RedRoute, a voice-based customer service experiences and conversational artificial intelligence startup, is going after an emerging $350 billion customer service automation sector.
When Brian Schiff, Sam Krut and Jacob Cooper founded the company in 2015, they were still undergraduates at Cornell University and it was initially an Uber-like social transportation app to help people find rides on college campuses where the transportation giant wasn’t operating.
Working with a number of taxi companies, Schiff told TechCrunch they realized much of the business was coming into the taxi services over the phone, and there would be too many requests and not enough phone representatives. That’s when they realized there was an opportunity to fix the back-end channels of customer service and contact centers.
Seeing the modern world of voice technology as more people were outfitting their homes with Amazon’s Alexa, Google Home and voice-controlled televisions, the trio pivoted their business in 2017 to create a similar experience for the world of customer service.
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Here’s how it works: Imagine calling customer service and being greeted by a voice-driven “Alexa-like experience” that is able to engage back and forth with a caller to help them resolve the simple requests that are coming in, Schiff explained.
It takes as little as 30 minutes to get RedRoute set up, and customers can try the software with zero upfront costs and risk-free, performance-based pricing, an industry first, according to Schiff. He estimates that RedRoute’s AI is able to handle an average of 50% of requests entirely with the product. For the other 50% of calls that are more complex, RedRoute will take in information and pass it along to agents who now have more time to give to those calls.
They worked on their product for a year and entered the market in early 2018 to work with their transportation customers. When the pandemic hit in 2020, RedRoute moved further into the contact center space and is now working with customers like Brooklinen, UNTUCKit, Pair Eyewear and GNC.
“It was an opportunity to move into e-commerce, and we got in with an initial batch of successful pilot customers and started to scale it up,” Schiff said. “Then we went in for the fund raise to really double down on those efforts.”
The funding round he refers to is $6.5 million in seed funding led by ScOp Venture Capital and Bullpen Capital, with participation from a group of angel investors. RedRoute previously raised a $2 million pre-seed round.
Schiff plans to use the new capital to grow the business across the board, product development and key leadership.
Among RedRoute’s competitors, he sees his company differentiating itself by offering those zero upfront costs and the call automation technology that is intelligently engaging with the customer, having a conversation and completing requests on its own. The company is also targeting smaller contact center organizations, where Schiff said there is not much adoption of call automation technology at all.
“These are companies looking to buy things off-the-shelf that are pre-integrated with their existing tech stack and don’t require engineering or some intense upfront investment,” he added. “We’re coming in with that solution where you’re able to step into the product, no money upfront, it’s free for 30 days, takes about 30 minutes to turn it on and you can see results on day one.”
Meanwhile, RedRoute is pushing 100 customers today, with three-times e-commerce growth in the fourth quarter where revenue also grew 10 times. That was all done with an employee headcount of 25 people, a number Schiff expects to increase to 40 by mid-year. The e-commerce side of the business is “growing at an amazing feat,” while the transportation side is recovering, he added.
“We feel like we’re in a position where we have established product-market fit,” Schiff said. “We’ve got strong traction in a big market, we understand how to grow it and this is the opportunity to scale it. That’s really what we’re thinking about and working on every day.”
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