The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
20VC: Duolingo Co-Founder on Why $3M is Harder than $100M to Raise | Why You Should Always Take Tier 1 VCs Even at Worse Terms | Why Europe Can't Win Unless the US Screws Up | How AI Impacts the Future of Work and Education with Severin Hacker
May 19, 2025
Severin Hacker, Co-founder and CTO of Duolingo, dives into the complexities of raising funds, explaining why obtaining $3M can be tougher than $100M. He discusses Duolingo's AI pivot and its transformative effects on personalized education and software engineering jobs. Severin shares candid opinions on Europe's startup challenges and why the continent lags behind the U.S. in tech innovation. He also contemplates the role of AI in jobs and education, questioning the future of traditional pathways like computer science degrees.
01:31:43
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Quick takeaways
- Raising capital from tier one VCs provides crucial signaling that can significantly impact a startup's success, despite potentially worse terms.
- Duolingo's shift to an AI-first model revolutionized course creation, enabling them to produce 148 courses in just a year compared to twelve years for the first hundred.
Deep dives
The Importance of Securing Top-Tier VC Funding
Raising capital from tier one venture capitalists is crucial, even if it comes with slightly unfavorable terms, due to the strong signaling effect that their investment provides. It's often more challenging to raise smaller amounts, like three million dollars, compared to larger sums, such as one hundred million dollars. This principle is underscored by the example of Duolingo, which struggled to acquire funding in Europe despite having a unique product, indicating that access to significant investment can be pivotal for startups navigating the competitive funding landscape.
