Coveo: $227 Million In Funding And Over $1 Billion Valuation

By Dan Anderson ● November 7, 2019
  • AI SaaS enterprise solutions leader Coveo announced it raised $227 million in funding at a valuation of more than $1 billion

Coveo — a leader in AI SaaS enterprise solutions — announced it raised $227 million in funding. This round of funding was led by OMERS Growth Equity with participation from existing investors Evergreen Coast Capital, FSTQ, and IQ. With this round of funding, it makes Coveo a unicorn — meaning it is valued at over $1 billion

What does Coveo do? Coveo uses artificial intelligence and intelligent search technologies to personalize millions of digital experiences for customers, partners, dealers, and employees. And Coveo combines unified content, unified interactions, and machine learning for delivering relevant information and recommendations across every business interaction.

As a result, websites, commerce, contact centers, apps, and digital properties become effortless and effective. Coveo partners with a number of the largest enterprise technology players and now the company has over 1,500 deployments in mid-to-large sized global organizations across multiple industries. And now Coveo is also embedded in many leading business applications from vendors including Salesforce, ServiceNow, Sitecore, Dynamics and more.

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“Companies from VISA to Tableau see us as a key platform to meet the challenges of doing business in today’s data-driven AI-takes-all economy,” said Louis Tetu, CEO and Chairman of Coveo. “We believe that to serve a million people you need to deliver a million unique experiences. We help businesses globally become digital experience leaders and compete against digital giants, using data and AI to deliver the personalized, predictive and profitable experiences expected in today’s market.”

Currently, Coveo enables more than 500 customers to deliver effortless experiences that deliver real business value such as improving a top 10 retailer’s revenue per visit by 8% and saving Tableau over $18 million a year by enabling client self-service. Plus it improved customer service agent efficiency at Medallia by 34%.

Coveo provides artificial intelligence solutions to dynamically serve relevance and recommendations at scale across every digital journey. And it is uniquely positioned to enable companies to be relevant, coherent, and optimize profitability at every interaction.

This is considered valuable for web, commerce, service, and workplace applications across the enterprise and it equips enterprises to thrive in today’s competitive landscape.

“We believe that Coveo is the market leader in leveraging data and AI to personalize at scale,” added Mark Shulgan, Managing Director and Head of Growth Equity at OMERS. “Coveo fits our investment thesis precisely: an A-plus leadership team with deep expertise in enterprise SaaS, a Fortune 1000 customer base who deeply love the product, and a track record of high growth in a market worth over $100 billion. This makes Coveo a highly-coveted asset. We are glad to be partnering to scale this business.”

This funding round also caps a major year for Coveo as SaaS subscription revenues grew over 55% year-over-year and the company saw a continual stream of product innovation releases across its cloud-based AI personalization, recommendations, and search platform. The company also made a recent commerce artificial intelligence acquisition.

“Coveo has been a strategic partner. They helped us save $18M a year in support overhead as part of our digital transformation initiatives,” said Tableau Senior Program Manager of User Experience Dave Jobling. “Coveo has been a strategic partner. They helped us save $18M a year in support overhead as part of our digital transformation initiatives.”

Now Coveo has over 500 employees and the company is continuing to recruit top talent in data science for growing its teams located in offices based in in Quebec City, San Francisco and London. And the company also has a new iconic office at Windsor Station in downtown Montreal.

“Coveo gives companies like ours a competitive edge by enabling us to anticipate and meet our customer needs,” added Amy Fowles Gath, Vice President of Marketing at Formica. “With rich content navigation and powerful personalization, formica.com has seen a double-digit increase in visitors and conversions up triple digits.”

“Companies need to look at harvesting data and using AI as a way to scale their businesses – especially their customer service and support organizations. According to our State of Support Services 2019 Report, the need for AI technology in customer service and support is very high,” explained John Ragsdale, Distinguished Vice President Technology Research at the Technology Services Industry Association. “AI personalization through intelligent recommendations and search platforms, such as Coveo, are my top recommended investment. Indexing all content and data in the customer journey – from initial outreach to support – and then applying AI to automatically recommend the most relevant next step for the customer or employee, puts Coveo in an excellent position for future growth,” he continued.

The full terms of the transaction were undisclosed. And the equity investment by OMERS and existing shareholders represents a 15.5% stake in the company. In conjunction with the close of the transaction, OMERS managing director Mark Shulgan is joining the Coveo Board of Directors.

RBC Capital Markets and BofA Securities acted as the financial advisors to the company for this funding round.