Without meeting investors, earning $100 million annually: The 10-fold growth myth of an AI voice recorder.

Author | Huang Nan

Editor | Yuan Silai

Looking back two years ago, few could have foreseen that an AI card recorder that attaches to the back of an iPhone would enable a young company to sweep across overseas markets within a few years.

In 2021, Xu Gao, a young serial entrepreneur, was looking for his fourth entrepreneurial direction. He found that an app called "Live Transcribe" on Google had been downloaded over 1 billion times.

This is a real - time voice - to - text app. Based on Automatic Speech Recognition (ASR) technology, it can transcribe real - time conversation content into text. However, since it cannot store audio or text, users need to transfer the information to a Google Pixel to use it.

Voice - to - text is obviously a strong demand. In China, AI recorders that support real - time transcription account for over 35% of all recorders.

Surprisingly, there was no hardware product overseas that could solve this problem. The product iterations of major recorder manufacturers such as Sony, Olympus, and Philips had stagnated for nearly a decade. Their products still mainly focused on single - function recording and lacked technologies such as real - time transcription, multi - scenario adaptation, and intelligent noise reduction.

This was an excellent opportunity.

Noticing the urgent need of overseas users for voice - to - text tools, Xu Gao founded Plaud.AI and entered the market with recording devices. In the following year, the company released its first recorder product that could be controlled by a mobile phone and had IoT capabilities.

Within half a year, the company achieved profitability.

Since then, Plaud.AI has entered uncharted territory.

In June 2023, Plaud.AI launched the Plaud Note, a smart recorder with AI functions that can be controlled wirelessly. Its revenue and sales volume saw explosive growth.

Plaud Note (Image source/Company)

According to Z Potentials, as of November 2024, Plaud.AI's annualized revenue reached $100 million, with a ten - fold growth for two consecutive years. Xu Gao, the founder and CEO, also revealed in an interview with Time magazine that nearly 700,000 of their products had been shipped globally.

"What we're doing is like when wireless earphones replaced wired earphones. We priced our product at three times the industry average, but still managed to become the top - selling product in the category," he publicly stated in a media interview.

Investors, of course, didn't overlook this project. However, there is no public record of Plaud.AI receiving financing, and no investment institutions have spoken up or disclosed relevant information as investors.

Multiple industry insiders told Yingke that many investors are quite interested in Plaud.AI, but the founder has no intention of in - depth communication. An investor told Yingke that after the Plaud Note became a hit, many institutions approached the company to seek a stake, but they never even got to meet the founder.

Some investors also admitted that although Plaud.AI's growth rate exceeded expectations and some institutions had closely monitored the project, a real - world situation is that consumer - tech products like this are prone to pitfalls in the early stage, making it difficult for investors to make decisions.

"The core reason is that as a non - innovative product form, the differential value of an AI recorder is difficult to perceive intuitively in the early stage. Moreover, the needs of overseas users and domestic users are quite different, and the product's capabilities are uncertain. So, we are becoming more and more cautious about such projects," said Hu Yun, an investor focusing on the smart hardware field, to Yingke.

Behind Plaud.AI is a quiet transformation of hardware startups. In the past, entrants competed in terms of supply - chain capabilities, R & D strength, and the amount of capital. Now, entrepreneurs can leverage the elusive "experience" to tap into large markets.

Investors in the hardware track have found that when Chinese companies fully embrace the global market, the game has become more complex, and the time they have to hesitate is getting shorter.

From Solving Single - Point Tasks to One - Stop Solutions

Every other Friday, a cross - border e - commerce company in Shenzhen holds a cross - departmental inspection meeting at a factory in Dongguan.

Amid the noisy machine sounds in the factory, the operation, quality control, logistics, and procurement staff form a semi - circle. Some hold price quotes smeared with ink, while others hold samples randomly inspected from the production line, and they are also flipping through the logistics tracking maps on their tablets.

As they walk, they discuss the progress of rush orders from Southeast Asia, the quality inspection requirements of new European regulations, and the material preparation for the sudden additional orders from South American customers. Occasionally, Cantonese - Mandarin hybrids, Vietnamese weight units, and production - line jargon are mixed in the conversation.

In the past, three people were needed to record such meetings: one to record the whole process with video and photos, one to take notes on - site, and another to ask for details at key points. Even with the recording, various professional terms and cross - discussions still added a lot of difficulty to the post - meeting review.

After the meeting, they had to compare the scattered notes with the recorded audio and video, organize the meeting minutes, check the data, and break them down item by item. It would take at least half a day to present the materials to the boss. Once there was a market change, they often missed the best response time because they couldn't react in time.

Now, all these problems can be solved with a recorder the size of a card.

The Plaud Note is a wirelessly - controlled smart recorder. Users can start recording by simply tapping the start button. It is equipped with three high - sensitivity microphones to ensure clear and noise - free recording.

It has a thin and light design, with a thickness of only 2.9 to 3 millimeters. It supports Magsafe magnetic technology and can be attached to the back of a mobile phone. When fully charged, it can record continuously for up to 30 hours and store about 480 hours of audio content. It also has an AI noise - reduction optimization function. After recording, the content can be uploaded to the cloud for storage to prevent data loss.

The Plaud Note supports Magsafe magnetic attachment (Image source/Company)

In terms of specific functions, one of the biggest selling points of the Plaud Note is that as the world's first recorder equipped with ChatGPT, it effectively integrates AI intelligent algorithms with the recording function.

The Plaud Note supports text conversion in nearly 60 languages and can organize the recorded content into mind maps, notes, or diaries, improving the efficiency of information organization.

