AI is supercharging sales in hard-to-reach industries — and Lace AI shows us how

At Bek Ventures, we believe AI’s potential lies not just in supercharging already technologically- advanced industries, but in transforming markets that have traditionally lagged in automation. 

This thesis led us to lead a recent $14M round of investment in Lace AI, an AI-powered sales management tool that we are already seeing make an impact. Targeting the home services industry, Lace AI is helping small and medium-sized businesses across America — the backbone of the US economy, but traditionally underserved by technology  — boost revenues by identifying missed sales opportunities.

Lace AI’s revenue intelligence software uses AI technology to analyze all the calls coming into these businesses to detect lost revenue opportunities.

By analyzing customer interactions with sales representatives in real-time, Lace AI’s tech helps sales teams to improve how they train and coach their staff, and also identifies lost sales opportunities and flags the reasons why a qualified call didn’t convert. 

A sales manager can then reconnect with the customer, addressing concerns and sealing the deal. This is where Lace AI’s competitive edge lies: it’s leveraging AI not only to train sales teams — a process that might take time to prove results — but also to increase revenues immediately.

Clients typically see conversion rates increase by 30-40% using Lace AI’s software. Lace AI secured its first client in the home services industry at the end of 2023, and adoption has been snowballing since.

There are large markets without products built for their needs in mind, and they remain underserved despite the sea of software solutions that exists today. In salestech specifically, the next winners will be those building AI-powered solutions for these verticals, and we believe Lace AI has two key advantages that fit our thesis.

Sales teams have been adopting AI at pace, with McKinsey estimating that automation could increase sales and marketing productivity by as much as $1.2 trillion. 

But the home services industry — valued at $545 billion in the US — isn’t adopting AI as fast as others. The technology industry, which many AI sales coaching products are targeting, is the fastest adopter of AI solutions, according to McKinsey research, while uptake is slower in more tactile sectors like energy and materials. 

This is reflected by the companies we see rising to the top amid the AI hype. The biggest names right now in AI-driven vertical software are those targeting the tech industry, where they have a ready and willing customer base. But we think even more value can be unlocked in markets that have historically been underserved by automation players, due to the perceived difficulty of not just making a product that works well for these customers, but also selling it to them. There is potential for tech companies to help these laggard industries leap ahead. 

Lace AI’s strategy of delivering instant revenue generation demonstrates a unique understanding of the market. A plumbing company probably doesn’t care about the technical intricacies of how LLMs gather, sift, and analyze data — it just wants to know if this software is going to help it make more money. Companies can easily understand Lace AI’s value on the bottom line — and from our observations, that’s a commercial demand that even some of the most hyped AI companies aren’t yet delivering on in high-adopting sectors. 

As evidence of how Lace AI is resonating, the company’s customers have been willing to spend up to the equivalent of 10% on top of their sales representatives’ salaries on the product, meaning it is typically the second-highest software investment for clients behind their CRM solutions.

Automation is not as dependent today as it once was on well-structured, technically hygienic environments or well-connected sets of APIs. Today, the increasing ubiquity and sophistication of AI means it is now possible to complete more complicated, human-like functions even in low-tech settings. 

We were first introduced to Lace AI co-founder and CEO Boris Valkov — a former Facebook AI Engineering Lead on the team behind PyTorch — in August 2023. While building the company, Boris and Stanislav Stoyanov, Lace AI’s other co-founder, realized that by identifying exactly where a sale was lost, it could be converted, generating immediate ROI for the company. In other words, they found a niche in a hot AI market that actually responds to real-world customer needs.

It’s everywhere, but its ability to reshape markets slower to adopt cutting-edge technologies has not yet been fully explored. At Bek Ventures, we believe that when the dust settles on the AI hype, it will be the teams that most deeply understand the markets’ needs that will offer the best products and emerge as leaders. The Lace AI team is poised to do just that, helped by tapping into Europe’s high-quality technical talent, something we saw in our current portfolio company Payhawk who became an eventual market leader.

Lace AI has the potential to transform other low-tech markets where sales have high value, like car dealerships or real estate agents. Whilst at the same time, the potential to expand its offerings and value to customers with new products such as AI call agents, marketing automation features and more.

With our support, Lace AI has been expanding its team and building a stronger sales and marketing function, meaning even more companies across America can benefit from its solution. 

We are looking forward to partnering with them on this journey.