33 thoughts on “5 Things about Microsoft TellMe deal”

  1. Does anybody know how the investors, founders and employees all made out in this deal?

    230+ million is a lot of money to raise. Not sure if it was all in up-rounds, but it seems like the VCs involved probably took a large chunk of the company.

    If the company is profitable, did the investors recoup part of their investment through a dividend?

  2. I am betting this is going to mean more royalty payments to nuance as microsoft tries and pushes it into the mobile handsets? Just a guess – if i hear anything will update the post!

  3. If this is indeed mobile search related,it just confirms my suspicions that the first wave of mobile search “let’s put our logo+brand up there and have them type the keywords like they are used to” is indeed, despite the commercial-interest-fueled-hype, a big failure.
    A phone is not a PC, never was and never will be.

  4. I am sure the VCs were happy to get something out of this. Tellme could have IPO’d in 2000 or even 2004 to a much higher valuation. Now, although profitable, their revenue growth has stalled (411 calls, which drive most of their revenue, will continue to decline due to free411 and other non-voice substitutes). Customer service has never been a huge business for them and there is too much competition (they are losing big accounts as airlines and banks build VXML expertise). Their cost structure is also higher given their lack of an on-premise solution (every call needs to be routed to their platform). The mobile search product is just a beta. Not sure that an acquisition was the smartest route here for Microsoft.

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