Contact centers play a key role in the calls a company initiates with its customers, which is a $400 billion global market. Today, a company that believes it can improve the way agents work within them with AI is announcing a major fundraising. Observe.ai – which provides natural language tools to track voice and text conversations, and to provide guidance for subsequent engagements and to use the data for compliance and other reporting requirements – raised $125 million , funding that it will use to continue to develop its technology and access more markets.
Its goal, said Swapnil Jain, CEO of Observe.ai, is to target the “dreadful experiences” that tend to be the norm for contact center engagements.
The company counts a number of large multinationals among its customers – it does not disclose which ones, but Jain mentioned a few large telecommunications companies by name in our conversation, without confirming whether they were actual customers. The ones it discloses on its site are smaller names like Kin, Beyond, and Public Storage. The company said in March that ARR had increased by 150%, with customer interactions analyzed by its AI increasing by 3 times, and a 426% increase in AI-based agent ratings, with a 201% increase in AI-based agent coaching sessions.
(He doesn’t disclose actual revenue figures, so take the percentages with a grain of salt…)
The funding is a Series C and has notable investors. SoftBank Vision Fund is leading the round, with participation from video conferencing giant Zoom, alongside previous investors Menlo Ventures, Scale Venture Partners, Nexus Venture Partners and others. Observe.ai has now raised $213 million, and it doesn’t disclose a valuation, but for some context, PitchBook notes that San Francisco-based Observe.ai was valued at $304 million in July 2020.
Zoom is a strategic investor in this round, but Jain declined to elaborate on what the two will do together, although he said that would likely be revealed in a month or two. Recall that Zoom has had great ambitions to enter the contact center market for some time.
Zoom launched a new contact center solution in February 2022, though its bid to acquire five9, a big player in the space, for nearly $15 billion fell through after shareholders of the latter company complained. rejected the offer. While there may still be some debate about whether customers, or even agents or businesses, want a lot of video engagement in calls, there are times when you might imagine that might be useful, as in cases of technical assistance.
Observe.ai could provide a sweetener to this mix for potential customers, in the form of intelligence that can be applied to voice-only interactions and those that take place over chat. But it looks like it could also be measuring sentiment and conversations on Zoom’s most famous medium:
“It will be a first for us to work with video analytics,” Jain said, although it’s too early to say what value we’ll get from analyzing all of this.
The contact center market is one of the most vocal when it comes to enterprise software and its adoption of AI. Anecdotally, I’m not sure TechCrunch has covered a single contact center startup in the past few years that doesn’t relied on AI innovation to disrupt its operation. (Gong.ai, Google, TalkDesk and more are among those playing in this space.)
Observe.ai was incubated at Y Combinator (part of its winter 2018 cohort) and has been around since 2017, and it believes it has been one of the leaders of that movement, not least because of members of the team like Jithendra Vepa, its chief machine learning scientist, who previously led Samsung’s team working on its AI assistant Bixby. “We are focused on precision AI,” said Jain, who co-founded the startup with Akash Singh (CTO) and Sharath Keshava (CRO).
A critical point in the approach taken by Observe.ai is that it sees itself as an augmentation, not a replacement, of real agents, a distinction that promises to be a key point of differentiation between different AI approaches. .
“Tthere are going to be important workflows when we talk about contact entries. We know there will be support, but over 40% of customers also use contact centers for sales processes. When you’re a buyer buying insurance, you want to get human and trust. »
Part of the rationale for this big round of funding is also to give the company a track in the lead up to what it describes as “IPO readiness,” although there is no no timetable for how and when this might take place.
In the meantime, big backers are showing up for what looks like a big opportunity today.
“Observe.AI has a transformative vision to deliver actionable and trusted AI that empowers digital-first businesses to create exceptional customer experiences,” Priya Saiprasad, partner at SoftBank Investment Advisers, said in a statement. “The company has built an intelligent and flexible platform with endless use cases, from healthcare companies looking to improve patient experience to financial institutions aiming to increase revenue. We are thrilled to partner with Swapnil and their team to help them accelerate a paradigm shift within the contact center industry.