Portuguese unicorn Unbabel declares bankruptcy but got €13.3 million from recovery funds

Unbabel, the Portuguese unicorn specialised in Artificial Intelligence translation and automated linguistic solutions, is bankrupt owing money to around 36 creditors, including Portuguese public companies.

The company, which went under in February, has received €13.3 million in funding from Portugal’s Recovery and Resilience Plan (RRP).

Unbabel has been declared insolvent by a commercial court after it had filed for insolvency in February of this year, after a period of financial difficulties and restructuring.

The case gains particular relevance due to the volume of public funding involved. According to data from the Mais Transparência portal, cited by the tabloid daily Correio da Manhã, Unbabel benefited from a total planned investment of €14.83 million under the Recovery and Resilience Plan (RRP), having already received approximately €13.3 million, equivalent to 89.6% of the approved amount.

This funding was associated with a project related to the development of artificial intelligence technologies.

Among the creditors identified in the process are IAPMEI – the Agency for Competitiveness and Innovation, the entity responsible for managing European funds, and the Social Security Institute.

IAPMEI’s presence on the list of creditors raises the possibility of partial non-compliance with contractual goals or objectives, which, if confirmed, could imply the return of part of the public support received.

The insolvency process is now following its legal procedures, with a creditors’ meeting scheduled for July 2nd, where the next steps regarding the liquidation or eventual recovery of the company will be discussed.

In parallel, the tech company’s problems had already been exposed at the end of 2025, when an investor filed a lawsuit for €12.75 million, contesting the sale of the company’s assets to the American company TransPerfect.

Shortly afterwards, Unbabel itself ended up resorting to the courts to file for insolvency, culminating in the current outcome.

Source: Correio da Manhã. Image: Unbabel