Alexa Accelerator Alumnus Presence AI Acquired by Groupon
Earlier this month Groupon announced it had acquired Presence AI, a 2018 alumnus of the Alexa Accelerator run by TechStars that was a guest on Voicebot Podcast episode #64. Presence AI offered a text-message based appointment scheduling solution for hair salons and other small businesses. Michele Meyer, co-founder and CEO of Presence AI told Voicebot in September 2018:
“We believe that today a lot of businesses still rely a lot on phone calls and on emails while actually, people don’t want that. They want to be able to interact with their businesses over texting or over voice. Basically when they want how they want it.
“It’s interesting because when the web came up the success was that the businesses could have their customers actually come on their website and actually enter information in forms and so on. But today we don’t want to do that anymore. We have too many logins, too many passwords. We don’t want to download another app. So what do we want to do? We want to ask Alexa to book my next haircut appointment.”
Or, in the case of Presence AI’s first product, send a text message. The AI behind the product enabled salons to “accept and manage bookings, provide instant answers to customer questions, remind people when it’s time to re-book” along with other services all via text message according to the announcement. It appears that Presence AI had not yet rolled out Alexa integration at the time of the acquisition despite its background with the Alexa Accelerator. Sarah Butterfass, chief product officer at Groupon, commented on the acquisition and emphasized the alignment with a text and chat-based solution:
“Booking is a key part of our voucherless initiative aimed at improving the redemption experience, providing always-on availability, giving consumers more reasons to buy through Groupon and opening up our marketplace to a broader range of merchant. Presence AI’s technology is very complementary to what we’ve been building into our existing booking experience and will accelerate our roadmap with its text- and chat-based interface.”
Alexa Accelerator Momentum
Founded in 2015, data from Crunchbase and Pitchbook show Presence AI had only taken in $20,000 in outside funding. That is the standard Techstars baseline for its accelerator programs, but the company likely also accepted a convertible note in the amount of $100,000 jointly from Techstars and the Alexa Fund. There may also have been additional funding from individuals that were not reported to the venture financing databases. Regardless, Presence AI appears to have only taken seed funding before the acquisition by Groupon. Voicebot has not been able to confirm these details but will update this story as we learn more.
Presence AI is the second Alexa Accelerator alumnus to exit through acquisition this summer and the third overall. In June, Sensible Object, which participated in the inaugural Alexa Accelerator in 2017, announced that it had been acquired by game maker Niantic, best known for its Pokemon Go app. Although there appears to be no public record of the acquisition, Twine was acquired at some point by Freeconferencecall.com according to someone familiar with the founder. Other Alexa Accelerator alumnae have closed funding rounds subsequent to the program, including Pulse Labs, Novel Effect, Aspinity, and Jargon, but only two have thus far been acquired.
Growing Use Case
Michele Meyer highlighted in the announcement that over 3 million text messages had been generated by Presence AI over the previous year through interactions between the automated AI and consumers booking appointments and that merchants were saving time while also generating incremental revenue. In September 2018 when Meyer was interviewed for the Voicebot Podcast, he indicated that Presence AI only had one live customer and expected to bring three more live within the subsequent month. Many customer interactions required multiple text messages so the total users served was not in the millions, but likely was in the tens of thousands with services booked in the hundreds of thousands. Groupon also indicated that it had booked “tens of millions” more appointments for merchants in 2018 than 2017 so this is a growing area of interest for both the company and its own customers.
Another area of alignment between the companies resulted from a common vertical focus. Presence AI was primarily designed to support the “health, beauty and wellness space, which is one of Groupon’s largest categories.” Groupon also found it attractive that Presence AI also had a number of integrations with popular booking software providers such as Booker, MindBody, and Salon Biz.
Presence AI listed an entry-level package for customers at the time of acquisition for $69 per month for up to 200 users and a version that included unlimited texts and customer accounts for a single site for $189 per month. Both services offered a free trial period. The company also listed an enterprise-level agreement without set pricing. Meyer now lists his professional status in LinkedIn as “Director, AI + Messaging” at Groupon.