From Near Death With Chatbots To New Life In E-Commerce, Octane AI Raises $4.25 Million
A startup that builds conversational commerce tools for brands has raised $4.25 million to help build its presence in the growing world of e-commerce.
The funding for Octane AI, announced today, was led by Bullpen Capital along with participation from General Catalyst Partners, Boost VC, FJ Labs and others. (Octane AI’s three cofounders are also all alumni of past Forbes 30 Under 30 lists: Matt Schlicht for his startup helping musicians connect with fans, Leif K-Brooks for Octane AI, and Ben Parr for his work at celebrity-backed venture fund #DominateFund.)
The company is also debuting a new product called “shoppable quizzes,” which allows companies to build a feature on their website that lets users interact with chatbot-like AI to answer questions to better understand what products they’re looking for.
“The shoppable quiz is the idea of bringing the in-store conversation to the front page of an e-commerce website,” says cofounder and CEO Matt Schlicht. “It allows them to ask questions once you walk through that virtual front door.”
Online quizzes to help shoppers better understand their options aren’t entirely new. Companies like Care/of have been using them to help people navigate their vitamin needs, while the shampoo brand Prose uses theirs to help people find the right fit for their hair. However, Octane AI thinks their technology will help make it easier and cheaper. (The feature has been in private beta for two months with a few dozen companies such as DoeLashes and Beauty Bio.)
While the company has now raised $9 million since it began in 2016, the path to this milestone has not been smooth. During the early days of chatbots several years ago, Octane AI made celebrity-branded bots for celebrities like 50 Cent, Cardi B and Maroon 5 before pivoting to focus on e-commerce at the end of 2017. However, the founders realized they were getting pulled in too many directions and decided to focus on a single e-commerce platform: Shopify.
“What struck me was that they as a company were going after the bet that Facebook and bots or Facebook Messenger were going to be important,” says Megan Berry, Octane AI’s vice president of product, who joined the firm six months after it began. “But they didn’t have all the answers of how and why and what the use cases were, but they didn’t have all the ideas.”
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Image: Octane AI, which uses AI for conversational commerce, has raised $4.25 million. Source: OCTANE AI