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Ada Support Inc., a Toronto artificial-intelligence startup that has become a go-to customer service “chatbot” provider for online companies has raised US$44-million led by Silicon Valley venture capital firm Accel.

The financing comes as Ada’s 100-plus clients deal with a quadrupling in customer inquiries through its chatbot software this month from February, Ada chief executive officer Mike Murchison said. “People are more at home right now” because of the pandemic. “As a result they tend to be using digital services more and customer service channels are experiencing higher volumes.”

Chatbot software reduces the time for companies to answer customer questions by providing automated answers, helps human service agents become more productive and captures data from inquiries that help guide business strategies.

Ada had already tripled sales in each of the past two years and is generating revenue at a rate of US$10-million-plus annually. Its customers include retail technology company Shopify Inc., teleconferencing software provider Zoom Video Communications Inc. and digital marketing company Mailchimp. Telus Corp. is also among its biggest clients.

“Ada is probably the one company I’m least worried about in our portfolio” said Boris Wertz, founding partner with early funder Vancouver-based Version One Ventures, which also participated in the latest round with Bessemer Venture Partners, Firstmark and Leaders Fund. “They’re giving companies the ability to scale up customer service and response times in these unprecedented times.”

The company, co-founded by Mr. Murchison and head of product David Hariri, started in 2014 as Volley Industries, a social app for people looking to source help from other company founders, designers and product professionals. But as Volley scaled up, it was overrun trying to deal with customer service inquiries. When they asked other digital companies how they dealt with customer service challenges they discovered the issue was widespread.

So the pair changed their business into a customer service technology provider. To learn what they needed to do, they spent a year in 2016-17 working as remote customer service representatives for seven online companies, answering calls, texts and e-mail.

Mr. Murchison said they found many questions were repetitive, mundane and easily answered, that existing software for agents was hard to use and that businesses wanted to offer more human help than possible. Ada, which now has more than 150 employees, says it has reduced customer wait times by up to 98 per cent, solves more than 70 per cent of customer Inquiries instantly and generates customer satisfaction scores of 90 per cent. “You don’t see that type of rate from [other chatbots] while also seeing customer satisfaction rates [rise]," Accel partner Ben Fletcher said.

Although Ada’s tool uses AI to answer routine questions, it is designed to be “Fisher Price simple” to use by non-technical agents, Mr. Murchison said. While other chatbot providers focus on fully automating customer service or efforts such as nudging customers who have abandoned shopping carts to finish purchases, Ada “focuses on the providing a great customer experience” by addressing questions quickly and effectively, said Bernie Leas, vice-president of operations with Balsam Brands, an online seller of artificial Christmas trees based in California. He said since Balsam started using Ada in 2018, the number of live customer chats has dropped by 50 to 60 per cent, and the company has identified ways to make its website more user friendly.