Portfolio company spotlight

“We are experiencing higher call volumes than normal. There are 20 callers ahead of you in the queue”. We have all been there. When calling customer service departments to solve an enquiry, one must first navigate a labyrinth of menu options, and thereafter wait for what feels like forever to be put in touch with the right customer service (CS) agent.

In today’s fast-moving digital age, end customers are no longer willing to wait. They expect instant help with their issues, 24/7 and demand nothing less than a personalized and specific approach. On the other hand, enterprises with large volumes of CS requests spend a significant amount of resources to ensure that these needs are met, employing a large number of costly agents to answer queries on a daily basis. However, 75% of agent time is still devoted to manual research, with valued customer interaction at a dismal 25%. Additionally, agents take long to train, are costly to replace and have high turnover rates. Furthermore, efforts to outsource CS to countries with cheaper labor costs rarely result in a consistent quality of service, often negatively impacting customer experience.

Considering all of the above, it has been clear for a while that the traditional call center operating model is no longer fit for purpose. To this regard, over the last two decades the general vision in the market has been CS automation, with the key purpose of decreasing costs, increasing efficiency and improving customer experience, ultimately increasing customer retention and top line growth.

Although several players have attempted to tackle CS automation, most existing solutions remain limited in their ability to truly solve all the underlying intricacies of the problem. Considering the large variety and volume of customer queries, in conjunction with customer expectations of a customized service, interactions need to be efficiently personalized. It is therefore necessary for conversational AI solutions to be use case agnostic, flexible and easily optimizable. This is not the case with most incumbent solutions, which have a limited ability to address the multitude of use cases/intents due to their fixed/constricted nature. Additionally, current solutions do not enable business users within CS teams to autonomously build and use automation tools without relying on scarce IT resources.

Parloa’s platform offers both customizability and enablement. The company’s front-end solution facilitates the workflow of business users within CS teams, enabling them to build, test and train voice bots themselves without over-relying on IT specialists or costly external consultants. Coupled with Parloa’s state of the art natural language processing technology and their own-built phone infrastructure, this enables them to easily customize the AI based on their client’s data and needs, ensuring higher efficiency/ lower errors, better recognition of end-user intents and ultimately a better customer experience and higher satisfaction.

Parloa’s vision is the full automation of CS communication, not only to the extent of improving the efficiency/costs of agent’s workflows, but to the extent of fully replacing agents’ tasks. To this regard, their focus is to build the leading platform for enterprises to leverage the best AI & step by step create the central ‘brain’ for any customer related communication. While parts of Parloa’s product and vision are not new, we find Parloa particularly interesting because they first started by building a solution to a difficult problem by tackling voice based CS (which still comprises the bulk of CS interactions and requires highly complex technology), whereas other new players have been focusing on building (simpler) text based solutions.

During the last year the company has been on an exceptional growth path and has shown proof of product-market fit in Germany, capturing large enterprise clients within the insurance/financial services and e-commerce verticals. It is our belief that Parloa is part of a new breed of conversational AI platforms, using a superior technical foundation and making personalization a seamless process. Parloa’s product has great potential to take a clear position in the CS software stack, providing sustainable value (ROI) for customers. We are very excited to support the company in its journey to become a leading player in the conversational AI category and to finally bring an end to the customer service mayhem.