Grammarly raises $ 200 million to expand its AI-powered writing suggestion platform


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Based in San Francisco, California Grammar, which develops an AI-powered writing assistant, today announced it has raised $ 200 million, valuing the company at $ 13 billion post-money. Baillie Gifford led the round with participation from funds and accounts managed by BlackRock. Grammarly Global Product Manager Rahul Roy-Chowdhury said the funding will be spent on developing the company’s technology and “to accelerate[ing] efforts to help people communicate… in our digital world.

As companies increasingly embrace digitalization, the $ 1.2 billion AI writing assistants market is growing. expected to grow at a compound annual growth rate of 27.6% from 2018 to 2028. According to a survey by John Snow Labs and Gradient Flow, 60% of technology leaders reported that their budgets for natural language processing – which includes techs like Grammarly’s – are up at least 10% from 2020, while a third say their spending has increased by more than 30%.

“From changes in tone to changes in communication in the workplace in general, the global pandemic has left a lasting impact on the way we communicate. Going to everything remotely – including school and work – has only increased the need for a digital communication aid like ours, ”Roy-Chowdhury told VentureBeat via email. “Poorly written communication was already estimated to cost businesses billions a year in lost productivity – and that was long before the pandemic forced people to start communicating remotely through all kinds of new connectivity tools.” and productivity. “

A brief history

Conceived by Ukrainian developers Alex Shevchenko, Max Lytvyn and Dmytro Lider, Grammarly was founded in 2009 as Sentenceworks shortly after the sale of MyDropBox, Lytvyn and Shevchenko’s plagiarism control startup to Blackboard. One of Grammarly’s first products was a simple WYSIWYG editor that users could paste text into, which evolved into an app providing spelling and syntax suggestions.

In 2012, Grammarly moved from a largely academic clientele to a larger consumer market, rolling out subscription plans and running ads on Facebook, Twitter and YouTube. In 2014, Grammarly released plugins for Microsoft Office that integrated its grammar checker with Outlook and Word. And in 2015, the company released the Grammarly browser extension for Chrome and Safari. A Firefox extension followed soon after, as did an add-on for Google Docs; the Grammarly Keyboard with message and email analysis for iOS and Android; and a desktop client for MacOS and Windows.

Today, Grammarly offers its entry-level Grammarly Premium service in English only for $ 30 per month (or $ 144 per year), while the enterprise level Grammarly Business starts at $ 25 per user per month. Both add style and vocabulary recommendations across platforms, as well as full sentence rewrites and a tone detector that can identify “temperatures” (eg, “aggressive”, “annoyed” and “excited”). in emails, documents and blogs.

“Our business model is a freemium model, where we offer a free version of our product as well as Grammarly Premium and Grammarly Business, which are paid upgrades,” a Grammarly spokesperson told TechCrunch in an interview in 2019. “The only way Grammarly makes money is through its subscriptions… We do not sell or rent user data to third parties for any reason, including to show their ads. Period.”

As of October, eligible Samsung smartphones running the Samsung Keyboard have benefited from Grammarly’s spellcheck technology. Grammarly’s handwriting suggestions are built into the Samsung keyboard, although access to the company’s premium features requires a subscription.

“Looking ahead, expanding our critical communications support begins with the launch of our latest product offering, Grammarly for Windows and Mac. It’s a new way to experience Grammarly on any desktop or online application, and a big step forward in bringing our writing support in real time to more places people write, like Microsoft PowerPoint and the native Slack app, to name a few. said Chowdhury. “We’re also going to double partnerships, our next frontier, to extend the reach of our writing assistance … And as more and more business leaders recognize the direct link between effective communication and business performance, we’re ready to go.” to meet the growing demand for Grammarly Entreprise. “

Expanding segments

Driven by the digital transformations that accelerated during the pandemic, more companies are expected to adopt AI technologies that automatically recommend and adapt copy, especially in marketing. According to a investigation Per Phrasee, 63% of marketing teams would consider investing in AI to generate and optimize advertising content. Sixty-five percent believe AI can generate desirable brand language, the survey found, while 82% believe their organization would benefit from data that provides insight into how consumers react to that language.

In an effort to broaden its appeal in markets with specific editing needs, such as sales, Grammarly recently introduced Grammarly for Developers, a development kit that allows companies to add Grammarly-based recommendations to web applications. existing. Grammarly for Developers, currently in closed beta, handles communication between applications and Grammarly’s cloud services, rendering underlines and suggestion cards, applying text transformations, and providing personal dictionaries.

“With Grammarly for Developers, we are helping developers provide a better writing experience for their users while saving them valuable time and resources to develop their own technologies,” added Roy-Chowdhury. “Our first Grammarly for Developers product, the Text Editor SDK, brings Grammarly’s communication aid to any web application… Grammarly is [now] available on more than 500,000 applications and sites.

In June, Grammarly rolled out additional features focused on corporate communications, including support for up to 50 style guides, code snippets, brand tones, and an analytics dashboard. Snippets are predefined response templates for quick communication. Branded tones are “tone profiles” that specify which tones team members should use and avoid. As for the analytical dashboard, it displays metrics that make it easier for managers to identify trends and strengths in communication.

Grammarly has competitors in Writer, Ginger, ProWritingAid, and Slick Write, which also provide an AI-powered writing assistant for a range of use cases. Opposed to Ginger, an English teacher writing for Fast Company find that Grammarly’s advice “lacks understanding of the nuance”, for example by overseeing layoffs too zealously.

But Grammarly – which has over 600 team members and is profitable – claims to have managed to attract 30 million users and 30,000 teams to date. New and existing customers include Frost & Sullivan, HackerOne, Lucid, Zoom, Cisco and Expedia.

The total capital of the company amounts to more than $ 400 million with the last funding round.

“In 2020 alone, we delivered 1,200 billion writing suggestions to our global user base. Sixty-eight percent of Forbes Global 2000 companies have at least one Grammarly user – and we expect this to increase dramatically in the years to come, ”Roy-Chowdhury said. “The number of Grammarly Business customers with large contracts has grown by over 250% in the past year alone. We also support over 6,800 nonprofits and non-governmental organizations from over 150 countries with a free offering, while Grammarly’s education division serves over 2,500 educational institutions with capacities tailored to their needs.

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