AI voice recognition startup cuts 20% of its workforce amid a difficult financing environment with high Intrerest Rates.

A start-up company focused on voice recognition software recently announced the layoff of about 20 employees, accounting for 20% of its total workforce. This is the company's second round of layoffs this year. The company's CEO stated that the main reason for the layoffs is the reduced funding for start-ups due to the high Intrerest Rate environment.

This company, established in 2015, has received support from several well-known investment institutions. Currently, it is facing intense competition from open-source voice recognition software and tech giants.

In an email sent to employees this week regarding layoffs, company executives mentioned the difficulties in the fundraising environment for startups, macroeconomic challenges, and the company's performance over the past year. It is reported that the laid-off employees include data scientists, researchers, and engineers.

Although this round of layoffs has not attracted widespread attention, it reflects the significant pressure that AI startups are facing in this rapidly changing era.

The company's CEO said in an email statement to the media: "I don't want to bet on whether the market will provide us with additional funding around this year. Because the Federal Reserve has signaled that 'high Intrerest Rate will last longer.'" He emphasized: "We must adopt a conservative strategy to curb the possibility of cost growth at all costs and focus on the company's efficiency."

Despite the fact that the company just experienced its "best quarter" in its startup history, the CEO refused to disclose specific revenue. Last autumn, the company announced it raised $47 million, along with the 2021 financing, bringing the total raised to $86 million and valuing the company at $267 million.

In the past year, although many private software startups have been laying off employees, AI has remained a highlight in startup financing. However, as more companies enter the competition, some previously high-performing AI startups are beginning to face challenges.

For example, an early leading company in the generative AI field had to cut its revenue expectations after a competitor launched a directly competing product. The company's two co-founders also resigned last month.

The challenges faced by this voice recognition company also highlight the potential impact of open-source software on proprietary AI. This is one of the hottest topics in the industry, involving billions of dollars in the market. Although open-source large language models are currently not as powerful as proprietary models, the gap is narrowing.

Unlike large language models, speech recognition software has been commercialized for decades and has been widely used through various voice assistants. This company provides speech recognition services for enterprise clients, claiming that its solutions are more accurate, faster, and better suited for business operations than existing options.

However, as tech giants refine their voice-to-text generation services and other startups launch similar products, corporate clients have begun to cut their budgets for commercial software, making it difficult for software providers to secure new business.

In the face of these challenges, the company's CEO insists that they can cope with competition because their product quality is better and more precise. He also believes that the products launched by certain competitors actually help the entire industry understand the potential of AI voice recognition software.