Duolingo (Mini Dive)
Generational Opportunity or Value Trap?
Hi all,
One of my goals for 2026 is to meaningfully expand my circle of competence by covering many more companies. But if I want to do that without compromising on quality, there’s really only one sensible way to approach it.
I’ll continue publishing my regular deep dives, which are typically 10,000 words or more and aim to cover every aspect of a business in depth. Alongside that, I also want to start sharing work on companies that are still in the early stages of being considered for a full deep dive.
This is a process I’ve long taken, but haven’t documented before. I think doing so might be really helpful for some of you, and hopefully spark some new ideas. After all, the goal of this Substack isn’t just to be a recommendation engine, but an ideation and learning engine, so we can all become better investors together.
I’ll be calling this new series Mini Dives. In each piece, I’ll take a first look at a business and share my personal, nuanced view, covering its competitive landscape, value proposition, and running it through my quality score checklist. I’ll then lay out my current view on the company and what I plan to do next.
These will be shorter than a full deep dive, typically around 3,000 to 5,000 words, and hopefully more digestible for those of you with very busy lives. I hope you find this helpful.
The business we’ll be looking at today is Duolingo. It has been actively discussed in the X community and one that has equal numbers of bulls and bears. The stock is down over 70% from all-time highs in just over 8 months.
The question we’ll attempt to answer today is:
Is this potentially a generational opportunity or a value trap?
Table of Contents
Introduction
Value Proposition
Business Model
Moats & Differentiation
Competitive Landscape
Financials
Bull and Bear Case
GabGrowth Quality Score
Concluding Thoughts (What I am personally doing)
