People

The People

Governance grade: B+. Founder-led, founder-aligned, and founder-controlled — Luis von Ahn and Severin Hacker still run the company they built in 2011 and together hold 76% of the voting power through Class B super-voting stock, so the board can advise but cannot overrule them. Executive pay is refreshingly simple (salary plus RSUs; founders get only salary plus a decade-long performance PSU), the co-founders have massive skin in the game, and insider trading is disciplined under 10b5-1 plans. The real concerns are structural rather than behavioral: a dual-class structure that neutralizes public shareholders, a CFO who was just recruited out of her own audit committee chair seat, and a steady drumbeat of insider selling by CTO Severin Hacker that has run in the tens of millions of dollars over the past nine months.

Governance Grade

B+

Skin-in-the-Game (/10)

Founder Voting Control (%)

Independent Directors

The People Running This Company

The operational spine is narrow: two co-founders who have been partners since Carnegie Mellon, a brand-new CFO pulled off the board, and a product/engineering bench drawn largely from ex-Google leaders. The bench is stable but thin at the C-suite — succession for either founder would be a genuine event.

No Results

The January 2026 CFO change is the single biggest people-risk on this page. Matt Skaruppa — the CFO who took Duolingo public and through five years of growth — resigned the same week the stock was already under pressure from AI-spending concerns, and the stock fell 8% on the news. Gillian Munson was recruited into the role directly from her seat as audit committee chair. She is credible (Vimeo CFO, Morgan Stanley analyst), but moving your own audit chair into the CFO chair blurs the line between oversight and management. Watch Q2–Q3 2026 financial disclosures carefully as her first full-cycle output.

What They Get Paid

Pay is almost entirely equity for working executives and entirely performance-based for the founders. The CEO has taken the same $750,000 cash salary every year since 2021 — the CEO pay ratio of 2.6× the median employee is among the lowest in the S&P peer universe. Where shareholders should focus instead is the mechanical enrichment from the founder PSU grant, which has already paid out roughly $115M to von Ahn alone.

No Results

The headline distortion is in the Pay-Versus-Performance table. The SEC's "Compensation Actually Paid" calculation — which marks equity awards to year-end value — shows von Ahn's 2025 CAP at negative $44M because stock-price-hurdle PSUs granted at IPO lost paper value as the stock fell from its May 2025 peak. In 2023 and 2024 the same calculation produced $140M and $129M of "CAP" for the CEO. The accounting number swings violently with the stock; the cash reality is that von Ahn has earned $767,500 a year in cash every year since the IPO.

Pay is earned. What looks like an occasional megapay spike is pure mark-to-market on the founder PSU — a grant the Board sized specifically so that founders receive less than 1% of each marginal dollar of new stockholder value created above the IPO price.

Are They Aligned?

Yes, economically — but on their own terms. The dual-class structure means the founders control the company. The question is whether they behave like owners, and the answer from the disclosed data is mostly yes.

Ownership and Control

Class B common stock carries 20 votes per share and converts 1:1 into Class A. The co-founders together command 76% of the vote with far less of the economic interest. Every Class B share is held by insiders; public holders vote Class A only. Practical consequence: shareholder proposals, activists, and even large institutions have negligible leverage at the ballot box. Baillie Gifford at 12.1% of the float controls just 2.9% of the vote.

Insider Behavior — Hacker Sells, von Ahn Holds, Shelton Buys

The insider-activity picture is the single most telling signal on this tab.

No Results

Three observations matter:

Hacker is selling mechanically and heavily. Through a 10b5-1 plan running since mid-2025 he has been converting ~10,000 Class B shares into Class A every 1–2 weeks, at prices ranging from $344 down to $172, for more than $20M of aggregate proceeds. The trades are pre-scheduled and compliant, but the cadence is consistent even as the stock collapsed — he is not waiting for better prices. His remaining Class B position is still massive (~3.06M shares), so this reads as diversification, not a statement on fundamentals. It is still the kind of activity that should raise eyebrows during a period when the share price has more than halved.
Von Ahn has not sold a share in the open market. His Form 4 activity is limited to PSU settlements and the accompanying tax-withholding at vesting. He exercised 32,000 legacy options in 2025 (proceeds retained in shares), and his year-end direct position was ~7.3M Class B. For a CEO watching his paper net worth drop by hundreds of millions of dollars in a single quarter, that is a meaningful vote of confidence.
Director Jim Shelton bought 5,000 shares in the open market at $99.76 on March 3, 2026 — a $499K check. Open-market director purchases at Duolingo have been rare and the timing, right after the February selloff, is pointed.

Dilution, Options, and the Founder PSU

No Results

At IPO the Board granted von Ahn 1.2M PSUs and Hacker 600K PSUs, tied to ten stock-price hurdles from $127.50 to $816 over 10 years. Eight of ten tranches have already been hit. That's impressive in one sense — the stock did reach $525 in May 2025 — but it means the founders are now sitting on substantial earned equity, while tranches 9 and 10 (requiring $612 and $816) will almost certainly forfeit unless Duolingo trades near all-time highs again before July 2031. The company's anti-hedging and anti-pledging policies apply to these shares; none are disclosed as pledged.

