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Api.ai Raises $3M For Its Siri-Like Conversational UI, Makes Developer Usage Free

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Api.ai, a developer of AI and natural language tech that enables developers to add Siri-like conversational interfaces to their apps, has raised $3 million in additional funding. The round is being led by SAIC Capital, the U.S.-based venture capital arm of China’s largest automaker, SAIC Motor.

That’s noteworthy given that SAIC Capital is another backer with ties to the automotive industry, where voice driven interfaces make a lot of sense. Previous investors Intel Capital, and Alpine Technology Fund also participated, along with Motorola Solutions Venture Capital.

However, the biggest news is perhaps that the additional investment is allowing api.ai to drop the fees for developers using its API, as the company switches to a business model based on large enterprise consulting and support, customisation and on-premise or private cloud installation and licensing.

Naturally, the startup will also continue investing in the development of api.ai’s “deep learning methods for speech recognition, intent classification and dialog management,” which points to one of the main drivers behind moving to a largely free-to-use model.

In a call, api.ai co-founder and CEO Ilya Gelfenbeyn told me that since the startup’s AI and language engine uses machine learning it essentially becomes smarter the more data and use cases are fed into it.

And, given that making usage free will likely significantly increase developer uptake, the product api.ai sells to enterprise customers, such as those in the automotive or Internet of Things(IoT) and consumer electronics space will become greater in value as a result.

Gelfenbeyn says they now have more than 8,500 developers using api.ai to add conversational interfaces to their apps. That’s up from 5,000 or so since we covered the startup in May with regards to its renewed emphasis on making its API easier to use, not least for developers operating in the IoT space.

The company’s own consumer app, Speaktoit, a voice and AI-driven assistant for Android that is similar to Apple’s Siri, also brings in revenue, hence the total api.ai has raised (and presumably its run-rate) has been kept pretty lean.

Api.ai has also put together an interesting board of advisors, however superficial these things can be.

It boasts Stephen Wolfram, CEO and Founder of Wolfram Alpha, the ‘knowledge engine’ that in part powers Apple’s Siri and its ability to answer questions; VP & Project Leader of Project Loon at Google, Mike Cassidy; and Dariusz Paczuski, Head of Growth at Yahoo who also previously oversaw product and marketing efforts for Microsoft’s voice platform, TellMe.