Editor’s note: This article was first published in March 2014. The figures are as of then: von Ahn had sold two projects to Google over eight years for $10-100 million, and Duolingo users numbered in the tens of millions. Duolingo’s first business model relied on learners working on web content; the company later moved to other revenue sources.
Everyone has a talent, and Luis von Ahn‘s is building business systems that offer you a product or service for free and profit from it. Chances are you have made money for him without knowing it.
One of his first business ideas came when he was 12. The idea was a gym that would be free for its users. Von Ahn worked out that people exercising on machines can generate energy, so he could offer a gym with no membership fees, connect all the machines to the power grid and sell the electricity produced to a power company. And it was a very good idea: wouldn’t more people join a gym if membership were free? But von Ahn learned the first marketing lesson of his life, which is that if something is offered to us for free, we don’t want it. People actually want to pay, so the young entrepreneur had to give up on the idea.
But von Ahn, who is now a computer science professor at Carnegie Mellon University, has not stopped trying to build innovative business models based on giving the product away and making money from it. In fact, over the last eight years he has sold two projects to Google for an amount that, according to Business Insider, lies somewhere between $10 million and $100 million (quite a wide range).
Thanks to the rise of the internet, von Ahn thought about how to harness the power of millions of human minds. Of course, beyond his own profit, there is the benefit he generates for everyone else. This entrepreneur can truly say he has worked to make the world a better place.
See also: A profitable business opportunity with a future and current demand
Duolingo
Duolingo is a platform for learning languages for free. Von Ahn noticed that in many Latin American countries people want to learn languages, but with such high levels of poverty many cannot afford to pay for classes at a language school. With Duolingo, its users (already numbering in the tens of millions) help translate the internet.
Duolingo’s system lets users learn languages easily, level by level, and every sentence they work on is later used to translate the web. In other words, von Ahn uses technology to make users all over the world, in a fun way and with small “doses” of their time, collectively contribute to a translation that would probably take hundreds of years to do any other way. In return, users learn a language for free.
(Read: Free online language courses)
reCAPTCHA
Luis von Ahn is the inventor of CAPTCHAs. CAPTCHAs are those words that appear on forms and comment boxes to keep out spam from automated bots. Von Ahn took advantage of the millions of times millions of people around the world fill in CAPTCHAs and used them to help digitise old books.
You may have noticed that CAPTCHAs are usually made up of two words. Well, one of those words is a scan of a word from an old book that software cannot decipher, so a human has to do it.
reCAPTCHA was bought by Google.
In 2004 he also came up with an application in the form of a game in which players matched images with each other. The game helped label photos for search engines and detect inappropriate content. Google was quick to buy the invention and relaunch it as Google Image Labeler, which helped it avoid problems with images and, at the same time, sort them by subject.
That is what this young entrepreneur’s businesses are all about: giving away something free, fun and productive, while your use of it solves an existing problem. And why not sell it to a giant like Google for a few million along the way?
You can watch Luis von Ahn’s talk at TED en Español in the video below.
Watch: Luis von Ahn at TED en Español
Further reading
- The secret to getting rich is having a stupid business idea
- 3 people with the coolest jobs (and businesses) in the world
- The learning techniques used by people who learn fast
Featured image: Daniel Case, CC BY-SA 3.0, via Wikimedia Commons.
