Bret Taylor’s Sierra reaches $100M ARR in under two years
Sierra, a San Francisco-based startup that is just 21 months old, has announced reaching an annual revenue run rate (ARR) of $100 million, signaling remarkable growth in its AI-powered customer service agents tailored for enterprises. This rapid expansion reflects a broad adoption of AI agent technology across various sectors. The pace of Sierra’s success has even taken its experienced co-founders by surprise. Bret Taylor, formerly co-CEO of Salesforce, and Clay Bavor, a longtime Google veteran, noted in their blog that achieving this milestone happened far quicker than they anticipated.
The company’s clientele spans a diverse range of organizations, including well-known tech firms such as Deliveroo, Discord, Ramp, Rivian, SoFi, and Tubi, as well as more established companies beyond the technology industry like ADT, Bissell, Vans, Cigna, and SiriusXM. Both Taylor and Bavor had predicted that tech companies would be open to experimenting with AI-driven customer support, yet they were pleasantly surprised to see traditional businesses embrace Sierra’s offerings as well.
Sierra develops AI agents capable of automating tasks traditionally handled by human customer service representatives. These tasks range from authenticating patients within healthcare systems and processing product returns to ordering replacement credit cards and assisting customers in applying for mortgages. This innovation effectively streamlines customer service procedures, enabling greater efficiency and responsiveness.
Although Sierra operates in a competitive landscape that includes startups like Decagon and Intercom, it asserts a leadership position within the AI customer service sector. Its last funding round, in which it raised $350 million led by Greenoaks Capital, valued the company at $10 billion. Additional investors include prominent names such as Sequoia, Benchmark, ICONIQ, and Thrive Capital.
Sierra’s valuation stands at an impressive 100 times its revenue multiple, reflecting strong market confidence despite the inherent challenges of such a high multiple. The startup employs an outcomes-based pricing approach, charging clients based on completed work instead of flat subscription fees, aligning costs directly with delivered value.
The partnership between the co-founders has deep roots; Taylor and Bavor first crossed paths at Google in 2005, where Taylor hired Bavor as an associate product manager. Taylor, a Stanford computer science alumnus, previously co-created Google Maps and founded FriendFeed, which Facebook acquired. During his tenure at Facebook, he served as CTO and helped develop the “Like” button, later founding Quip, a competitor to Google Docs that Salesforce acquired. After his role as co-CEO of Salesforce, Taylor reunited with Bavor, who had spent nearly two decades at Google leading flagship products like Gmail and Google Drive, culminating in their decision over lunch to launch Sierra.
