Zendesk Targets “Essential” AI Startups with Global VC Arm

The company will be investing "tens of millions of dollars" to stay ahead of the AI curve.

Pastel pink piggy money coins saving, financial investment and budget concept, money in the bank deposit and growth, pig hd
Contact CentreSpeech AnalyticsLatest News

Published: June 21, 2024

Rhys Fisher

Zendesk is looking to invest in early-stage AI startups via its new venture arm.

The move is part of the company’s mission to stay abreast of the latest AI trends and enhancements, and harness the “transformative impact” of the technology.

By investing in startups, Zendesk Ventures hopes to broaden the company’s knowledge and understanding of AI, expand its marketplace of app and partner integrations, contribute to the broader growth of the AI industry, and identify potential acquisition opportunities.

In discussing the formalization of the company’s VC arm, CEO Tom Eggemeier confirmed that Zendesk would be investing “tens of millions of dollars” into its venture efforts moving forward.

He also commented on the news in a LinkedIn post, where he emphasized how big an impact AI will have on the future of the company:

“The future is clear: AI is essential for all businesses, and we’re not just adapting, we want to lead this transformation in customer experience. Zendesk Ventures is a big part of that vision, and it will help us propel the CX industry forward through AI innovation.

As customer and employee services undergo rapid transformation thanks to AI advancements, our investments go beyond fueling growth – they enhance our customers’ ability to deliver outstanding service.

With promises of heavy investment, let’s take a closer look at how and where Zendesk is planning to spend.

Investment Strategy

Having made on-off ventures since 2018, the new VC arm is a formalized system that will focus primarily on seed and Series A rounds.

More specifically, Zendesk is seeking companies that specialize in customer service or related fields, focus on AI, are integrated or willing to integrate into its partner marketplace, and have an annual recurring revenue (ARR) of less than $50 million.

For organizations that meet these criteria, the company is willing to invest millions of dollars in a single deal.

Indeed, Eggemeier confirmed that the company has already invested in PolyAI – a voice-based customer service provider – and unitQ, a customer feedback collection and analytics startup.

However, despite discussions around the amount the company will be looking to invest, the CEO was keen to highlight that profits were not the main goal of Zendesk Ventures:

It’s not as much about the returns, it’s more about putting people into the ecosystem.

More News from Zendesk

Zendesk has launched a comprehensive Workforce Engagement Management (WEM) solution as part of its new Workforce Engagement Suite, following the acquisitions of Tymeshift (July 2023) and Klaus (January 2024).

Though it doesn’t include learning management and gamification, it covers the essentials of workforce management (WFM) and quality assurance (QA), and introduces unique features not typically offered by other CCaaS and CRM vendors.

The system automates forecasts and uses the latest contact volume data to continuously optimize them for greater accuracy.

Additionally, Zendesk WFM uses this updated forecast data to automatically schedule and reschedule agents in real-time across channels, improving scheduling efficiency.

In other news, Zendesk announced new partnerships with AWS and Anthropic – in a move aimed at boosting the speed, accuracy, and efficiency of its AI offerings.

The collaboration with AWS will utilize Amazon Bedrock to develop and scale new generative AI (GenAI) applications.

Meanwhile, the partnership with Anthropic will integrate the Claude 3 family of large language models (LLMs), offering Zendesk customers greater choice and flexibility in AI models.

Artificial IntelligenceGenerative AI

Brands mentioned in this article.


Share This Post