Deepgram raises $130M at $1.3B valuation to expand voice AI

Deepgram announced today that it has raised $130 million in a Series C round—a late-stage funding round—valuing the company at $1.3 billion. The round was led by AVP, with participation from existing investors including Alkeon, In-Q-Tel, Madrona, Tiger, Wing, and Y Combinator. New investors also joined the round, including Alumni Ventures, Columbia University, Princeville Capital, Twilio, and SAP, bringing Deepgram’s total funding to date to over $215 million. Alongside the funding, Deepgram announced its acquisition of OfOne, a startup specializing in voice AI for quick-service restaurants, which are fast food establishments.

The funding comes amid enterprise demand for voice AI in contact centers and sales developments. Elizabeth de Saint-Aignan, a partner at AVP, noted that in 2024, when talking to enterprises about how they were thinking about using AI inside their business, they started to hear about them using voice AI in these processes, much of which was powered by Deepgram. Deepgram’s models and APIs for speech recognition and text-to-speech are currently used by more than 1,300 organizations, including Granola, Vapi, and Twilio.

According to CEO Scott Stephenson, Deepgram was cashflow positive last year and did not actively seek the raise, but chose to accept strategic capital to accelerate growth. “In the last year, voice AI has gone mainstream, and there is more potential pull. We see that we can make larger investment sooner in order to accelerate growth. And that is why we felt it could be a good time to raise,” Stephenson said. This expansion aligns with broader market trends; analysts’ reports project the voice market to grow at over 30% year-over-year, reaching a value of $14-$20 billion by 2030.

Deepgram plans to use the capital to expand its global footprint, support multiple languages, and target the restaurant sector through its acquisition of OfOne. OfOne claims an accuracy rate of more than 93% in receiving orders, but the automated food-ordering space has faced notable public setbacks. For instance, Taco Bell withdrew its voice AI experiment after a person ordered 18,000 water cups. Despite these challenges, Stephenson remains optimistic about the sector’s potential in the US. He believes that food ordering could provide the first positive interaction that more than 300 million Americans have with voice AI, following what he described as 20 years of sour interactions with digital assistants. Meanwhile, investor interest in the sector continues; competitor Presto recently secured $10 million in new funding.

Why it matters

Deepgram’s $130 million Series C and acquisition of OfOne signal the company’s intent to expand its voice AI footprint into the restaurant sector and support multiple languages, capitalizing on the growing demand for voice AI in enterprise processes.