Lernout & Hauspie Speech Products, NV: Financing from Start-up through IPO

In 1995, Lernout & Hauspie Speech Products (L&H) was poised for an Initial Public Offering (IPO) on the NASDAQ, home to industry heavyweights like Microsoft and Intel. If the IPO were to be successful, L&H would be the first Belgian company ever to list on the venerable stock exchange. For L&H, the IPO was a key milestone in its remarkable history. Since its founding in 1987, the company had several times teetered on the verge of bankruptcy, rescued only by the financial acumen of its energetic young founders who demonstrated the ability to tap a wide range of financing sources. In this case, Professors Herwig Langohr and Benoit Leleux, along with INSEAD MBA graduate Danny Lein (’96), introduce us to this feisty company and trace its rocky financial history, from its use of “guerilla financing” strategies to the moment Lernout and Hauspie must give the thumbs up or thumbs down to a tempting IPO offer.

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