the Duolingo

learning app is potentially becoming a gateway to the test. And Luis, the CEO, recently spoke about it, which is all bigger picture. What he wants is the English test to have a score and it already has a score, but that score to be recognized where I am Duolingo 160 or I'm Duolingo 120. And that signifies how good you are at a specific language, but also having a flywheel back into the app where people are in the app. And while they're learning a language, they're basically able to have previews of their scores. And ultimately, what that is, if you think about how we learn other things and take tests for other categories, it's having kind of that preview. This is the score. I would have got a score. I would have

got a score. I would have got. And I think it's that flywheel. So again, they're monetizing the test, but I think it also leads into greater engagement usage and actually more meaningful of why you're on these apps in general. So that's kind of the three different components of how they monetize today. Ads, subscriptions, which is a monthly thing. And I didn't really explain it in total, but it's a subscription membership

that users pay for to remove ads. And then as they've matured over the last several years, it's to add on other things, whether it's a mistake and you get your mistakes back and essentially other different product offerings that are inside the app as well. So as they add more value, they're seeing increase in subscriber growth. They went from kind of 1% three years ago to essentially 5% today.

And every year they've incrementally added roughly 1% subscribers. How important is that conversion from free to paid users? And then I guess, is there any way that you think they could maybe strengthen the offering of the subscription? Yeah, well, so I think the test is a pretty important part of the flywheel of potentially getting your preview and your score inside of that. I think that's an interesting product that they could offer. Now, the other part of that question is how important is just this description in general? I think it's important to the business. I think it's also important to building out the product suite. Again, how they've highlighted it, and I think

it makes a lot of sense, is you think of other products that are out there dating Spotify, for example, and how many of those free users turn to paid, it's somewhere in that kind of 10, 12, 15, 20, I mean, somewhere like 30% subscribers in terms of users to subscribers. I do think that makes some sense in terms of how people are using this and the type of users that's using this. Again, not dating versus language, but more so it's something that you pick up and you're trying to, you have an objective in mind. Um, and today it's five and a half percent. So if they can obviously double their subscribers, but also double the value that people are getting inside the app. And there's other ways of

monetizing as well, which is in-app purchases, but subscription is, is really big for any other business, right? Like when, when you have a subscription model, uh, you have visibility in the business, uh, which allows you to one, take on more risk in terms of product evolution and, and marketing spend. Cause you can now market against that a little bit better because you can measure lifetime value of these users in better ways and see how some of the cohorts are coming back. So I think all of it's important and subscription is clearly an important part of the business going forward. What do you think of the ad business independently? Is that growing on its own or is it kind of just a funnel for hopefully subscribers?

Yeah, no, it's growing. Obviously ads are growing because users are growing. So there's similar like ad loads, in a sense, in terms of placement in the app. Today, they basically have been very light on ads. And the purpose of that is they understand the freemium model, the product itself and the experience there is more important than the ad dollar that they'll collect today. Today, I believe they only offer or highlight one ad at the end of each lesson. And what that means is there's obviously opportunities to add at the beginning and the end. So you could easily, quickly double your ad inventory immediately. It's just they want to have that continued organic growth of the business, which is really that referral type model where, hey, use Duolingo.

I don't even remember where I first started using it per se. And I think a function of that is simply that it's gamified and people use it, people talk about it, it's a good experience, And they're trying to maintain that experience and then add enough value where they can get you to subscribe. So that's like the ads are an important way of monetizing and also a small push towards the subscription without it being overwhelming. Okay. And we're going to talk financials for Duolingo on the second app. The last more qualitative question, what are your thoughts on management? They're founder-led. Is the CEO slash founder really important to the thesis here? Yeah, I think he does bring like one expertise and he's obviously the founder and it's not a

young company per se. It is young, but it's not three, four years old like a snowflake or five years old like a snowflake, but it is 10 years old and it's young enough. But he's executed wonderfully. He's also been pretty sensitive to, again, the product itself and not overwhelming users. And I think that's been smart. They spent very little money historically on marketing dollars to build to where they are so that they have this natural uh mission that is resonating with users uh that is allowing them to just continue to push forward and 40 million monthly active users is a lot of users for a language learning app um and he was the founder uh and sold it to google recaptcha um so he has a lot of success behind him uh both uh kind of pre um

Duolingo. And then during Duolingo, I think, again, he brings some of the mission to the company of what they're trying to achieve, which is reduce the price of education in general, specifically focused on language today. They're branching out in other categories. We talked about ABCs, but math and some other more repetitive categories make a lot of sense for them. So I think he's important. CFO has extensive background. We're going to have him here shortly, uh, uh, on a conversation, but the, uh, the, um, uh, the management team's good. They've executed wonderfully. And I think it shows up in, in essentially everything they're doing from users to, uh, uh, monetization to, um, to pretty much everything. So.

