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Verbit eyes public offering as it reaches $1 billion valuation

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Verbit, a transcription technology company, will look to go public after announcing its most recent round of $157 million in funding on Tuesday, according to a news release.

The company, headquartered in Palo Alto, California, reached a valuation of $1 billion in four years, making it a so-called unicorn, tech-industry vernacular for a privately held company that achieves that milestone. Verbit’s latest round of funding will support research and development and add 200 positions, as well as “help prepare Verbit for a public offering,” the company said.

Tom Livne, the company’s founder and chief executive, wrote in an email the company is planning for an IPO in 2022 on either Nasdaq or NYSE.

Verbit provides live captioning and transcription services using both artificial intelligence and human workers. When an event is uploaded, the AI forms an initial draft transcription, which is then fact-checked by employees who passed transcription-skills tests. Verbit’s customers are in education, court reporting and business.

“The transcription market has been ripe for innovation. That’s the initial reason why I founded Verbit. The shift to remote work and accelerated digitization amid the pandemic has been a major catalyst for this $30 billion industry and has further driven Verbit’s already-rapid development,” Livne said in a press release. “Securing this new funding is yet another milestone that brings us closer to becoming a public company, which will further fuel our expansion through strategic acquisitions and investments.”

Verbit announced in May its acquisition of long-running captioning provider VITAC, the country’s largest closed-captioning provider in media and entertainment, with customers that include about 100 broadcast and cable networks, as well as government and education clients.

When higher education moved online due to the coronavirus pandemic, captioning and accessibility for lectures and meetings became a priority for many institutions. Auto-generated captions on platforms like YouTube do not require accommodations standards set by the Americans with Disabilities Act. Captioning must meet accuracy standards in order to meet guidelines.

Providing automatic captions and searchable transcriptions for lectures also falls under the philosophy of “universal design,” in which accommodations are already available, rather than students needing to request them. Recent results released by Blackboard’s “Ally” accessibility arm found that a majority of files checked by software found “severe to major accessibility issues.”

“Throughout the pandemic, many schools and businesses adapted by using more technology to provide students and employees with access to virtual environments without the need to be physically present,” Livne wrote StateScoop in an email. “Digital tools will continue to play an increasingly important role in maintaining the popularity of the hybrid work landscape, but also its success. To fuel remote work, training and learning effectively, leaders must prioritize ensuring that remote environments are accessible to individuals navigating disabilities, as well as those who may not (and often aren’t) reporting their disability needs. Accessibility is often only being considered as an afterthought, but Verbit’s leadership are working with institutions and businesses to help them make it part of their initial plans and focuses.”

Originally published on edscoop.com.

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We got an exclusive look at the pitch deck AI transcription startup Verbit used to raise $157 million as it eyes a near-term IPO

Tom Livne, Verbit CEO and founder, wants the company to become a decacorn “as soon as possible”. Verbit
An Israeli startup that uses both humans and artificial intelligence to dictate speech has raised $157 million at a unicorn valuation.

Verbit, which was founded in 2016, wants to be a leading player in what it calls a $30 billion global transcription market. The company has a network of 30,000 human transcribers who fact-check the work of its AI, machine learning, and natural language processing technology.

“We see unicorns all around us and we belong with them based on the revenue and traction that we have,” Tom Livne, the Verbit CEO and founder, told Insider. “It’s obviously a nice milestone for us but we want to be a decacorn with a billion dollars of annual revenue as soon as possible.”

The Series D funding round was led by Sapphire Ventures, which also led the startup’s last round in November 2020. New York-based Third Point, Israeli investors More Capital and Lion Investment Partners, and ICON fund also backed the round.

They joined existing investors such as Stripes, Vertex Ventures HV Capital, Oryzn Capital, Viola Ventures, and ClalTech. The Series D round bring the company’s total investment won to date to over $280 million.

Last month, Verbit acquired US captioning business VITAC which provides services to cable news networks in North America. “Acquiring VITAC is a great milestone for us because it gets us into the media and entertainment vertical which we believe is a $1 billion addressable market and they have a strong brand in this space.”

Verbit was started in response to Livne’s frustration at the low quality of transcription he received while working as a lawyer. The company will use the funding to add around 200 employees to its current 350 strong headcount. The startup is also in the midst of planning for a public listing in the future.

“If an interesting acquisition comes along we may raise again but if all goes according to plan we will go public next year,” Livne added. “We haven’t touched the Series C round so there was no need for additional capital but we made a trade off to get our valuation. We don’t want to commit to anything but want to make the company ready to list next year.”

Originally published on businessinsider.com.

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