DeepL, a European rival to Google Translate, rides AI hype to a $2 billion valuation

PARIS — DeepL, an artificial intelligence-powered translation platform, said Wednesday it’s raised $300 million in fresh funding, in a sign investors are still willing to invest major sums into the AI space. 

The deal, led by venture capital firm Index Ventures, boosts DeepL’s valuation to $2 billion.

ICONIQ Growth and Teachers’ Venture Growth came on board as new investors, while existing investors IVP, Atomico and WiL also participated.

At $2 billion, DeepL is now worth double what it was in its previous round in January 2023, when it raised $100 million from investors at a $1 billion valuation. 

Launched in 2017 by founder and CEO Jaroslaw “Jarek” Kutylowski, DeepL is a competitor to Google Translate.

Speaking with CNBC Wednesday following news of the investment, Kutylowski said he’s “super confident” about the firm’s $2 billion valuation tag and felt it was “pretty moderate.”

“Obviously we are at the private stage,” Kutylowski told CNBC via a phone interview. “Multiples will be larger than [they are] for publicly-traded companies at the later stage.”

“Nevertheless, I’m trying to keep it all sensible,” he added.

Kutylowski said DeepL’s latest fundraising round consisted of a mix of a primary investments into the business, as well as a secondary share sale by some early investors, including b2venture, a Swiss venture fund.

“That’s down to the fact we don’t need those extra levels of capital,” he said. “At the same time, we want to have this very strong backing from these late-stage folks.”

DeepL offers translations between 32 different languages including English, German, French, Spanish, Italian, Polish and Dutch.

Going forward, Kutylowski said the focus is on expanding and growing in key strategic markets like the U.S., as well as investing in research and development.

The U.S. is now DeepL’s third-largest market. DeepL opened its first U.S. office in January.

DeepL is also looking to add support for more Asian languages over the next year, and Kutylowski noted that Asia is “a very strong market for us.”

DeepL’s long-term vision, he said, is to become more of a productivity tool for enterprise firms looking to use the company’s tools to take tedious manual work out of day-to-day company communications.

“We’re really expanding our product towards being able to support these bigger enterprise customers,” Kutylowski said.

“For us, the vision here is really to be able to create this kind of language system for our customers. They have this control of the language that their employees are speaking … [and] sending out lists of emails to their employees.”

The company has ramped up its focus on selling into enterprise in the past few years and now counts customers including Zendesk, Nikkei, Coursera and Deutsche Bahn.