https://steveridout.com/2023/03/23/buy-back.html

Steve Ridout
Indie software creator

I Bought Back My Acquihired Startup

March 23, 2023

I wrote about my language learning startup, Readlang, back in 2014,
and then again in 2016, both times attracting attention on Hacker
News, where my story of a struggling one-man startup seemed to
resonate. Well, it's now 7 years later, and a bunch has happened
since, so it's time for an update...

The Aquihire

My Readlang story caught the attention of Duolingo and I went to work
there in 2016. Meeting them for the first time on their company
vacation at a fancy resort in Costa Rica was a culture shock after my
frugal bootstrapper lifestyle. "You'll get used to it" said one of
the other engineers, which turned out to be half right. It was a
wonderful, surreal experience.

We talked about a potential Readlang sale before I joined Duolingo.
But they were more excited for me to work for on other projects. It
sounded like an aquihire which made me uncomfortable. So instead we
agreed that I would work for them for a while and keep Readlang on
the side. I spent the first 9 months working on an ill-fated chatbot
(a few years too early as it turns out). After this, I decided that I
had unfinished business and emailed to say that I'd be leaving to
work on Readlang again. They quickly got back to me and said I could
have carte-blanche to work on a completely new product around
listening. I had ideas in this area already, and it seemed too cool
to turn down. Get paid to hack together a new prototype that I would
be in charge of? Yes please!

My idea was to launch an MVP and then leave to work on Readlang
again. Within a few months we launched the first version of Duolingo
Stories and the reception both internally and externally was really
promising. So much so that I was now pretty excited to continue
growing it. It seemed we were onto something. Given that Stories was
kinda similar to Readlang, it felt weird for me to be running
Readlang on the side, so I brought up the option of a sale again with
the idea that I'd either go all in with Duolingo or leave for
Readlang. I figured that eventually I'd either work on Readlang
inside Duolingo or Stories might even evolve to become a replacement
for Readlang. So we did the deal. We migrated the site to run on
their infrastructure and the customer's payments went to Duolingo's
Stripe account instead of mine. Beyond that, nothing much changed
with Readlang. Stories grew, but it never did turn into a Readlang
replacement. I occasionally thought about pitching Readlang as a
project to focus on, but I could never convince myself that it would
move the needle at Duolingo's scale, and so it was neglected.

The Buy-Back

At the end of 2021 I left Duolingo and with it, Readlang. I left
instructions on how to maintain Readlang but figured that one day
something would break, and there was a good chance they'd want to
shut it down. I said that if it ever got to that point to please get
in touch with me.

I spent most of 2022 half-heartedly working on some other projects (
JigglePix, Flashdown, Notepad Calculator), until in December I got 3
emails from random people complaining about payments being taken by
Readlang that they had no idea about. To get 3 emails to my personal
email was pretty strange. I asked Duolingo and they confirmed that
something was going wrong. It turned out that people were using
Readlang for card testing fraud. After I helped them to fix the
problem and refund everyone they asked if I wanted Readlang back and
how much I'd pay. Of course I said yes!

How Is Readlang Doing Now?

Surprisingly OK! If you had asked me 7 years ago what would happen to
Readlang if I just abandoned it and left it in maintanence mode for
all this time, I would have bet that it would have declined, but
actually, it basically held steady. Here's a monthly revenue graph:

Readlang Revenue

The first few years show good growth. During this time I was
constantly adding new features, blogging about it, and it largely
spread organically with enthusiastic users sharing it in different
online and offline communities. After putting it maintenance mode in
early 2016 it continued growing until the sale to Duolingo. At this
point we dropped PayPal for simplicity resulting in a dip but after
that revenue held surprisingly constant. About 10% of users were
churning each month but the supply of new users never dried up.
People continued to recommend Readlang, it even appeared in one of
Tim Ferriss' "5 Bullet Friday" newsletters in 2018! There was a
noticeable bump in 2020 likely driven by the pandemic lockdowns.

That's the beauty of software - up-front work can continue delivering
value for years to come!

Now that I have it back, I'm wondering how to get it to do this...

Readlang Future Revenue

I have ideas. And of course there are more ideas that time to
implement them. Recently I experimented with adding ChatGPT-powered
Smart Definitions. But I think the most important thing is to improve
the streak mechanic to get people more invested in returning every
day - did I mention I worked at Duolingo? :-) If I manage to improve
growth then I might even think about re-investing the profits and get
someone else to help out. It's not like I'm committed to this
one-man-startup approach forever!

Anyway, I'm looking forward to improving Readlang again. It's fun to
have my baby back!

UPDATE

  * Discuss on Hacker News

  * Twitter
  * GitHub
  * LinkedIn