Tearing Down Language Barriers: The Story of Unbabel
This week we meet Vasco Calais Pedro, co-founder of Unbabel. Being the CEO of a current YCombinator company that is growing rapidly every week, Vasco has a lot of insights and experiences to share. He talks about how they built their very diverse team, how they got into YCombinator, doing things that do not scale, and his vision of Unbabel becoming "the de facto human quality translation engine of the web" within the next few years. This is the story of an ambitious team that made its way from Lisbon to Silicon Valley and are going full steam ahead.
Quick facts: founded August 2013, 5 founders & 3 part time employees, 2959 freelancers (and counting), $420 000 funding to date.
Tell the story of how Unbabel got started. What is your next milestones and vision for the future?
Unbabel started during a surf trip in the south of Portugal. Both João Graça, our CTO, and me have PhD’s in Natural Language Processing and would often discuss language related problems. During that trip, the team started thinking about how Machine Translation, despite showing huge promise and demonstrating big improvements over the last decade, was still not able to reliably solve basic communication issues. We kept seeing translation mistakes that were fairly simple for humans to solve. We thought that if we were able to make it really easy for people to correct the mistakes, it could be pretty powerful in helping people overcome language issues.
We prototyped a few solutions and tested them with landing pages. Encouraged by the results we started building the product that is Unbabel today: a platform that combines automatic and human translation. Since then, we've been growing our community of translators and finding customers. That is our next milestone, demonstrating that we can deliver affordable translation, with quality, fast. We are well on our way towards that goal. We have more than 30 paying customers, more than 2600 translators and are growing 15% per week.
We imagine a world where I can write this text in Portuguese, my native language, and you can put it in your newsletter in your native language (that I don’t know what it is) and each reader receives the text in their inbox in their own native language, and none of us even knows what was the original language or the target languages, it would not matter. Language will not be an issue, we will be communicating, sharing a story, an idea, that’s what really matters. Today, without the english language that unites us, this would not possible. And how many people are we keeping out of the conversation because of this? The fact is that the majority of the world doesn't speak English.
The reality is that, unless you work with language, translation is, for the most part, an obstacle between you and your customer, or your target market. For most people in the word translation is a nuisance that prevents them from doing what they really want to do, which is to reach out and touch someone who speaks a different language. Our vision is to make translation...disappear. That is, to make translation so seamless that you won't even realize that it is happening. You will be able to simply communicate.
What do you have that all the other language translation startups do not?
We combine the humans and technology in a unique way. On the one hand, Unbabel combines Machine translation with distributed Crowd post-editing. That is, each text is translated first with machine translation, then split into small parts and then each small part is edited by a several people in sequence until it is perfect.
We're building a proprietary MT engine and creating a new interface for translators to be more efficient. We aim to actually enable our translators to work from anywhere as long as they have a smartphone.
We believe in being where communication happens and let translation be an enabler of communication. With that purpose we released a translation API, we already deliver translation by email (where the average knowledge worker spends 20% of their time), and plan to build integration apps with platforms like Zendesk, Gmail and Salesforce.
You are an extremely diverse team, with members ranging from 20 to 38 years old and with different backgrounds. How did you form this team?
João and I met while we were researchers at Instituto Superior Técnico. We both felt strongly that the best way to change Portugal and the world would be creating awesome products and so when the opportunity came I convinced him decline a prestigious research grant he had been awarded and to join a startup with me. I hope he forgives me one day, when we can look back at what we accomplished. We went on to build two startups together, before Unbabel. In the last startup, we hired Bruno for design and UX and Hugo as front-end developer. Quickly we became more than colleagues. Overcoming the daily trenches of startup life quickly creates strong bonds.
At that time I already knew Sofia from Beta-i, a non-profit that promotes entrepreneurship in Portugal. I had been trying to get her to work with me for a while on other projects and once she decided to join, I felt we had a pretty unique team.
The most important part of a startup are the people you build it with. It is the number one reason for for failure of startup, but it is also the most important ingredient in the mix. We are both complimentary in skills, strong in technology, design and business and more importantly, resilient and resourceful. Having done a number of startups before, it is amazing what you can do when you get the right group of people together. I am really proud of my team and what we accomplished so far.
Talk about how you got accepted into Y Combinator, and what it’s like to be a part of it. In what way has it helped you?
First of all we applied! It took us a while to finish the application and we were really proud of it when we were done. Just being called in for the interview was huge validation considering less than 1% get called! We worked really hard for 2 weeks getting the demo ready and preparing for the questions. The interview was super intense, for 10 minutes there were questions about market size, technology, what we had done so far, who we were, it was super fast! We were selected because the market is huge and we have a great team.
There are two sides to actually participating in the Y Combinator, namely the program and our own experience as a team living in California. The Y Combinator philosophy is all about growth, the relentless pursuit of growth. All we need to be doing is talking to customers and building product. The Y Combinator partners have been helpful in key decisions and in keeping the focus and pressure up. Also, there is the alumni network which is very supportive, the brand - it’s a door opener to say we’re a “Y Combinator company”, and of course the other companies in our batch - we’re always surrounded by motivated, hard working, intelligent people, and that’s great! Finally, every Tuesday we have a group dinner with great speakers, who speak very candidly about how they built their companies and what they learned along the way. We’ve had the opportunity to listen to and speak with the founders of Eventbrite, Airbnb, Evernote, Homejoy, VMWare. It’s very inspiring and there are always key lessons to take home.