Okay. Well, that's all the questions we have for the first half. Uh, we're going to hit, like Brett mentioned, valuation and financials on the second half, but before that, let's take a quick break. Pluralsight, a tech workforce development company, provides the solutions high-performing engineering teams need to tackle today's biggest challenges. Whether it's building the skills individuals and teams need to tackle mission-critical projects, driving cloud transformation, or helping software teams to ship reliable, scalable, and secure code. Harness the collective power of hindsight, foresight, and insight with Pluralsight at pluralsight.com slash vision. This episode is brought to you by KPMG. As a business leader, how can you innovate,

build trust, and move forward in a digital era? KPMG can help by bringing together the right talent and technologies, generating insights that spark opportunities. To explore they're thinking, visit reed.kpmg.us slash opportunities. All right, welcome back in. We want to talk valuation. So I think it trades at around a sales multiple of 15 times. Could be lower right now because I know growth stocks have been hit, but somewhere on there, right? Yeah. So yeah, I guess teens, let's say. So what sort of growth are you expecting in order to get a good return on this? And then also, what kind of margins do you think Duolingo could have at scale? Yeah. So the multiple, I think one thing to remember is that

there's revenue and there's bookings. And bookings are roughly like $200 million or $300 million this year that they will have. And then bookings will eventually turn to revenue because those are mostly the subscribers and things like that. So there's like a 30% kind of gap between those two. So it's pretty important. So 12 is nine and kind of like a nine bookings multiple. But again, that doesn't show up in things like Bloomberg or Yahoo Finance or any other outlet. It's not a gap number. So that's part of the issue in terms of that.

So it trades a little bit cheaper than many of those metrics. The kind of stable state or normalized margins. Again, we like to hover around like a 20% as we think about it, right? So you have like the match group, which again, if we're using comparables here, you have 35% margins on that overall business. Similar type of dynamics that happen in that marketplace is essentially get someone to a finish point and then in theory, they get off. I mean, the whole goal is to get someone to learn a language and then move to, and then essentially move off unless they want to learn two, three languages, which are some of their users. Similar to dating apps where you bring them on. And once they're on, they, in theory, potentially find somebody, their significant other, and maybe it's two or three languages and they move off.

So, when we think about it, that's how we're thinking about the margin structure. Obviously, that's probably closer to the high end, just given that they have so many apps and so many users across all those apps. And somewhere in between that, we think, is kind of where they can level off. They're also in a really strong position from a competitive standpoint. There are different types of product offerings that we think allow them to extend at a pretty marginal cost. Again, adding new products where a lot of the technology and engineering is in place. Again, we've asked about when you launch math, what kind of requirements does that take from that team? From what we've heard, it's been very little.

so they're able to launch new products with the same type of infrastructure behind the scenes. And I think that's pretty important because they have fairly low marketing expense. G&A and most of their line items are pretty able to scale up or revenue-able and bookings able to scale up on top of those over time

as they continue to monetize here. The growth of this business, I think, is pretty straightforward. Obviously, more users is obviously number one. That's a pretty easy one. But there's ad inventory, as we talked about, that they can move into. Today, it's one. And I could easily envision more and more supply coming onto the platform as they try to balance how many users can you get versus how much ad inventory you should add. Again, I think of Instagrams and some of the others of how they've been able to slowly, over two decades now, add more and more

ad inventory into these platforms in fairly creative ways. So I think that's on the table. If math, so they plan to launch a math product this year. I think that is an interesting product. Again, we haven't seen the product. We don't know anything about it. We don't know the success of it. So there's not really much to bake in there. But if you take ABCs, which is now a top 25 app in terms of the age, the app store will break it down into age demographics. So five and under, It's a top 25 app there within a year and a half. So that's pretty strong. They don't monetize that.

But again, I think it shows to their ability to create products to then attach people to and then eventually monetize that. I think the English test is pretty interesting. Obviously, they've been able to hold some of their market that they've taken over the last several years. And again, they're a product company. They also hired the head of content from PBS. So I don't know where they eventually go with this.

but I do think they do have a lot of characters and content that people engage with. They're one of the number one, they've known recently of being one of the number one TikTok accounts. I think they, again, they literally just have their character there and dancing and all of a sudden they're kind of, if you go check them out, like one of the most followed accounts out there, it's pretty incredible. So there's that viral, they've spent zero marketing dollars on that.

