Portland artificial intelligence startup Caravel was acquired by Commsor, a globally distributed company that builds community management software.
Terms of the deal were not disclosed but the entire Caravel team of six is joining Commsor. Caravel will continue in the near term as its own product, said founder and CEO Maxwell Folley, whose role will transition into vice president of product for Caravel.
Caravel, which has been through several challenges since it emerged from TechStars in the spring of 2020, makes software that gleans intelligence from different chat and conversation sources. Initially, the startup targeted corporate customer success, support and experience teams where the platform could help companies gain product and customer insights from customer calls, chats and service tickets.
However, as the product gained traction, those customers also wanted to use it in their community management to better understand their user communities, Folley said.
“We had customers in DevOps and fintech and they were managing and moderating communities over Slack and other platforms. It was a big tedious task for them,” he said. “They didn’t get much insight other than engagement numbers. The conversations themselves are what drives engagement and what makes a community whole.”
It’s this community aspect that ties Caravel to Commsor.
Caravel was able to raise a $1 million in summer 2021. One of those investors was Commsor. Folley said he and Commsor CEO Mac Reddin talked frequently and it became clear the two companies are aligned in vision and the product combination could do more than each could individually.
Commsor itself raised a $50 million Series B earlier this year. It has more than 40 employees worldwide.
“With this acquisition, we’re thrilled to support not only your Community teams but also Support, Success, and Product,” said Reddin in a blog post. “The qualitative insight from Caravel combined with the community touchpoints from Commsor will provide a holistic picture to understand what people are doing, what's important to them, and how you can better build your company around their needs.”
This year is shaping up to be a strong one for Caravel, Folley said. In the first quarter revenue doubled and in the second quarter it was up 160%.
For Folley the decision to sell was the best decision for the company. He has been building Caravel through several major challenges and was thinking through scenarios with not only a looming recession but the future of early stage fundraising in a tightening market.
“For us, even in the face of a downturn, we were having our best quarters back-to-back. We had a few other acquisition offers as well but this one was ultimately the most appealing to us,” he said.
Caravel went through a significant product pivot in early 2020. It was part of a TechStars Seattle cohort that started in February 2020, where it developed the current iteration of the product. It completed the program in May as the world turned upside down in the early months of the Covid-19 pandemic.
Folley and the company’s initial co-founder also decided to split that summer. So by the end of 2020, Folley was rebuilding the team and keeping the cadre of early customers on board as well as fundraising.
“It was definitely a challenge,” he said of the last two years. “There are ways to look at the timing. Going through TechStars and halfway through the program it shifts fully remote and the onset of the pandemic. And everyone sitting on their hands to see how this was going to pan out for the market and the economy.
“But some of the most resilient and successful companies have been built and come on to the market in (hard) times,” he continued. “A lot of the challenges that you face and getting really creative on tackling those problems, the regular challenges you have building a company don’t seem as significant. You build the strongest companies at those times.”
