From music ID to voice AI: SoundHound joins the billion-dollar club

Joining the elite ranks of unicorns.

Despite setbacks in the music identification space, there's a bright spot.

While Shazam was being acquired at a price well below its previous valuation, rival SoundHound secured a funding round that pushes its worth to roughly $1 billion, according to Recode. The investment suggests that backers see promise in voice-activated assistants, even as a comparable product struggled.

PitchBook documents reveal that in November, SoundHound raised an additional $50 million from an unnamed investor. This is a modest increase from the previous round just ten months prior, when a $75 million injection in January 2017 gave the firm a post-money valuation of $830 million.

Nevertheless, SoundHound's fortunes look brighter than Shazam's, which was acquired by Apple for $400 million in December, far below its own $1 billion valuation.

Initially, the two apps offered similar services, but in the past two years SoundHound has evolved beyond simple music identification. Its current focus is the Hound app, a voice-recognition and AI-powered assistant that answers questions, akin to Amazon's Alexa or Apple's Siri.

Over its twelve-year history, SoundHound has taken a measured approach to fundraising, accumulating roughly $165 million to date. Past investors include TransLink Capital, Global Capital Partners, and Walden Venture Capital.

SoundHound opted not to provide a statement.