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Scaling Unbabel — my personal learnings

Unbabel just announced a $60m round last week. Congratulations Vasco Pedro, João Graça, Hugo Macedo, and all Unbabel team and friends!

Unbabel is the fastest-growing company I have been fortunate to watch. I met for the first time Unbabel in mid-2016, just before raising a $5M series A. Below are my insights looking to Unbabel evolution

  1. Apparently (supported by data) product-market fit in a specific segment

When I saw for the first time Unbabel deck I was puzzled with the idea that they had found traction in customer service. I have worked in the customer support industry and it was not obvious to me at first. But after some further thoughts, it made sense given that in customer service (i) time to answer the ticket, (ii) cost to answer and (ii) the quality of the answer (and the translation) are quite important— and no other translation solution could beat this value proposition. It actually would allow customer support teams to increase languages supported, enabled cost-effective ways to enter in new markets or reduced costs/improved quality of support by centralizing customer support on best desks, independently of the language/country of origin.

Unbabel pitch deck made it very clear by showing the data:

  • High NPS (3.75x higher the next best niche)
  • Decent Margins (2x next best niche)

2. Understanding the size of the market/niche and the pockets of value

After finding product-market fit in a niche, the next question was “is this niche big enough for us to pursuit?” At that time, customer service only represented 1/5 of the total volume o Unbabel.

For that, the team spent quite some time understanding the customer service market and the need for translation services/multilingual support. Leveraging the few data points available and some advisors’ input, clearly 2 potential large segments standout as potential large markets. So it made sense to double down and create a business around those segments.

3. Focus + excellent execution

After finding product-market fit and aligning strategy, Unbabel becomes laser-focused on customer service. From pricing (e.g., per ticket vs. per wording), to marketing, to product, etc. everything was tailored to customer service.

And looking from outside, they have been doing it brilliantly! The team was already amazing — I loved the interactions — but further raised the bar and hire some of the best minds here.

It has been a pleasure to follow the Unbabel growth curve. I hope your best years are ahead!

Thanks Vasco Pedro and João Graça for allowing me to engage and learn from you! This learning has been very impactful in my personal journey. Hugo Macedo thanks for making it possible.

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