Financial machine translation company Lingua Custodia has received funding totalling EUR 1.15m (USD 1.28m), which it will use to open its first branch outside France. Slator contacted Olivier Debeugny, CEO of Lingua Custodia, to find out more about the funding round and how the company intends to deploy the funds.

Debeugny told Slator EUR 300,000 came from Investessor, a French angel investor network, with the rest being contributed by individuals connected with the financial industry. New investors provided some EUR 0.5m, while existing shareholders contributed a further EUR 300,000.

This latest funding round brings total funds raised to EUR 2.4m (USD 2.67m). Lingua Custodia did not disclose its valuation.

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Lingua Custodia was founded by former asset management professionals in 2011, and the company’s first engine was released almost five years ago in 2014. The company was launched with the aim of streamlining the translation process for finance professionals and now offers engines in nine languages, with Chinese and Japanese having recently been added.

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Debeugny explained that their machine translation engines have been developed specifically for “investment finance and corporate finance.” The company’s clients are “predominantly financial institutions on the buy-side or on the sell-side — therefore, asset managers but also brokers, custodians, private banks…,” Debeugny said. Lingua Custodia is now branching out into the insurance sector “in partnership with insurance groups,” he added.

Asked what framework Lingua Custodia uses, Debeugny said they are “experimenting and monitoring various frameworks and are currently focusing on Sokeye,” Amazon’s open-source, sequence-to-sequence toolkit for NMT. “We are also dedicating a large part of our resources to our specialized data collection, classification, and cleaning processes,” he said.

MIFID & Mainstream MT

Since Lingua Custodia’s inception, “machine translation has become mainstream and there is a strong interest for domain-specialized machine translation services,” according to Debeugny. Demand is widespread, with Lingua Custodia observing “traction in all geographies and from clients of all sizes,” he said.

“Machine translation has become mainstream and there is a strong interest for domain-specialized machine translation services” — Olivier Debeugny, CEO, Lingua Custodia

One factor driving demand for machine translation in the financial services space is the MIFID II directive, which was introduced in early 2018, Debeugny said: “The increasing cost of regulation for financial institutions is indeed a driver to reduce structural costs and this includes translation. This factor is definitely fuelling our growth.”

MIFID II obliges fund managers to split out research costs from commission costs, which has prompted them to look for ways to reduce spend on research (including translation of research) since they now have to be able to justify the cost to the investor.

Lingua Custodia plans to use the funds raised to open up a branch in the European investment fund hub of Luxembourg, Debeugny told Slator. The office opening, scheduled for September 2019, will see Lingua Custodia launch its first location outside France. The company also plans to expand beyond Europe’s borders and into Asia in the next two years.