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Fast Company
2 days ago
- Business
- Fast Company
How AI can help restaurants provide better hospitality
At first glance, the idea of integrating artificial intelligence (AI) into the restaurant experience seems counterintuitive. After all, sitting down for a meal is one of the most fundamentally human experiences there is—from the warm greeting at the host stand, to the conversations at the table, and the feeling of eating food that someone else prepared for you with care. But when applied thoughtfully, AI doesn't detract from that—it enables more of it. And for restaurants, that's an operational game-changer. Despite macroeconomic conditions, people are still going out to eat—in fact, OpenTable data shows that dining is up 7% year over yearat the time of writing. But restaurants are feeling the squeeze navigating continued staffing shortages, shrinking margins, and the looming impact of tariffs. The National Restaurant Association's 2025 State of the Industry report revealed over a third (39%) of restaurants were not profitable in 2024. Meanwhile, 95% of operators said labor costs were a significant challenge last year, and 77% said recruiting and retaining employees remains a significant challenge. And that is where AI can help close the gaps. Take something as simple as answering the phone: 59% of customers hang up after being placed on hold for a minute or less and it's estimated that over 60% of calls to restaurants go unanswered during peak hours —that's money off a bottom line that's already running on a razor-thin margin of ~3-4%. AI phone agents like and PolyAI can help restaurants take reservations and answer pertinent dining questions, 24/7. This means less time spent manning the phone, and more revenue from increased bookings. Technology has even come so far that these voice agents can be trained on a restaurant's brand and tone-of-voice so that warmth and hospitality aren't lost to efficiency. Automating phone calls is a good example of how restaurants can start small with AI. With any business, a test-and-learn approach helps you figure out which tools are right for the job and helps get team members on board. Restaurant owners can start by implementing a single tool—say, one that only manages inventory or only optimizes staff scheduling. Or maybe you don't have resources for a full marketing team but could use large learning models like ChatGPT as a starting point to create marketing campaigns, social media content, and even help produce branded swag. You can see the themes that are appearing here: reducing operational friction and costs and streamlining processes. Because the less time restaurant managers spend in the office or hosts spend on the phone, the more time they can devote to the core part of the job: delivering great hospitality. Diners are the beneficiary of this upleveled dining experience—they will feel,but not see, AI behind the curtains. The use of AI will undoubtedly accelerate across the hospitality sector in the near and long-term future and it's promising and exciting to see a strong interest in adoption: 72% of restaurant operators plan to adopt AI soon, and nearly 94% acknowledge its necessity to remain competitive in the evolving landscape of food service. The future of hospitality isn't a trade-off between high-touch service and high-tech tools; it's a blend of both. It's my belief that by embracing these new tools to build stronger restaurants, we can, in turn, build a stronger industry.
Yahoo
27-06-2025
- Business
- Yahoo
‘AI rollup' investors think services firms can trade more like software companies. Here's what they get wrong
Nathan Benaich is the founder of Air Street Capital and author of the State of AI Report. Nikola Mrkšić is the CEO of PolyAI. Across the technology investing world, investors are scaling their bets on a seductive thesis: Generative AI will transform low-margin service businesses into high-margin software companies. Several well-known platform venture firms have committed billions to this strategy and have begun to make their bets. Here's how the thesis goes: First, acquire traditional business process outsourcing (BPO) companies such as call centers and accounting firms at modest valuations of 1x revenue. These businesses typically operate at 10-15% EBITDA (earnings before interest, taxes, depreciation, and amortization) margins, weighed down by armies of human workers performing repetitive tasks, and automation faces the greatest structural resistance. Second, deploy generative AI to automate core workflows, cut headcount, and expand EBITDA margins to 40% or more. What once required hundreds of accountants or call center agents can now be done by a handful of people managing AI systems. Third, exit the newly minted AI-enabled services company at software multiples because buyers and public markets recognize you've transformed a human-heavy service business into a scalable AI business. Where traditional BPOs trade at 6x EBITDA, software companies command 20x or more. On paper, it's brilliant arbitrage. In practice, it's a mirage. It rests on a fundamental category error: confusing operational improvement with business model transformation. Yes, AI can make workflows more efficient. No, that doesn't turn a services company into a software company. Indeed, five years ago, a now notable AI company ran this exact experiment, and walked away. Its findings should serve as a warning to today's believers. Let's dig in. The most damning