Facebook made one of its most significant moves to provide a better service experience to the businesses run on its platform. The social media behemoth acquired Kustomer, a startup that was created to disrupt the customer services industry with innovations.
Most of the innovations use tactics like providing better data to agents and a unified view of a customer. It does this by bringing data together from social media and other channels, so it can offer a complete historical overview of communications between customer and company. Kustomer can be seen as a new innovative CRM platform that will be integrated with Facebook.
The terms of the deal have not been officially released by Facebook, but some sources familiar with the matter said that it is valued at $1 billion.
More about Kustomer
Kustomer was co-founded by its CEO Brad Birnbaum and Jeremy Suriel after the two worked with each other in other places like AOL, Airtime and even sold a previous startup to Salesforce. They had also raised around $174 million in private funding from various investors, including:
- Tiger Global Management
- Battery Ventures
- Cisco Investments
- Redpoint Ventures
- Social Leverage
- Canaan Partners…among others.
According to PitchBook estimates, the company was last valued at $710 million. It is evident why Facebook is so interested in Kustomer and what they plan to do strategically.
The social media platform has been eyeing the customer services market where it wants to serve its businesses by doubling down, as evidenced by the purchase of Kustomer. About 175 million people are using Facebook to engage with customers and as online identities for their businesses.
The company has to compete with other platforms like Snapchat and TikTok, which are doing a much better job of selling their products to businesses, in addition to other services. Facebook realizes the need to step up to the challenge.