#258 Brian Peterson: How Dialpad is Building the Future of AI-Powered Communication

0:00We're an AI powered customer communications platform and intelligence platform. So we do things like full contact center with Omnichannel. If you want to do, you know, online chat with your customers, social media chat with your customers, like WhatsApp integration, email. We do the full call center as well, all integrated with one full customer journey and all that. And then we do, on top of that, provide basically messaging, voice, video for everything you need, full communication platform worldwide. And then we run AI on top of it. So we, I mean, our focus is on customer communication and whatever is going to make that better or more efficient.

0:36It's a combination of all of it. I'm not a big believer that it's going to take over the world and you're not going to need, you know, a support agent anytime soon. And even if it does, it'll be able to do some really. So Brian, tell me, introduce to listeners who you are and what your background is as far as it's relevant to Dialpad and what Dialpad does. Yeah, for sure. So my background, real quick background, is I've been in communications and tech for over 20 years. I was back at Google. I started Google when I came out of college in 2002. There was about, I think, 600 people there. Wow. So I got to live a lot of the growth of Silicon Valley and got to live it all.

1:24So I was there for eight years, living through going from 600 to, I don't know, it was like 15 ,000 by the time I left. And then while I was there, I learned obviously a lot about cloud infrastructure and just Google infrastructure too. And my co-founder from Dialpad, he got acquired through his company, which is called Grand central at the time and they were a a phone system that like rings all your different phones and this is back in you know 2005 so this is really state-of-the-art stuff back then they got acquired and then i got brought in and introduced to them because i already knew the technology at google and the cloud stuff and they needed help porting their whole system to google and so i came in helped them migrate everything to google architecture and infrastructure and that became google voice Okay.

2:12So we were the team that built Google Voice. And then we were at Google and we're like, Google Voice is mostly a consumer product. And at the time we're like, this makes a lot of sense for businesses, the same technology. And we didn't think anything was that great out there. And so we left and that's how Dialpad started. Google funded us. And we even have Rich Minor on our board, the co-founder of Android. Sure. So we are all in on this and we're doing it now for 14 years. Wow. So, yeah, that's kind of our quick background, how we got started. Yeah. Google Voice still exists. Yeah, it does. Yeah.

2:49As a consumer product. It does. And it also is a business product. So Google did eventually sort of build it out for their for their workspaces product. Yeah. But it's pretty it's pretty lightweight. Like we're we're part of the more advanced version and full contact center and all that, too. Yeah. It's interesting things like Google Voice that they don't seem to promote at all. uh i mean i i've heard about it through friends i tried it years ago but uh they seem to have these products that are created pushed out and then they yeah you got to find them yep or they cancel them maybe yeah yeah yeah no they still are going strong on it um we don't really cross over much with them i think it's still a really good product if you want to get like a second phone number.

3:36So you don't have to give out your personal cell phone number. But I, yeah, we don't really cross over much with them. They seem to be mostly still consumer from what we can tell, but yeah, totally agree. Okay. So what does Dialpad do? So we, the quick phrase is we're an AI powered like customer communications platform and intelligence platform. So we do things like full contact center with Omnichannel. If you want to do, you know, online chat with your customers, social media chat with your customers like WhatsApp integration, email. And we do the full call center as well, all integrated with one full customer journey and all that.

4:14And then we do, on top of that, provide basically messaging, voice, video for everything you need, full communication platform worldwide. And then we run AI on top of it. So we bought a company about eight years ago called TalkIQ, which was way before obviously this big boom in like this version of AI. And they did voice AI. And we already knew when we started building this that the future of communications is going to involve a lot of AI. They need to go hand in hand. And so we kind of knew that was happening. And we saw this company and we said, hey, this is a perfect fit. They could do live transcription and coaching on a live sales call.

4:56And we're like, if we can connect that with our platform, this is going to be gold. And that's what we've been doing for the last eight years is building out that team, connecting all the pipes. And now, as far as I know, we're one of the few people who can do real live coaching. Things like if someone asks a question on a live phone call, we can provide the answer. Not a chat, but an actual live conversation like we're having right now. It can respond. And that's obviously super useful for support teams. It's really useful for sales. So if someone calls in and they're like, want to ask about your competitor, right?

