Apr
06
2021
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Sendbird raises $100M at a $1B+ valuation, says 150M+ users now interact using its chat and video APIs

Messaging is the medium these days, and today a startup that has built an API to help others build text and video interactivity into their services is announcing a big round to continue scaling its business. Sendbird, a popular provider of chat, video and other interactive services to the likes of Reddit, Hinge, Paytm, Delivery Hero and hundreds of others by way of a few lines of code, has closed a round of $100 million, money that it plans to use to continue expanding the functionalities of its platform to meet our changing interactive times. Sendbird has confirmed that the funding values the company at $1.05 billion.

Today, customers collectively channel some 150 million users through Sendbird’s APIs to chat with each other and large groups of users over text and video, a figure that has seen a lot of growth in particular in the last year, where people were spending so much more time in front of screens as their primary interface to communicate with the world.

Sendbird already provides some services around that core functionality, such as moderation and text search. John Kim, Sendbird’s CEO and founder, said that additional developments like moderation has seen a huge take-up, and services it plans to add into the mix include payments and logistics features, and that it is looking at adding in group audio conversations for customers to build their own Clubhouse clones.

“We are getting enquiries,” said Kim. “We will be setting it up in a personalized way. Voice chat has certainly picked up due to Clubhouse.”

The funding — oversubscribed, the company says — is being led by Steadfast Financial, with SoftBank’s Vision Fund 2 also participating, along with previous backers ICONIQ Capital, Tiger Global Management and Meritech Capital. It comes about two years after Sendbird closed its Series B at $102 million, and the startup appears to have nearly doubled its valuation since then: PitchBook estimates it was around $550 million in 2019.

That growth, in a sense, is not a surprise, given not just the climate right now for virtual interaction, but the fact that Sendbird itself has tripled the number of customers using its tools since 2019. The company, co-headquartered in Seoul, Korea and San Mateo, California, has now raised around $221 million.

The market that Sendbird has been pecking away at since being founded in 2013 is a hefty one.

Messaging apps have become a major digital force, with a small handful of companies overtaking (and taking on) the primary features found on the most basic of phones and finding traction with people by making them easier to use and full of more interesting features to use alongside the basic functionality. That in turn has led a wave of other companies to build in their own communications features, a way both to provide more community for their users, and to keep people on their own platforms in the process.

“It’s an arms race going on between messaging and payment apps,” Sid Suri, Sendbird’s marketing head, said to me in describing the competitive landscape. “There is a high degree of urgency among all businesses to say we don’t have to lose users to any of them. White label services like ours are powering the ability to keep up.”

Sendbird is indeed one of a wave of companies that have identified both that trend and the opportunity of building that functionality out as a commodity of sorts that can be embedded anywhere a developer chooses to place it by way of an API. It’s not the only one: Others in the same space include publicly listed Twilio, the similarly named competitor MessageBird (which is also highly capitalised and has positioned itself as a consolidator in the space), PubNub, Sinch, Stream, Firebase and many more.

That competition is one reason Sendbird has raised money. It gives it more capital to bring on more users, and critically to invest in building out more functionality alongside its core features, to address the needs of its existing users and to discover new opportunities to provide them with features they perhaps didn’t know they needed in their messaging channels to keep users’ attention.

“We are doing a lot around transactions and payments, as well as logistics,” Kim said in an interview. “We are really building out the end to end experience [since that] really ties into engagement. A couple of new features will be heavily around transactions, and others will be around more engagement.”

Karan Mehandru, a partner at Steadfast, is joining the board with this round, and he believes that there remains a huge opportunity, especially when you consider the many verticals that have yet to adopt solid and useful communications channels within their services, such as healthcare.

“The channel that Sendbird is leveraging is the next channel we have come to expect from all brands,” he said in an interview. “Sendbird may look the same as others but if you peel the onion, providing a scalable chat experience that is highly customized is a real problem to solve. Large customers think this is critical but not a core competence and then zoom back to Sendbird because they can’t do it. Sendbird is a clear leader. Sendbird is permeating many verticals and types of companies now. This is one of those rare companies that has been at the right place at the right time.”

Feb
03
2021
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Rocket.Chat raises $19M for its open-source approach to integrated enterprise messaging

Chat platforms like Slack have been game-changers when it comes to what business users want and expect out of their work communications. Today, a company that’s aiming to move the goalpost again with an integrated, open-source alternative is announcing some funding to fuel its growth.

