Smartcat Secures $43M—Is AI Finally Ready to Replace Human Translators?

Smartcat, an AI-powered translation platform, has secured $43 million in a Series C funding round led by Left Lane Capital, bringing its total funding to $70 million. With an impressive client roster that includes over 1,000 corporate customers — 20% of which are Fortune 500 companies — Smartcat is positioning itself as a major player in the rapidly growing AI translation market.

Founded in 2016 by Ivan Smolnikov, Smartcat was born out of Smolnikov’s desire to transform the traditional, often cumbersome, translation agency model. Having previously served as a physicist at the Russian Academy of Sciences and later co-founding ABBYY LS, Smolnikov’s background in both science and entrepreneurship laid the groundwork for what Smartcat would become. “The conventional translation agency model is outdated,” Smolnikov said. “I wanted to create a solution that leverages AI to streamline the process, making it more scalable and efficient for enterprises dealing with multilingual content.”

At its core, Smartcat’s platform helps businesses translate a variety of materials — including e-learning courses, websites, and software — into over 280 languages. Rather than developing its own translation models, Smartcat uses a sophisticated matching engine that identifies the best third-party AI model for the task at hand. The platform also offers a hybrid solution that allows customers to integrate human translators when AI alone falls short, combining automation with professional editing services.

Despite the increasing capabilities of AI, Smolnikov admits that AI-generated translations still lack the nuances and cultural subtleties that human translators bring to the table. “AI can certainly deliver accurate translations, but accuracy doesn’t always capture the essence of a message,” he explained. To mitigate this, Smartcat gives customers the flexibility to choose between fully automated translations, human translations, or a blend of both.

One standout feature of Smartcat’s platform is its ability to fine-tune models based on a customer’s specific needs. For example, companies with a large volume of frequently translated phrases can train the platform to “memorize” these phrases, resulting in faster and more consistent translations. Additionally, Smartcat maintains a global network of translators and editors available for hire, ensuring that clients always have access to expert review when needed.

Although the AI translation market is competitive, with companies like DeepL, Lilt, and Lengoo offering similar services, Smartcat’s unique blend of technology and human expertise sets it apart. Smolnikov views the company’s main competition as traditional translation agencies, which struggle to scale efficiently in today’s fast-paced, globalized world. “Enterprises have historically outsourced translations to agencies or attempted to handle them in-house, but both approaches have significant limitations,” he said. “Our platform offers a practical alternative that combines AI-driven quality with scalability.”

Smartcat’s recent funding will primarily be used to expand its team of 200 employees, accelerate product development, and enhance its marketing and sales initiatives. As the company continues to grow, investors see huge potential in the AI translation sector. Left Lane Capital managing partner Vinny Pujji stated, “Smartcat has established a strong foundation in the market and is well-positioned to capitalize on its competitive advantages in the coming years.”

The global demand for machine translation solutions is expected to rise dramatically. A report by Grand View Research suggests that the market, valued at $978.2 million in 2022, could grow by 13.5% annually through 2030. As AI continues to evolve, the future looks bright for Smartcat and the broader language AI industry.

By seamlessly blending AI with human oversight, Smartcat aims to continue leading the charge in transforming how businesses approach translation. As more companies go global and the need for multilingual content increases, Smartcat is betting that its hybrid approach will provide the winning formula for success in an industry poised for rapid growth.