AI research startup Listen Labs scrubbed a $1.5B funding round for Salesforce talks

Listen Labs, a market research startup that uses voice AI to conduct customer interviews, recently signed a term sheet for a $125 million Series C at a $1.5 billion valuation, with Menlo Ventures set to lead the round, according to several people with knowledge of the matter. Listen Labs walked away from the signed term sheet, a rare occurrence in the venture world and one that is generally frowned upon, according to VCs.

What happened

Where the sources line up

But that round never closed, the people said. Listen Labs walked away from the signed term sheet, a rare occurrence in the venture world and one that is generally frowned upon, according to VCs.

Practical impact for readers

The financing likely collapsed because of acquisition talks with Salesforce. The CRM giant has recently held talks to buy Listen Labs for around $2 billion , Business Insider reported. The discussions are not finalized, however, and may not result in a deal, the outlet notes.

Who should pay attention now

Listen Labs is one of the leading startups in the rapidly growing field of automating customer research with AI. The three-year-old startup has about $30 million in annualized revenue, about three times more than Simile, a competing startup that predicts human behavior, according to two people familiar with the companies’ financials. In late July, Simile announced that it had closed a $200 million Series B at a $ 2 billion valuation led by Greenoaks — likely setting a new valuation benchmark for Listen Labs, one person said.

What is still unclear

If talks with Salesforce collapse, several VCs told TechCrunch that they expect Listen Labs to return to market and target a valuation of $2 billion or higher.

Source notes

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