5:26You might be a new sales rep and you might not remember how to answer, how do I go against my competitor? It detects the question and it automatically pops up for the agent on their screen, the sales rep. Hey, here's how you should answer this. And that's a feature we've had for seven years and it's one of the biggest sellers we have. But we do other things like all kinds of stuff with this data and we have all this vast amount of data. We have 8 billion minutes of sales and support conversations running through our platform. And so we do a lot of other things with AI, like customer satisfaction is another big feature of ours.

5:56We have automatic AI customer satisfaction. And I know if you've ever called into something and at the end of the call, it says stay on the line for a survey. Right. Right. And no one ever does it. Or if you stay on the line, it's usually because you're pissed off. Right. And then, so it's probably gonna be a bad rating. Well, we built a model that's all our own that does. Analyzes the customer satisfaction of every single conversation to 90 % accuracy. And so now instead of like only having 5 % of your conversations, like graded and customer satisfaction rated we're doing night you're doing 100 right and so then that can tell you like who are your best sales reps who are your best agents who are the agents who when they talk to you the customers are the least happy right like that's super important information or what are they complaining about right you have you have millions of minutes on your call center in a month what what are they talking about like are they complaining what features are they complaining about so like that's our thing is we're unlocking all that data too and so like our other slogan is like voice is the last offline data set.

6:55It was really, if you think about business, it's the only thing that isn't tracked. Yeah. Right. Because it's so it's hard to do it. You have to transcribe it. You have to then analyze it with natural language processing. And the way we've been able to scale is we built all of it ourselves. So all the AI we do, our own transcription, we do our own transcription with high accuracy. We do our own large language model, which we call Dialpad GPT that analyzes all these calls. We have a vast amount of PhDs and AI people at our company. And so we've just been cranking away for the last seven years building out all these things.

7:29And it's that perfect combination of AI with communications. So that's our thing. The model, is that a fine-tuned open-source model? Is that built on Lama? Yeah. So we took everything that's pretty much open-source and we combine it. We fine-tune it. We have our own recipes of tweaking these models to get the best out of them. And then we take our like eight plus billion minutes of conversations that are like 100 % relevant, right? Because they're all real sales calls. They're all real support calls. And we use that to fine tune them. And then that in turn gets us super high accuracy, better than ChatGPT and better than like Google or Amazon's transcription.

8:11All because it's with perfect data. And if you like use ChatGPT, it's amazing and it can do a lot of things, but it's built around data of the whole worldwide web, which is good, but it's also bad because there's fake news and, you know, or like things that just aren't relevant to your business. And when us like you need it to be so relevant because your conversations are very different than another business's conversations. Right. Yeah. Yeah. And the customer, are enterprises or BPOs or where are you selling into? We're selling to almost every type of company in every vertical. And I think that's one of the best parts about Dialpad.

8:52And we pitch this to like people who we recruit is the coolest thing about our product is literally every business in the world needs our software. It's it's right. It's customer communications. Right. It doesn't matter what size you are. One to ten thousand. You're going to need it. What we're in, we're in about, you know, a third enterprise, a third mid market, a third SMB in all kinds of verticals, retail, recruiting, you know, healthcare, everything like Uber is a big customer of ours. You know, Motorola, Randstad is like the largest, one of the largest recruiting firms in the world. Los Angeles Chargers are using us.

9:31Netflix is using us. So we have a large and vast range, and we're in over 50 countries, so we've got a pretty big international presence too. Yeah. And is it primarily customer service or customer discovery? Yeah. And do you have a voice or a chatbot interface that handles most stuff and then hands off to a live agent if need be, if it's in that space? or is it supporting sales calls where it's a human calling out and they just need support? Yeah, we do. So we have basically like three different things we're selling to. We're selling to salespeople. So we have a product called Dialpad Sell, which is for the sales team, both inbound and outbound.

10:20So like if you want to put a phone number on your website for sales leads, right? We handle all of that. We also handle outbound if you're like a BDR calling out people or even messaging, right? We support messaging too. We have a very large contact center product as well for support teams so for your support contact center and then we also have dialpad connect which is kind of the knowledge worker so like say you you're somebody who just doesn't want to use your personal cell phone number or you want you have an assistant who needs access to all your voicemails all your messages right you want them to be able to maybe respond as you we provide all that software for just basic advanced business phone system and messaging as well so those are kind of the three things and then on the on the chat bot all of those support, especially the cell and the support side, they support full modern like RAG LLM based chatbot that we've built.

