Talkdesk is estimated to have made $229.5M in 2021, an increase of 85% over 2020. It serves 1800+ global customers across 70 countries, including IBM, Acxiom, Hunter Douglas, and Trivago. The company achieved solid growth during the COVID-19 pandemic due to a surge in customer queries as people began working remotely. 

Talkdesk has an annual churn rate of 0%, which is surprising since seasonality is a given when dealing with sales departments. It accomplishes this by considering customers’ seasonal needs during contract negotiations, so shifts in usage are baked in. Annual plans also give Talkdesk more cash flow up front. 

Talkdesk has raised $497.5M from notable investors such as Viking Global Investors, Franklin Templeton, Amity Ventures, and Willoughby Capital. The company was last valued at $10B, putting its valuation/revenue multiple at 43.6.     

Publicly listed customer service companies have lower multiples, in the range of 6 to 8. For instance, leading service-first CRM company, Zendesk, has a market cap of $9.1B and a multiple of 6.63. Freshworks, which delivers help desk support with automation, has a market cap of $3.7B with a multiple of 6.56. 

Talkdesk is a subscription SaaS that primarily makes money by charging users for license fees. It attracts two types of clients: customers who need phone systems and telephone providers who need users. A business with 50 active users may pay Talkdesk between $5K and $7K a month, but it’s moving upmarket.

Talkdesk requires users to subscribe for a minimum of three years with monthly fees starting at $75 per user, per month. This is much more expensive than other options, such as Freshworks ($18) and Kixie ($35). It doesn’t disclose fees for a certain number of users or contract length. Payment methods include per-hour login usage and concurrent billing. The pricing model doesn’t really scale well, making it tough on low-budget customers.

Talkdesk unlocks premium features per tier (four in total). These add-ons comprise workforce management, agent assist, and proactive outbound engagement. Customers who want even more support can request a standby technical account manager.

Talkdesk sells to a broad range of industries. Aside from the usual suspects, Talkdesk targets retail & ecommerce, travel & hospitality, and the public sector. More industries will likely follow, as cloud-based contact centers become increasingly widespread. This diverse customer base mitigates the risk of overreliance on any single vertical. Having multiple sources of revenue enables Talkdesk to expand into new geographic markets. 

Talkdesk, at its core, is a cloud contact center platform that enables users to manage customer conversations on their desired channel, including voice, email, SMS, chat, and social media. Besides automating processes, Talkdesk provides quality management, real-time agent assistance, and customer experience analytics. The company offers a 100% uptime guarantee.

Talkdesk can integrate with a variety of third-party tools, notably Salesforce, Zoom, Microsoft Teams, and Epic. After integration, supervisors receive access to call center metrics that predict future consumer behavior. The knowledge management feature helps them obtain relevant data faster. The AI Trainer, a human-in-the-loop AI model training product, is for even quicker operations. 

The main advantage of Talkdesk is ease-of-use. The platform’s open API environment allows users to find information without taking a lot of steps. Additionally, Talkdesk automatically synchronizes customer data to display insights the moment a call is received. So far, the results are positive: 19% CSAT improvement, 20% agent productivity improvement, and 23% wait time reduction.

Talkdesk is competing in a saturated space. Big players that offer a full CRM solution and new entrants that dominate a particular niche within CCM are all eating into its market share.

Unlike Talkdesk, which is suited for contact centers, these companies—like Zendesk, Freshworks, and Freshworks—don’t just concentrate on messaging, they provide a comprehensive set of services, from reporting and analytics to community forums. They’re geared towards corporates that require extensive features.

Not only do both Zendesk and Freshworks cover contact centers, but they also delve into sales and marketing as well as HR management. Hubspot is another company that monitors the entire customer journey in one, central place. All three of them are known for their flexibility and low cost.  

More and more startups are focusing on these two particular CCM segments. Systems of record store important information and streamline operations. For example, Mailchimp automates the creation of marketing campaigns. Conversely, workflow tools improve productivity by coordinating the flow of daily tasks. Twilio Engage collects customer data, which lets marketers define a workflow for each set of customers, resulting in a high level of personalization. 

Ultimately, Talkdesk does a little bit of everything for contact centers, so it doesn’t have many direct competitors. 

8x8 is the most similar alternative, catering to businesses with high call volumes in highly regulated industries, like healthcare and insurance. The primary difference between the two is that 8x8 has its own integrated unified communications offering, while Talkdesk is an independent provider. 

The customer communications management (CCM) market is forecasted to hit $2.75B by 2028 from $1.32Bn in 2021 at a CAGR of 11.4%. Changing consumer preferences caused by the COVID-19 pandemic have heightened interest in digital channels and a rising number of SMEs are embracing SaaS to retain clients.

43% of customers prefer contact centers that use bots to simply service. Thus, 29% of all businesses have installed live chat software to meet this demand. Companies like Talkdesk, which supports omnichannel engagement via AI software and third-party integrations, are primed for growth. 

In the last year or so, Talkdesk released two major features: Workspace and Builder. The former is a customizable interface for contact center teams, while the latter is a suite of services for customization across workspaces, routing, reporting, and integrations. Both products are part of the general strategy of moving upmarket.  

Talkdesk is also launching specific tools for certain industries, such as finance and healthcare. Zoning in on the unique pain points that each vertical faces helps it stand out from more generic solutions. Furthermore, the company can strengthen customer relations by addressing particular needs.  

Talkdesk has recently expanded into Australia, Brazil, Canada, France, Germany, Ireland, Italy, Mexico, the Netherlands, Southeast Asia, and Spain. It’s able to establish a global presence by strategically distributing eight data centers across the world, connecting customers to the closest one around them.

Talkdesk’s wide range of tools could be a double-edged sword. Although it’s beneficial for moving upmarket, original users may feel overwhelmed and decide to choose a less complex customer communications platform. Small businesses with basic contact requirements and tight budgets will consider advanced AI-powered tools to be overkill.