Preply, the language app known for its live instructors, locks out Series C at $120M and doubles down on A.I.

July 20, 2023: The company told only that a language learning platform connecting people with tutors increased $120 million of fresh capital to ramp up its use of artificial intelligence known as Preply.

The firm, founded in Ukraine but based in the U.S., bagged the funds by issuing fresh equity and debt. Preply’s founders include Ukrainian entrepreneurs Kirill Bigai, Dmytro Voloshyn, and Serge Lukianov.

The equity portion was led by Horizon Capital, a happening capital firm focused on investing in rising entrepreneurs, particularly Ukrainians. Reach Capital, Hoxton Ventures, and others also backed it.

The funding adds to a $50 million Series C funding round Preply raised last year and brings its total funding raised to over $170 million.

Preply is a marketplace platform that connects people with human tutors to help them learn new languages. Each teacher on Preply shares a profile that tutees can view and sets an hourly rate for classes. Preply gets a cut of the hourly rates tutors charge.

Preply also deals with large organizations such as Datadog, GroupM, and Bain, which use it to improve their teams’ foreign language skills. The company is yet to be profitable, although revenues have grown tenfold in the previous three years.

Kirill Bigai, Preply’s co-founder and CEO, said the company would use the funds to “extend our administration in the [online language learning] category through AI-powered human tutors, providing a learning experience that is fast becoming a game changer.”

“Though the team today is very global, as a Ukrainian-founded company with significant R&D in Ukraine, this is a milestone to be celebrated. One that echoes the resilience and determination of the Ukrainian tech sector and all Ukrainians,” he added.

The funding comes at a time of tighter fundraising conditions for startups, struggling to raise money quite as quickly as they did in the 2020 and 2021 boom years of technology triggered by Covid-19 lockdowns and monetary easing.

Thanks to the favor of OpenAI’s ChatGPT and tools like it, A.I. has been a notable exception to that rule. Many startups are raising seismic sums of cash as venture capitalists try to find the companies that will win from the upswell of demand for A.I. tools.

Preply said it already uses machine understanding to match learners and tutors better. Now, it’s incorporating more A.I. into its offering, launching an A.I. assistant to help tutors develop exercises, grammar explanations, and discussion starters.