On July 13, 2021, Poland-based language service provider (LSP) Argos Multilingual announced it had acquired Chillistore Technologies, a linguistic quality assurance (LQA) provider.
The deal was completed in January 2021. However, Argos decided to delay going public with the announcement until July to refine its value proposition and launch a rebranded website first.
Argos Multilingual CEO Véronique Özkaya told Slator the company purchased Chillistore for approximately 70% of its USD 3m annual revenue. This puts the purchase price at around USD 2m.
According to Özkaya, Chillistore generates a healthy EBITDA margin in the upper teens and has 12 full-time employees; which brings Argos’ total headcount to around 180. Combined revenues for the full-year 2021 are expected to be around USD 35m.
Founded in 2010 by Managing Director Anna Woodward Kennedy, Ireland-based Chillistore focuses purely on LQA services, and does not offer translation. Its core customer base includes technology companies, which frequently add a layer of LQA atop the software development and localization process. Life sciences companies — one of Argos’ key customer segments — also commonly use third-party reviews for quality control.
Slator 2020 Language Industry M&A and Funding Report
For Özkaya, this latest acquisition presented an opportunity to deepen Argos’ existing LQA service offering. “We quickly saw that Chilli’s sole focus on quality services was a great way to scale this business and do it better,” she said.
Chillistore will operate as a separate and independent subsidiary of Argos Multilingual. Woodward Kennedy will stay on as Managing Director and the Chillistore brand will be retained, with Argos providing support in terms of infrastructure and technology.
The acquisition is the third for Argos, which bought SH3, a Kansas-based language service provider in 2014, and life sciences translation specialist ENLASO in 2017.
Investing in New Services
The Chillistore deal is an integral part of Argos’ redefined growth strategy, which Özkaya rolled out following her appointment as CEO in 2020. The plan involves focusing on enterprise clients as well as investing in new services.
“We felt this depth of services allows us to build stronger relationships with our customers as we help solve more problems for them,” Özkaya said.
The potential synergy between the two companies was immediately obvious to Özkaya, who told Slator “the chemistry felt right straightaway. There is a very strong customer-centricity and solutions mindset with everyone at Chilli.”
Chillistore’s solutions range from solving specific quality issues to implementing full, scalable quality frameworks. “For one customer, we’ve set up a quality program where we review all content for new products and languages.” Özkaya said. “We work hand in hand with the customer’s LSP by providing feedback that helps improve the translations over time. Once the market feedback is within expectations, we tend to reduce the review levels.”
The goal is to provide clients with transparency and control over their localized content. “We give customers peace of mind when it comes to releasing content that will not only be correct but also resonate with their markets,” she added.
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