The iPhone 4S hit shelves only today, but is already a huge hit with record pre-orders exceeding 1 million devices. The sales stampede is being attributed to an unlikely source, a virtual assistant embedded into iOS named Siri which represents a breakthrough in mobile computing. As Wall Street Journal reviewer Walt Mossberg put it, “(it)has to be seen to be believed.” Menlo Ventures was fortunate to have backed Siri at the A round alongside friends at SRI and Morgenthaler and was the largest shareholder at exit. So what’s the secret sauce and why did Apple choose Siri, among 500,000 other apps in the App Store, to become a core part of the operating system?
First is the paradigm shift of voice as the human-computer interface. There have only been a handful of shifts in history: the keyboard, the mouse, the touch screen, and gesture-recognition. With Siri, voice interaction becomes a reality by going beyond speech-to-text and deriving intent from the full string of words. Where Americans hear “Olive Garden” and think restaurant, a computer could conclude an olive colored garden, a garden of olives, or the proper noun Olive Garden. Siri’s magic is in mapping words to domains of expertise and handling commands properly.
Then there’s the persona. Years before funding Siri, our research led us to SmarterChild, an AIM chatterbot whose dialogue was little better than a Magic 8 Ball, yet it had amassed 10 million buddies that were sending billions of questions every month. The market was speaking. Siri’s dialogue capabilities are far more advanced, giving her a genuine sense of humor. The twitterverse is ablaze with a Siri Easter egg hunt looking for clever responses. For example, asking Siri “Do you know HAL9000?” gets a response “Everybody knows what happened to HAL, I’d rather not talk about it”. The illusion of Siri’s humanity ignites the imagination.
The value goes well beyond the fun though; Siri helps users get things done quickly. As the Menlo team researched and speculated on the future of mobile search, we arrived at the conclusion that it should behave much differently. Rather than a page of blue links, mobile users would want action. If Siri could respond to “Book me a table for 2 tonight at Madera at 7” with a simple confirmation, it would be much preferred to a link to the OpenTable website. Siri’s intent engine correctly parses strings into the appropriate web API parameters to get real work done.
Finally and most importantly, as any investor knows, is the quality of the people involved. It was clear Siri would be a hit if she delivered, but could a problem that has alluded computer scientists for decades be solved by a small team on a timeframe that would yield venture returns? Here we hit the mother lode with three co-founders who were exceptional in their own rights but complemented each other perfectly. Dag Kittlaus, formerly of Motorola, was bursting with vision, Adam Cheyer, having led SRI’s CALO project from which the Siri underpinnings originated, was an engineering execution machine, and Tom Gruber, formerly a research scientist, was deeply steeped in AI theory. There was significant technical risk, but if anyone was going to persevere—they would. Complementing the team were great fellow board members Gary Morgenthaler of Morgenthaler Ventures and Norman Winarsky of SRI. Board meetings just clicked.
When Apple approached Siri to acquire them, the decision to sell was a tough call and there was lot of hand-wringing at the Board level. Siri had just raised a new round from Horizons and had close to $20 million the bank. But ultimately, we knew Siri would become more spectacular in Apple’s hands and the offer was too compelling to turn down. I’m sure I speak for the whole board and team when I say that we couldn’t be more pleased to see the world welcome Siri with open arms after unwrapping their new iPhones.
Shawn Carolan is a managing director with Menlo Ventures. Currently, Shawn sits on the Boards of IMVU, PlayPhone, Roku, Talari, TeleNav (NASDAQ: TNAV) and YuMe. Additionally, he tweets here. Opinions expressed are entirely his own.