Sierra

“The only way I can justify 15 or twenty billion in market cap for Sierra is not if I build a slightly better next generation service cloud, if I am the entire customer ecosystem for your entire business.”

“Sierra doesn't have their own model team. They use other people's models, right? Because the value of Sierra is the go to market. It's Brett Taylor.”

“I think Brett Taylor's actually trying to recreate the next generation of Salesforce. He is absolutely not playing the customer support game. He's moving into pre-sales.”

“If you use a tool like Sierra, the wedge right now is voice, but the important part is tool calling. 11 Labs lets you do some tool calling, but that's not the bread and butter.”

“And then chat GPT happened and then everyone realized actually customer service is going to be the biggest market for AI. And they've been on the journey since then. You know, I think in customer experience in customer service, Sierra, Decagon, everything happ…”

“There's a very high chance Sierra will get killed.”

“And the reality of a lot of, in full reality, a lot of the so-called ARR that you see with some of these companies that you mentioned is actually contracted ARR. So none of this is ever actually deployed in production at scale. Find me one real customer from a…”

“Our most recent customer actually turned off of Sierra to come to Decagon”

“So I think we actually just became as of the close last week on Tuesday, one of the fastest enterprise company with a direct sales motion to grow from one to 100 and 150. Bidding Sierra with one quarter.”

“There will always be capability overhangs. They may not stay still, and so you gotta be nimble. But the Sierras of the world, the Cognitions of the world, the Cursors of the world, the Decagons and Harvey's, these are all agent labs for their field. They can b…”

“Every one of our rounds, we actually guided to and took a lower price than we could have.”

“Some of our most effective employees of the entire company are 22 or 23 years old and have been completely AI-pilled.”

“Our first founding head of research was the Princeton professor who literally wrote the paper on language model based agents, the react paper.”

“And we're not, you know, we're not doing our own pre-training. We'll leave the capital expense there to, you know, the labs and the larger companies.”

“The capital expense the ongoing capital expense to create what is effectively a highly perishable bag of floating point numbers just doesn't work. Just doesn't work for any, but a small number of companies.”

“So today we have a set of our own proprietary fine tune models. But these are fine tunes on top of open weights models.”

“We have software engineers who are completely AI-pilled and using Cloud Code, Codex, our own internal agent we call Pinecone that we used to run much of the company on, and they estimate they are between three and 20 times more productive in terms of features …”

“We work with 40% of the fortune 50. We have 50% of our customers doing over a billion in revenue. We have 30% doing over ten billion in revenue.”

“So I, to date review and approve every single hire we make, and I get some help from pine cone and I've basically taught it.”

“Sierra brain is it starts with a 20 or 30 page document that grounds any agent in what we are as a company. What we do, how we're organized, our team structure, the competitive landscape, our strengths and weaknesses, all of these things. And then on top of th…”

“Brett is actually still an extraordinarily capable software engineer. It's remarkable. So, you know, some of the code that is in production, right, he has written”

“We will in short order be in a way, one of the larger B to C companies. We're doing that via our customers, but you know, we'll, we'll, we're serving hundreds of millions of interactions, right? Soon billions of interactions.”

“We are at multiple larger multiple larger size than one of our next nearest similar vintage startup competitors growing faster.”

“My hunch is it will be more like an Uber lift market. And we obviously think we're in the pole position to be the bigger of those two.”

“We then enlisted half a dozen design partners that we built the first version of our product and platform with and for. And these are, in the history of the company, legendary, legendary companies. Olokai, great flip-flops, you should buy them. SiriusXM, Sonos…”

“My understanding is, you know, Palantir has kind of low hundreds of customers. We are and intend to be at a lot larger scale than that.”

“You mentioned the six week cadence. We have kind of a tick tock, a three hour meeting and a one and a half hour meeting. We've done this since the beginning of the company”

“As for running the board meetings themselves, we don't have board decks, we have board memos. So Brett and I write a usually six to 10 page memo.”

“When we, in our first Black Friday, Cyber Monday with a set of retailers, one of one of our lead engineers, our head of operations, me or Brett, was in real time personally reading every single conversation that our agents were having, because we wanted to mak…”

“I now have a very complex networking setup that combines two cellular networks and a Starlink mini so that I have uninterrupted beautiful connectivity to and from the city every day.”

“We completely changed our engineering interview process. So it now looks much more like, here's a very here's a kind of prompt think through an application you would like to build. Cool. Okay. Here's a 150 dollars to spend on choose your coding agent. You can …”

“I will be disappointed if in the next no more than two months, not every one of our interviews has some strong AI native component to it.”

