Connectly, now bolstered by investment from Alibaba, leverages AI technology to personalize text messages for its customers, according to a report by Kyle Wiggers. Two days ago, the story highlighted how Stefanos Loukakos, who previously led Meta’s Messenger division and briefly engaged with the company’s blockchain project, identified a major challenge faced by online retailers. He observed that their untargeted marketing strategies—consisting of generic social media posts, texts, and emails—were failing to engage and convert potential shoppers.
Loukakos emphasized the necessity for businesses to develop winning messaging campaigns that not only automate interactions with both leads and customers but also tailor recommendations to help customers discover preferred products and allow companies to gain better insights into consumer behavior.
Loukakos and Yandong Liu, previously a CTO of Strava and a former Yahoo researcher, found common ground in their interest in messaging-based marketing, leading them to launch Connectly.ai in 2020. Their platform utilizes AI to enhance the sales processes of businesses, such as retailers and enterprise e-commerce companies, across any messaging platform. As Loukakos explained, Connectly enables customers to engage with messages without the burden of hosting, managing, or updating software.
Connectly’s technology seamlessly integrates with popular messaging platforms, including WhatsApp, Instagram, SMS, and web-based chatbots, allowing brands to construct ad campaigns and automate customer interactions. The AI system, which is tuned according to a retailer's product range and preferences and connected to the brand's online store, sends notifications like price changes, inventory updates, and promotions.
The platform also automatically segments customers based on interest, detecting when someone abandons their shopping cart and sending tailored messages offering discounts or reduced shipping as an incentive.
Regarding transparency and privacy, Loukakos assured that Connectly’s bots clearly disclose their identity and align with GDPR requirements, offering users the option to opt-out of brand messages.
While surveys suggest hesitation from consumers using AI chatbots over live agents, companies are increasingly deploying AI for its cost-saving potential. Gartner forecasts that by 2026, one in ten customer service interactions will be automated, aiming to cut down labor costs.
Connectly is gaining traction with over 300 subscribers expected to double revenue in 2024, building on last year’s fivefold increase to $3.5 million. While Loukakos refrained from specifying revenue figures, projections suggest it may reach $7 million this year.
Despite fierce competition in the conversational e-commerce sector, including players like Attentive, Twilio, and Infobip, Connectly’s appeal among venture capitalists endures. Alibaba spearheaded a recent $20 million Series B funding round, elevating Connectly’s total fundraising to $37.2 million, with a valuation of about $100 million.
Loukakos did not disclose potential strategic alliances with Alibaba but praised their involvement as significantly enhancing Connectly’s potential. An Alibaba spokesperson expressed their enthusiasm for partnering with groundbreaking companies, acknowledging Connectly’s innovative work in AI-driven conversational commerce.
Additionally, Unusual Ventures, Volpe Capital, RX Ventures, and Falabella Ventures joined the Series B round of funding. Loukakos plans to allocate these resources to expand Connectly’s platform and increase the San Francisco team from 65 to nearly 80 employees by year’s end.