11:10We launched last fall or this past year that does all of that. It sucks in your knowledge base. So you basically connect it to your knowledge base or upload any data you want. We scour the whole thing. And then when someone comes in and says, hey, how do I do this thing with my account? It automatically dips into your knowledge base and it returns a beautiful, you know, human language version of the answer, right? And uses the LLM technology to parse the question and then also to construct the answer. And then does the whole, you know, vector database lookup and all this stuff behind the scenes to get the right answer.

11:45And we built all this stuff around it to do curation. Because like the biggest problem with enterprises have is like they don't want to just unleash an LLM directly to their customers. Like they want to make sure it says exactly what they want it to say. And so we had to build a whole curation system around it that does things like here's all the questions we've seen here's all the answers that we would provide our technology would provide do you want them yes no oh I want to change the wording on this one right and so we have all that and it can even take actions and if they don't have the answer through the we call it AI agent or that's our product name if they can't get it from the AI agent they can easily from the same chat window escalate to a real person and it has their whole customer and customer journey already summarized for them.

12:30So it says like, oh, here's what they were asking the bot about, right? Here's what, what was, what they got, what they didn't get from it. So now when the agent, the real human takes over, they got it right there. It's already, and that's kind of our other strategies. We want to own the whole customer journey because you've all probably had bad experiences too, where like you start on like an online chat that is clearly a bot and it doesn't help you and you escalate and then you kind of have to repeat yourself. Right. to the person you're now talking to or provide the same information again. A lot of times it's because it's a completely different system.

13:02And that's what we're also trying to solve. The way you can get the whole picture of a customer is if you have all those endpoints. Like we even do video meetings. So if you're a salesperson, you can go from messaging someone to a call with someone to now let's schedule a meeting. It's all in the same timeline. You can see everything you talked about over a meeting, over a call, over a message. We can summarize all that. And that's like our strategy, right? Like that's what we think should have been the way things work, right? That's kind of like the real unified communications. Yeah. The customer service end of it is getting kind of crowded, it seems to me, just based on the number of pitches I have from companies.

13:44You know, there's, you know, Sierra, these guys, there's a new company, Crescendo, that was, you know, sort of has humans and AI all under one roof as opposed to like having a BPO and then your chatbot and trying to make them talk to each other. How do you stay ahead of the pack? Yeah, there's so much competition. I think when ChatGPT came out, I think every single smart person in the world said, wow, this would be amazing for customer support. And so now since those large language models came out, I think it feels like half the startups are trying to build some kind of customer support bot. The way we stay ahead is one, we have our own AI team.

14:32So we started on this before people did start on this. And we already had the technology of an AI team and inference and all these things you need to run AI at scale. So when this whole world of like large language models came out, we already had all the team to do it. We had the scale to do it. We had the data to do it. So we've already been cranking as fast as we can. So we, one thing we're ahead of those, but even then the thing that differentiates a lot of us or us versus maybe some of these startups is anyone can go build a chat bot. You know, you can usually figure it out and there's enough stuff out there.

15:06But it's really hard to build like a global real-time communication platform. And I mean, not just chatbot. Like, to have a full contact center that what businesses expect is they need all of it in one. They need the ability to like, yeah, go online and talk to a bot on a website. But then like we just talked about, escalate to a real person or transfer to a real person or add someone to a call or maybe switch to screen share. We have a built-in where you can call into a call center and they get a link and you can see the screen share of the agent. so the agent can show you what they mean when they're you know like that's the type of stuff that you kind of have it have an all-in-one and it's really hard to build like that that was our background with google voice is you have to build a worldwide platform we're in over 50 countries pretty much day one because we are also telephony and that is expected you have to work with the phone number and if you can't like you're missing a huge piece of that puzzle and it's really hard to build that piece.

16:07So we've been spending our lives building it. And it's not something you can just like learn in your college class at Stanford. And they don't teach it. They teach mobile apps. I can build an iPhone app, but they don't teach how to build like a worldwide, real-time, reliable communication network. We have to work with carriers around the world and have partnerships. We have to do all of this in-house. And that is so hard to build that that gives us all those advantages of customer journey It gives us the data advantage. These AI startups don't have the data. They're buying conversational data online that's not really relevant.

