The industry has been extremely lucrative for the company, as within the first seven years of business, they grew from 0 to 30 million SEK in revenue, all from a bootstrapped approach.
In this episode of Meet the CEOs, Daniel sits down with Virpal Singh, the CEO and Co-Founder of DigitalTolk, to gain insights into how he has grown the business so quickly and what advice he has for other like-minded entrepreneurs.
Takeaway 1: Solving pain points often leads to increased business down the line
Despite what many assume when looking at the DigitalTolk business model, Virpal explains that most of their business comes from pre-planned, scheduled work rather than on-demand interpretation requirements.
“Actually, only a fraction of the jobs are instantly needed,” he explains. “A large quantity is actually planned in. It’s actually less than 10% that are urgently needed.”
“Instant work was our initial entrance into the market, but what we have found is when we resolve that pain for a customer, they then provided us with 90-95% of their business to us.”
Because the initial pain point was so big for the customer, Virpal and the team were then able to use that relationship and their skillset to acquire longer-term projects from those emergency customers.
Takeaway 2: When you find a distribution channel that works, double down on that.
Unlike other businesses, 90-95% of DigitalTolk’s business comes from working in the public sector.
“The vast majority of our clients have been in the public sector, but when you find a distribution channel that works, double down on that,” he explains. “Our initial customers were in the B2B space, but when we saw we could win significantly higher value deals in the public sector, that’s when we started working on growing our reputation in that space.”
However, Virpal does admit that there are some limitations to this approach in the long term. “We actually started to go back to the B2B market in the last year or so, given the fact that there’s only so many deals coming out each year.”
Takeaway 3: Even in self-service solutions, customer service is crucial.
When it comes to breaking into the public sector, Virpal explains how DigitalTolk has been able to do so successfully.
“We obsess about providing the best possible customer service,” admits Virpal. “Even though we have the best self-service solutions when the customer calls, we will pick up in seconds.”
But that doesn’t just include day to day customer service, it also includes consulting and educating them on the future of the space.
“We also consult with customers, informing them where the future is going and what you should be aware of,” he explains. “And that’s a conversation that happens before the tender. It happened a year or two before. We always make sure to talk to customers and provide them with information that will benefit them.”
Takeaway 4: When working with freelance and contract workers, creating strong relationships is essential for continued success
DigitalTolk has a large network of interpreters that they work with regularly, all of which are working with the company on a freelance basis.
However, Virpal explains that just because they are not contracted members of staff, that doesn’t mean you shouldn’t still treat them with respect and show that you value them.
“We’ve got a large network of language professionals that we work closely to build loyalty with,” explains Virpal. “We do this by considering their needs as well, ensuring we fulfil their requirements as much as the customers. We had an instance early on where a customer complained that the interpreter was late, so I called them and asked them why rather than assuming they were at fault. The interpreter explained that the hospital was large and cut into different houses and buildings and that they had been provided with the incorrect information.”
But this conversation also made Virpal appreciate the perspective of the freelancers that he employs. “The interpreter also said on the call that we only called when there was a problem and that we didn’t care, which was the historical opinion in the industry by many freelance interpreters,” Virpal admits. “That’s when I recognized that we needed to bring about changes that ensure they don’t feel about that when they work with us. Suddenly, we were getting calls from 50-year-old interpreters in tears, explaining that no one had ever shown such appreciation for the work they do.”
Takeaway 5: DigitalTolk has always been bootstrapped, but they’re assessing new options for expanding into new markets
When it comes to funding DigitalTolk, Virpal and the team have always taken a bootstrapped approach, and with incredible success. However, as they now consider expanding into new markets, Virpal is looking into other options.
“It’s something that we’re exploring more and more as we venture into new markets,” Virpal explains. “We’ve never even been close to raising venture capital before, but I think our scalable model is very relevant for that. In my opinion, the way that the financial market has turned in recent years is very unfair to a lot of entrepreneurs who’ve actually delivered on their expansion targets.”
“Ultimately, if you have a long-term sustainable model, and you need to go into the red occasionally to achieve your desired expansion, then that is an okay thing to do.”
“The people aspect makes or breaks everything.” Photo: Pax Engström Nyström.
Takeaway 6: It’s important to move with new technology rather than run from it
As an interpretation business, you might be forgiven for thinking that Virpal and his team were concerned about the rapid improvements that generative AI is making, but far from it. In fact, Virpal and his team know that to continue to grow and succeed, they must embrace this type of technology.
“We’re doubling down on AI translations and expanding into new marketings,” explains Virpal. “If you’re going to do something crazy, why stop at one thing when you can do multiple? We can’t cheap out and underinvest. This is the time for us to invest.”
Takeaway 7: Don’t underestimate the growing pains that come from expanding as a business
Virpal admits that one of his biggest learnings running DigitalTolk was just how many growing pains there are as your business grows.
“Underestimating the growth pains that come and the consequences of that has been a significant learning curve,” admits Virpal. “If there’s one thing I would do early, is get an HR in place. One thing we did was underestimate how hard someone coming from a large corporation would find working for a startup. What’s rational and makes sense at a large corporation may not be the same at a startup.”
“The people aspect makes or breaks everything.”
