Israeli firm Verbit, a hybrid AI-based and human transcription and captioning software company, said on Tuesday that it secured $250 million in Series E funding, just some six months after raising $150 million at a valuation of $1 billion and marking its entry into the “unicorn” club.
The latest funding values Verbit at $2 billion. The startup was founded in 2017, just four years ago.
The Series E round was led by California-based Third Point Ventures, with existing investors Sapphire Ventures, More Capital, Disruptive AI, Vertex Growth, 40North, Samsung Next, and TCP Capital also taking part.
Verbit’s total funding now exceeds $550 million, including debt financing from the Silicon Valley Bank and secondary investments, according to the announcement.
This company said the new investment “demonstrates investor confidence in Verbit’s promise to revolutionize the $30 billion transcription market.”
Verbit employs over 450 people in offices in Tel Aviv, New York, Kyiv, and Palo Alto, and works with 35,000 freelancer transcribers and 600 professional captioners globally, the company said.
Its services are used by more than 2,000 customers across the legal, media, education, government, and corporate sectors, including CNBC, CNN, FOX, Harvard University, Stanford University, and Kaltura.
Verbit, founded in 2017 by CEO Tom Livne, Eric Shellef and Kobi Ben-Tzvi, has developed a service that combines artificial intelligence and human input to provide a more accurate, faster, and cheaper transcription offering.
Traditional transcription companies rely on manual work, resulting in high costs and long turnaround times. Fully automatic transcription only reaches an average accuracy rate of some 70 percent, while customers usually need a high-quality transcription, the company says.
Verbit’s solution integrates automatic speech recognition algorithms with the human touch. Not only do humans go over the transcription and make the necessary corrections, but all corrections made by human transcribers contribute to and improve the Verbit algorithm through machine learning technologies.
The fresh funding will help Verbit pursue further acquisitions, the company said, following its May purchase of VITAC, the largest provider of captioning products and solutions in the US.
Sagi Rothman, Verbit’s CFO, told The Times of Israel that the company plans to invest further “in product development, infrastructure, and geographic expansion” beyond its main market, the US.
Verbit’s core transcription and captioning services are currently in English, with a growing base in Spanish and French.
As for acquisition possibilities, Rothman said there are currently about 5,000 transcription and captioning companies globally, specializing in different fields like education, legal, and media.
Verbit works across industries and hopes to shore up its customer base with additional acquisitions, Rothman said.
“This funding round is a vote of confidence in our ability to solidify our position as the market leader within the transcription space,” said Livne, who serves as CEO.
“We built a powerful technological platform to modernize this industry and our strategy to build vertically integrated, voice AI solutions has brought tremendous value to our customers and enabled their businesses to become more accessible,” he added in a statement on Tuesday.
Robert Schwartz, managing partner at Third Point Ventures, will join Verbit’s board of directors as part of the investment.
“It’s rare to encounter such a large, fragmented market ripe for digital transformation and simultaneous consolidation. Verbit’s exceptionally talented team has achieved scale and leadership in an incredibly short time,” said Schwartz.