16:42So it's kind of that whole together package, right? Yeah. The voice or voice data, I mean, the captured conversations and that analysis, you said that voice is the last online. Offline. Offline, I'm sorry, data. Data set, yeah. So, yeah. It seems, do you do other things beyond customer calls? I mean, you mentioned, you know, teleconference, like group meetings and things like that, even live meetings. And there are a lot of tools now that transcribe those meetings and they're hooked up to a chat bot that then you can query the meeting. But it seems for an enterprise, that would be a pretty powerful tool if you could capture all the conversations that go on in meetings with the knowledge of the people attending and mine that for insights.

17:50That's how we use, obviously we use our own product internally. So all of our meetings internal are with Dialpad meetings. that I would say, to be honest, so we have lots of companies who use Dialpad meetings instead of any of the other competitors for internal and external meetings. Most of our customers are using our meetings product as a seller or a support agent with a customer. Because the thing about our platform is like, again, I just told you a little story about like, hey, I first start texting you, I call you on an outbound call, then I set up a meeting with you. Having all that data and conversation in one thing.

18:31So they use us for the meeting with the customer, even though they might use something else internally for their own internal meetings. But that gives them all the other features we've built, like live coaching. Like one of the features we have is called playbooks, where to like tell you, here's all the things you need to figure out on this call, right? You need to find out their budget. You need, you know, this like kind of typical sales playbook stuff, right? But you can customize it with us. But you can say, I want you to first initial call, find out their budget, find out their use cases, right?

18:59And it knows when you ask the question. It tells you to ask it. It knows when you asked it. And then it does a little summary of their answer. And so that now is all combined with even your call you had with them a week earlier. It all goes to your CRM. It goes into our system too, but it can go to your CRM. And now you have the full picture. And then we can do even cool things like some of the stuff we do is like a churn prediction. you know, for support side, same thing. Like they might, one, we can analyze that, but getting back to your original thing, support people. So you call into a, you know, and have an issue.

19:32They can hit a button that gives you a unique link to join our meeting product, where now you can be face-to-face, which increases satisfaction. They can share their screen. You can share your screen. We even have like remote desktop control so they could take over your screen if they want to like do the thing for you. And again, it keeps that conversation together. So you just switched to video from a regular phone call, but it's keeping all that data in one place. So like, that's where, that's kind of like where I buy, why we have so heavily invested in video is because future it's customer relations is going to be a lot of that too.

20:05You kind of just need it all. Right. So we don't want to miss anything. Yeah. Yeah. The, is there a consumer side to this? We have a lot of consumers who buy dial pad. That's not what we're going after. there's a lot of you know one person two person you know businesses using us uh my parents are using it for their home phone system i'm using it with my wife um but it's we don't stop anyone from signing up but it's it's pretty much mostly yeah for b2b yeah and is it uh you don't stop people from signing up is it prohibitive for for an individual no so one of the first things we did and this was our Google Voice background, I think we were the first product where you could sign up for a phone number online and get it instantly was Google Voice and back in like 2007 or eight.

20:55And so we took that and we said, most of our competition was contact sales. So one of the first things we did was like, no, you're gonna be able to do everything and sign up online. You're gonna be able to go and pick a number, search numbers, do everything, pay and get phone calls or get messaging instantly. So we always prioritize that. And so that's why we do have a lot of just people who come to our website and sign up, even if they're not a business. We don't enforce that. And then how do you charge? Is it pay as you go? It's per seat. So most of the stuff is per seat. If you're just using our regular Dialpad Connect, that one's the cheaper one, and that's more for just regular.

21:31I need a separate number and more controls for my business line. and then it goes into like the contact center is more expensive because it has all these other things and call routing and skills-based routing and all the extra AI that goes on it but even our base one has AI and transcription and summaries so yeah it's and then our contact center has a very small per minute charge depending on international calls toll-free calls things like that. Yeah. Why is it taking, from a consumer's point of view, such a long time for this to penetrate the market? Because I still, you know, get that chatbot that doesn't do any good.

22:15And, you know, I got to wait, and then it's somebody at a call center in India, and they don't really ask me the same questions I've already answered. Why is it taking such a long time for enterprises to adopt these technologies. Well, they haven't found out about Dialpad yet. So that's part of it. We announced we're over 300 million in revenue just last year. So we're getting there, but we have a long way to go. It's a massive market. The main reason is, one, to do what I'm telling you, you have to have the whole thing. You can't just be an AI agent bot. You have to have the whole thing to have that amazing customer experience and not really anyone's built it yet.