Rocket.Chat, a startup and open-source-based platform of the same name used by banks, the U.S. Navy, NGOs and other organizations big and small to set up and run any variety of secure virtual communications services from one place — they can include not just team chat, but also customer service, collaboration platforms covering your staff and outside partners, school classrooms, conferences and more — has raised $19 million.

The company plans to use the funding both to continue adding more customers, but also expanding the platform’s functionality, including more security features, a way to use the service over federated blockchain architecture, apps for marketplaces, options for bots, and more social media and omnichannel customer service integrations, and potentially facilities for virtual events.

As more business interactions have gone virtual, it has essentially opened the door for companies like Rocket.Chat building virtual communications platforms to build in an increasing number of features into what it does.

The Series A round of funding has four lead investors — Valor Capital Group, Greycroft, Monashees and NEA — with e.ventures, Graphene Ventures, ONEVC and DGF also participating. The Porto Alegre, Brazil-based startup (which is incorporated in Delaware) has now raised $27 million to date.

Rocket.Chat is not disclosing its valuation with this round, but it comes on the back of some significant growth in the last year. The startup now has 16 million registered users across 150 countries, with eight million of them monthly active users. Of that 16 million, 11.3 million users registered for the service in the past six months. It’s currently installed on some 845,000 servers, the company said, and has over 1,500 developers building on its platform.

Rocket.Chat’s funding and expanding business comes as part of a bigger focus overall for open-source platforms.

The promise of open source in the world of enterprise IT has been that it provides a platform to customise a service to fit with how the organization in question wants to use it, while at the same time providing tools to make sure it is robust enough in terms of security, extensibility and more for use in a business environment.

Over the years, it has become a big business opportunity, in line with organizations getting more sophisticated in terms of what they expect and need out of their IT services, where off-the-shelf apps may not always fit the bill.

Rocket.Chat positions itself as something of an all-in-one superstore for any and all communications needs, with organizations putting their own services together in whatever way works for their purposes.

It can either be hosted and managed by customers themselves, or used as a cloud-based SaaS, with its pricing ranging between free (for minimal, self-hosted services) to $4 per user per month, or higher, depending on which services customers want to have, whether its hosted and how much the platform is being used each month.

Image Credits: Rocket.Chat

As you can see in the mock-up here, its basic platform looks a little like Slack. But if you are using it for omnichannel communications for customer service, for example, you can build a platform within Rocket.Chat where you incorporate communications from any other platforms that might be used to communicate with customers.

Its work collaboration platform starts with Rocket.Chat’s basic chat interface, but also allows you to integrate alerts and links to other apps that you regularly use, as well as video calls and more. These and other functions built on Rocket.Chat can then be made to interact with each other — for example handing tickets off in customer service to internal tech support teams — or separately.

The idea is that by providing a version that can be hosted and managed by organizations themselves, it gives them more privacy and control over their electronic messaging.

Its thousands of customers reflect an interesting mix of the kinds of organizations that are looking for solutions that do just that.

Gabriel Engel, the CEO and founder, tells me the list includes several military and public sector organizations including the U.S. Navy, financial services companies like Credit Suisse and Citibank, as well as the likes of Cornell, Arizona State, UC Irvine, Bielefeld University and other educational institutions, and a number of other private companies. 

That flexibility does not always play to Rocket.Chat’s advantage, however. Controversially, it seems that the list also includes the other end of the spectrum of organizations that want to keep their messages limited to a very specific audience: Islamic State it turns out also hosts and runs a Rocket.Chat to disseminate messages.

Engel says that while this is not something that the company supports, and that it works with authorities to shut down users like these as much as it can, it’s a consequence of how the service was built:

“We are not able to track usage if they are running Rocket.Chat servers of their own,” he said. “There’s a reason why the U.S. Navy uses Rocket.Chat. And that’s because we cannot track and know what they’re doing. It’s isolated from any external influence, for better or worse.” He added that the company has policies so that if an illicit organization is using its SaaS version, these get taken down in cooperation with authorities. “But just as with Linux, if you download and run Rocket.Chat on your own computer, then obviously it’s out of our reach.”

Hearing about how a platform built with privacy by design can be abused, with seemingly little to be done about it, does seem to offset some of the benefits. The ethics of that predicament, and whether technology can ever solve it, or whether it will be up to government authorities to address, will continue to be a question not just for Rocket.Chat but for all of us.

In the meantime, investors are interested because of the alternative it provides to those groups that need it.

