Last week an article appeared in Computer Business Review reporting that VoiceVault, a long-time competitor to VBG, had entered “administration”. This of course means the company is shuttering it operations and is selling its assets. Click here to view the story.
VBG has competed with VoiceVault since our inception in 2009, and over time we became familiar with several members of their team, their technology, etc. VoiceVault had good people and had good technology, so it is a shame to hear this news.
I personally can relate to this story, having previously been involved with a voice biometric startup in the mid-2000s that also entered “administration” after its investors no longer wanted to fund the venture. That company too had good technology and many good people. And perhaps as was the case with VoiceVault – it was a company created too early for the market.
On the strictly human level, administration is a painful process. Startup team members invest significant physical time and mental energy, and often have high hopes for a bright future should the venture “take off”. However, if the venture fails, it can be devastating to leave your hopes and dreams behind, admit defeat, and then move on to pick up the pieces and start new careers.
And in many cases, founders and start-up team members have invested significant personal funds into the venture. These losses can be quite painful too. But, for founders and principals who take venture capital to augment their own personal and “friends and family” investments, this is a good cautionary tale to share.
Investors have a right to make a return on their investment, and most technology investors will expect returns in the near-term (within a few years). VoiceVault has been at it for over 10 years, so it’s not unreasonable for investors to want to shut the business down.
VBG had a “bumpy” first few years, with sporadic revenues and heavy intellectual property and development expenses. During this time, we had no less than four viable offers for venture capital funding, each involving several million dollars. Although tempting, we knew the market had a long way to go before it was truly ready, so we decided to remain privately funded – and we’ve never looked back or regretted our decisions and strategy.
Today VBG is profitable, healthy, growing, and realistic about our future. Being profitable is of course our primary goal, but we are not under pressure to produce short-term profits to outsiders who don’t necessarily understand the intricacies of our industry. We instead pressure ourselves to improve our products, our delivery systems, and the way we conduct business with clients and partners. Some of our activities are essentially total risks to test market conditions, sometimes resulting in total losses of investment. This is OK.
VBG continues to gain acceptance in the market, and over the past year or so we have started to expand our footprint globally. VBG's growth has been a very slow and steady process that is the result of patience and years of commitment to our plan – an approach which unfortunately does not often favor venture capital.
Peter is an avid reader, particularly of high-tech topics. These articles express his opinion only, but he hopes you enjoy them!
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