Interview with Vasco Pedro, CEO of the rising star of the Portuguese startup ecosystem – Unbabel

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With over 7000 living languages and a multi-billion translation industry, Unbabel might have just found a way to transform the “lost in translation” phrase into business.

Unbabel is creating fundamentally new ways for businesses to interact with consumers across language barriers and borders. Building out its natural language processing (NLP) platform, they combine the work of some 40,000 human translators and editors with artificial intelligence and machine translation mechanisms. By using technology to aid human translators, Unbabel’s platform simplifies the translation process and dramatically lowers costs.

The company, which was founded in 2013 and has raised $8 million to date, is one of the most successful Portuguese startups and was cited as one of Business Insider’s “startups to watch in 2017”. In order to learn more about Unbabel, we talked to Vasco Pedro, the Founder and CEO. Here is the interview:

Unbabel is creating new ways for businesses to interact with consumers across language barriers and borders. How did it all start?

Both Vasco Pedro (CEO) and João Graça (CTO) have PhDs in Natural Language Processing. It was clear since the beginning that neither Machine Translation or Human translation alone would solve the fundamental problem of a multilingual world. Machine Translation doesn’t have the quality required and human translation is not scalable. The benefit of the process is that you have a highly scalable translation with human quality.

From Lisbon to San Francisco and back, what was your journey like to get where you are now?

Different cultures SF vs Lisbon. Gave us a sense of what’s important. Lot’s of hard work, no shortcuts, being a language company and experiencing new cultures really drives the point home. Coming back to Lisbon was a purposeful decision given the availability of talent, great startup conditions and the opportunity to have huge impact in the local startup culture and economy.

What makes Unbabel different form the rest of the language translation startups?

Unbabel is vertically integrated, from the base machine translation to the tools for Unbabelers (our global community of 50,000 bilinguals) to work on, to the integrations that customers use on a daily basis. One great effect of this is that we have incredible data that no one else does. And in machine learning, data is the big differentiator.

You were part of the Y combinator acceleration program. What do you think got you there and what would you recommend to future applicants for the program?

For YCombinator you have 10 minutes, there are no slides, it’s just a conversation, they ask you to show them what you got, a demo if you have it, and it’s all very real. It’s high stakes, you have four people firing questions at you and then when the time’s up they say ‘okay you’re done, that’s it’. And what they do is, if they call you, you’re in – and if you’re out, they’ll send you an email with feedback explaining why you didn’t get in. They called us on our Portuguese number, I answered the phone and it was Garry Tan saying they really liked us and that they liked the market and that they would like to invite us to join YCombinator. I told them ‘yeah, cool, tomorrow we’ll go to Seedcamp but then we’ll come back’ and Garry was like,‘no, you’re in YCombinator, there’s no need to go to Seedcamp’. We eventually agreed, of course, and sent an email to Seedcamp explaining the situation. We then celebrated for like 10 min. and went to bed – we were exhausted from the jet lag.

YCombinator follows the motto: the relentless pursuit of growth. Focus on what’s important – if this metric is important to you forget about everything else, you’ll focus only on this and grow at least 10% every week. It’s really tough to get those 10%, but when you simplify and focus everything on one thing it’s easier. Every decision you make is based on that, because that’s what matters. You put your life on hold for 3 months, for 3 months of your life you’ll only do this. This is a huge advantage. You focus on your product and talk to your customers thinking that you need to grow those 10%.

I would totally recommend it to anyone. The best way to do that is simply to be concise in your application. But every unnecessary word in your application subtracts from the effect of the necessary ones. So before submitting your application, print it out and take a red pen and cross out every word you don’t need. And in what’s left be as specific and as matter-of-fact as you can.

You and the 4 other co-founders seem to be getting along very good. What would you recommend to other startups with multiple founders?

Pay off your emotional debt. If you’re a startup, you tend to have technical debt which is fine and accepted. Likewise sales and marketing debt. But the one thing you really can’t accumulate is emotional debt between the founders. I think that’s the number one killer of startups. You have the little issues that build up on a daily basis, the little tensions, and you don’t address it. And then when something big comes up you kind of are discussing everything else. What we do to prevent that, well, each company has to figure out its own thing. For us it’s a number of company activities that allow us to get out of our workstreams and connect with one another in a different context. The biggest one is surfing. Once a month the whole company gets in a couple of vans or buses and we head to a beautiful spot on the Lisbon coast to hit the waves or relax by the beach. It helps to clear the mind and reminds us that we’re working with people we respect and that we enjoy hanging out with. Those are the moments we can have the best conversations. When you’re standing in the sun in a wonderful place and you’re willing to connect.

What is Unbabel focused on right now?

Since our Series A funding round in October 2016, we’ve been investing heavily not just in bolstering our technology foundations for scale, but in the commercial functions we need to get our products and services in the hands of many, many more companies and people around the world. We’ve hired a Chief Revenue Officer, senior sales reps and a whole team underneath them to support this.

As a rising star of the Portuguese startup ecosystem, how much has the ecosystem helped you get where you are and what is your overall impression of it?

We made a very conscious decision to turn down offers of staying in Silicon Valley after Y Combinator in order to return to our hometown in Lisbon and build something big over here. We wanted to, and so far have achieved a lot, in capitalising on the research and engineering talent coming out of (or returning to) Portugal. Although we don’t have the same opportunities afforded to us, we see the probability of having a bigger impact here and indeed the world as much higher than being just another company in San Francisco.

Now we have people fighting in the trenches – but then you need the heroes. You need astonishing exits so that people realize it’s possible. Having a startup is not like having a local shop or business, it takes a lot of time and it takes a lot from you, emotionally. But, honestly, I don’t think it will take long for us to see those success cases.

Unbabel was the first Portuguese startup to get into YCombinator, then there was Orankl and then after that the number of Portuguese startups trying to get into YCombinator increased so much just because people realised it was possible. Portugal is a lot like California. Even geographically. We don’t need to re-create Silicon Valley in Portugal, but we need to have the same kind of successes.

Something that they told us in the last dinner at YCombinator that annoyed me, but I kind of have to agree with, is that ‘lameness is contagious’. So, in fact, you’re not a Portuguese company or startup – you’re competing at a global level, on a global market. It’s important that your surroundings push you to the limit. Like when we were at YCombinator, everyone kept on pushing us, because everyone is working so hard, and pushing for results, that it is contagious. It’s inspiring, there’s a compound effect. Nowadays it’s all about traction. So for me having a lot of startups pushing each other is key to have a strong startup ecosystem. You can’t just think you’re a Portuguese company, it’s easy to be tempted by it – but you need to go further. Portuguese companies sometimes think small, and startups are kind of changing that. We need to change that mentality. And, in order to change it, we also need to bring international people to scene.

What is next for Unbabel?

We’re working to, and hitting the targets on a very ambitious business plan to grow 300% in 2017 and again in 2018. We’ve just cleared the last hurdle in launching on the Salesforce App Exchange and we’ll be cementing our foothold in customer communications with new product integrations as well as growing much faster in e-commerce listings management.