My whole point around this is I believe there's tons of opportunities for them to continue to build demand for a robust platform of products. And Luis, the CEO, has repeatedly talked about multiple years, right? Like this isn't going to be math and it blows up. And he wants the math product to build organically and then market against it. He thinks that's essentially the best way. And in some ways, it makes sense is don't market against the product, let the product build, see if it's viral, see if it's a good product, and then market against it once you have confirmation. And that's kind of how they've done it the whole time. So, you have all these demand drivers I'm trying to talk about, which

ultimately, when you start to talk about how many there are and whether it's the content with the head of PBS, what does that turn into? Obviously, there's a lot of kids' content out there that we've… Look, I have a three-and-a-half-year-old. There's plenty of kids' content out there, and Duolingo could easily be one of those in a major way. The English test and some of the other drivers, I think, continue to compound this company at a pretty rapid rate in terms of top line. So you get more users, more revenue per user, more value in many of these products. They also have a family plan and not to end there. They just launched a family plan for the first time. And we think that'll create a little bit more stickiness into the product as two people

will be on a family plan. You'd have to cancel it for both people to get off. I think that is a pretty sticky product. He's pretty happy about the potential there. And there's some other things to talk about, but I'll stop there. It sounds a little bit like they're trying to build a match group for education, in a sense, just then diverse products, but really around one central theme. What are their primary costs? Is it just app store fees? Is that the biggest one for them? That's the biggest cost of goods sold. So that's predominantly their biggest cost. Now, Remember, the App Store fees are under pressure. So this year, actually, new users, they'll get any new subscribers,

they'll actually get an uplift in gross margin. So we've talked about that a little bit. So there'll be a key benefit share to any App Store changes. Are we at the end of the App Store compression story? I don't think so. When does that and what's the barrier of who gets the benefits and who doesn't? That's still to be determined. but there's probably going to be more pressure on app store fees, probably for our lifetime.

And again, not whether that's right or wrong, but I do think we continue to head that direction. So, that's the biggest cost of goods sold, which is huge, right? It's like 20%, 30% in some cases. Now, below that, you have sales and marketing, G&A. G&A is a little bloated because of the IPO. And that'll come down. They've been really light there. Marketing, It's like they really just started thinking about marketing. I mean, I think the number was going up to a couple of years ago, they spent like $14 million in total lifetime marketing dollars for the inception of the company to get to 20 at the time, like 25 million users.

So you can get a sense of simply how efficient they historically have been. And it goes back to the brand and their ability to create organic demand for their product. That truly is what's separating them from the others because the other ones are marketing. I mean, I was listening to the radio the other day and Babbel is marketing against me. Maybe it's because we're just always on Duolingo.com. But I do think there's something to speak about their efficiency as it relates to organically driving demand for their products. And again, around that, when they build the ecosystem of content and some others and other products, you could see a platform here that emerges across multiple genres of curriculums in a sense. So that's really most of the expense that goes into this business.

Yeah. Ryan, I think we already answered my next question. You want to go on to the next one? Sure. Yeah. I mean, it's got a few different products, like you mentioned, and it seems like they're trying to expand into different offerings. So what do you think of the different products that they're moving to has the most potential to drive shareholder value in the future? yeah so it again it's i think the english test and proficiency test and really becoming like the having that to be the validating kind of um uh uh part of their business where all the schools are accepting this test which they are in a sense now uh but like the early stages of that i think that just validates the proficiency that's being built on this platform for people learning language. They've had plenty of studies that have shown kind of the five units is the same as kind of a certain amount of semesters in school. So, there's validation there in terms of what you

learn and how quick you learn it. It's like a half the rate of what you would learn in university, half the time. So, the English test is important as a validator of the education they're providing. um i then think again it's moving into these other categories whether it's math um content and again i just think building out the platform outside of just uh language itself even though that's like the core of what this is and that has to be the strongest point going forward i do think uh there's so much beyond that that they can continue to uh move into and use their brand power as a leveraging tool uh but also use that as a way to drive people to a subscription model where potentially you're getting all of these things throughout all

stages, whether it's a kid that's three and a half years old that starts off with ABCs, all of a sudden he needs to learn a language as he's in school or use it as kind of like a supplemental type tool. In addition, using math with it as well, because everyone, again, it's a repetitive type of curriculum. And I think as they expand out, they'll have more to offer in a subscription and that'll ultimately drive. So it's all these things that I think are important that could potentially unlock significant value.