“In today’s environment, organizations must have a secure communication platform to engage teams internally, communicate with customers and partners externally, and connect with safe interest-based communities,” said Dylan Pearce, partner at Greycroft, in a statement. “Rocket.Chat’s world-class management team and open-source community lead the industry in innovation and provide a communications platform capable of serving every person on the planet.” 

Jun
20
2019
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Slack opens at $38.50, a pop of 48% on its first day of trading on NYSE as WORK

Slack, the workplace messaging platform that has helped define a key category of enterprise IT, made its debut as a public company today with a pop. Trading as “WORK” on the New York Stock Exchange, it opened at $38.50 after setting a reference price last night of $26, valuing it at $15.7 billion, and then setting a bid/asking price of $37 this morning.

The trading climbed up quickly in its opening minutes and went as high as $42 and is now down to $38.95. We’ll continue to update this as the day goes on. These prices are pushing the market cap to around $20 billion.

Note: There was no “money raised” with this IPO ahead of today because Slack’s move into being a publicly traded company is coming by way of a direct listing — meaning the shares went directly on the market with no pre-sale. This is a less-conventional route that doesn’t involve bankers underwriting the listing (nor all the costs that come along with the roadshow and the rest). It also means Slack does not raise a large sum ahead of public trading. But it does let existing shareholders trade shares without dilution and is an efficient way of going public if you’re not in need of an immediate, large cash injection. It’s a route that Spotify also took when it went public last year, and, from the front-page article on NYSE.com, it seems that there might be growing interest in this process — or at least, that the NYSE would like to promote it as an option.

Slack’s decision to go slightly off-script is in keeping with some of the ethos that it has cultivated over the last several years as one of the undisputed juggernauts of the tech world. Its rocket ship has been a product that has touched on not one but three different hot growth areas: enterprise software-as-a-service, messaging apps and platform plays that, by way of APIs, can become the touchstone and nerve center for a seemingly limitless number of other services.

What’s interesting about Slack is that — contrary to how some might think of tech — the journey here didn’t start as rocket science.

Slack was nearly an accidental creation, a byproduct that came out of how a previous business, Tiny Speck, was able to keep its geographically spread-out team communicating while building its product, the game Glitch. Glitch and Tiny Speck failed to gain traction, so after they got shut down, the ever-resourceful co-founder Stewart Butterfield did what many founders who still have some money in the bank and fire in their bellies do: a pivot. He took the basic channel they were using and built it (with some help) into the earliest public version of what came to be known as Slack.

But from that unlikely start something almost surprising happened: the right mix of ease of use, efficient responsiveness and functionality — in aid of those already important areas of workplace communication, messaging and app integration — made Slack into a huge hit. Quickly, Slack became the fastest-growing piece of enterprise software ever in terms of adding users, with a rapid succession of funding rounds (raising over $1.2 billion in total), valuation hikes and multiple product improvements along the way to help it grow.

Today, like many a software-as-a-service business that is less than 10 years old and investing returns to keep up with its fast-growing business, Slack is not profitable.

In the fiscal year that ended January 31, 2019, it reported revenues in its S-1 of $400.6 million, but with a net loss of $138.9 million. That was a slight improvement on its net loss from the previous fiscal year of $140.1 million, with a big jump on revenue, which was $220.5 million.

But its growth and the buzz it has amassed has given it a big push. As of January 31, it clocked up over 10 million daily active users across 600,000 organizations, with 88,000 of them on paid plans and 550,000 using the free version of the app. It will be interesting to see how and if that goodwill and excitement outweighs some of those financial bum notes.

Or, in some cases, possibly other bum notes. The company has made “Work” not just its ticker but its mantra. Its slogan is “Where work happens” and it focuses on how its platform helps make people more productive. But as you might expect, not everyone feels that way about it, with the endless streams of notifications, the slightly clumsy way of handling threaded conversations and certain other distracting features raising the ire of some people. (Google “Slack is a distraction” and you can see some examples of those dissenting opinions.)

Slack has had its suitors over the years, unsurprisingly, and at least one of them has in the interim made a product to compete with it. Teams, from Microsoft, is one of the many rival platforms on the market looking to capitalise on the surge of interest for chat and collaboration platforms that Slack has helped usher in. Other competitors include Workplace from Facebook, Mattermost and Flock, along with Threads and more.

