Imagine if Google Translate was able to deliver 100% accurate translations, no matter how complex the subject was. Having developed an app as easy to use as the Google one and as accurate as a translation services company, Stepes is planning to revolutionize the translation industry.
After having spent the last two years in Beijing enjoying a scholarship to study an MBA (click HERE to read about it), naturally I had to interview some start-ups in that city, and the idea of a chat-based translation app immediately seduced me.
I met Carl Yao, Founder and CEO of Stepes at his office in Beijing. Although the Headquarters of this start-up are located in San Francisco (US), it can be considered both an American and Chinese company. Why? The parent company of Stepes, CSOFT International, has its Headquarters in Beijing.
Well, enough of the introductions, let’s discover everything about Stepes!
Who is behind Stepes?
Having served for more than 15 years as CSOFT Vice President of Sales and Executive Vice President for Global Strategy, Carl Yao definitely knows what he is talking about when it comes to the needs of the world’s translation industry.
After finishing his BA in mathematics and computer science from Whitman College (Washington State, USA) Carl Yao went to Brown Univeristy (Rhode Island, USA) to study a Master’s degree in Computer Science. But he didn’t graduate. Instead, in 2003 he co-founded CSOFT International, one of the top 25 Language Service Providers in the world.
Carl is a serial technology entrepreneur. Before founding Stepes he had already founded YAOS Technologies, developing a multilingual speech engine that used natural human voice to synthesize speech; and also had created TermWiki, a social knowledge network and the world’s largest terminology cloud.
It’s precisely this big entrepreneurial background and expertise in the translation industry which Carl believes is the best asset of Stepes, now with a team of 25 people.
“You know how many startups fail? Just 1 out of 4 make it to the second round, and among them many will die. The probability of success is very small in the start-up world. However with Stepes we are reasonably sure it’s going to succeed.
We are not just a couple of technology guys saying let’s go into the translation field. We have been in the industry for the last decade, so we know the demand and where the world needs are in terms of translation. This is the most important factor for our success.”
A magical shower
Like most good ideas, it wasn’t at the workplace nor in a meeting where Carl had the vision to create Stepes. It was at home, specifically while taking a shower.
“A lot of good ideas come to me in the shower. I read an article saying this is true, you get up, take a shower, and that’s when your brain is more active, so you’re able to come up with great ideas.”
Surprised? Have a look at this interesting chart!
Long before the brilliant idea came to him, he had already realized something was wrong with the translation industry:
“If you look at what’s happening in the industry over the last few years, we haven’t been able to meet the demand, simply because translation is still very expensive. Companies do realize that they need to localize, but then the hassle to get the translation done for their product is too overwhelming. So they’re not doing it, and as a result they’re sacrificing potentially millions of dollars in profit.
We have 6500 languages in the world. That’s huge! We are 7.2 billion people around the world. Yet there are only about 250,000 translators. We definitely see a mismatch between supply and demand of translation!
Right now only a very small amount of the world’s content, especially digital content, is translated. That is not consistent with the way the world wants to grow and develop, which is a globalized world, a globalized economy.”
At this point, they started to work on balancing that mismatch, and they discovered it wasn’t a real mismatch:
“We did a study, and it turns out over half of the world’s population is bilingual. These people not only speak two or more languages, but they also specialize in a specific industry field, like medical, legal, financial services, engineering, etc. They are perfect for translation!”
A way to make translation accessible and appealing to those bilingual subject matter experts had to be found. But how?
“Studies show that in 2017 we’ll have 6.7 billion smartphones in the world. That’s more than laptops or PC’s, because the penetration rate is much, much higher. Everyone has a smartphone, people carry them wherever they go.
Not only that, if you look at the digital content, 70% is created and consumed on the mobile. Every minute there are 240 million whatsapp messages, 80 million tweets, 12000 hotel bookings. Yet if you look at the translation industry, very little, if anything, is translated on the mobile.
There’s a reason for that. The mobile is small, but when you talk about translation you talk about processing a large amount of text. This seems to be a contradiction, and that’s why the other translation companies are not looking in this direction. They say the mobile devices are too small and they can’t support the translation process. And here is where we had to innovate.”
And finally, the magical shower:
“I was thinking about chats. There are so many people chatting nowadays. What are they doing? They’re typing text. Suddenly the idea came to me: why can’t we use chat to do mobile translation? When it comes to translation, even though you may be talking about a large user’s manual with thousands of words, you still have to translate one sentence at a time.”
Another benefit of using mobile phones is that the translator can be notified instantly and he can immediately start working on the translation. In the translation industry, projects usually take a lot of time, as they need to go through a long process. With this system, it just takes a few minutes!”
They didn’t wait a single day and immediately started working on the idea. Have a look at this video to better understand what Stepes app look like:
And where did the name come from? Stepes are the Eurasian grasslands where the world’s major languages are thought to have originated some 5000-6000 years ago. You can learn more in this article published by Nature.
