It’s ironic that on a day when voice-to-text transcription company SimulScribe signed a – potentially – $17 million exclusive deal with Ditech Networks to resell SimulScribe to its carrier customers, it’s now emerged that competitor Spinvox may in fact be up for sale. However, the difference between the two is marked.
Simulscribe raised only $5.7 million and says it is is already profitable on sales of about $4 million. It also only has 7 employees for it’s Phonetag service. ( It reminds me of Vox Sciences). And Ditech already has voice processing software and equipment inside every major carrier’s network. Ditech has noise canceling technology, so combine it with Simulscribe – which also supplements its transcriptions with humans – and you have a good combination.
By contrast UK-based Spinvox has raised a whopping $200 million and has deals with call centres employing thousands of people because it’s service can only transcribe the most basic of messages. It is also not yet profitable, despite Spinvox CEO Christina Domecq saying in late July that it will be cashflow-positive within 90 days.
Invesco Perpetual says in its latest report that it has “written down” the value of its £759,000 investment to, er, £76,000. That’s 90% less, just in case you don’t have a calculator handy.
Invesco Perpetual said in its report: “The business has been put up for sale, and it is possible that, should a good sales price be achieved, the new valuation may be exceeded.” So, exceeded from the new valuation of £76,000? One would hope so.
A Spinvox’s spokesperson emailed us with a very short “No comment” and has apparently asked the investment firm to withdraw the statement.
Spinvox raised £15m of more backing in July after burning through the $100m (£61m) it raised in March 2008, however, we understand this figure was more in the form of a loan than new investment.
Of course we are talking about a potentially large market here.
The prize is a potential $1 billion million market as carriers realise that traditional free voicemail is a dead business when people will pay to have their voicemails to be converted into text. They are also quite worried about Google Voice which has a similar – though less accurate – service.
But it seems unlikely now that Spinvox can hope to achieve a valuation to better the money put into it, especially since a potential exit route has now been closed off by this SimulScribe deal with Ditech Networks. Then again, if Spinvox does indeed go nowhere at least it won’t affect the startup market – well, too much.