Apr
30
2019
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Facebook Messenger will get desktop apps, co-watching, emoji status

To win chat, Facebook Messenger must be as accessible as SMS, yet more entertaining than Snapchat. Today, Messenger pushes on both fronts with a series of announcements at Facebook’s F8 conference. Those include that it will launch Mac and PC desktop apps, a faster and smaller mobile app, simultaneous video co-watching and a revamped Friends tab, where friends can use an emoji to tell you what they’re up to or down for.

Facebook is also beefing up its tools for the 40 million active businesses and 300,000 businesses on Messenger, up from 200,000 businesses a year ago. Merchants will be able to let users book appointments at salons and masseuses, collect information with new lead generation chatbot templates and provide customer service to verified customers through authenticated m.me links. Facebook hopes this will boost the app beyond the 20 billion messages sent between people and businesses each month, which is up 10X from December 2017.

“We believe you can build practically any utility on top of messaging,” says Facebook’s head of Messenger Stan Chudnovsky. But he stresses that “All of the engineering behind it is has been redone” to make it more reliable, and to comply with CEO Mark Zuckerberg’s directive to unite the backends of Messenger, WhatsApp and Instagram Direct. “Of course, if we didn’t have to do all that, we’d be able to invest more in utilities. But we feel that utilities will be less functional if we don’t do that work. They need to go hand-in-hand together. Utilities will be more powerful, more functional and more desired if built on top of a system that’s interoperable and end-to-end encrypted.”

Here’s a look at the major Messenger announcements and why they’re important:

Messenger Desktop – A stripped-down version of Messenger focused on chat, audio and video calls will debut later this year. Chudnovsky says it will remove the need to juggle and resize browser tabs by giving you an always-accessible version of Messenger that can replace some of the unofficial knock-offs. Especially as Messenger focuses more on businesses, giving them a dedicated desktop interface could convince them to invest more in lead generation and customer service through Messenger.

Facebook Messenger’s upcoming desktop app

Project Lightspeed – Messenger is reengineering its app to cut 70 mb off its download size so people with low-storage phones don’t have to delete as many photos to install it. In testing, the app can cold start in merely 1.3 seconds, which Chudnovsky says is just 25 percent of where Messenger and many other apps are today. While Facebook already offers Messenger Light for the developing world, making the main app faster for everyone else could help Messenger swoop in and steal users from the status quo of SMS. The Lightspeed update will roll out later this year.

Video Co-Watching – TechCrunch reported in November that Messenger was building a Facebook Watch Party-style experience that would let users pick videos to watch at the same time as a friend, with reaction cams of their faces shown below the video. Now in testing before rolling out later this year, users can pick any Facebook video, invite one or multiple friends and laugh together. Unique capabilities like this could make Messenger more entertaining between utilitarian chat threads and appeal to a younger audience Facebook is at risk of losing.

Watch Videos Together on Messenger

Business Tools – After a rough start to its chatbot program a few years ago, where bots couldn’t figure out users’ open-ended responses, Chudnovsky says the platform is now picking up steam with 300,000 developers on board. One option that’s worked especially well is lead-generation templates, which teach bots to ask people standardized questions to collect contact info or business intent, so Messenger is adding more of those templates with completion reminders and seamless hand-off to a live agent.

To let users interact with appointment-based businesses through a platform they’re already familiar with, Messenger launched a beta program for barbers, dentists and more that will soon open to let any business handle appointment booking through the app. And with new authenticated m.me links, a business can take a logged-in user on their website and pass them to Messenger while still knowing their order history and other info. Getting more businesses hooked on Messenger customer service could be very lucrative down the line.

Appointment booking on Messenger

Close Friends and Emoji Status – Perhaps the most interesting update to Messenger, though, is its upcoming effort to help you make offline plans. Messenger is in the early stages of rebuilding its Friends tab into “Close Friends,” which will host big previews of friends’ Stories, photos shared in your chats, and let people overlay an emoji on their profile pic to show friends what they’re doing. We first reported this “Your Emoji” status update feature was being built a year ago, but it quietly cropped up in the video for Messenger Close Friends. This iteration lets you add an emoji like a home, barbell, low battery or beer mug, plus a short text description, to let friends know you’re back from work, at the gym, might not respond or are interested in getting a drink. These will show up atop the Close Friends tab as well as on location-sharing maps and more once this eventually rolls out.