evidence against the AI rollup thesis hides in plain sight on public markets. Today's 'AI-transformed' BPO firms that have invested heavily in automation—among them Concentrix, Genpact, and Infosys—trade at 5-23x EV/EBITDA (enterprise value to EBITDA). Their pure software counterparts, such as Salesforce, ServiceNow, and Workday, command valuations of 22-92x EV/EBITDA. Here is a chart to tell the story: That's not a gap that can be bridged with press releases about OpenAI, Anthropic, or Gemini partnerships. It's a fundamental difference in how markets value human-dependent businesses versus true software platforms. Consider Concentrix, often cited as a BPO transformation success story. Despite a major push in launching their gen-AI products in 2024 and now having deployments at over 1,000 customers, the company's EV/EBITDA multiple remains stuck in the low single digits, and its EBITDA margin is still hovering around 10%. The market's message is clear: Automating workflows doesn't change your fundamental business model. In 2019 PolyAI, the leading conversational AI company, spent six months exploring whether to acquire incumbent human-driven contact centers to accelerate its growth. After analyzing the opportunity by visiting over 10 contact centers, building relationships with three major BPOs, and hiring industry advisors, the answer was a clear no. 'Business Process Outsourcing firms are not trusted to innovate, not rewarded for innovating, and not allowed to innovate,' read its board deck. The structural barriers it identified remain unchanged today: The illusion of control: Buying a BPO doesn't mean owning the business you're supporting. You're simply renting the right to supply labor on the client's terms. Tech stacks, processes, and approvals remain firmly in the client's hands. AI deployments still require their permission, integration, and oversight. You're not in control; you're a replaceable vendor. The pricing trap: Most service businesses bill by the hour. Efficiency improvements that reduce billable hours directly cannibalize revenue. As PolyAI discovered, BPOs promise innovation to win contracts, then revert to maximizing billable hours to protect margins. It's a business model fundamentally at odds with automation. Zero switching costs: Where 10-year service contracts were once the norm, it's now increasingly common to see three-year terms or less. This reduces the ability to recoup up-front AI investments, particularly when there's little client lock-in, no network effects, and no moat. PolyAI chose to remain a software company, partnering with BPOs rather than acquiring them. Today, it's valued at over $500 million with customers like PG&E, Marriott, and FedEx. Meanwhile, the BPOs they considered buying still trade at single-digit multiples. Here's what investors are missing: Services businesses aren't inefficient by accident. They're inefficient by design. The inefficiency is the product. Clients pay for flexibility, customization, and someone to blame when things go wrong. Automating away the human doesn't just reduce costs, it fundamentally changes what you're selling. BPO technology capability has never been the constraint. And clients who wanted software would have already bought software. The most successful services firms understand this. They use AI to augment their humans, not replace them. They maintain margins through pricing power and relationships, not through headcount reduction. Ultimately, they still trade at services multiples because that's what they are. The AI rollup thesis represents a familiar pattern in technology investing: the conflation of technological capability with business model transformation. We've seen this movie before. In the early 2000s, believers thought e-commerce would transform retail margins. Amazon proved them right by building a native digital retailer, not by acquiring and transforming Sears or Barnes & Noble. In the 2010s, investors believed software would eat traditional industries. The winners built new software-native businesses rather than retrofit old ones. The same lesson applies today, but with a narrower scope. AI may well transform some corners of professional services, especially when existing firms are pushed to adopt new tools by private equity owners with clear control and incentives. We've seen this in sectors like health care and financial services, where PE firms have driven adoption of AI-driven tooling. But this is different from the AI rollup thesis that VCs are chasing—one that assumes low-margin, labor-heavy service businesses can be turned into software-like platforms simply by embedding AI. For those firms, transformation won't come from owning the service layer. It will come from new, AI-native companies with fundamentally different economics. The AI rollup thesis is venture capital's attempt to arbitrage the multiple gap between services and software. But that gap exists for a reason. Services businesses, even highly automated ones, face different constraints, different economics, and different customer relationships than software companies. PolyAI saw it in 2019. Public markets see it now. The AI revolution is real. The opportunity to improve services businesses with AI is real. The idea that this improvement transforms them into software companies? It's unlikely to be real today, just as it wasn't in 2019. AI rollups may still deliver returns, but not the kind VCs are underwriting. At best, they're tech‑enabled private equity: operationally heavy, valuation‑capped, and unlikely to scale like software. The opinions expressed in commentary pieces are solely the views of their authors and do not necessarily reflect the opinions and beliefs of Fortune. Read more: Informatica CEO: How to future-proof your career in the age of AI Why despite all the AI upheaval, there's never been a better time to be human How to lead when machines can do everything (except be human) I've led teams at Google, Glean, and GrowthLoop. Here's why AI is making me a more human leader This story was originally featured on Sign in to access your portfolio