On the other hand, moving to California and living together has been a unique opportunity. I believe that one of the reasons that Y Combinator encourages teams to find a small space to work from and to live together during those 3 months is that when you spend 24 hours a day with someone it will quickly become apparent if there any major team issues. Living together has allowed us to to devote 100% of our time and energy to building Unbabel. We spend a lot of time “in our cave”, building product, discussing how to increase growth, how to tweak our business model, talking to users, to customers. We got a lot done! And I think we made an important piece of Unbabel history. We will always look back at these times together, cooking for each other, sharing a small house, working in the living room and maybe say “those were the days”!
How was it to move from wonderful charming Lisbon to the tech and startup Mekka of SFBA and Mountain View? What is the biggest difference?
I had lived in Silicon Valley twice before so I knew what to expect in terms of lifestyle. A lot of my friends and colleagues are here and I am used to the mentality and entrepreneurial spirit. Also, both João and I have strong ties to the US, we both did our PhDs here. So being here has been an opportunity to get back in touch with our network. That being said, the intensity of Y Combinator and the fact that we are living together in one small apartment amplifies pretty much everything. Being here as part of the YC opens doors, and augments our community and accelerates the pace of progress tremendously. Silicon Valley that are amazing for any startup: the business environment is very open to startups, to setting up meetings fast and getting stuff done, and in our case, our largest early customers are here, the large internet titans who have millions of words to translate. Maybe the key difference between Lisbon and Mountain View (suburbian stereotypes aside) is that sometimes it feels like everyone here is working on a startup, a product, a service. The conversations in the streets, at restaurants and bars are about value proposition, deploying new products, and that helps to keep us motivated. The hard part was leaving family, friends and routines behind, Skype helps!
How did you secure your current funding? Are there any special challenges when raising funding in Portugal/Europe vs Silicon Valley/the US?
Our fundraising was perhaps unusual when compared to my previous experiences. We started by trying to raise a small pre-seed round but investor interest was so high in Portugal that we found ourselves negotiating a potential series A before we had even launched the product. We had the good fortune of meeting with Alexandre Barbosa from Faber Ventures, who has been a truly exceptional partner. Faber led the round and, after getting into Y Combinator, we were in the very interesting position of not having enough space in the round for all investors. We were focused on investors that were the right fit for us and would bring a lot of value to Unbabel beyond and so we closed investment from Faber Ventures and Shilling Capital Partners in Portugal. We felt that at our stage they were the best partners we could have and every day we confirm that initial feeling. It is a great joy to me to see investors of this calibre growing in Portugal, it bodes well for our future. Raising in the US was a very different process so far, mostly because YCombinator gives you very standard terms for investment, which means a simpler process and basically no negotiation time.
In general, the US feels more founder friendly than Europe, specifically when it comes to valuations and legal terms. It’s possible to raise a lot more money on convertible notes here. It’s also much more expensive to do business here so there are always two sides to each coin.
What is your biggest learning (so far) as a founder?
It is all about the team. Having the right people around you basically makes all the difference. I spend a lot of time making sure the team is happy and aligned. I’ve learned that team focus and happiness should be my major concern as a CEO. Nowadays it is accepted that it is ok to have technical debt in the beginning. It probably ok to have marketing debt in the beginning as startup. The one thing you can’t afford as a startup is emotional debt. If you let issues accumulate very quickly it becomes impossible to move forward. As long as we stick together, nothing will stop us.
Tell a story about a challenge you faced and overcame.
One of the goals during Y Combinator is to grow 10% a week at least. It is very hard to do that 12 weeks in a row. If you are able you get an exponential curve of growth. One week were falling behind on our weekly revenue goal and we needed to become creative pretty fast. The whole team brainstormed about what could we do to create revenue for Unbabel and we decided to try a hack.
Every member of the team enrolled on Odesk as independent translators and we applied to translation jobs by submitting Unbabel as a translator. We ended up getting a customer that wanted translations from Arabic to English. The problem was that we couldn’t handle Arabic characters yet in the platform so we created a google doc, asked our translators to translate on google docs and managed to meet our target and then some. It was a very intense couple of days and we did it in some pretty non-scalable ways, but it worked. Most startups try to do things that scale from the start. In fact that is the definition of a Startup, a scalable business. The little secret, which they drill into you at Y Combinator, is that you should be doing non-scalable things in the beginning. Early growth is a manual thing and that is what enables you to scale the right things at the right time.
Where do you see Unbabel in 5 years?
We will be the de facto human quality translation engine of the web. Millions of people will be using us, many of them unknowingly because our translation will be so embedded in each process it will have become invisible. We’ll be a large company, with a strong research component, where people are proud to work.
What books (or other sources, methodologies, philosophies) have been influential in how you approach running Unbabel?
Pitch Anything by Oren Klaff, was a good recent one. We follow the Lean Startup methods, in particular, we’re big on pretotyping (Alberto Savoia).
What are you currently looking for (partners, employees, funding, other things etc)?
We are a young company that is growing fast, so we are pretty much looking for all of them. The thing we focus on every day is growing customers and translators.
Our customers can be startups or large online companies (mostly), who need to translate from customer service emails, to their whole website content.
Our translators can be anyone who speaks two languages and wants to be a part of making the world a better place while earning some money making quick translations. We have more than 2.600 people in our community, but need many more in different language pairs, such as German and Chinese that have high demand.
You can reach out to the Unbabel team on Twitter @theunbabel.
