Now that is indeed something that does not happen everyday. 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 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 .
While Livemocha and busuu chose and continue to rely on a freemium model as their business strategy, babbel.com decided to 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.
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.