Malaysian Reserve
07-05-2025
- Business
- Malaysian Reserve
PolyAI names The CX 100 for 2025: One hundred visionaries revolutionizing customer experience
Program celebrates its third consecutive year tapping the top 100 CX leaders around North America. NEW YORK, May 7, 2025 /PRNewswire/ — PolyAI, the company powering the world's most lifelike AI agents for customer service and support, is proud to announce the release of its third annual CX 100. This deserving cohort includes 100 pioneering figures who have revolutionized the world of customer experience through their steadfast commitment to fresh ideas and enabling strategies, all while prioritizing the needs of the customer. 'The CX 100 is one of my favorite programs, as we get to work with so many creative, customer-focused leaders in the space, and this is our chance to spotlight those – both in and out of our client base – who have caught our attention,' says Nikola Mrkšić, co-founder and CEO at PolyAI . 'They've introduced revolutionary approaches, cultivated highly effective teams, and emphasized empathy as the foundation of outstanding customer engagement. Their accomplishments encourage others within and beyond their industries to completely rethink what's possible in customer experience.' PolyAI assessed nominees based on their impact in three key areas: creating exceptional customer journeys for their respective organizations, driving a customer-first approach throughout their organizations, and leveraging technology and processes to enable superior service delivery. As in prior years, awardees hail from North American companies representing a wide range of sectors, featuring industry titans such as Aflac, Hertz, Waste Management and Charles Schwab, alongside regional standouts like Howard Brown Health, BMO Bank of Montreal, Canyon Ranch, and Alaska Communications. And what list would be complete without everyone's favorite jibbitz vessel, Crocs? The new entrants to The CX 100 join the ranks of previously named innovators from Marriott, American Airlines, Hopper, FedEx, Disney, Louis Vuitton and more. Meet the 2025 CX 100 Visit the CX 100 website to explore the full list of honorees, and join us in celebrating these exemplary leaders who are proving that the future of customer experience is bright and progressive. About PolyAI PolyAI builds the world's most lifelike enterprise voice agents for customer service and support. Our voice AI platform helps companies like FedEx, Marriott, Allstate and Unicredit automate the work of thousands of customer service representatives and provide superhuman customer experience at scale. The company has raised $120m from investors including NVIDIA and Khosla Ventures, and has offices in San Francisco, New York and London. View original content to download multimedia: SOURCE PolyAI
Forbes
27-03-2025
- Business
- Forbes
From Gen-Z To Baby Boomers, Voice Is The Choice For Service Needs
AI voice agent When it comes to calling customer service, we've come a long way from legacy Interactive Voice Response (IVR) systems that leave callers trapped in an unending maze of options and begging to 'Speak to a representative!' The recent boom in Generative AI (GenAI) has made sure of that. Customer service teams are increasingly relying on GenAI-powered voice agents that allow callers to speak freely, interrupt at will, and get many of their service needs resolved without ever having to speak to a live representative. And, amazingly, customers actually prefer picking up the phone to seeking customer service via text chat on a website. This may come as a surprise to some. In the early 2010s, many anticipated text-based chatbots would be the tech that revolutionized customer experience (CX), slashed costs and transformed brand interactions. Though chatbots do have a role within the customer service landscape, their impact has been more modest than originally forecasted. In fact, voice still reigns supreme as the go-to channel for customer service needs, challenging earlier assumptions about tech adoption and customer behavior. Chatbots: Expectations vs. reality When chatbots first debuted, many organizations were attracted to the promise of constant uptime, immediate responses and cost reductions driven in large part by no longer needing numerous human agents. For businesses that had their sights set on scaling while controlling costs, chatbots seemed like they could be the silver bullet for CX success. Despite these high expectations, Nikola Mrkšić, CEO and co-founder of PolyAI, does not think chatbots have lived up to the original hype — or will ever do so. Mrkšić said, 'Requests that start on self-service digital channels like chat often finish over the phone, proving that technology adoption can't be forced — it has to be earned.' No matter how advantageous a tech tool may be for a business, if the end users (customers) aren't benefitting, implementation of that tech is just an exercise in futility. Recent