AI startup Decagon emerges from stealth with $35M in funding to revolutionize customer service with AI

The gold rush for artificial intelligence shows no signs of slowing down as investors and VC firms pour billions into innovative generative AI startups. One of the latest beneficiaries of this funding wave is Decagon, a tech startup specializing in AI-powered customer support solutions.

Today, Decagon officially launched from stealth mode, announcing a combined Seed and Series A funding round totaling $35 million. The seed round was spearheaded by a16z, while Accel led the Series A, with participation from prominent investors including Elad Gil, Aaron Levie (CEO of Box), Howie Liu (CEO of Airtable), Matt MacInnis (COO of Rippling), Aaref Hilaly (Partner at BCV), Mike Vernal (formerly of Sequoia), Frederic Kerrest (Co-founder of Okta), Jack Altman (CEO of Lattice), and Ed Hallen (Co-founder of Klaviyo).

Founded by CEO Jesse Zhang and CTO Ashwin Sreenivas, Decagon leverages generative AI to enhance or replace a company’s customer support team. Their platform, utilized by businesses such as Eventbrite, Bilt, Webflow, Substack, and Rippling, delivers AI-driven support that mimics human capabilities, efficiently managing complex customer service tasks.

Generative AI gained widespread attention with the viral success of the ChatGPT chatbot in late 2022. This technology is revolutionizing the customer service industry by providing human-like communication and personalized interactions.

With its new funding, Decagon positions itself against other well-funded AI customer support startups like Forethought, which has raised over $90 million from New Enterprise Associates and other investors.

“Customer support chatbots may seem like a saturated market, but many solutions are more hype than substance. Decagon stands out by creating AI agents that offer a genuinely human-like support experience, capturing the intricacies of large enterprises,” said Jesse Zhang, CEO of Decagon. “Our AI agents do more than answer queries; they integrate with existing workflows to perform actions like processing refunds or delaying shipments.”

Decagon also empowers customer support leaders with greater control and insight into their operations. Its AI-powered analytics dashboard automatically reviews and categorizes customer interactions, identifying trends and suggesting updates to the knowledge base to better address inquiries. This enables customer experience leaders to adopt a proactive rather than reactive support strategy.

“Collaborating with Decagon has been exceptional,” said Thatcher Foster, VP of Client Solutions at Bilt. “They have transformed our complex data and workflows into an intelligent, highly effective support tool for our members. Decagon has significantly enhanced our operational processes, and we look forward to a continued partnership.”

Accel partner Ivan Zhou told Reuters Decagon’s product is unique because it not only powers a customer-support chatbot but also acts as an internal support liaison, offering services like generating software bug reports, analyzing customer emails to suggest product improvements, and creating internal documentation.

As AI continues to reshape industries, Decagon’s innovative approach to customer support showcases the transformative potential of generative AI in providing efficient, human-like service.