Toronto-based Ada Support Inc. and San Francisco's Dialpad Inc. have agreed to merge in an all-share deal that values Ada at around $600-million, or about US$430-million, according to sources cited by The Globe and Mail. The transaction is expected to close as soon as next week, the sources said.
The deal marks a sharp comedown for Ada, which reached a US$1.2-billion valuation during the pandemic tech boom. Both companies sell AI-powered customer service software, and the merger is being framed as a way to combine Dialpad's enterprise telephony footprint with Ada's LLM-based automation technology.
Ada's valuation falls far below its pandemic peak
Ada raised US$130-million in a round led by Spark Capital at the height of the pandemic software bubble, briefly joining Canada's unicorn club. But tech valuations slid starting in late 2021, and legacy software providers have stayed depressed as investors question how much large language models will disrupt the market.
Like other emerging tech firms, Ada cut costs as conditions tightened. Sources told The Globe and Mail that the company eliminated half its marketing team in July and laid off 25 employees last week. CEO Mike Murchison co-founded Ada in 2016 with David Hariri, who left in July for a product role at Shopify but remains on the board.
What the combined AI customer service company will look like
Ada built its business around customer-service chatbots and later rebuilt its stack on LLMs, adding voice agents in April 2023 that could handle phone calls. That shift led to a rapid decline in revenue from older products but quick growth in its LLM-based offering. Even so, sources said overall revenue expansion has lagged other fast-growing AI companies, recently running at about US$50-million annually.
Dialpad, founded in 2011 and much larger than Ada's roughly 200-person team, sells contact-centre software and launched an agentic AI platform last October for building autonomous voice-and-text agents. Its clients include Randstad, Nasdaq and T-Mobile.
- Ada: Toronto-based, founded 2016, roughly 200 employees, ~US$50M annual revenue, LLM-based chatbots and voice agents
- Dialpad: San Francisco Bay Area-based, founded 2011, sells contact-centre software, launched agentic AI platform in October
