In 2017 Respond.io set out to solve a simple problem: businesses couldn’t keep up with customers switching to messaging apps. Today Respond has become one of Malaysia’s technology success stories with its customer conversation management software.
Kuala Lumpur-headquartered startup Endeavor Catalyst raised $62.5 million in a Series B round led by Camber Partners with participation from existing investors. Last raised $7 million Series A in 2022. According to TechCrunch, the company grew to $35 million in annual recurring revenue (ARR), up 169% year-over-year and with a 30% profit margin.
Co-founder and CEO Gerardo Salandra worked at IBM and Google before joining RuntasticA fitness tracking app sold to Adidas in 2015, he founded Respond in Hong Kong in 2017 with Hassan Ahmed (CTO) and Laroslav Kudritsky (COO). The team moved the business to Malaysia two years later.
The platform helps medium and large B2C businesses generate revenue from customer conversations across multiple messaging channels, including WhatsApp, Instagram, TikTok, Messenger, Line, Telegram, WeChat, voice calls and web chat. It also uses AI agents to automatically handle high-volume customer inquiries, identify leads and close sales without human intervention.
Salandra described its core customers as “high-minded” businesses where customers need to talk to someone before they buy, such as healthcare, automotive, retail, education and travel. “You don’t go to a website, put in your credit card and buy a car, you talk to somebody, you ask a lot of questions,” he said. Its sweet spot is companies with 200 to 10,000 employees.
The rise of artificial intelligence has raised an obvious question for platforms like Respond: Can tools like ChatGPT simply replace what they’ve built?
Salandra believes that her mount is strong enough to stop this kind of aggression. The company currently processes 2 billion messages per quarter.
“If I look at the numbers, AI is becoming more prominent every day, we’re growing faster,” he told TechCrunch. “We’re not seeing what the public SaaS markets are seeing.”
According to him, part of this is related to prices. Unlike its enterprise software competitors, which charge per seat, Answer charges based on the volume of customer conversations, meaning it doesn’t matter if a human or AI answers. “When fewer people use your product, they make less money,” he said. “But we don’t get paid like that.”
Existing platforms, particularly those that dominated North America and Europe, were built around email and phone calls. “The existing platforms have prioritized messaging as an afterthought. They’re very email-focused, they’re very call-focused, but when it comes to messaging, it’s an afterthought,” Salandra said.
According to the CEO, this volume of message data creates feedback. More messages mean better AI. Better AI attracts more customers. More clients generate more messages. “It’s what we call a data flywheel,” Salandra said. He added that a startup is also important for any startup AI company. “Because we started a long time ago and have such a strong foundation, we can provide better AI than someone who is just entering the messaging space.”
With the new capital, the company plans to continue hiring, organic growth and acquisitions, Salandra said. The CEO has two types of acquisition targets: technology that fits his existing ecosystem and teams with a strong customer base in strategic markets such as Europe and North America. “Imagine how many months I could save if I found the right company that already has clients and a team,” he said. “I can sustain myself for six months to a year with applesauce.” He confirmed that the company is already in talks with several potential targets.
A geographic push makes strategic sense. Respond currently derives approximately 30% of its revenue from APAC, 30% from Latin America, and 20% from the Middle East and Africa, keeping North America and Western Europe at a total of 20%. But Salandra says these regions are now growing the fastest. “It took longer to make the change, but now they’re moving very quickly to messaging channels,” he said, adding that he expects both regions to become the company’s largest segment within two to three years.
Despite the fresh injection of capital, Salandra is cautious about what will happen next. “We don’t want to be a growth company at any cost,” he said. “Even with this money, we’re going to be very disciplined.” But Salandra has bigger plans. “My favorite result?” he said. “The bell is ringing on the Nasdaq.”
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