ZoomInfo Buys Israeli Company Chorus.ai for $575 Million
CTech – Business intelligence company ZoomInfo announced Tuesday it has agreed to acquire Israeli startup Chorus.ai, which developed an AI-based system to analyze sales calls, for $575 million.
Under the terms of the agreement, ZoomInfo agreed to acquire the assets and specified liabilities of Chorus in an all-cash transaction, which includes a cash tax benefit of over $100 million. The purchase price will be funded with cash on hand and $500 million in additional financing.
The acquisition is expected to lead to significant growth, generate positive operating income, and positive cash flow by the second half of 2022. In addition, the acquisition will lead to the expansion of the potential market of ZoomInfo for about $70 billion. Currently, ZoomInfo’s platform has more than 20,000 revenue teams users worldwide. The purchase of Chorus.ai will add to the platform a new category of insights that will reach new customers. As part of the deal, Chorus.ai 200 employees will join Zoominfo, as CEO Jim Benton will be named ZoomInfo’s Senior VP for emerging products.
To date, Chorus.ai has raised $100 million and has 200 employees, 40 of them in Tel Aviv. ZoomInfo also has Israeli roots, the company was founded by Yonatan Stern in Israel before it went through an IPO in 2020 after it was acquired several times along the way. Currently, the company is valued at about $20.7 billion. ZoomInfo has about 1800 employees in a number of locations in the US, while its R&D center is located in Raanana and has more than 300 employees, of whom about 240 are developers. In a conversation with Calcalist, Nir Keren, ZoomInfo’s operations director in Israel and its CTO said that “most of the acquired company’s technical staff is located in Israel and have managed to produce incredible technology with a small number of hands. We will significantly increase the number of employees in the field.”
Russell Levy, Chorus.ai, co-founder and CTO will remain with the company; however, the rest of the founders will not do so.
Chorus.ai is a direct competitor of Israeli company Gong, which only recently fundraised at a value of $7.2 billion. “We will take what Chorus can do and put them on steroids. Before this purchase, Gong and Chorus were very similar in analyzing calls using a bot, and the main change will be that we know best how to sell, while on the product level they will get data that will give them an upgrade. For the first time, companies in the sales realms will get an end-to-end tool,” Keren said. “We are very proactive when it comes to acquisitions, and whatever fits our engine interests us, and Chorus is of great interest to us thanks to their technology. They created dedicated technology for text transcribing have reached very high levels.”
ZoomInfo provides a platform to organizations for locating and preserving business information. The platform enables marketing and sales departments to locate rich information on different organizations and key people in these organizations, thus saving time on research, enabling targeted marketing campaigns, and also helps in finding suitable candidates for recruitment.
Its technology, which is based on artificial intelligence, identifies trends in the employment world such as new roles created or new appointments.
Chorus.ai’s system records all sales calls, transcribes them, and performs an analysis of what was said. After analysis the system is able to generate insights, educating sales staff and managers. The company was founded in 2015 by Roy Raanani, who served as its CEO up to March 2020, Micha Breakstone, and Russell Levy. The company’s customers include Qualtrics, Marketo, and Adobe.
“ZoomInfo is the only company that can marry a best-in-class data layer with world-class go-to-market applications,” said Henry Schuck, ZoomInfo Founder and CEO. “The acquisition of Chorus will accelerate our vision to deliver a modern go-to-market platform that brings together best-in-class intelligence with comprehensive data management, workflow, and engagement software, empowering companies to effectively execute their revenue-generating strategies. With the largest Conversation Intelligence patent portfolio in the industry, Chorus will advance each aspect of our vision by surfacing a new category of insights, illuminating new workflows, and enabling more targeted engagement at scale.”