Klaus: How An Estonian Startup Brings Customer Conversations to The Next Level
„CEE Star of the Week“ is our weekly series of short stories where we present a company from Central and Eastern Europe that has recently achieved something significant – closed an investment round, won a prize, successfully launched on a new market, made a prominent hire, etc. The stories can be found both on trendingtopics.at and trendingtopics.eu.
1966 – the year when the first chatbot Eliza was created with the idea to be an algorithm-based psychotherapist. Fast-forward 50 years from then, in 2020, AI-powered chatbots have already taken over many of the mundane customer service interactions. No matter what, however, human-to-human conversations continue to bring the most value to the experience of users and there are relationship-driven conversations that neither side wants automated. The Estonian Q&A and conversion review startup Klaus which assists support teams to deal with agent feedback and optimize their client communication processes has recently raised $5.4m to fuel its growth.
Kair Käsper and Martin Kõiva, the co-founders of Klaus, shared insights with Trending Topics about the business path of Klaus, the biggest challenges they have overcome so far, and the plans they have for the future of the company.
Trending Topics: What is unique about your platform and the solution that you provide to your business clients?
Martin Kõiva: Klaus helps companies improve their support quality and deliver consistent customer experiences through regular feedback to their support agents. This function is sometimes referred to as customer support quality assurance (QA) or conversation review. This is a major topic for large support teams and call centers around the world – Klaus provides a solution for this on the modern SaaS tool stack. We integrate with the likes of Zendesk, Salesforce Service Cloud, Intercom, and 14 other tools.
What does the $5.4 million investment round mean for your company?
It’s been a wild ride for Klaus since we founded it in 2018. We’re happy to have our customers Automattic, Wolt, Voi, Epic Games, SoundCloud, Doodle, Wistia, Euronics, and Trivago, and others by our side in this journey. And, with support from our new investor Global Founders Capital – and our previous VC investors Creandum, Icebreaker, and angel investors who also participated in the latest round, – we’re confident to make a real impact on the customer service quality in companies of all sizes.
What do you expect to achieve with the raised money?
Klaus is already serving customers as large as 5,000+ seats. We are now looking towards new ways of enhancing our solutions for other enterprise customers. The new financing round helps us pay extra attention to enterprise solutions and develop the product further to suit the needs of very large customer service teams.
How was the idea of Klaus born and was there an identifiable market demand in the beginning?
We built Klaus as a solution to a pain point we experienced first-hand while working together at Pipedrive, a leading CRM startup. After four years of building up the support function and hiring over 100 customer-facing professionals, it became clear that the best way to ensure consistent quality is to have a high-quality system for giving feedback to agents. Engineers have code review, content writers have the editorial process, support teams now have conversation review.
How did you manage to onboard clients such as Epic Games and Soundcloud?
Most decent-sized organizations have a quality assurance process but they just do it in spreadsheets. We’re building a product that is actually solving a problem for our users and making their processes more strategic and less time-consuming. Knowing the pain points firsthand, and actually using the product ourselves every day helps us to understand what our users want and need.
In addition, we put a lot of effort into building a beautiful and intuitive tool, and our customer support is first-class – which is, of course, given with the category of our product.
What is your business model?
We’re a subscription-based business and we charge per user, meaning for every reviewer and reviewee, who’s linked to the account.
What is your current market share and how well are you positioned in terms of competition?
It’s tough to say, to be honest. The market is still in its infancy and all players small, relatively speaking. We win over customers from the competition on a regular basis but we also believe that everybody has an important role to play as pioneers in creating this SaaS segment.
What have been the hurdles and challenges from the beginning? What challenges do you expect for the next 12 months?
I guess like with every new startup it’s about finding your place on the market, getting the first customers on board, and serving them with a solid product that helps to make their lives easier, not create additional commitments. We put together an awesome team of industry experts who have managed to do just that.
As we grow, it’s more and more about who we bring onboard and a lot of decisions rely on that. We’re a remote-first company, meaning that we need to work extra hard on keeping a beautiful company culture.
What is the biggest success of the company up to this point? What about the biggest failure?
We have onboarded enterprise customers of 5,000+ users who use Klaus every day to give feedback to their team, onboard new agents, and improve the quality of their conversations. There have been plenty of market and product hypotheses that have turned out not to be valid but we also would not count them as true failures because they have been crucial in helping us find the right direction afterward.
What are the future plans of your company for the next 12 months?
It has become very clear that there are many thousands of large customer support teams in the enterprise segment that desperately need a solution like Klaus. With that in mind, we plan on speeding our expansion into that segment.