Investors are scrambling to get into ElevenLabs, which could soon be valued at $3 billion

ElevenLabs, a startup that makes AI tools for voice applications, has reached out to existing and new investors about a new round, which could value the company at up to $3 billion, TechCrunch has learned.

The two-year-old company specializes in making artificial intelligence tools to generate artificial voices for audiobook narrations, and real-time video dubbing into other languages.

A source at one of the interested venture capital firms told TechCrunch that investors are scrambling to get into the fast-growing company, and that their company is willing to offer a valuation of up to $3 billion, believing that’s what it might take to get into the next round. This person said an agreement was likely to be reached in the coming weeks.

Investors from two other companies confirmed that ElevenLabs is raising money, but is passing on the deal. One of these sources heard firsthand that the company’s annual recurring revenue (ARR) has increased from $25 million at the end of last year to nearly $80 million in recent months, making it one of the fastest-growing startups developing real-world AI applications. (These investors requested anonymity for competitive reasons.)

If this revenue number is accurate, it means investors could value ElevenLabs at about 38 times the most recent ARR number. This multiple is slightly lower than some enterprise-focused companies like Hebbia and Glean.

The multiple may be lower because a significant portion of its revenue comes from consumer use of narration and personal video dubbing. Consumer revenues are often considered more volatile than revenues generated by business customers.

The round, if completed at a $3 billion valuation, would triple ElevenLabs’ valuation from January’s Series B, which was co-led by Andreessen Horowitz, Nat Friedman, and Daniel Gross.

This will be Eleven Labs’ third round in just over a year, but TechCrunch was unable to find out the size of the potential investment, as discussions with investors are still ongoing. Eleven Labs has already raised $100 million.

While Google’s Gemini and OpenAI have offered their own human voice models, neither company’s offerings can replicate the speech of other humans like Eleven Labs. Other companies targeting the artificial sound generation market include Murf, Tavus, Resemble AI, Respeecher, and Lovo.

ElevenLabs did not respond to a request for comment.