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Gupshup, a messaging-focused customer engagement platform, today announced that it raised $100 million in funding from Tiger Global Management, valuing the startup at $1.4 billion. Gupshup says the proceeds will be put toward its go-to-market, product, and customer acquisition efforts as the company anticipates the close of a second, “significant” additional round.
The ubiquity of smartphones and messaging apps — as well as the pandemic — have contributed to the increased adoption of conversational technologies. Fifty-six percent of companies told Accenture in a survey that conversational bots and other experiences are driving disruption in their industry. And a Twilio study showed that 9 out of 10 consumers would like the option to use messaging to contact a business.
Gupshup, which was founded in 2014, offers a chatbot authoring service that allows developers to create, deploy, and publish chatbots across over 30 channels. The company claims to send more than 6 billion marketing, sales, and support messages between over 100,000 businesses and 300 million customers via Facebook Messenger, Telegram, Skype, Slack, and more per month.
India is one of Gushup’s largest markets. According to cofounder and CEO Beerud Seth, in recent years, business messaging has become more widespread there as text messages have begun to include hyperlinks and leverage newer IP-based messaging channels like WhatsApp, rich communications services, and Gupshup’s own Gushup IP (GIP).
Gupshup pitches GIP as a “smarter,” “more conversational” messaging service that’s compatible with a range of mobile devices. It comes in two flavors, GIP Native (which embeds in native messaging apps) and GIP Widget (a device-agnostic chat widget), and features end-to-end encrypted messages with buttons and rich media like ecommerce flows, mini games, and cards.
Gupshup also developed an on-device AI model for message classification and visualization. The model reads incoming messages and divides them into categories and sub-categories, after which it visualizes elements like amount and account number. Server-side AI models for natural language understanding field user queries sent to Gupshup’s chatbots.
Gushup occupies a chatbot market that’s anticipated to be worth $142 billion by 2024, according to Insider Intelligence, up from $2 billion in 2019. Gartner predicts that over 50% of enterprises will spend more per annum on chatbot creation than mobile app development by this year. And Juniper Research expects that 75% to 90% of customer queries will be handled by chatbots within the next year.
Even before the pandemic, autonomous agents were on the way to becoming the rule rather than the exception, partly because consumers prefer it that way. According to research published last year by Vonage subsidiary NewVoiceMedia, 25% of people prefer to have their queries handled by a chatbot or other self-service alternative. And Salesforce says roughly 69% of consumers choose chatbots for quick communication with brands.
Perhaps reflecting the growing chatbot demand, Gushup had an annual run rate of around $150 million as of 2020. It’s expecting over 50% growth in for next few years.
“The growth in business use of messaging and conversational experiences, transforming virtually every customer touchpoint, is an exciting secular trend,” Tiger Global Management partner John Curtius said in a statement. “Gupshup is uniquely positioned to win in this market with a differentiated product, a clear and sustainable moat, and an experienced team with a proven track record. In addition to its market leadership, Gupshup’s unique combination of scale, growth, and profitability attracted us.”
This latest tranche brings San Francisco, California-based Gushup’s total raised to over $150 million. Propr to this in March 2010, the company, which has around 250 employees, closed a $12 million series D led by Globespan Capital Partners.
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