Language-learning startups speak to VCs

From the Central Intelligence Agency to Silicon Valley, venture capital firms are raising investment in startups using technology to improve language translation and education.

During the past month, investors have funded two such early stage language companies. Pittsburgh-based Carnegie Speech, closed a $2.2 million second Series A round last week with funding from CIA-backed venture capital fund In-Q-Tel. The other company, EnglishCentral, a provider of Web-based conversation English language learning tools, raised an undisclosed amount from Google Ventures and Atlas Venture.

The investments come as businesses and government agencies worldwide struggle to find workers able to communicate in foreign languages. The CIA, for example, has been ramping up efforts to recruit Arabic speakers and expand its language training offerings. In Asia, English language schools are booming. But language educators are finding some shift in the skill sets that learners are seeking.

“Previously, most of the focus has been on reading, writing and grammar. But with globalization, everyone is realizing what they need is to be able to speak and listen,” says Angela Kennedy, CEO of Carnegie Speech, which licenses artificial intelligence and speech recognition technologies from Carnegie Mellon University for its software products. The company, which previously raised $6 million from Osage Ventures, sells programs for training students in English, Farsi, Russian and “Iraqi” that are used by customers in sectors including business process outsourcing, aviation and intelligence.

A key feature of Carnegie’s software, Kennedy says, is an ability to diagnose speech errors at a very detailed level, such as helping a student who has trouble pronouncing the letter ‘R’ when it comes after the letter ‘S.’

“Because we understand exactly what’s wrong with the student’s speech, we can tell them exactly how to fix it,” she says. “Some of the software on the market simply says: “That wasn’t clear, please try again.”’

Conversation and listening comprehension skills are also an area of emphasis for EnglishCentral, which has offices in Tokyo and Lexington, Mass. Users select from a database of videos, ranging from sports to movies to Barack Obama speeches, and then record themselves speaking. The site employs speech recognition technology to “listen” to users’ speech and score it based on pronunciation and syntax.

Carnegie Speech and EnglishCentral are two of several language-related startups that have raised funding in recent months. Others include:

Lingotek, a Draper, Utah-based developer of collaborative translation applications, has raised at least $4.9 million in venture funding over the last three years from backers, including In-Q-Tel, Canopy Group and Flywheel Ventures, closing its most recent round in July, according to Thomson Reuters (publisher of PE Week).

Wimba, a New York-based developer of online collaboration software for language learning and other types of online education, raised $3 million in June, bringing its total funding raised since 2000 to $18.8 million. Backers include Tudor Ventures, Ascend Venture Group and ABS Ventures.

Lattice Voice Technologies, a U.K.-based developer of language recognition software, raised $64 million in late September from Yorkshire Fund Managers.

eduFire, a Menlo Park, Calif.-based operator of a platform for connecting teachers and students from around the world for language learning and other educational purposes, raised $1.3 million in September from backers including Battery Ventures and Western Technology Investment. —Joanna Glasner