Can AI fully replace human translators? The answer is unlikely, as AI translations often miss the lexical depth of human-made ones, primarily due to the probability-based decisions of AI models, which lack personal experience. While AI can deliver “accurate” translations, they often feel lifeless and lack the vibrancy that enriches the original texts.
For numerous businesses, accuracy is paramount, making the AI translation sector a promising field. Smartcat, established in 2016, stands out as a provider of automated translation solutions aimed at enterprises, with co-founder and CEO, Ivan Smolnikov, reporting strong demand.
“We serve over 1,000 corporate clients, including 20% of the Fortune 500,” Smolnikov shared with TechCrunch. “Though many of Smartcat’s users are large global corporations, we also cater to various local and international government agencies.”
Before launching Smartcat, Smolnikov was a physicist at the Russian Academy of Sciences, where he delved into fiber optics. After two years in research, he transitioned toward entrepreneurship by founding the language services firm ABBYY LS.
Smartcat incubated at ABBYY, emerging as an independent company in 2016 when Smolnikov exited ABBYY, where he was a board member at that time.
“I created Smartcat to transform the conventional translation agency model, which often relies on labor-intensive, slow processes based on human resources,” Smolnikov explained. “Our AI platform is tailored to cater to various enterprise needs involving multilingual content.”
Primarily based in Boston, Smartcat provides tools, applications, and managed services designed to help businesses translate written and spoken content—such as e-learning modules, websites, files, and software—into approximately 280 languages. Instead of directly training AI translation models, Smartcat utilizes a “matching engine” to identify suitable third-party models for the desired content and target language.
Smartcat refines some translation models, including those trained by clients, where necessary, especially if a company has an extensive collection of frequently-translated phrases they’d like the model to “remember.”
To address the occasional errors introduced by AI, Smartcat also connects clients with a network of translators and copy editors available for review services at a cost. “Clients can opt for various translation methods, be it AI-only, human translation, or a hybrid of both—inclusive of professional editing post-automatic translation,” Smolnikov highlighted.
In recent discussions among translators on Reddit, concerns arose regarding Smartcat’s relations with non-paying clients. Smolnikov has since clarified that those issues have been resolved, allowing translators to set their own rates, aside from Smartcat’s 2% to 8% per payment fee, which hinges on job volume and the geographical location of both the client and translators.
Though numerous companies are venturing into the AI translation space, including those offering human-enhanced services (like EasyTranslate, D-ID, DeepL, Lilt, Lengoo, and others), Smolnikov believes Smartcat is primarily competing against traditional translation firms as well as in-house operations.
“Historically, companies relied on outsourcing tasks to agencies,” he noted. “The insourcing model struggled with scalability when handled manually… Smartcat’s commitment to quality in language AI provides an effective alternative.”
Investor sentiment supports this view.
Recently, Smartcat announced a successful $43 million Series C funding round led by Left Lane Capital, with contributions from Lead Edge Capital, boosting its total investment to $70 million. Smolnikov indicated this funding will aid in expanding its 200-strong workforce, enhancing product development, and supporting ongoing marketing and sales initiatives.
Vinny Pujji, managing partner at Left Lane Capital, remarked, “As an early player in this market, Smartcat boasts a diverse range of customers and is well-positioned to enhance the quality and scope of their offerings, securing long-term competitive advantages.”
These potential “advantages” could lead to substantial rewards if optimistic projections about the AI translation market are accurate. Per Grand View Research, the global market for machine translation solutions, valued at $978.2 million in 2022, may expand at a 13.5% compound annual growth rate from 2023 to 2030.
