SoundHound, the voice AI company that facilitates conversational AI services for automotive, connected hospitality, and home applications, today announced that it had raised a sum of $25 million in equity to shore up its position in the market. The company laid off 40% of its staff earlier this month.
SoundHound did not disclose who is behind the funding except that it comes from a diverse set of strategic and financial investors, both from the new capital providers and the current shareholder base.
SoundHound notes that the funding is coming in the form of preferred equity and is convertible into shares of Class A common stock, potentially on or after the one-year anniversary of the issuance date if certain price conditions are met.
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SoundHound was once valued at more than $1 billion when it was still a privately held startup and was seen as an independent alternative to services created by Big Tech, such as Amazon’s Alexa.
SoundHound went public in November 2021 through a SPAC merger at a $2.1 billion valuation. But, the SPAC valuation went the way of several other SPACs and did not hold. Today, SoundHound has a market cap of $295 million.