G2 research revealed that nearly half (45%) of customers who had a negative experience with a chatbot said that it lacked the knowledge needed to resolve their issue. When it comes to customer service needs, the channel of choice is still the phone. In fact, recent PolyAI research showed that 65% of American adults surveyed prefer the phone for contacting retail and travel customer service teams. Contrary to popular belief, the research also showed that 86% of surveyed Gen Zers choose the phone for service needs in these sectors, smashing the stereotype that younger generations don't want to talk on the phone. Why voice is still the king in customer service When considering the 'why' of customer preferences, it's important to keep in mind how people tend to act when they're confused or frustrated, which is often the case when reaching out to customer service. In these situations, there is a very human need to feel heard and understood. The truth is voice channels are equipped to meet those needs better than any text-based dialogue ever could. When faced with a problem and talking to customer service, people want to outline the issue and have customer service find a solution quickly. Rather than typing out a long block of text about their problem to send to a chatbot that may or may not respond appropriately, most customers find it easier and more natural to explain the problem verbally. That way, they can get instant, empathetic feedback that guides them closer to a solution. Because of this, voice channels still reign supreme in customer service situations. Another reason so many people prefer using the phone is because of recent advancements in natural language understanding (NLU) models. Mrkšić said, 'The modern voice experience is far superior to that of traditional IVR systems that relied on precise keywords and looped through confusing menus. Voice AI agents let callers speak naturally.' Regardless of colloquial accent, pauses, interruptions or interjected questions, AI agents can identify callers' intents and respond appropriately in normal, natural-sounding language that some callers may even mistake for live agents. PolyAI research found that over 70% of people are willing to use a smart AI bot as long as it can accurately fulfill their customer service needs by performing tasks like processing a return, performing a price match, or answering questions. Voice's call to action for CS teams The modern era of voice AI agents is paving the way for better CX that builds trust and, ultimately, loyalty. According to a recent Prosper Insights & Analytics survey, over a quarter of adults are not only familiar with GenAI tools, but also already using them. As the technology continues to improve, its advancements will drive adoption and usage across sectors, as well as increase comfortability with interacting with GenAI tools. Prosper - Heard of Genetrative AI Because AI agents can resolve many FAQs and common issues, human customer service representatives have more time to handle higher-level tasks and sensitive issues that need a uniquely human touch. Moving forward, the optimal customer service approach will combine respecting how customers naturally want to interact with thoughtful automation that genuinely enhances their experience. When it's needed, live agents will step in with the human expertise and empathy that they can provide. Successful companies will maintain robust phone-based support systems while intelligently incorporating automation where it's most beneficial. This balanced approach will help create meaningful customer connections and positive experiences that foster long-term relationships and brand loyalty. Let's hop on a call: One customer's victory with voice AI A leading travel platform used to book hotels, homes, flights, and car rentals recently saw success when integrating voice AI agents into their customer service strategy. These AI agents easily communicate with callers and are available 24/7. The sophisticated system can even solve problems proactively because it can identify callers' intent and respond appropriately. The voice AI is programmed to have the most up-to-date company information, so the majority of frequently asked questions can be resolved without needing a human agent. However, if the query is too complicated for the AI, it is smart enough to know when it needs to escalate a call for a human to handle. The results of implementing this cutting-edge technology are better CX and improved first call resolution rates. The voice AI can successfully resolve 15% of incoming calls without human intervention. When calls do require human expertise, the technology smoothly transfers customers to travel specialists, enhancing the customer service team's operational efficiency while providing customers with a seamless service experience. When it comes to customer service, the channel of choice is still voice, and it will likely remain that way in part because of voice AI innovations that improve CX and solve problems. Rather than being displaced by chatbots or text-based alternatives, voice interactions have been revitalized by technology. These new technologies are creating experiences that respect how people naturally want to communicate while still delivering the speed and convenience modern consumers demand. The evolution of voice AI hasn't replaced the human element in customer service — it has enhanced it, ensuring that the oldest form of communication remains the most effective for resolving customer needs.
