Duolingo valued at $6.5 billion as shares pop nearly 40% in debut

Language learning app Duolingo Inc notched a valuation of $6.5 billion after its shares surged nearly 40% in the company’s Nasdaq debut on Wednesday, becoming the latest education technology startup to impress Wall Street.

Duolingo’s stock opened at $141.4 per share, blowing past the initial public offering price (IPO) of $102 per share, which was above the top end of its target range.

The e-learning company’s flotation comes at a time of increased investor interest around the edtech space, after pandemic restrictions sent students and teachers from the classroom to the web.

Online education platform Coursera Inc has gained 15% from its IPO price after a March debut, while MasterClass has more than tripled its valuation in a year after a funding in May, according to a media report.

Duolingo raised nearly $521 million by selling about 5.1 million shares. Almost 1.4 million of those shares were sold by stockholders and those proceeds will not go to the company.

Earlier this week, the company raised its price target range to between $95 and $100 per share, from an earlier estimate of between $85 and $95 per share.

The Duolingo app has more than 500 million downloads and is the top-grossing app in the education category on both Google Play and the Apple App Store.

Duolingo offers courses in 40 languages to about 40 million monthly active users. There are more people learning certain languages, such as Irish and Hawaiian, on the company’s platform than there are native speakers of those languages worldwide, it has said.

The company was founded in 2011 by Luis von Ahn and Severin Hacker, who met at Carnegie Mellon University when von Ahn was a computer science professor and Hacker, his doctoral student.

Goldman Sachs & Co and Allen & Company are the lead underwriters for the IPO.