AI voice startup lays off 20% of staff amid difficult financing conditions due to high Intrerest Rate.

Recently, an artificial intelligence startup focused on voice recognition software announced it would lay off about 20 employees, accounting for 20% of its total workforce. This marks the company's second round of layoffs this year. The company's CEO stated that the main reason for the layoffs is the challenging financing environment due to high Intrerest Rate.

Founded in 2015, this company has received support from several well-known investment institutions. Currently, it is facing fierce competition from open-source speech recognition software and tech giants.

In the layoff notice sent to employees this week, company executives mentioned the difficulties in the startup financing environment, macroeconomic challenges, and the company's performance over the past year. The employees being laid off include data scientists, researchers, and engineers.

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

The CEO stated in a statement: "Given that the Federal Reserve has signaled that 'high Intrerest Rates will last longer', I do not want to bet on whether the market will provide us with additional funding in the short term. We must adopt a conservative strategy, control cost growth, and focus on the company's efficiency."

Although the company just experienced "the best quarter" since its inception, the CEO refused to disclose specific revenue figures. Last fall, the company announced it had raised $47 million, along with previous funding, bringing the total amount raised to $86 million, which valued 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, as generative chatbots and image generators have attracted significant interest from founders and investors. However, as more companies join the competition, some AI startups that once performed well are beginning to face challenges.

For example, a startup that was an early winner in the generative AI wave has lowered its revenue expectations since a large AI company launched a directly competing product. The two co-founders of the company also resigned from their positions last month.

The challenges faced by this voice recognition company also reflect 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 gradually narrowing.

Unlike large language models, speech recognition software has been commercialized for decades and has been promoted through various voice assistants. This company provides speech recognition services for clients, including several well-known enterprises, claiming that its solutions are more accurate, faster, and better suited to business needs than existing options.

However, as tech giants continue to improve their voice-to-text generation services and other startups launch similar products, enterprise clients are starting to cut their budgets for commercial software spending, making it difficult for software providers to secure new business.

Taking a certain open-source speech recognition software as an example, six months after its launch, the developing company began charging developers for API access, making it easier for developers to directly use the software rather than attempting to self-host a free version.

In the face of these challenges, the company's CEO insists that they can cope with competition because their product quality is higher and more precise. He also believes that the launch of open-source voice recognition software helps the entire industry understand the potential of AI voice recognition technology.