Symend Raises $43M to Prevent Customer Bill Defaults

Addressing Rising Consumer Credit Defaults: Symend Secures $43 Million Funding Extension

Economic instability stemming from the recent pandemic has prompted forecasts of continued fluctuations in consumer credit default rates throughout 2021. A startup focused on assisting consumers in navigating these challenges has now announced a new round of funding, driven by increased demand for its services.

Symend's Platform for Proactive Customer Engagement

Symend has developed a platform leveraging behavioral analytics. This platform integrates with existing customer engagement systems to pinpoint customers experiencing difficulties with bill payments. It then proposes alternative payment plans, aiming to prevent defaults from occurring in the first place.

Funding Details and Company Growth

The company has secured an additional $43 million in funding as an extension to its Series B round, which initially closed in May of the previous year. This brings the total Series B funding to $95 million, and the total funding raised since its founding in 2016 to over $100 million.

Investment Leadership

Inovia Capital spearheaded this latest funding round, with participation from other undisclosed investors.

Strategic Investment Amidst Increased Demand

While Symend has not disclosed its current valuation, CEO Hanif Joshaghani, who co-founded the company alongside CMO Tiffany Kaminsky, indicated that the funding follows a substantial increase in enterprise investment in solutions designed to support customers facing payment challenges.

The Challenge of Customer Support Capacity

“The level of customer uncertainty is exceptionally high, and service providers are struggling to handle the large volume of inquiries effectively and with empathy,” Joshaghani explained.

Key Client Sectors and Market Reach

Symend currently serves clients in the telecommunications, financial services, utilities, and media industries. The company reports having secured contracts with two-thirds of major North American telecommunications providers, as well as a large multinational bank.

Progress Towards Customer Reach Goals

Last year, Symend projected reaching 100 million customers (customers of its client companies) by the end of 2020. The company is currently being asked to confirm whether it has achieved this milestone.

Beyond Deferrals: A Holistic Approach

Symend’s core objective is to identify customers struggling with payments and offer solutions beyond simple deferrals, which often merely postpone the underlying issue.

Alleviating Customer Service Strain

The company’s solutions also aim to reduce the burden on customer service operations experiencing overwhelming call volumes.

The Limitations of Deferral Programs

Despite their prevalence, Joshaghani believes deferrals can create a “false sense of financial security” for customers.

Multiple Bills in Deferral

This is often because customers are typically deferring payments on multiple bills simultaneously.

Data on Rising Bill Payment Difficulties

A company survey conducted in July among 500 users revealed a 27% increase in individuals falling behind on bill payments between April and July 2020. These individuals were typically behind on an average of three bills: 55% on loans, 37% on rent/mortgage, 21% on lines of credit, and 52% on credit card payments.

Understanding the Root Causes of Financial Strain

Financial difficulties are rarely solely attributable to a lack of funds; they are often linked to job loss, illness, family issues, and other complex circumstances.

A Sensitive and Empathetic Approach

Symend prioritizes a sensitive and empathetic approach to both identifying and addressing customer financial challenges.

Supporting Customers Through Empathetic Communication

“Recognizing Symend’s commitment to helping customers avoid negative outcomes, we implemented strategies with our clients to ensure customers felt supported and empowered to take action and prevent bills from accumulating during deferral periods,” Joshaghani stated. “Through empathetic communication, self-service tools, and flexible repayment options, Symend has enabled leading enterprises to deliver a positive customer experience during a time of significant uncertainty and stress. By empowering customers with digital tools, Symend reduces pressure on overwhelmed call centers, enhances customer satisfaction, lowers operational costs, and assists customers in resolving past-due bills before they escalate to collections.”

The Intersection of Behavioral and Data Science

Symend’s team comprises approximately 25% behavioral science PhDs. The company employs a data-driven approach, utilizing both internal business data and third-party resources – similar to the data analysis used by AI-powered fintech companies to assess loan eligibility.

Investment in Algorithms and Analytics

Kaminsky highlighted the company’s increased investment in algorithms and analytics over the past year.

Personalized Customer Interactions

“Leveraging our behaviorally informed algorithms, Symend can identify and differentiate key variations in customer behavior to personalize and optimize interactions based on individual preferences,” she explained. “Symend’s AI/ML model further enhances this by combining insights from customer interactions with historical data on actions taken. These insights help Symend uncover underlying psychological and behavioral traits to determine which engagement strategies will positively influence behavior.”

Utilizing NLP for Sentiment Analysis

To gauge customer sentiment and refine its strategies, Symend utilizes NLP processing models to automatically categorize responses to communications and within self-service tools. “Our metrics are designed to foster a consistently positive brand experience that extends beyond past-due bills. Therefore, our AI/ML model incorporates sentiment analysis and engagement scoring to ensure communications resonate with the customer’s unique and evolving needs, creating a consistently positive experience that promotes customer retention.”

Future Expansion Plans

The newly acquired funding will be used to support continued hiring, particularly internationally, with a focus on establishing operations in Latin America and the Asia-Pacific regions. The company also plans to expand its product offerings to include customer retention and acquisition tools, alongside further development of solutions to prevent bill defaults.

Investor Confidence in Symend’s Mission

“We strongly believe in Symend’s mission to deliver lasting value to enterprises by helping their customers avoid collections,” said Dennis Kavelman, partner at Inovia Capital. “Their approach is unique and effective, combining behavioral science and data science to create a personalized experience for each customer. With this new investment, Symend is well-positioned to scale globally and partner with large enterprises across various industries.”