AI reading coach startup Ello raises $15M to bolster child literacy

Ello aims to eradicate childhood illiteracy by leveraging artificial intelligence and child speech recognition technology. The startup announced today that it secured $15 million in Series A financing to help it do so, and the funding will go toward product development and expanding access to consumers.

“Ello is one of those great companies,” Coddy Johnson, partner at lead investor Goodwater Capital told TechCrunch. “We were drawn to the proprietary and radical leaps that the Ello team has made – and continues to make – in AI technology to enable 1:1 tutoring for kids, which research has long shown to be the most effective learning approach.”

Ello is a subscription-based service aimed at kids from kindergarten through Grade 3 that delivers five books every month for $24.99. Parents download the Ello app, which determines the child’s reading level through a series of questions. It also asks about their interests – including animals, arts & crafts, sports and science. Reading experts then hand-select books for each child. Additional kids can be added to a family account at $12.49 per month per child. While it’s exclusively a tablet app for now, the startup is working on bringing it to smartphones, too.

Using its proprietary technology, Ello listens to the child read out loud and analyzes their speech to correct mispronunciations and missed words. Like a real teacher, the AI reading coach waits until the child has finished reading the page before using phonics-based strategies to teach them critical reading skills. Kids can also tap on the question mark icon if they want extra help.

“Ello is the patient reading companion that every parent wishes they could be– even in those moments of frustration,” co-founder and Chief Experience Officer Dr. Elizabeth Adams told us. Adams is a clinical psychologist who specializes in child development and child behavior.

The app also features gamification mechanics, so that as the child progresses each month, the app collects points, which can be exchanged for toys and prizes.

Ello was founded in 2019 by Adams and CEO Tom Sayer, the former head of impact and adoption programs at Google for Education. The third co-founder is engineer Catalin Voss, who was a PhD candidate in AI at Stanford University. Voss has also co-founded and sold two machine-learning startups, DukaConnect and Sension.

In March 2020, Ello launched through Y Combinator as a service to partner with parents around their child’s development. However, after speaking with hundreds of parents, the founders discovered that the pandemic severely impacted how children were learning how to read.

According to a 2021 study from Stanford University, reading fluency among second- and third-graders in the U.S. was about 30% behind what would be anticipated in a typical year at the time.

Adams even experienced this problem with her own daughter, who found it difficult to learn how to read over Zoom. “We thought it was an important moment where we could build something better,” she said.

Ello is different than other ed-tech companies, Adams explained, because it isn’t assessment-based and doesn’t show progress markers. A similar startup, Amira Learning, launched an AI reading assistant in 2018, however, but that one’s specifically aimed at educators, rather than for at-home use like Ello.

“Ello doesn’t check for comprehension,” she said. “We’re really focused on engagement and the child’s love for reading and growing that confidence…We give children an experience that is based on learning, but also delightful and doesn’t feel like a test.”

The company claims its AI reading coach outperforms OpenAI’s Whisper and Google Cloud’s speech API. In terms of traction, the company says 10,000 families use Ello, and children have read over 100,000 books on the app.

On the long-term roadmap, Ello intends to partner with schools in the near future and develop a product specifically designed for classrooms. The company is running pilot programs with about 30 schools, mostly in San Francisco and New York.

“A teacher’s pain point is different than a parent’s,” Sayer said. “Teachers really want that assessment data. So, we want to make sure we’re building that into the tool.”

While Sayer declined to provide specifics around the product roadmap, he mentioned that the company is currently integrating generative AI into its app. Also in the pipeline, the company plans to launch versions of Ello in other languages. Ello is currently testing a German version.

“One of the great things about self-supervised learning, which is the underlying technology that our speech recognition is built on, is that it’s much easier to counter-bias and we’ve actually put in a lot of effort to rigorously evaluate the performance of our models across different demographics, whether that’s different ethnicities, ages, genders, children with specific learning needs… when we see a disparity, we can actively correct that in a much more easy manner,” Sayer added.

In addition to Goodwater Capital, the round included participation from Reed Hastings, Common Sense Growth, Homebrew and Ravensburger.

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