On Tuesday, Artificial Intelligence startup DigitalGenius announced it secured $3 million in its first round of institutional funding. The funding round was led by Metamorphic Ventures and other leading technology investors and venture capital firms, including Lerer-Hippeau Ventures, Lowercase Capital, RRE Ventures, Lumia Capital and strategic angel investors.
The New York-based startup deals with a platform that automates question-and-answer conversations, that suit the companies looking for a text-based customer support service without any actual person needed for it. The company’s technology makes use of the machine learning and natural language processing (NLP) to replicate ‘friendly’ human-like attributes. The company in a post stated, “The tool carries on a human-like conversation with people via SMS. As you ask questions, the system walks you through the sales funnel to the point, in the case of a car, it could direct you to a dealer in your area.”
DigitalGenius’ client list already includes many global brands like Unilever, BMW, number of banks and financial institutions. The company has many feathers to its cap that includes winning runner-up at TechCrunch Disrupt, winner of the Milken Institute Start-up Challenge, Unilever foundry50 and has been listed one among the top eight fintech start-ups of 2015. With the new funds, the company plans to expand its operations and turn its artificial intelligence technology into a viable product to communicate with consumers at scale.
David Hirsch, co-founder and general partner of Metamorphic Ventures said, “With the proliferation of the NLP and AI, more and more applications will be built that solve consumer pain points. The DigitalGenius team has built an amazing platform that enterprise customers and brands can leverage to increase customer satisfaction and reduce labor costs. I can’t wait to live in a world where interacting with the cable company is actually a pleasurable experience.”
While starting to looking for fund, the startup was trying to pull out $2 million but it gather so much interest from investors that the company ended up raising $3 million, said Mikhail Naumov, the chief strategy officer at DigitalGenius. With the market for the product growing, Naumov and the company’s founder Dmitry Aksenov they are looking out for guidance on the business and its growth as they lack business experience. He said,” we are certainly counting on investors to provide infrastructure support, on hiring the right talent, getting access to more clients and help designing the overall business strategy.”
The startup has offices in London and New York City and is looking forward to add 10 more employees to their team this year. “A significant portion of the funding will be devoted toward bringing talent on board. We are hiring aggressively right now and also plan to use this round of funding to productize our offerings.” 80% of the new hires are expected to be engineers while the rest would be for the business management roles.
Of late, there has been a drastic growth in the AI initiatives that includes small startups and even major tech companies. Last month alone, Nervana Systems, a startup that provides intelligent systems for companies to build better apps, raised $20.5 million. Followed by Atomwise, ‘deep learning’ startup to identify drug candidates pulled in $6 million. Giant tech companies like Facebook expanded its research division in Paris and Google also working on to improve the speech-recognition technology that has recently reduced the error rate to 8% from 23% in 2013. Replacing the human workers with the robots which would increase the efficiency and reduce the salary is the tempting factors that attracts many companies to want it which thereby create a market demand for it.