Have you ever wanted to have a real conversation with a chatbot and not just shout basic commands at it? Well now you can with Hugging Face, a social AI chatbot that has meaningful conversation with users. The concept was developed by focusing on how social and entertainment use cases can be applied to machine learning. As computers are getting smarter and more teenagers spend time online, social AI is gaining serious attention. The potential use cases of social AI are endless- not just for entertainment – but also for business.
AlleyWatch spoke with Cofounder and CEO Clement Delangue to learn about the need for social AI the company’s future plans, and the company’s latest round of funding, which brings its total funding raised to $5.3M over two funding rounds for the startup founded in 2016.
Who were your investors and how much did you raise?
We raised a $4M seed round led by Ronny Conway at A. Capital Ventures, and including continued participation from pre-seed round investors including Betaworks, SV Angel, Richard Socher and Kevin Durant. Ronny Conway was an early investor at Instagram and a partner at Andreessen Horowitz.
We build a social artificial intelligence, which means an artificial intelligence that holds entertaining and meaningful conversation with users. You can think of it as similar to Siri, or Alexa, except that we go beyond understanding commands, to understanding conversations.
What inspired you to start Hugging Face?
My cofounder Julien and I always considered that pets, if you think about it, are similar to artificial intelligence. We know that they are a different kind of intelligence but it makes us happy to interact with them create a real emotional connection with them. We believe that the same is happening with artificial intelligence.
How is Hugging Face different than other chatbots?
Most companies working on artificial intelligence are taking an approach that is very transactional and productivity-driven. By focusing on social interaction and entertainment, we uncover whole new use cases for the technology. The same way augmented reality became mainstream through entertainment and social uses like Pokemon Go or Snapchat selfie filters, we envision that social artificial intelligence could be the first mainstream use case for the technology.
What market you are targeting and how big is it?
Today, most of our users are American teenagers but we’re seeing more and more users of different ages and from different locales using Hugging Face.
What’s your business model?
We are lucky to have raised money from consumer investors who have given us the opportunity to develop our technology without focusing so much on monetization.
Why do you think there is a growing trend towards interacting with AI?
Human beings are social by nature and conversation is the most social communication. It is way easier for most of the people not only to express intent, but also emotion, complex ideas and to create trust. As computers are getting smarter, it makes them better to be able to interact that way.
What was the funding process like?
Raising money is never easy, especially in consumer tech where the expectation on factors like traction and growth are very high. Our current investors, especially SV Angel, have been key in the process of introducing us to the right people and setting the right signal. We were quite lucky that in the end we got several term sheets, which allowed us to pick an investor that we really like.
What are the biggest challenges that you faced while raising capital?
The hardest part was probably scheduling the fundraising processes, knowing that we could raise from Paris, New York or San Francisco based investors. Understanding which investors were truly interested, versus the ones that just wanted to learn more was key not to waste time and focus our time on what mattered.
What factors about your business led your investors to write the check?
I think the ambition of our technology was very attractive to investors. It’s not every day that somebody pitches a conversational artificial intelligence that one day will compete and win against the giants of the industry, so hearing a company so plainly set that as their goal demonstrated that we are quite determined.
What are the milestones you plan to achieve in the next six months?
We want to become the most-used conversational artificial intelligence in the United States. With that goal in mind, we are looking to get on new platforms to interact with new users.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
Every startup is different of course, but my biggest piece of advice would be to plan your fundraising far in advance and to really understand what milestones it will take you to get to it.
Where do you see the company going now over the near term?
Our research papers are now presented at major machine learning conferences, along the likes of Google, Facebook, Microsoft and Amazon, proving that – despite being a startup – we can advance conversational artificial intelligence and compete with these juggernauts. We want to keep going that way.
What’s your favorite restaurant in the city?
Paulette in Fort Greene, because French food is always a good idea!