Messenger’s upcoming Close Friends tab with Your Emoji status

Facebook Messenger is the best poised app to solve the loneliness problem. We often end up by ourselves because we’re not sure which of our friends are free to hang out, and we’re embarrassed to look desperate by constantly reaching out. But with emoji status, Messenger users could quietly signal their intentions without seeming needy. This “what are you doing offline” feature could be a whole social network of its own, as apps like Down To Lunch have tried. But with 1.3 billion users and built-in chat, Messenger has the ubiquity and utility to turn a hope into a hangout.

Click below to check out all of TechCrunch’s Facebook conference coverage from today:

Mar
19
2019
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Salesforce update brings AI and Quip to customer service chat experience

When Salesforce introduced Einstein, its artificial intelligence platform in 2016, it was laying the ground work for artificial intelligence underpinnings across the platform. Since then the company has introduced a variety of AI enhancements to the Salesforce product family. Today, customer service got some AI updates.

The goal of any customer service interaction is to get the customer answers as quickly as possible. Many users opt to use chat over phone, and Salesforce has added some AI features to help customer service agents get answers more quickly in the chat interface. (The company hinted that phone customer service enhancements are coming.)

For starters, Salesforce is using machine learning to deliver article recommendations, response recommendations and next best actions to the agent in real time as they interact with customers.  “With Einstein article recommendations, we can use machine learning on past cases and we can look at how articles were used to successfully solve similar cases in the past, and serve up the best article right in the console to help the agent with the case,” Martha Walchuk, senior director of product marketing for Salesforce Service Cloud explained.

Salesforce Service Console. Screenshot: Salesforce

The company is also using similar technology to provide response recommendations, which the agent can copy and paste into the chat to speed up the time to response. Before the interaction ends, the company can offer the next best action (which was announced last year) based on the conversation. For example, they could offer related information, an upsell recommendation or whatever type of action the customer defines.

Salesforce is also using machine learning to help route each person to the most appropriate customer service rep. As Salesforce describes it, this feature uses machine learning to filter cases and route them to the right queue or agent automatically, based on defined criteria such as best qualified agent or past outcomes.

Finally, the company is embedding Quip, the company it acquired in 2016 for $750 million, into the customer service console to allow agents to communicate with one another to find answers to difficult problems. That not only helps solve the issues faster, the conversations themselves become part of the knowledge base, which Salesforce can draw upon to help teach the machine learning algorithms about the correct responses to commonly asked questions in the future.

As with the Oracle AI announcement this morning, this use of artificial intelligence in sales, service and marketing is part of a much broader industry trend, as these companies try to inject intelligence into workflows to make them run more efficiently.

May
16
2017
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Symphony, a messaging app backed by Wall St, gets $63M at a $1B+ valuation

 Symphony, a secure messaging app that counts 15 of the world’s biggest banks among its investors and 200,000 paying customers, has raised a new tranche of funding to fuel its expansion into new markets. Symphony has closed in on $63 million; and according to sources close to the company, the startup is now valued at over $1 billion — confirming our reporting from December. Read More

Mar
09
2017
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Google goes after Slack and splits Hangouts into Chat and Meet

Google’s messaging strategy can be confusing, but if there’s one thing that’s clear after today’s Cloud Next keynote, it’s that the company is doubling down on the idea that Hangouts is its enterprise product and Allo/Duo are its consumer communications apps. Read More

May
10
2016
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Slack debuts ‘Sign in with Slack,’ the work chat platform’s answer to Facebook Login

Sign In With Slack Slack is pushing to become the identity layer for all enterprise apps. The workplace chat app has already captured the eyes, minds (and wallets) of the tech world with its deceptively simple, zippy platform for people to communicate and collaborate with each other on projects. One of its chief hooks is the ease with which you can integrate lots of different apps so that you can communicate… Read More

Dec
10
2014
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‘WhatsApp For the Workplace’ Cotap Adds Universal Chat Feature Accessible Via URLs

Screen Shot 2014-12-10 at 17.38.30 Cotap, the enterprise messaging app founded by ex-Yammer execs that bills itself as a ‘WhatsApp for the workplace’, has launched a new feature to expand the circle of people who use the app: it now lets others send messages to those users via a URL on Cotap.me, without having to download the app itself. It comes on the heels of a desktop app launch for the product in October that… Read More

Sep
18
2014
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Convo Brings Chat To Its iOS And Android Apps

Convo Chat Enterprise social network Convo has finally brought chat from its desktop and web apps to mobile. Today, the company is rolling out a new version of its app for iOS and Android that significantly changes its look while bringing real-time chat to its users when they aren’t sitting at their desks. Read More

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