Hubbub, the popular subscription-based online language learning service, today announced some updates on its operations in the United States – the Berlin-based company’s largest market by overall revenue and the one experiencing also the fastest growing. In the first half of 2022, the company sold over 1 million subscriptions in the United States and is now expanding its B2B business in the United States as well.
A few years ago, Babbel set its sights squarely on the US, bringing in Julie Hansen, former COO and president of Business Insider, as US CRO and CEO. It’s perhaps unsurprising that the company is also looking to grow the B2B side of its business. So far, the company expects around 6% of its total revenue to come from its B2B business by the end of the year, but this is a growing share of its overall activity.
“B2B is a slower build,” Hansen told me. “It’s a people-driven business. But it grows really well. We are actually ahead of our target so far this year.
Moving forward, Babbel has hired a group of salespeople in the United States and is starting to see some traction with American companies, including a number of MLB teams, for example. Hansen noted that the US market is also quite different from the European market in this regard.
“[The U.S. market] is different from Europe, where we largely serve a white-collar audience – multinational companies, sometimes its front-line workers, a hotel office, etc. Very often it is intra-company communication, as well as between companies. In the United States we have some of that, but we have a lot of what you might consider more of a blue-collar workforce,” Hansen noted.
Overall, the B2B side of the business now works with over 1,000 companies and has a revenue turnover rate of over 100%.
She also noted how Babbel has branched out from its origins as a mobile app in recent years. The company has launched more than 20 podcasts in recent years, for example, but from a business perspective, its live classes also continue to grow.
Hansen noted that Babbel’s live courses saw 300% year-over-year user growth and 400% year-over-year revenue growth, which she attributed to the fact that the company changed its business model for these live classes, moving from pre-class pricing to an all-in-one (or learn?) subscription model. In Europe, the company’s live business saw more than $1 million in revenue in May and June, the company tells me, and it’s also launched in the United States.
Like other educational apps, Babbel got a tailwind at the start of the pandemic, as people decided they might as well learn a new language while stuck at home. Interestingly, Babbel never experienced a real downturn during the latter stages of the pandemic, in part because now travel has once again become a major motivation for its customers.