Outside the founder PSU, the share-count overhang is modest: 859K options outstanding at a weighted $18.38 strike, plus 12.5M shares available under the 2021 Plan and 1.6M under the ESPP. Management additionally has a $400M buyback program authorized in 2026, the first meaningful capital-return step post-IPO.

The proxy discloses no related-party transactions above the $120,000 Item 404(a) threshold other than standard indemnification agreements. There are no undisclosed loans to insiders, no real-estate deals, and no family members in the C-suite. Within this tab, related-party risk is effectively absent — which is not the same as saying there is no conflict risk. The Munson CFO transition is technically a related-person-type event (a director taking an executive role) but is not a Regulation S-K Item 404 transaction.

Skin-in-the-Game Score

— /10 Scale

An 8 out of 10. The co-founders have hundreds of millions of dollars of net worth locked in founder-era stock, von Ahn has not trimmed, and pay is overwhelmingly contingent on long-term stock performance. It isn't a 10 because (a) Hacker's mechanical 10b5-1 diversification cadence is aggressive, and (b) the dual-class voting structure tilts the alignment in favor of the two people at the top, not all shareholders equally.

Board Quality

Duolingo's nine-person board is 7-of-9 independent (the two dependents are the founders) and the board is classified with staggered three-year terms, which dilutes shareholder ability to enact change quickly. Committees are staffed entirely with independent directors and the audit chair is an SEC-designated "financial expert." The bench skews toward consumer-tech operators and VC partners who have seen many cycles.

No Results

Where the board is strong: consumer tech operators and VCs (Bohutinsky, Clemens, Gordon, Lilly, Schlosser) and gaming/engagement design (Ross, Gordon) — both directly relevant to a gamified consumer subscription business. Jim Shelton brings actual education-policy depth that is unusual at this caliber of board and genuinely useful given Duolingo's brand positioning as a mission-driven education company.

Where it is thin: no one on the board has public-company CFO experience who is not also in management now that Munson moved off the board. Sara Clemens is the audit financial expert but her background is operating (COO of Twitch and Pandora), not finance. For a company with $1B+ in bookings that is now shifting into heavier AI capex and a $400M buyback, adding a career CFO or capital-allocation specialist to the board would strengthen the oversight layer.

One governance demerit worth noting in the fine print: eight directors — essentially the entire non-founder board, including Munson — each filed one Form 4 late in 2025 ("inadvertently," per the proxy). One-off late filings are a compliance lapse, not a scandal, but eight simultaneous late filings points to a process failure inside the company's own insider-trading compliance desk. The policy explicitly designates the General Counsel and CFO as the Compliance Officers — both functions in transition at the time.

The Verdict

**Governance Grade: B+.** Duolingo is governed the way a founder-led tech company at this stage typically is — with a lot of concentrated voting power, modest cash pay, a large-but-earned founder equity grant, and a credible but not ironclad oversight board. What separates it from the median is that the founders behave like owners: minimal cash comp, no hedging or pledging, a CEO who has held every share, and a board that has kept executive pay formulas simple and resisted the urge to sweeten the deal with bonus plans and perks. The most valuable signal on the page right now is Jim Shelton writing a $499K personal check for open-market stock at $99.76.

Strongest positives. Founders have 76% of the vote and behave in a way that is broadly shareholder-aligned — von Ahn has not sold a share, pay is mostly contingent, and the founder PSU structure has already extracted genuine value creation rather than showering the founders indiscriminately. Executive pay is simple (salary + RSUs) and the CEO pay ratio is 2.6×. The clawback, anti-hedging, and anti-pledging policies are all in place. Seven of nine directors are independent.

Real concerns. Dual-class voting permanently neutralizes outside holders. CTO Hacker has sold more than $20M of stock over nine months on a 10b5-1 plan that has not paused as the stock halved. The CFO seat is held by a director recruited off the audit committee chair — governance hygiene will be tested when her first earnings cycle begins. A plaintiff's-bar investigation (Faruqi & Faruqi, announced April 21, 2026) is looking into potential securities claims tied to the AI-spend disclosures and Q3/Q4 guidance cuts — routine at this stage but a reminder that disclosure discipline is not optional. And the board lacks a current-generation public-company CFO as an independent voice now that Munson has crossed the aisle.

What would move the grade.

Upgrade trigger (to A−): adding an independent director with public-company CFO or capital-allocation credentials; a meaningful pause or slowdown in Hacker's 10b5-1 selling cadence; execution of the $400M buyback at current prices.
Downgrade trigger (to B− or below): the Faruqi investigation maturing into a certified securities class action with merit; von Ahn beginning to sell open-market stock; any material accounting revision during Munson's first two quarters; or the 2026 say-on-pay vote landing below 80% support.