Open Source Conversational AI Startup Rasa Raises $26M in Funding Round Led by Andreessen Horowitz

Conversational artificial intelligence startup Rasa Technologies has closed a $26 million Series B funding round led by Andreessen Horowitz. The new investment will go toward improving the company’s open-source tools for building chatbots and other AI projects, an area that’s undergoing something of a renaissance in the wake of the ongoing COVID-19 health crisis.

Rasa Raise

Rasa’s core products are toolkits for building chatbots and what it refers to as contextual assistants. The company is best known for the Rasa Open Source platform for conversational AI, which Rasa claims has been downloaded more than three million times. There’s also the free, albeit proprietary Rasa X software, which acts as an assistant for building a virtual assistant with the open-source software. For revenue, there’s Rasa Enterprise, a more advanced platform that developers can use to design and launch chatbots that require greater scale. The enterprise services also cover compliance with different regulatory acts such as HIPAA and GDPR.

“A simplistic chatbot might be easy, but a resilient, fully contextual assistant that works is not,” Rasa CEO and co-founder Alex Weidauer said in a statement. “Rasa is committed to supporting the developer in creating robust, mission-critical bot applications, through better research, investment in open source software, superior developer tools and education, and flexible on-prem or cloud deployment.”

Chatbots in Favor

All told, the company has raised $40 million since its founding in 2016. The new funding is double the $13 million Series A round led by Accel that Rasa closed a little over a year ago. Since that round, Rasa says it has sextupled software downloads and educational material viewing, while member numbers have tripled. And the enterprise offerings have taken off with some of the most prominent companies in the world, including Orange, Adobe, BMW, and Deutsche Telekom.

Chatbots are undergoing a kind of resurgence right now, after what appeared to be a decline in favor of other uses for conversational AI. Other startups in the space are attracting investor attention or getting outright acquired. Expert-trained chatbot developer Directly closed an $11 million funding round in May, while international e-commerce platform CM.com bought chatbot platform startup CX for $17.5 million earlier this month, to give just two examples. And researchers at Facebook recently boasted that their new Blender chatbot outperforms any other, including Google’s new Meena chatbot, setting up a potential chatbot arms race among the biggest tech companies.

Chatbot Multiplication

In the last few months, the COVID-19 pandemic and the resulting self-imposed or mandated lockdowns and business closures have exploded the demand for interactive A.I. New chatbots have been deployed with amazing rapidity to relay public health information, answer medical questions without the need to talk to a doctor, and keep people informed about how a business is operating under the evolving safety guidelines.

The national governments in India and the UK have created COVID-19-specific chatbots on WhatsApp to answer questions about the pandemic, while in the U.S., state governments have also started asking developers like Voicify to design ways to communicate with citizens about COVID-19 through Alexa and Google Assistant.

For healthcare providers, companies like Orbita are building interactive voice and text chatbots. Medical professionals and policymakers are all looking for ways to slow the rush of calls to hospitals and doctors, whether that means integrating Hyro’s free coronavirus-focused version of its virtual assistant or adapting Microsoft’s template for the same purpose. Rasa’s open-source options are all but guaranteed to be part of plenty of businesses as AI-powered chatbots become as integral a part of a business as an email address.


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