LinguaSys today announced that Mark Cuban, technology mogul and owner of the NBA’s Dallas Mavericks, “acquired a significant position” in the company, producer of the Carabao machine translation software. He cited its role in helping large enterprises get “across language boundaries and conduct global business.”
Cuban joins some other well-known names in backing language technology companies. For example, actor and tech investor Ashton Kutcher and investor/author Tim Ferriss took stakes in language learning startup DuoLingo. Salesforce founder Marc Benioff led the first round of funding for Cloudwords, a cloud-based translation platform. In 2011 Gene Simmons, a rock icon of KISS fame, signed on as a spokesperson and partner in Ortsbo, machine translation technology used in social media. Back in 2007, U2’s Bono bought into SDI Media through Elevation Partners. Babelverse, with its on-demand interpreting platform, secured funding through 500 Startups, with some familiar names on its list of mentors.
Why are these celebrities investing in such technology? It’s a combination of financial opportunity and global awareness:
- Entrepreneurs such as Benioff see the opportunity to disrupt the language market with a cloud-based solution, much as he did with sales force automation. Kutcher has belied his onscreen persona with his technology savviness. Some coverage of these companies cites Common Sense Advisory’s market estimates of a US$33.5 billion market in language services and technology, a pot of money that interests venture capitalists, private equity groups, and angel investors such as these celebrities (see “The Language Services Market: 2012,” May12).
- Performers such as Bono and Simmons have been spotlighted in the global arena and understand the value of communicating to their audiences. Furthermore, Bono has done extensive international work and relied on interpreters and translators. And while most people remember Simmons for just one tongue, he actually speaks several. Straddling technology and sports, Cuban’s comments underscore the importance of language to commerce (see “ROI Lifts the Long Tail of Languages in 2012,” Jun12).
Finally, it may be a question of these celebrities finding suitable investments for their wealth. Investors are scouting markets the world over for lucrative places to put their money. Andrew Ross Sorkin wrote in the New York Times that the private equity sector is sitting on “more money than they know what to do with.” He states that these firms have US$1 trillion in funds available, and that nearly 20% of that will have to be returned to investors in the next 12 months unless they find companies in which to invest. Actors such as Kutcher, who receives between US$800,000 and 900,000 for each episode of “Two and a Half Men,” must surely be looking for alternatives to today’s rate of 0.331% for a certificate of deposit at his local bank.
Will language technology be the next place where these celebrities make a name for themselves? The last big wave of investment in language software was in the late 1990s and early 2000s when mainstream venture capitalists such as Draper Fisher Jurvetson, North Bridge Venture Partners, and Sigma Partners invested in the likes of translation management system (TMS) developers GlobalSight (part of Welocalize) and Idiom (now part of SDL). While a valuable addition to the sector, TMS did not radically disrupt the market. These celebrities are hoping that this next wave of cloud-based translation, interpreting, and machine translation will reinvent the market. Our research shows that it’s time for a major rethink, with productivity levels stagnating and translation demand far outstripping the capacity of the industry as currently structured to deliver (see “Translation Future Shock,” Apr12).