Sierra, a startup based in San Francisco, has made waves recently by announcing it hit a $100 million annual revenue run rate (ARR) just 21 months after launching. This rapid growth signals that businesses across various industries are increasingly adopting AI-driven customer service solutions.
Co-founders Bret Taylor, a former Salesforce co-CEO, and Clay Bavor, a longtime Google executive, were taken aback by the startup’s pace. They shared on their blog, “That’s a heck of a lot quicker than we expected.”
Sierra’s client roster includes tech giants like Deliveroo, Discord, Ramp, Rivian, SoFi, and Tubi, along with established names outside the tech world, such as ADT, Bissell, Vans, Cigna, and SiriusXM.
While Taylor and Bavor initially thought tech companies would be the first to experiment with AI customer service agents, they were pleasantly surprised by the interest from older, more traditional businesses as well.
The company boasts that its AI agents can manage a range of tasks, from verifying patients for healthcare providers and processing returns to ordering replacement credit cards and assisting customers in applying for mortgages—essentially automating many customer service functions that typically need human involvement.
Sierra does face competition from startups like Decagon and Intercom, but it positions itself as the leader in the AI customer service landscape.
In September, Sierra raised $350 million in a funding round led by Greenoaks Capital, which valued the company at $10 billion. Other notable investors include Sequoia, Benchmark, ICONIQ, and Thrive Capital.
With its current $100 million ARR, Sierra is valued at a hefty 100x revenue multiple, underscoring its rapid growth.
The startup uses an outcomes-based pricing model, which charges customers based on completed tasks instead of a flat subscription fee.
Taylor and Bavor first crossed paths at Google in 2005, where Taylor recruited Bavor as an associate product manager.
A Stanford computer science graduate, Taylor co-created Google Maps and later founded FriendFeed, which was acquired by Facebook. During his time at Facebook, he served as CTO and helped design the well-known “Like” button. He eventually founded Quip, a competitor to Google Docs, which Salesforce bought for $750 million in 2016.
After spending over a year as co-CEO of Salesforce alongside Marc Benioff, Taylor left the company in 2023. Bavor, who dedicated 18 years at Google leading products like Gmail and Google Drive, invited Taylor to lunch, where they decided to embark on the journey of launching Sierra.
