Reflecting on Augment’s acquisition to Sutherland Global: What we learned from building and selling our own CX company

The background

Six years ago, chatbots were all the rage.  Facebook had just announced their now defunct bot solution.  Vendors were swarming the marketplace with AI solutions promising human level dialogue for customer support inquiries. The market would soon discover that while AI had made significant advancements, it had not become sentient.  After witnessing numerous mishaps with this technology in our customer base, in 2016 we carved out a small team from SVSG to build our own solution.

That platform became Augment, which would go on to raise 10M in VC funding and power numerous world leading brands.  Today, Sutherland Global is bringing Augment’s technology in-house to power their workforce of call center agents, and we couldn’t be more excited to see Augment’s AI further Sutherland’s mission to deliver “exceptionally engineered experiences for customers and employees”.

What we learned from working with Augment’s clients

The initial problem that Augment set out to solve was broken customer support.  We’ve all had the frustrating experience of attempting to ask what should be an easy question (is my product covered under warranty?), only to end up waiting on hold while a despondent customer support agent navigates what must be the Ninja Warrior equivalent of a database.

Sadly, while there have been improvements, for most brands customer support is still quite broken.  As the Augment team dug into the problem, it became clear that customer support is a second-order problem, and that the bigger problem is customer experience (CX).  The main drivers of call volume are issues related to the marketing, sales or product department.   Customers call in to vent about their frustrated experiences as much as they are looking for solutions.  To sum up Augment’s findings: the best customer service is the issue that never happened.

Another observation that became apparent is that digital-first companies don’t have nearly the same magnitude of service issues compared with older, more established brands.  It’s not because they have a better customer support team.  Rather, these companies have been designed from the ground up with a digital-first mentality.  This means that each department has a much clearer view into CX/EX, and is able to address experience issues before they boil up to the contact center.

How non-digital natives can get CX/EX right

As the world has become digital, brands have woken up to the fact that they need to prioritize CX/EX in order to remain competitive with digital-first natives.  In the digital world, the bar is no longer a company’s direct competitors, but any relatable experience.  Netflix has set the bar for navigating media, Google has set the bar for searching for content, Amazon for product returns etc.  If a business has friction points in the customer journey, like water flowing through a river bed, customers will gravitate toward a competitor who offers a smoother pathway.

Our experiences with Augment’s clients taught us that in order to get CX/EX right, non-digital natives need to equip themselves with digital infrastructure to capture the touchpoints along the customer and employee journeys.  These efforts are often described as “digital transformations”, but they often fall short because they require structural changes that are too burdensome for management to bear.  For this reason, we believe that owners and investors need to drive this change.

What’s next at SVSG

Over the past 10 years, SVSG has been conducting technology and product diligence for venture capital and private equity investors.  Most recently, with Augment we saw firsthand the important role that CX/EX have in capturing business value from digital transformations.  Through these experiences, we have come up with a framework to model the financial risks and opportunities associated with going digital.  Follow our journey as we share our approach to unlocking the remaining 90% of the US economy that has not yet been digitized.