Every day, millions of people around the world use applications produced by well-known tech giants based in Silicon Valley. Many of these applications are localised into local languages and customised to local standards. However, only very few people know a big portion of that localisation is managed from Brno.
Three years ago, the Brno-based company Moravia IT was acquired by the global leader in localisation, RWS (a publicly listed company from the UK, founded in 1958). Now it represents one of the world’s top producers in the translation business, having a turnover of over USD 450 million and employing over 2,500 people.
I spoke with Tomáš Kratochvíl, a member of the board who served 10 years as the CEO, about the ups and downs of doing business from Brno and the key factors to their success. His is the 8th in a series of interviews with the personalities behind notable Brno companies that operate internationally.
This story mentions several company names, as they changed over the years. It all started in 1990, a few months after the Velvet Revolution, when the Forstinger family founded the company Moravia Translations. Later, the company shifted its focus to the ICT sector, translating software documentation. The first two foreign clients came in, Hewlett-Packard France and Minolta Austria.
Moravia goes digital
All the profit was invested in a technology that enabled the search and reuse of already translated or similar terms. A contract with Oracle launched the company’s international expansion to Eastern Europe in the role of a multilingual vendor. At that time, the core of the business was still language translation – the company was not directly accessing the source code. It changed in 1995, when a full localisation for Microsoft and Corel was delivered. Tomáš was just coming in as a software engineer.
After ten years, Moravia Translations became the dominant player in Eastern Europe and one of four Microsoft premier vendors localising MS Windows and MS Office into an expanding number of languages, including Japanese, Chinese and Korean. The business already included software testing and engineering (localised version compilation and check). This is how Moravia IT, a daughter company, was born in 2000.
In 2015, the internationally successful company was acquired by Clarion Capital Partners, a venture capital fund, and almost three years later, sold to RWS. Within RWS, Moravia represents a division that is focused on digital leaders worldwide. For some of its clients, Moravia stands in the unique position of being their single vendor (localising for all their languages and all products).
The total number of RWS Moravia’s employees grew to 1,500 at present, with over 800 of them based in Brno. They have other offices in the US, China, Japan, UK, Ireland, Poland, Argentina and Colombia. The company also uses over 13,000 independent translators – a valuable pool of talents, available also for supporting clients in their global expansion and localising digital content into more than 250 languages.
Recently, Moravia marked a new milestone as it integrated an Indian company Webdunia.com, acquired by RWS, as a provider with a greater coverage of the languages used in this increasingly important region.
I asked Tomáš where he sees the future of the business. There will be a need to process more digital content in more languages, and budgets will be tight. Yes, machine translation will be used more to do routine jobs, but the difference will be made by human decisions – about the definition of quality. In other words, not only technology and the right processes are necessary to make translation good enough and save cost, but also a talented human workforce.
Brno is no longer perceived as a far-away, developing location. When some investors offered Tomáš to move to Silicon Valley, where his kids could attend a school with kids of other CEOs, he declined for the reasons mentioned below.
Moravia IT intentionally chose to establish its foreign offices in secondary cities with a lot of university students and highly skilled workforce. In Brno alone, it hires many fresh university graduates every year. They are not all from IT faculties and often, it’s their first job. The pool is though increasingly getting rather limited, with more international companiesoperating in the city.
The foreign crew in Brno isn’t a large one just yet. English is spoken in everyday communication, though, as the management is distributed across 2-3 continents and nationality stops being relevant. The growth wouldn’t be possible without that. You need people who live close to your clients.
“Brno has changed a lot over the last 10 years and become an attractive place to work and live,” Tomáš said. “Visitors from abroad mention beautiful architecture, truly international gastronomy and a vibrant nightlife atmosphere. “ On the other hand, the cons include poor flight connections. However, travelling 90 mins to Vienna isn’t really such a shame as you’d need a similar time to reach an airport in big cities. Still, regular flights (at reasonable times to catch the next plane) from Brno to international hubs like London and Frankfurt would help.”
RWS Moravia in numbers
|Turnover (in mil CZK)||3298||2541||3881|
|EBITDA (in mil CZK)||243||160||500|
|Employees in Brno||597||596||608|
*Fiscal year Jan 1, 2018 – Sep 30, 2018
** Fiscal year Oct 1, 2018 – Sep 30, 2019
Tomáš led Moravia whilst it grew from a small to a mid-size company – then all the way to a major global presence with two successful exits. Today, he helps company leaders to find new insights as a coach, mentor and board member; and helps to shape companies driven by authentic vision and business integrity. For Tomáš, success goes beyond measurable achievements. If you don’t find him in a board room, he is probably cycling somewhere around Macocha or Kojal, enjoying the nature „around the best place on the planet – around Brno.“