We’re excited to share that last week, Verbit announced its $60 million Series C funding round, which Sapphire led. Verbit offers a best-in-class transcription and captioning platform that combines the efficiency of artificial intelligence with the accuracy of human transcription.
There are a number of reasons why we chose to partner with Verbit. First, the market for automatic transcription was already booming pre-COVID, but adoption recently accelerated as organizations quickly shifted online. Second, the near-perfect accuracy of Verbit’s “human-in-the-loop” transcription model has given it a strong customer base among legal and educational institutions and positioned it to emerge as a market leader. And last but not least, Founder and CEO Tom Livne is a passionate leader who saw firsthand the issues associated with transcription while working at a law firm.
Here’s more on why we’re so excited about Verbit:
A sizeable market experiencing accelerated growth
The automatic transcription and captioning market is rapidly growing and as such, presents an exciting investment opportunity. That’s because highly accurate transcription is an essential service for higher education institutions, the legal industry, media and entertainment and other market sectors.The education and legal transcription markets alone are worth $5 billion because academic institutions are required to transcribe massive amounts of audio and video content in order to be compliant with federal regulations, and the legal field needs exact records of court proceedings in order for lawyers, courts and more to do their jobs accurately.
Recent advances in automatic speech recognition (ASR) technology, which enable transcription accuracy of up to 90% and transform audio into text in a matter of minutes, have made this an attractive industry. Before COVID-19, automatic transcription across all sectors would have been worth more than $30 billion by 2025. That’s an impressive number that’s likely now much higher due to the aftermath of the pandemic. The rapid transition to an online world has only driven demand for transcription as many organizations have moved operations online, producing much more audio and video content than before.
In the near future, Verbit aims to expand its automatic transcription service to new sectors, including government, finance and the enterprise. In addition, Gartner estimates that call centers will use speech-to-text technology to transcribe 40% of all inbound queries by 2025. It’s clear that we have only scratched the surface of the potential of automatic transcription.
Combining the power of human and machine for near-perfect accuracy
Rather than offering an AI-powered platform on its own, Verbit uses a “human-in-the-loop” approach to achieve the +99% accuracy that its customers need. The company taps the speed and cost-effectiveness of machine-generated transcription and refines the results using a marketplace of 22,000 freelance transcribers in 120 countries. As a result, Verbit can provide near-perfect transcription at scale, with a faster turnaround and more affordable price than human transcribers. Human input also provides a feedback loop that helps train its speech recognition algorithms to become smarter and faster over time.
Verbit appeals to enterprise customers, which require almost 100% accuracy, which is why the company also offers best-in-class professional services to its customers who help guide them to make the most out of the platform on a daily basis.
Looking ahead, Verbit plans to use this additional round of funding to add new product capabilities to serve the finance and insurance industries, cultural institutions and call centers. In addition, Verbit has a promising strategy to supplement organic growth by acquiring small legacy vendors in the space. The company has already demonstrated this by completing its first acquisition of a transcription provider focused on the enterprise and higher education, and moving most of its customers to the more efficient Verbit platform.
An experienced founder focused on growth
Founder and CEO Tom Livne is a former lawyer who early-on saw the potential for AI to transform the costly and time-consuming process of transcription that has historically been done by stenographers. A second-time entrepreneur and former paratrooper in the Israeli Special Forces, Tom is an out-of-the-box thinker with a proven track record of growing successful businesses. We’re impressed with his clear dedication to rapidly expanding the company and his focus on execution.
Here at Sapphire Ventures, we believe in Boring AI — the idea that AI will have the greatest impact in solving what most may consider mundane problems in the enterprise, not the sexy (yet rare) use cases that grab headlines. We’ve invested in a number of AI and machine learning startups over the last several years, including current investments such as Clari, an AI-powered revenue operations platform for B2B organizations, and Moveworks, the first autonomous AI platform for resolving enterprise IT issues. We’ve also invested in numerous Israeli-based companies including JFrog, Kaltura and Monday.com. We’re excited to have Verbit become our latest partner in deploying AI to make everyday business processes more efficient — and we believe its future will be anything but boring!