From the idea to the chat-based translation app
I know what you are thinking. A text can’t be translated properly just translating single sentences one after the other. The translator needs to see the whole text and the context to translate accurately. Well, Carl and his team thought about this too, and here is where the second innovation came:
“On a cellphone there’s just a tiny screen. But there are also technological advancements that make a smartphone even more efficient than the desktop. If we just swipe right, we can show all the source content in its entirety, but with the current sentence you’re translating highlighted. And if you swipe left it will show all the translated text. The whole experience is very easy!”
Finally the happy day came and the app was launched! But things didn’t go as smoothly as planned…
“There were always bugs. The app was crashing all the time and people were giving this app 1 star. That really broke my heart, because we had worked so hard.
There are so many different devices. You have Android, iPhone and so many different manufacturers! It’s very difficult to account for all of these devices and all the different language settings.
We’re not like Google or Microsoft yet, we don’t have thousands of developers. We have a reasonably sized, modest developer team. That was one of the occasions when I felt we could have done much more if we were a bigger player.”
Fortunately, they were able to overcome it and solve the bugs with subsequent releases.
But for Carl and his team it was not enough. Since the launch of the app, they have been constantly improving it and adding new features, like Stepes Twitter or Stepes Facebook, allowing translation for user generated Social Media content 24/7 all year round.
Also, they created a very useful tool for travellers: Stepes One-on-One.
“It basically allows you to push a button and start talking:
You could also take a picture of a sign in the street and have it translated. It’s like a live translation session. Even if you go to a business meeting, you could have the service of an interpreter!”
And there is much more:
“We call it Above and Beyond Translation Service. Sometimes you have lots of questions you want to ask to a local translator: information about the city, restaurants, etc. That’s what we want to do, connecting people internationally, creating a truly international social network!
We are also working on another version where you can schedule in person interpretation. Just ask the translator to meet you at your hotel and you can go together to your business meeting.”
Overcoming the criticism
Over the last few years, the sharing economy model has become very popular, and we have seen how some of these companies, like Uber or Airbnb have been extremely successful. Cars, apartments, translations… Naturally, every company offers a different service. However, all of them have something in common: they have been criticized. A lot.
Stepes, and its sharing economy model, is not an exception. Here comes the first blow:
“Everyone is able to translate? It is not the same being bilingual than being a professional translator! What about the quality?”
“Actually we produce better quality. With Stepes, for every translation project you do, you’ll be ranked. If you don’t do a good job, you’ll be filtered out of the system. Moreover, we pre-qualify all the linguists. Your initial projects will also be reviewed by other translators. People can always review your quality so you really have to put in your best effort and do a good job.
We have two ratings actually. One is for performance, meaning timely response, friendly service, stuff that you can immediately rank. But we also have another ranking for linguistic quality. You have seven days to rank this one, so your reviewer or even your customer can check it first. And for those reasons, Stepes actually provides superior quality translation than other Language Service Providers.”
He gave me an example:
“If you take a taxi, usually the car is not very clean and the driver is not very friendly. He is only going to serve you once in a lifetime, so he doesn’t care. But if you get into an Uber driver’s car, it is usually clean and he wants to chat during the drive. The reason is because the Uber driver cares about his reputation. He wants you to give a 5 star rating, so he can get more opportunities to serve others.”
He also shared with me his particular opinion of what being a professional means:
“The word professional is a very abstract word. If you have been translating for 10 years but you don’t improve your skills or your terminology, keeping up with the industry development, you are not going to be a professional anymore. Just because you translated for years doesn’t mean you are able to translate with quality.
We had a project for a very large company in Japan some time ago. We hired an IT magazine editor in Japan to do the translation. When our reviewer read it, he said the translation was so beautiful he didn’t want to touch a single word.
If you ask if this person is a full-time translator, no, he’s not. He translates on a part-time basis, but he’s very good at his job and he knows English perfectly. He did a fabulous job translating, and that makes him a professional.”
It may look that with these words Carl is looking down on the full-time translators with a translation degree. I told that to him:
“Not at all! It is a wonderful opportunity for them to shine! If you have a degree in translating and if you have worked as a full-time translator, chances are you are good. But there are other people who use machine translation to cheat, not doing their job properly. We are going to find out.
Good translators will finally be able to tell the world: we are the best, look at my ranking, I am constantly outperforming the ones that didn’t put a lot of effort on it. If you know you are good, you are going to do very well in this kind of system. You are finally being recognized!”
And here comes the second blow:
“Are doctors, engineers, and other high profile professionals with good incomes really going to spend their spare time translating?”
Again, another Uber example:
“I was in San Francisco, I got into a beautiful Uber car, an Infinity SUV. The guy was so clean, so good, he chatted with me and I asked him what he did. He said he was a doctor. I was very surprised. A doctor! Why did he need to Uber? He told me: well, my wife is out of town and I have some spare time, I just wanted to drive.
Even if we are doctors or lawyers, all of us have some free time. Sometimes it is not necessarily for making money. As a professional, you also have a desire to share your knowledge with your industry.
