Talespin, a developer of enterprise XR learning technology today announced a $15 M Series B investment from its strategic partner, Cornerstone OnDemand (NSDQ: CSOD), a publicly-traded provider of web-based corporate training software valued at $3 BN. Talespin had previously secured $5.2 M in a Series A in 2018. Farmers Insurance Exchange and HTC are among the other strategic investors participating in this round.
Prior to founding Talespin, co-founder and CEO Kyle Jackson successfully co-founded OpenDrives, a storage solutions company that provides storage infrastructures to clients such as Turner, Disney, and LucasFilm. OpenDrives is now the gold standard for media storage and workflows across the world’s largest content brands. Founded in 2015, Talespin is Jackson’s first VR company. “The training space is where the customers for VR are today,” he told Forbes in an interview last week.
Talespin has been serving the insurance industry since 2017 when it built a VR training program for Farmers Insurance to simulate investigative tasks for claims adjusters. The company has since expanded that program, creating soft skills training applications for Farmers and announcing an off-the-shelf training solution for the whole insurance industry in 2019.
Talespin started working with Farmers in 2017 to develop VR training modules specific to home damage assessments for its Claims employees. They developed a soft skills program with an AI-powered virtual human, with a focus on simulating collaboration with third-parties vendors and customer experience training to empower Claims employees to provide a high level of customer service.
Stephen Fromkin is the co-founder and Chief Content Officer of Talespin, where he leads strategy and operations across new business, marketing, financial, and content production units. “Through our work with Farmers and others, we recognized a need in the market for immersive learning experiences, with XR showing its potential to close a variety of skills gaps. This led us to go deeper in the insurance space, creating “XR for Insurance,” an off-the-shelf training content library addressing training for critical communication skills and processes specific to insurance,” said Fromkin. Talespin has also been focused horizontally across industries on widely applicable leadership & communication skills. These content offerings are aimed at lowering the barrier to entry for businesses to adopt VR learning, giving wider access to its proven ROI.
With one hundred employees distributed across offices in Los Angeles, Seattle, Ottawa, Canada, and Utrecht, The Netherlands, Talespin is building its content on an XR technology platform, Runway, that is purposefully built to deliver enterprise applications on a range of XR devices, while collecting user responses. Runway gathers data on gaze, body movement, and facial expressions.
“Firing Barry” is a soft skills demo module that teaches interpersonal skills like conflict resolution and negotiation, but Talespin wants to build a diverse library designed to address common pain points. Although “Barry” is somewhat cartoony (we are still far from photorealism in VR), the virtual character has realistic body language and uses natural language recognition to talk like a human.
Talespin’s plan is to create an app store for enterprise XR training content that can be used by a much broader range of companies big and small for a relatively small licensing fee, still to be determined. This is exactly what Cornerstone OnDemand does. Jackson told us he thought pricing would be consistent with Cornerstone’s other titles with both packages and individual titles under five hundred dollars. “This will certainly help democratise VR training,” said Ted Schilowitz, the resident futurist at Paramount pictures. “Most companies don’t have the resources to build their own VR training modules, which can cost hundreds, even millions of dollars.” A Viveport for enterprise titles is an idea whose time has come.
The global human resource management market is anticipated to reach $38.17 Bn by 2027, a CAGR of 11.7%, from 2020 to 2027, according to a new report by Grand View Research, Inc. According to PWC, VR training takes 55% less time than traditional classroom training. “We worked with Talespin to create and deploy a soft-skills training simulation for 3,000 PwC senior-level executives at a recent event. This is just the beginning, as we plan on using this technology to not only train our employees – but introduce this way of training to our clients,” said Daniel Eckert, Managing Director, Emerging Technologies at PwC, about Talespin’s VR training.
This series B brings Talespin’s total funding to $20.2 million. They’ll use the proceeds to exchange Runway and expand its library. “We’ve built the camera, we’ve got a theater, but we are also building an airplane while flying it,” Jackson said. The company’s ambition is to produce as many as thirty training modules in 2020, ramping up to an ambitious fifty new content modules next year.
The 30-45 minute modules are made by matrixed teams of experienced designers, animators, category experts and programmers, who together produce each discreet experience. To date, Talespin has only completed eight modules. Because he’s been around the entertainment business his entire career, Jackson has a good working knowledge of the 2D production process. “It is similar, ” he said, “because we cast each module with experienced designers. Unlike a movie, this medium is plastic, changeable, and can be updated on the fly.” Through data collection and machine learning, the modules could be “realer than real.”
Jackson stressed that the investments are more business development than venture capital. Cornerstone OnDemand is a high growth, acquisition minded company which acquired Saba Learning for $1.4 Bn dollars last week. “We’ve been incredibly impressed with Talespin’s technology, leadership team and vision to transform the workplace through XR. ,” said Jason Gold, Vice President of Finance, Corporate Development and Investor Relations at Cornerstone. “Talespin’s technology is a perfect fit in our suite of products, and we look forward to working together to deliver great solutions for our customers.”