Zendesk is looking to invest in early-stage AI startups via its new venture arm.
The move is part of the company’s mission to stay abreast of the latest AI trends and enhancements, and harness the “transformative impact” of the technology.
By investing in startups, Zendesk Ventures hopes to broaden the company’s knowledge and understanding of AI, expand its marketplace of app and partner integrations, contribute to the broader growth of the AI industry, and identify potential acquisition opportunities.
In discussing the formalization of the company’s VC arm, CEO Tom Eggemeier confirmed that Zendesk would be investing "tens of millions of dollars" into its venture efforts moving forward.
He also commented on the news in a LinkedIn post, where he emphasized how big an impact AI will have on the future of the company:
“The future is clear: AI is essential for all businesses, and we’re not just adapting, we want to lead this transformation in customer experience. Zendesk Ventures is a big part of that vision, and it will help us propel the CX industry forward through AI innovation.
As customer and employee services undergo rapid transformation thanks to AI advancements, our investments go beyond fueling growth – they enhance our customers' ability to deliver outstanding service.
With promises of heavy investment, let’s take a closer look at how and where Zendesk is planning to spend.
Investment Strategy
Having made on-off ventures since 2018, the new VC arm is a formalized system that will focus primarily on seed and Series A rounds.
More specifically, Zendesk is seeking companies that specialize in customer service or related fields, focus on AI, are integrated or willing to integrate into its partner marketplace, and have an annual recurring revenue (ARR) of less than $50 million.
For organizations that meet these criteria, the company is willing to invest millions of dollars in a single deal.