We have doctors who went to the US to study and now they are here, working in China. They want to be able to help medical device companies translate with the best quality so that the products can be used in the Chinese market. And that’s really what propels a lot of people to do translation, the pride of sharing knowledge.
Sometimes it is not necessarily translation, but also translation review. You have a professional translator that translates, let’s say a user’s manual for a medical device. This doctor uses this device all the time and knows all the terminology. Therefore he can review the translation and make corrections.”
He also clarifies that there are also thousands of professional translators working on Stepes:
“The reason is simple, they can translate anywhere and anytime. And the software is easy to use and free, unlike other translation softwares, called CAT (Computer Aided Translation) tools. Those tools cost $1000 or more, and they have to be constantly upgraded.”
How is Stepes promoted?
Being so involved in social networks, one would expect that they are extremely active when it comes to create content and promote its services in major social networks like Facebook or Twitter. However, they are not. In fact, they have a very small number of followers. I asked him about that:
“Yes, it’s true. We’re not very active there. We focus on the core part of our business and that’s making sure we develop a good product that works when people need it. And that’s where we put all the investment and R&D efforts. But yes, we will be expanding our social media network to make it a lot more popular.”
So, how do they get customers?
“Even if we are not very aggressive on social media, we are targeting enterprise customers left and right. For example, we’ve launched a major campaign in Google Adwords, targeting companies looking for translation services.”
Some examples of these enterprise customers are financial companies with trades going on in the Middle East, companies that manage social media accounts for clients or one of the largest search engine companies in the world needing instantaneous translation from Russian to other languages to train their machine.
Companies like Amazon, Alibaba or Netflix, with a huge amount of content added to their websites every day are also among their target enterprises:
“If you ask Amazon, today they are competing very hard in India with a local player named Flipkart (one of GreyOrange’s customers). India has 23 major languages, each of them with millions of speakers. Amazon adds thousands of products to their site every day, each of them with a description. Right now none of those descriptions are translated.
If you use machine translation, the quality is not good enough. Companies cannot trust machine translating for customer facing content. With Stepes we can allow thousands of Indians to translate it using their phones.”
Who is funding the mobile translation?
Being a start-up created by CSOFT employees, obviously this is the company funding the Stepes project. However, they have higher ambitions.
“Now CSOFT is the sole investor, but we are looking for external investors, so we potentially have a new round of investment soon. The reason we want to do that is because we want to have the scalability. In today’s age, the digital age, things happen very fast. We want to be able to scale. We want to do it big and do it very successfully.”
In case you are wondering how exactly does Stepes generate revenue, here is their pricing model:
What to expect from Stepes in the future?
Today, one year after the app was launched, Stepes is a $1.2 million revenue company with 60,000 users and 100 corporate clients. I asked Carl about the future:
“We hope to have 500,000 users by 2018 and 5 million users by 2020. By then, we hope to generate $15 million or more.
You’ve seen how fast Uber has grown. We say we are more Uber than Uber. Their problem is that not everyone has a car. If you don’t have a car, you can’t Uber. Secondly, even if you have a car, you can’t Uber when you are travelling, in a meeting, or in a restaurant. With Stepes, you can do it anywhere and anytime, because your smartphone and your knowledge is all you need.”
Apart from economic goals, Carl and his team have also the vision that Stepes will help in the mission of preserving minority languages and cultures:
“For us, once we develop the platform, it applies to any language. So we can easily provide the opportunity to translate in those minor languages. Bhutanese is one of the languages even Google doesn’t support, and we can support it because we have linguists that can translate into this language. With Stepes, we hope to be able to provide translation even in dialects.
It is very sad, currently every year there are 20 or 30 languages disappearing. We hope we can help sustain their development and making them more visible for the world, so more people will be interested in learning them or even travelling to those places.”
Any tips for the future entrepreneurs?
Carl gave us two pieces of advice for those who are on the way to become successful entrepreneurs.
The first one is related with motivation and effort:
“Some of the ventures will fail, but some of them will succeed. So it’s all about putting in your efforts. If you are determined to succeed, if you give all you have and try your best, you’re likely to succeed.”
But of course, motivation and effort is not enough:
“Obviously you need to be smart, making sure that you understand the market. Why companies like Apple, Google or Facebook are so successful? If you look at their top management it’s not only technologists. They’re the best salespeople.
If you look at Google as a Startup, there were thousands of Googles before this one became successful, but the others 999 died. Why? Sometimes it’s not because they didn’t have the best technology, but because they didn’t know how to market themselves. You can have the best search engine, but if nobody knows that you are there you are not going very far.
Always think about the market and you’ll be able to generate results fast, and don’t think this is a future consideration, you really need to focus on sales from day one of your business.”
That’s all from Carl Yao’s office in Beijing. It’s very interesting to see how start-ups based on the sharing economy model are getting so popular. It’s a social revolution!
If you are as excited as we are and don’t want to miss what comes next, just drop your e-mail below and we’ll keep you updated monthly!