Duolingo achieves IPO readiness with streamlined procurement controls

Nancy Golembiewski, Controller at Duolingo, recently joined Zip for a webinar, and shared how the tool helped her team prepare for their July 2021 IPO.

Challenge

IPOs are an incredibly stressful process for companies, and a number of things have to be set in place and filed in order to meet compliance requirements. 

As Duolingo prepared for its July 2021 IPO, the finance team faced significant gaps in their procurement infrastructure. The company had grown rapidly but hadn’t scaled their procurement processes to sustain the growth. Without a formal spend management system, the team had no visibility into upcoming costs or outstanding commitments. As a publicly-traded company, this became even more critical information for accurate forecasting and financial reporting.

"At the end of every quarter, if we needed to know what invoices were out there that we hadn't been billed for yet, we had to manually reach out and find a way to gather that information," shares Nancy Golembiewski, Controller at Duolingo. "We had no purchase orders, so we couldn't tell if there was a purchase order out there that wasn't used or was partially used or potentially coming."

Accounts Payable consisted of one person having to track down Slack messages and emails to verify that contracts had proper legal and leadership approvals before processing invoices. The company had established an authorized signer policy with corresponding dollar thresholds, but each transaction required manual proof of approval. This created audit risk and made SOX compliance even more difficult to maintain.

Solution

Duolingo implemented Zip to establish a centralized procurement system with automated approval workflows aligned with their authorization policies. The platform automatically routes requests to the right approvers based on dollar thresholds and contract requirements, eliminating the manual chase for approvals and creating a complete audit trail. “Zip just automatically flows to who has to approve it," says Nancy. "The PO is created, the invoice comes, and if it matches, you're done."

With Zip, the finance team gained real-time visibility into all purchase orders, outstanding commitments, and spending forecasts. Requesters can now track the status of their purchases in real time, and approvers have the information they need to make timely decisions. The accounts payable team can process invoices and match them to POs without going back and forth with business owners.

Results

With Zip in place, Duolingo successfully completed their IPO and continues to maintain the financial controls required of a public company. The procurement system delivered end-to-end visibility into spend commitments, enabling accurate accruals and forecasting for quarterly SEC filings. The finance team now knows exactly what spending is coming and can confidently report on outstanding obligations.

Automated approval workflows ensure the proper segregation of duties without adding administrative burden, and the complete audit trail reduces risk and manual work. "You can't overlook the importance of having the controls in check," Nancy notes. "Even if you have a lean environment, you have to have the safeguards in place to prevent misuse and maintain accountability." 

With Zip, the lean finance team can now focus on higher-value work while continuing to support and help Duolingo scale as they continue to grow post-IPO.