Listen Labs abandoned a signed term sheet for a $125 million Series C at a $1.5 billion valuation, according to several people with knowledge of the matter. Menlo Ventures had been set to lead the round, but the financing did not close and the company walked away from the agreement.
Acquisition talks cited as likely cause
People familiar with the situation said the deal likely unraveled because Listen Labs was in acquisition discussions with Salesforce. Business Insider reported that Salesforce has held talks to buy Listen Labs for roughly $2 billion, but noted those discussions are not finalized and may not result in a transaction.
Market position, revenue and investor expectations
The three-year-old startup has about $30 million in annualized revenue, according to two people familiar with the companies’ financials. Several venture capitalists expect Listen Labs to return to the market and aim for a valuation of $2 billion or higher if talks with Salesforce collapse, the people said.
A person with experience negotiating exits to Salesforce cautioned that the CRM giant could view a roughly 67-times-revenue multiple as too high. In late July, competitor Simile closed a $200 million Series B at a $2 billion valuation led by Greenoaks, which one person said likely set a new valuation benchmark for Listen Labs.
Listen Labs was previously valued at $500 million when it announced a $69 million Series B in late January led by Ribbit Capital, with participation from Sequoia, Conviction, and Pear VC.
The company was co-founded in 2023 by Florian Jüngermann and Alfred Wahlforss, who met while pursuing master’s degrees at Harvard. Jüngermann was previously a German national champion in competitive computer programming; Wahlforss founded a staffing startup called Bemlo.
Listen Labs’ AI develops survey questions and conducts customer interviews over audio or video, then packages the resulting conversations into reports and PowerPoint presentations akin to those produced by human market researchers. Its customers include Microsoft, Canva, Anthropic, and Sweetgreen. Competing startups in the space include Simile, Outset, Keplar, and Aaru.
Original source: TechCrunch AI