“I was on one side. It was like, I think we need better kind of process and structure around this thing. Brett was on the side of people and maybe we need different leaders or a different leader in this space. The answer is with most things like turned out to b…”

“We think about rather than dividing up the company, we think about Majors and minors for every part of the company.”

“If you talk to folks like at Finn or Intercom or Gorgias or Sierra and others, they're all saying that there's convergence that support sales and marketing are all converging because once you can AI-ify them, you don't want to have three different agents, righ…”

“These Sierra Decagons, and also legal Harvey, these were niche markets before agents. These were niche markets that are like 10 to a hundred times larger because the agents add so much value.”

“Customer support has companies like Sierra, Decagan, Which are already almost ten billion dollar companies.”

“And I'm betting that I'm, companies like Sierra and others will figure this out soon. But if they don't, then I think the spike has to come down.”

“If Sierra doesn't grow, let me put it bluntly, if Sierra doesn't grow, then at some point, OpenAI and Entropic will stop growing because their customers today are primarily software companies for coding, right? And selling through software companies to corpora…”

“They're solving the problem of, you know, solving support cases and tickets. That is a very low margin business, right? So, like, you can't have a million conversations and have it cost a lot because there's not a big upside to that.”

“And my guess is their LLM spend is sub-ten percent of revenues. In other words, LLMs are not the dominant portion of the value they deliver. It's the LLM plus the software, plus the whole thing, plus all the domain specific knowledge.”

“Very clearly with AI, it was very clear for us that, you know, step by step, it will go towards this consumptive world, right? First consumptive, and then maybe in the next step, once we have more verifiability in the system, then also towards maybe an outcome…”

“And by the way, Brett Taylor, a combination of Sierra and open AI would make so much sense, especially as open AI goes after goes after enterprises. It would be a perfect match.”

“I think customer support is uninvestable today, and I get so much shit on Twitter for this, because everyone shits on them, but I'm like, Sierra and Dakagon, obviously two market leaders in terms of brand, and how much money they've raised, and you've got 16 p…”

“But I also think, like, you look at, like, all of our competitors, like, you mentioned Sierra, DecGone, and all of the other ones, we power all of them.”

“It's the best thing for OpenAI not to buy Sierra, incorporate that as a customer support product, and have Brett Taylor come in as the day-to-day CEO, and Sam can be fundraiser, Sam can be master of...”

“There was a massive hiccup with AI agents that Sierra launched for Gap.”

“So, we have payers with AI agents that pick up the phone. And we have providers that have AI agents that pick up the phone and make phone calls. We have revenue cycle management companies that work to make outbound calls to do it. We've already had- ... We've …”

“We just did a great case study with SoFi and I'm really proud that we raised their net promoter score by 33 points, just because it's just so delightful.”

“We reached a hundred million dollars in ARR in seven quarters, a 150 in eight quarters. We're, I think, around one 65 now, one month into our you know, next quarter or so.”

“Well, they're automating 90% of their cases.”

“It's actually easier when the internet has never heard of you and you want to make a well-grounded agent, it's actually pretty easy because there's no temptation from the LLMs to go off script. So actually, I would say. Ironically, the harder challenge is when…”

“So we did all this work, and in fact, you know, we, I think, have the best Cantonese support on the market. Great for us, and it's a huge selling point, and it's a technology that will certainly be commodity, commoditized in three years.”

“So, we do outcomes-based pricing. So, for a customer service context, that means if the AI agent resolves the case, no human intervention there's a pre-negotiated sort of rate for that, and if we do have to escalate to a person, it's free. For sales, it would …”

“Ultimately, I think Decagon and Sierra are examples of companies where you're moving from proceed software to basically utilization based customer support related agents, right? That is a real shift. That may impact some of the prior wave of sort of perceived …”

“We looked at a number of companies that were behind Sierra and Decagon and came to the conclusion that a direct head-to-head Against those companies, when you're a smart, it's just a little bit too hard.”

“There is nothing even remotely closed to what is needed when you go to a complex vertical out there. Okay. And it's definitely not in the kind of Sierra level, but even if you take it to the level of the APIs, If I'm kind of taking an anthropic and an open AI,…”

“And I came up with the example of Sierra, which I think unique asset is Brett Taylor. I mean, they have full control of Brett, who's one of the best salespeople, chairman of OpenAI. He can make a call to any company, any country, and they'll take his call. You…”

“I would argue that actually, I think agents will go the way of outcomes based pricing where, you know, for example, at CIRA, we charge per resolved case for our customer service agents. I think if you made an agent to Audit your financials. You should pay per …”

“Your AI agent is going to be your digital front door, and most of your customer interactions will happen via your AI agent, not by, from your mobile app or your website, even if they exist in those platforms,”