Respond.io Raises $62.5M to Expand AI Messaging Platform and Target Acquisitions

Respond.io has closed a $62.5 million Series B funding round led by Camber Partners, with participation from Endeavor Catalyst and existing investors, aiming to accelerate growth and acquisitions. The Kuala Lumpur-based startup, which provides customer conversation management software powered by AI agents, reported $35 million in annual recurring revenue (ARR) and a 169% year-over-year growth at a 30% profit margin.

Founded in Hong Kong in 2017 by Gerardo Salandra, Hassan Ahmed, and Iaroslav Kudritskiy, Respond.io relocated its headquarters to Malaysia in 2019. The platform supports mid- to large-sized B2C companies in managing customer interactions across messaging channels such as WhatsApp, Instagram, TikTok, Messenger, Line, Telegram, WeChat, voice calls, and web chat. Its AI technology automates handling high volumes of inquiries, lead qualification, and sales closure without human intervention.

Salandra, the co-founder and CEO, highlighted that Respond.io primarily serves “high-consideration” sectors including healthcare, automotive, retail, education, and travel, where customers typically engage in conversations before making purchases. The company’s ideal clients range from businesses with 200 to 10,000 employees.

Addressing concerns about AI tools like ChatGPT potentially replacing existing platforms, Salandra emphasized Respond.io’s strong market position, noting the company processes approximately 2 billion messages each quarter. He stated, “If I just look at the numbers, every day that AI becomes more prominent, we grow faster.”

Salandra explained that Respond.io’s pricing model is based on the volume of customer conversations rather than per-seat charges common among enterprise software competitors. This approach allows the company to maintain revenue regardless of whether interactions are handled by humans or AI agents. “When fewer humans use your product, they make less money,” he said. “But we don’t charge like that.”

The CEO criticized incumbent platforms, especially those dominant in North America and Europe, for being originally designed around email and phone calls with messaging added as an afterthought. He described a “data flywheel” effect where increasing message volumes improve AI capabilities, which in turn attract more customers and generate more messages.

Salandra also pointed out that Respond.io’s early start has given it a foundational advantage in AI development compared to newer entrants in the messaging space. “Because we started so long ago and we have such a strong foundation, we can provide better AI compared to someone who just entered into the messaging space,” he said.

Growth Strategy and Acquisition Plans

With the new funding, Respond.io intends to invest in hiring, organic growth, and acquisitions. The company is targeting two types of acquisition candidates: bolt-on technologies compatible with its ecosystem and established teams with strong customer bases in strategic markets such as Europe and North America. Salandra mentioned ongoing discussions with several potential targets and highlighted the time savings acquisitions could provide. “I can save myself six months to a year through an acquisition,” he explained.

Geographically, Respond.io currently earns about 30% of its revenue from the Asia-Pacific region, 30% from Latin America, and 20% from the Middle East and Africa, with North America and Western Europe contributing 20%. Salandra noted that North America and Western Europe are now the fastest-growing markets for the company and anticipates these regions will become the largest revenue segments within two to three years.

Financial Discipline and Future Outlook

Despite the substantial capital infusion, Salandra emphasized a disciplined approach to growth, stating, “We don’t want to be a growth at all costs company. Even with this money, we’re going to be very disciplined.” Looking ahead, he expressed ambitions for the company’s future, saying, “My favorite outcome? Ringing the bell at Nasdaq.”