How do they, it seems like they've reached 40 million MAUs pretty quickly. So how are they attracting the users? Is it just like that organic, like the social media presence that you talked about? Is there like any sort of like referral system where, or is it just purely like that organic social media? Yeah, it's predominantly organic. Again, here's a company that spends 40% of their revenue on R&D, right? And half of like 2x the amount of sales and marketing dollars. It's crazy.

I mean, it's like there is that natural adoption towards the brand. And go on Twitter and just type in Duolingo and then scroll down and you'll just see the amount of like satisfaction that's taking place in there. They're also trying to unlock a couple of things. So like they just added recently within the last year, contact sync. It sounds so easy, but adding your contacts into your experience, because historically, they didn't have a way to communicate with your friends in this thing and show that you are doing something. So, at the end of this year, they basically gave you the summary of how – every year, they give you the summary of how you did that prior year, and people are all posting it on social media. And you have people that are highly into learning languages and highlighting how successful they are, and they run different tournaments as well.

So, again, we're in a world of billions, of which some, the demand is forced upon them, meaning they have to learn a certain language to succeed in life and potentially try to succeed further. and then there's some that are learning language for the purpose of learning in and they just they're uh really interested in it there's also things like they got a huge boost during netflix's squid games um for people to learn korean um we all know netflix is going to continue to do these uh kind of uh uh other language uh shows and continue to have that and expand that out the question is, will we see the same effect? But they did see a lift in downloads then. They saw their record lift here at the end of the year because, again, we can see the data where downloads and revenue are at record levels. So, they're seeing some sustainability there. So, demand is

fairly organic that comes to Duolingo. I think that's the best way to summarize where these users come from. Okay. We should wrap up because he's got to go. From your view, what's the biggest risk to Duolingo's business? Last question to wrap up here. Yeah. I mean, it's always the same almost for every company. It's like execution around all these things you just talked about. And just ensuring that you execute. And look, math is going to be an important part of the story. So, we go on all the websites of all the schools for like the english test because the english test again is an important part of the story but it's whether uh these schools continue in five years from now to want the duolingo test to be it or

is there like political will of some of these legacy players um that kind of push out uh duolingo is a nice to have during the hybrid or the the virtual environment type deal um but maybe uh it isn't something as sustainable some of the schools that i've that i see it there's they're they're not fully locked in to, they're accepting it for now. And then they have like a date that it expires in terms of accepting it. And then they keep extending them out. So there's some of those schools. And the question is, how many of those begin to accept this forever and don't have kind of this expiration period? Again, majority aren't that way, but there are some that are out there. And again, the importance of that is because it takes a huge network of schools to accept it because when you're going to apply for certain schools, just like anything else, you need all the schools that you want to apply to to accept it.

Otherwise, why are you going to take the Duolingo test and then have to go take the other one if you really wanted to apply to this school, but they don't accept it, but they accept the other. So that's an important part of the story to track and follow because that could, again, it's 10% of revenue today. But I think it says a lot more about what the kind of demand could eventually be for understanding that this is a platform that is not only fun and gimmicky and motivates you day to day, but it's actually something that teaches you language at a high proficiency. you. So. Okay. Well, that's all the questions we have for any listeners that want to follow you or keep track. What's the best place to do that? Yeah. Twitter is always good. Email is really good. Um, if you want to do that, but tracking is a Twitter. So it's at underscore Sean, David, S E A N David. Um, I almost forgot that for a second, but yeah, so Sean, David on Twitter. All right. And you guys are doing an investor day soon. I know it's right around that. Is that

what you're calling it yeah so idea dan so uh uh january 19th uh we are are doing that um it'll be recorded so uh whether uh whenever this is heard but uh we're basically gonna have some of these companies including the cfo of duolingo uh he's gonna or q a get our investors and anyone out there to kind of get an understanding of uh who these companies are what are they about and and move on. We'll probably do this twice a year. Um, and then maybe next year do it, uh, one larger event. Obviously it's, this one's going to be two hours. Um, so I don't know if four hours is in the cards. Will that be recorded? Cause I'm realizing this will come out after the investor day. Yeah, it'd be recorded. That's why I said that. I figured, um, so it'll

be four or five companies. So yeah. Anyone that's interested. Yeah. You'll be able to check it out on. I'm assuming it's on Avery & Co.'s website. It'll be everywhere. I mean, YouTube and LinkedIn and Twitter. We're going to go live and then have it re-recorded and then sent out through email or something like that. So, it's good stuff. All right. All right. That's going to do it. We want to remind our listeners that Brett and I are not financial advisors. Anything we say or discuss here on Chit Chat Money is not formal advice or recommendation. We are, however, general partners at Arch Capital, so clients may have positions in the securities discussed in this podcast. Thank you all for listening. We'll see you next time.