Plaud.AI has identified the most fundamental need of users: recording is just a means, and the ultimate goal is to complete content organization. For example, the ultimate goal of recording a meeting is to not miss any key decision - making points and to - do items, rather than just organizing a speech manuscript.

Recording with the Plaud Note (Image source/Company)

"Today, the market is flooded with various consumer electronics products, which have raised users' expectations for the function integration, scenario adaptation, and user experience of innovative products. Users are no longer willing to pay for a single selling point but hope that products can solve multiple problems in real life. For companies, whether a product can accurately address users' pain points requires the team to spend time understanding users in - depth in specific scenarios," said Hu Yun.

He told Yingke that the reason why the Plaud Note became a hit is that it has built a complete closed - loop user experience - from hardware audio collection, intelligent transcription to in - depth content summarization and refinement, forming a one - stop solution. There is no need to switch between different products, which greatly improves efficiency and convenience.

As Xu Gao said, "In the future, everyone will own a portable AI device to capture what they have said, heard, and seen."

So, Plaud.AI is constantly exploring. Xu Gao also revealed that the company is exploring how to integrate the Plaud Note into more work scenarios. For example, on the basis of generating summaries, it will add collaboration functions and connect with SaaS tool systems such as Salesforce and HubSpot through APIs to achieve automatic recognition of voice data and cross - platform synchronization.

If users want to record and generate meeting minutes simultaneously, Plaud.AI is the only option. So, it's reasonable for them to earn two types of income: the hardware itself is priced at $159, and if users want to use all AI functions, they need to pay a monthly subscription fee of $9.9.

Take a Gamble or Miss Out on Big Profits?

In the past two years, while AI hardware entrepreneurs flocked to capital - intensive trends such as humanoid robots and AI glasses, Plaud.AI set its sights on the seemingly traditional and even mundane recorder category.

In this tool track that has been marginalized by smartphones, it captured a potential business opportunity for exponential growth.

While experiencing explosive growth, Plaud.AI has attracted the attention of many investors and has become a big hit.

However, when Plaud.AI was first established, the situation was completely the opposite. Liu Chang, an FA who has long served consumer electronics and smart hardware projects, told Yingke that even a project as profitable as Plaud.AI was not popular in the early stage. "In many cases, such projects couldn't be promoted. Maybe even the CEO wasn't sure if the product would be a hit, and investors were even more hesitant."

Another typical example is LiberLive, a fretless guitar brand that achieved annual revenue of over 1 billion and became the world's top - selling brand within two years. However, when it participated in roadshows in the early stage, investors generally showed little interest in this innovative category.

Such consumer - tech products often face a certain cognitive lag in the capital market and exhibit unique investment - cycle characteristics. In the budding stage, early - stage investors hesitate because the product's demand has not been fully verified by the market, and it's difficult to foresee its user - growth potential.

Investment opportunities are fleeting.

By the time the product explodes in the market and the cash flow becomes stable, the company has established self - hematopoietic capabilities and is more inclined to maintain the independence of product iterations and business layouts. Instead, it is more cautious about capital, making it difficult for investors to get involved.

Plaud.AI at CES 2025 (Image source/Company)

"The traditional logical framework for consumer - electronics investment is no longer effective. In the past, investors could rely on technical - parameter comparisons, market - size calculations, and user - research data to make judgments, but this method has reached its limit. Hardware innovation has entered a vague area," Liu Chang told Yingke. "Now, the success standard of a hardware product is no longer determined by hardware parameters but by whether it can accurately capture users' pain points and needs and be deeply integrated with users' cognitive habits, usage scenarios, and emotional appeals. This dynamic relationship is difficult to foresee and decide based on any static market analysis."

Meanwhile, the hardware track generally faces the "sandwich dilemma", being squeezed between large manufacturers and white - label products from Huaqiangbei. Take the smart - recording track where Plaud.AI is located as an example. Such products are squeezed from above by mobile - phone manufacturers upgrading the AI transcription and note - taking functions of their native systems and from below by white - label manufacturers seizing market share through price wars.

"As product differentiation increasingly depends on scenario innovation and product experience, startups need to invest a lot of time and resources in user insight and software - capability building. This is destined to be a long - term process, which conflicts with the short - term return expectations of capital. Undoubtedly, this further deepens the investment - decision - making dilemma," Hu Yun told Yingke.

Looking at Plaud.AI itself, currently, it is trying to achieve differential coverage through a multi - matrix product strategy.

In August 2024, Plaud.AI launched the Plaud NotePin, a wearable AI recorder. It has a pill - shaped body and can be paired with various accessories such as lanyards, wristbands, and clips. It is priced at $169. The Plaud Note is positioned as a meeting - efficiency tool for managers and has a phone - recording function. The Plaud NotePin focuses on mobile scenarios and is designed with a magnetic - attachment wearable design to meet the needs of people in high - frequency conversation jobs, such as doctors, construction managers, luxury - goods practitioners, and digital nomads.

Two recording products launched by Plaud.AI (Image source/Company)

"We will develop product forms that can provide the best user experience for different groups of people and scenarios," Xu Gao said.

Plaud.AI needs to grow and stabilize quickly within a short time window because once mobile phones can perform the functions of the Plaud Note, it will be difficult for the startup to compete.

Anyway, Plaud.AI has shown an attractive picture to countless entrepreneurs: in the complex and vast overseas market, backed by China's strong supply chain, an unknown young person can also create a growth myth.

(At the request of the interviewees, the names of investors and FAs are aliases)