22:58Because they either were traditional legacy call center where they don't have AI or they're catching up last minute to AI, right? That's not their like specialty. Or you're an AI startup who's building an amazing bot, but then you're asking to integrate. You're like trying to reach, but integration is even hard and it's expensive because they have to make their margins. And a lot of times they're using a third party for their AI. So it becomes really expensive. And it's, and it's also just so new. Like if you think about like, with these, the chat GPT, that was not that long ago. That really was those large language models were, were a real breakthrough and it wasn't really possible until then, but now people were playing with them, but to do all this stuff, to make it enterprise ready, there's a lot of work.

23:42Like you can't just release it to the world. And I think there was a company that said they replaced like 90 % of their support agents with their own homegrown chat GPT, you know, bot. And they just pulled that back and said it wasn't working. You know, like it's because you can't just unleash this amazing technology and give it directly to the consumer. It'll say crazy things. And you need all this extra stuff around it and you need compliance. It's just, it's not easy to then get it out the door. And it's still only been a couple of years since people have been able to really, really have it available.

24:17Because even before then, it was not available. Like GPUs weren't available. If we wanted to use Google or OpenAI, they didn't have enough bandwidth. So even if we wanted to roll out this amazing chatbot, so did everyone else in the world. You couldn't scale it. And so we then immediately said we can't wait on them. So that's why we started even having our own AI running on our own machines. and in some cases even down to the CPU because we needed availability. Yeah. We just, one thing like we had, I put this on LinkedIn. I was saying, I think we have the world record for generative AI summaries of calls and meetings.

24:52And it's only because we're able to scale it. And because we built it ourselves, it's cheap. Whereas if you were using someone else, it'd be so much money. And so it's just kind of the luck of, it's so new, that's why. Yeah. But it's coming. Yeah, everyone's talking now. I mean, Enterprise First has to adopt this, but everyone's talking about these multi-agent systems. Are you guys exploring that? Are you integrating that into your stack? And what would the agents do if you are working on that? Yeah. What do you mean by exactly? What do you mean by multi-agent? Well, agents that can take action.

25:35So I'm guessing. Oh, yeah, yeah. Yeah. You know. It's like the agentic. Right. Yeah. Yeah. Like the things that actually can do things. I'm sorry. Just answer. Call center agent. Yeah. But that also doesn't help us that like now. Yeah. Everything's called an agent, even if it's not a call, a call center agent. Yeah. So that's that stuff that's already we already do some of that. And we're doing even more advanced stuff with that. But that's part of what our bot can do, our AI agent, is you can say, hey, I want to schedule a meeting. And it would be like, oh, let me go reach into your scheduling system and say what times are available.

26:13And then it'll bring back, okay, we have these times, and they can click it, and then it writes it back to that same system. So we already have, that's what a lot of these workflows. So before agents, it was kind of called workflows, which is like that if this, then that flow. and you need a lot of that because you need to control the inputs and outputs again you don't want it to just again try to do the whole thing you want to say only if they ask this can they then do this so a lot of permissioning around it as well but yeah we already have that but we're starting to do even more so like things like we have the concept of holiday hours like setting your your business hours and that would have been really hard for you to go in and you know find it in the interface of a thousand different things and set it well from our own assistant inside of our web settings you can say hey i want to change my holiday hours it says okay what'd you like to change it to okay i want i'm open on weekdays this time and weekends we're closed and it's like okay we're gonna respond with is this correct you want these changes yes and it changes it so that is i think that is the biggest trend you're going to see this year is all this stuff that it's taking now this amazing understanding of the language and taking action with it that's why you're hearing about it all over the place.

27:23The agentic explosion is happening. Yeah. And for you guys, I mean, you have a strong business, but there's kind of an endless market. I mean, a lot of people chasing it, but you're in the game. So what's the future? Are you just working on building market share or developing new products or new directions? And if so, what are those directions? I guess agents or AI agents is one of them. I mean, our focus is on customer communication and whatever is going to make that better or more efficient. And it's a combination of all of it. I'm not a big believer that it's going to take over the world and you're not going to need a support agent anytime soon.