South African venture capital firm Kalon Venture Partners and Mauritius-based VC Compass have invested in financial services chatbot provider, FinChatBot.
The investment amount is $500 000 (R7 million).
FinChatBot develops chatbots for financial service providers to acquire and retain customers through artificial intelligence-powered conversations.
The start-up company says the acquisition of new customers via an automated chat conversation has a much higher success rate than any other channel.
FinChatBot will utilise the investment to continue its growth and expand the client pipeline.
Antoine Paillusseau and Romain Diaz, FinChatBot co-founders, identified the opportunity to use chatbots to meet the expectations of customers. FinChatBot says it lowers the drop-off rate traditionally experienced by customers who engage with a call centre.
Founded in 2016, FinChatBot claims it has developed chatbot services for more than 10 top tier insurers and banks in SA.
"By implementing our chatbots, financial services providers are able to increase their conversion rates, reduce operational costs and gather more data about customers which can be used for product innovation and customer retention," says Paillusseau.
"The investment is a huge vote of confidence in our vision for FinChatBot and I am extremely excited to learn from and grow with our partners."
Fabrice Boull'e, partner at VC Capital, highlights the investment is as much in the leadership of FinChatBot as it is in the technology.
"FinChatBot's business model, based on an unmatched expertise in creating chatbots for the financial services industry, struck us as ahead of the regional competition. But in the end, our investment decision was mainly motivated by our trust in Antoine's capacity to lead FinChatBot to the top, as well as our appreciation for his straightforward personality and transparency," says Boull'e.
Clive Butkow, Kalon CEO, expressed excitement about the conclusion of this deal. "As a leading technology venture capital company, we are constantly searching for the best of the best in new and emerging technologies disrupting industries.
"Chatbots are undeniably one of the fastest growing customer service industries, disrupting a traditionally frustrating customer experience. We identified FinChatBot as one of the leaders of this new industry, not only in the financial services industry but the chatbot ecosystem as a whole."
"We are delighted to have Kalon Venture Partners as a co-investor. We are convinced that Clive and Kalon's experience will add immense value to unlocking FinChatBot's potential," says Boull'e.
"We believe FinChatBot has reached a significant milestone in its development by raising funds from institutional investors, and we look forward to seeing Antoine and the entire FinChatBot team accelerate."
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