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How Two Stern MBA Students Turned an Idea into a Multi-Million Business
New York Business Journal
Liz Elting and Phil Shawe were classmates at the New York University Stern School of Business in 1991 when Elting had an epiphany: Let’s start a business to help companies that increasingly need to hire translators for business purposes.
Elting had the right background since she majored in languages at Trinity College and worked at a translation company for three years prior to starting her MBA.
In 1992, the duo launched TransPerfect Translations International Inc. out of a dorm room.
After advancing several thousand dollars on their credit cards, they started making cold calls to sell their services. After clients paid, they hired more freelance translators to grow their business. They plowed profits back into the business.
Twenty-one years later and headquartered on Park Avenue, TransPerfect has grown to 2,500 full-time employees with 80 offices, including locations in Dubai, Copenhagen, Beijing and Moscow. Most staffers concentrate in project management, business development, finance, IT and HR. The company relies on a network of more than 5,000 linguists and can offer services in 170 languages.
“In our 20 plus years, we’ve never had a language request we couldn’t accommodate,” Elting asserts.
The start-up begun in the dorm room generated $342 million in revenue in 2012, and that’s a lot of yen, pesos or dollars. Many clients sign one- to three-year contracts, but TransPerfect also operates on a project basis.
The company faces considerable competition since there are more than 28,000 translation companies, though many are regional and only a few produce $100 million or more in revenue.
Elting attributes some of TransPefect’s success to uncanny timing. “The year we started, 1992, was when globalization took off,” she said.
Of course, she and Shawe were industrious, forward-thinking and relentless in trying to build their business.
At the outset, they employed maxims that have been crucial to the company’s success. Though these sayings sound like typical marketing slogans, they resonate for the founders, and employees are imbued with the credos.
“We’re focused on wowing our clients, employees and vendors,” says Elting, a Manhattan resident. “Wowing” means anticipating clients’ needs, focusing on their concerns and exceeding their demands. Staff is trained to “make customers feel delighted, not just satisfied,” she asserts.
Many of TransPerfect’s clients are Fortune 100 companies, law firms, financial services companies, and advertising agencies. Assignments vary and can include document translation, website localization, oral interpreting and cultural consulting.
The Internet makes much of its work viable. For example, a couple of years ago, a Japanese client asked TransPerfect to translate 60 million words from Japanese into English in two months. The request required translating 10,000 pages of text a day.
“Without the Internet, we’d have no chance of contacting all the needed linguists around the world, coordinating our project manager and transferring the files to clients,” Elting says.
Nonetheless, Elting says that “having a strong local presence is critical to building and maintaining relationships.” Clients want to be able to call a strategy meeting and have TransPerfect staff attend in person to offer advice.
To ensure the quality of its translators, it established the TransPerfect Linguist Certification Program, nicknamed TLC. Increasingly, translators are becoming more specialized. In fact, TLC tests a specialist’s knowledge of pharmaceuticals, telecommunications or banking.
Since TransPerfect’s founding, Elting and Shawe have served as co-CEOs and collaborators. Elting handles much of the marketing, PR and human resources while Shawe focuses on technology.
“We cover for each other,” she says, just as spouses would in a marriage (they’re not married).
Despite its proliferating success, Elting says it must constantly adapt or innovate or face stultifying results. “We must be on the cutting edge and predict what clients want before they know it,” she says.
As its revenue rises and approach $350 million, the owners have spurned the notion of going public.
“We’re not considering it. Phil and I like the control, the autonomy. We’re rather focus on employees and clients and not worry about short-term quarterly profits and sacrificing for the long-term,” Elting said.