AI startup Listen Labs pulls $1.5B funding round amid Salesforce acquisition talks
Customer research AI company Listen Labs walked away from a signed $125 million Series C term sheet at a $1.5 billion valuation as it holds talks to be acquired by Salesforce for around $2 billion.
Listen Labs, a startup that uses voice AI to conduct customer research interviews, has walked away from a signed term sheet for a $125 million Series C round at a $1.5 billion valuation, which Menlo Ventures was set to lead. Abandoning a signed term sheet is unusual and generally frowned upon in the venture capital industry.
The likely reason behind the decision is an ongoing acquisition discussion with Salesforce. According to a Business Insider report, the CRM giant has recently held talks to buy Listen Labs for roughly $2 billion, though the deal is not finalized and may not go through.
Rapid growth
The three-year-old company currently generates about $30 million in annualized revenue, roughly three times that of rival Simile, which predicts human behavior using AI. In late July, Simile closed a $200 million Series B at a $2 billion valuation led by Greenoaks, a deal that may have set a new valuation benchmark for Listen Labs as well.
Several venture capitalists said that if the Salesforce talks fall apart, Listen Labs is expected to return to the fundraising market seeking a valuation of $2 billion or more. At the same time, someone familiar with Salesforce's acquisition history noted that a 67-times revenue multiple might be too high a price for the company to accept.
About the company
Listen Labs was founded in 2023 by Florian Jüngermann, a former German national champion in competitive programming, and Alfred Wahlforss, who previously founded staffing startup Bemlo. The two met while pursuing master's degrees at Harvard.
The company's AI creates survey questions and interviews customers by audio or video, then compiles the conversations into reports and presentations similar to those traditionally produced by human market researchers. Its clients include Microsoft, Canva, Anthropic, and Sweetgreen. In January, Listen Labs raised a $69 million Series B at a $500 million valuation led by Ribbit Capital.
