Funding for startups

Mobile Apps Firm Raises $100M

Speech-to-text mobile application company SpinVox Ltd. has raised a staggering $100 million in its third round of funding and attracted some big name investors in the process, an extraordinary feat given the current economic climate. (See SpinVox Raises $100M.)

Among the new investors in the U.K.-based company are Goldman Sachs & Co. , GLG Partners, Blue Mountain, and Toscafund Asset Management. Goldman Sachs also served as the company's financial adviser in this funding round.

SpinVox, which has now raised about $200 million from private investors and private equity firms, recently hired the bank to investigate funding options, one of which might be an initial public offering (IPO).

"An IPO is not planned, but it may be one of those [funding] options," says a SpinVox spokesman. "Investors are seeing the potential of the business."

Founded in 2003, SpinVox has developed software that converts voicemails into text messages, and last year the company signed up its first carrier customer, Cincinnati Bell Inc. (NYSE: CBB). (See MEM Sizzles on the Riviera.)

The company now has 12 mobile operator customers in North America, South America, Europe, Africa, and Australia, and says it will add 12 more this year. Operator customers include Telstra Corp. Ltd. (ASX: TLS; NZK: TLS), Vodafone España S.A. , Rogers Wireless Communications Inc. (NYSE: RCN; Toronto: RCM), SaskTel , Alltel Corp. (NYSE: AT), and Vodacom Pty. Ltd. (See Rogers Intros Voicemail-to-Text, Rogers Launches SpinVox, SaskTel Offers SpinVox Apps, Alltel Offers Spinvox, and Skype Uses Spinvox.)

The company claims its speech-to-text service for operators, called Messenger, boosts operator ARPU (average revenue per user) by 14 percent and can reduce churn by more than 30 percent, according to aggregated data from its carrier customers. The data also shows that operators see a 17 percent increase in text traffic and a 7 percent increase in voice traffic once they offer the Messenger service.

SpinVox plans to use its latest funding round to expand geographically, increase the number of languages it converts, and sign deals with Tier 1 operators in the Asia/Pacific, North America, and South America, according to the spokesman.

The SpinVox software already converts voicemails in English, French, German, and Spanish. Now it plans to add Italian, Portuguese, and Arabic to that list, giving a hint about where the company might be planning to expand its business.

SpinVox, which employs more than 300 people, expects 6 million people to be using services based on its speech-to-text technology by the end of the second quarter this year.

The company's spokesman also hinted at possible tie-ups with major telecoms equipment suppliers, but would not reveal company names.

"Unified communications is a key focus for us," says the spokesman. "Our service may be integrated with other products which may include text-to-speech [applications]. But we will remain a speech-to-text company."

— Michelle Donegan, European Editor, Unstrung

digits 12/5/2012 | 3:44:47 PM
re: Mobile Apps Firm Raises $100M A $100 million round for a firm focused on a speech-to-text application -- that's pretty remarkable, isn't it?

When was the last time a box-maker raised that much in one round?
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