Pam answering the phone at Dunder Mifflin became one of the most iconic refrains from “The Office,” and it’s really no wonder it was: businesses large and small have long relied on PBX communications. , voice mail, hot and cold calls, customer service lines, and most recently the inescapable cell phone.
All that has been changing, though, and today one of the startups hoping to be a leader in breaking that tune announced funding as it finds some growth, currently delivering some 10 million calls and messages a month for its customers.
open phonewhich provides a business line and related phone services to users through a smartphone app, becoming a user’s business phone separate from their private cell phones, has raised $40 million, a Series B it will be investing to continue expanding communication. and the collaboration services it provides and building deeper integrations with the other productivity tools its customers already use.
Tiger Global, known in the venture world for big growth rounds but in more recent times becoming more active in smaller, earlier-stage investments, is leading this Series B, with previous backers Craft Ventures, Slow Ventures, Garage Capital and Worklife Ventures among those also participating. Craft led OpenPhone $14 million Series A in 2020with Slow in the lead seed at the beginning of that year. Before that, the company went through Y Combinator in 2018. It has raised $56 million to date.
The married founders of OpenPhone, Mahyar Raissi and Daryna Kulya, respectively from Iran and Ukraine, are well aware that they are not the first to think of reinventing the humble business phone system.
Over the years, PBXs and basic phones have been replaced by IP PBXs and IP phones – telcos and managed service providers have had numerous stabs at the nebulous concept of “unified communications” around that . Meanwhile, OTT solutions like Zoom and other web-based video conferencing platforms are so easy to use (and still give people voice-based and dial-up options) that they’ve taken over many conference calling and networking capabilities. Skype calls to take for those who are self-employed or mostly alone.
Many people have stopped listening to voice messages, so messaging has become a much bigger part of the equation. Call centers are trying to make it harder to call them (and can be really frustrating when you do contact them), while some have given up land lines altogether to use only their cell phones to handle all their work calls.
In that context, OpenPhone’s unique selling point for the market, Raissi told me, is that it has built a system that caters to SMBs and brings elements of all of the above in a format that represents the lowest friction of all: a app that you can use with your regular phone, but that gives a person a dedicated work phone number and a growing number of tools to communicate with colleagues and clients.
He said that in the US, which is San Francisco-based OpenPhone’s main market today, Google Phone could have presented a significant competitive threat to the company, but failed to provide customer support to users, which essentially put it out of the running to tackle a bigger wave of business beyond single-user early adopters.
The company, as you might imagine with a YC startup, found its first traction with other entrepreneurs who went through YC, and has grown with its users. Currently, the company’s “sweet spot,” Raissi said, is between five and 500 employees, and to cater especially to larger organizations, it is phasing in more services, such as PBX replacements, and building integrations with CRM. and established sales software.
“One of the big goals is to invest in integrators,” Kulya said. “For example, a key piece is connecting OpenPhone to CRMs.” At the end of the day, he said, all of a person’s interactions through OpenPhone can be automatically logged in the CRM used by the team to track everything there. one reason why it’s unlikely to be an area where OpenPhone will invest to build its own CRM tools, He said the first integration will be with Salesforce, with Zendesk and others coming soon as well.
The crux of modern collaboration is conversation and OpenPhone wants to be a part of that. The idea is to bring part of the spirit of services like Slack to the telephone environment.
“We’re building phone services for the way people use phones today,” Raissi said, “so messaging is really important and so is collaboration around a phone number. You could have a shared number for a team and you could easily collaborate on texts and activities. We bring collaboration to the phone.”