Customer service AI startup Sierra, co-founded by OpenAI chairman Bret Taylor, raised $175 million in a funding round announced on Monday.
Launched by Taylor and former Google executive Clay Bavor, Sierra offers AI-powered customer service chatbots to brands like SiriusXM, Sonos, WeightWatchers and AG1. Using “conversational AI,” the startup provides enterprises with customized AI agents that mirror the nuances of human communication to ensure seamless customer service interactions.
“We really think that your conversational AI agent should be not only transactional, but a brand ambassador,” Taylor told CNBC. “It’s actually something that is a statement of your values. So do you want to be sarcastic? Do you want to use emoji? Do you want it to sound like text messaging, or do you want it to sound like a lawyer?”
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Founded in 2023, Sierra’s valuation at the time of funding reached $4.5 billion in just over a year since its launch and four times its previous valuation of $1 billion in January. The funding round was led by Greenoaks Capital with ICONIQ and Josh Kushner’s Thrive Capital as participating investors. The latest funding brought Sierra’s total finances to $285 million, according to Crunchbase.
Headquartered in San Francisco, Sierra has competition with other industry giants such as Salesforce and Microsoft exploring the AI chatbot space in partnership with OpenAI.
Both co-founders are no strangers to customer service tech: Taylor served as co-CEO at Salesforce, after the company bought his earlier founded startup Quip in 2016 for $750 million, and even before that, he was Facebook’s CTO and served on Twitter’s board for a significant period; Bavor worked on Google’s customer-facing products like Google Workspace, Virtual Reality, Google Lens, and others at Google Labs for 18 years.
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Sierra’s latest funding follows numerous AI investments recently, including OpenAI’s monumental $6.6 billion funding. According to CB Insights, one in three venture dollars has gone to an AI startup in 2024.