How Jesse Zhang Turned 'Obvious' Into $1.5B Unicorn

"Support's gonna be too crowded. It's such an obvious idea." That's what investors and advisors kept telling Jesse Zhang when he pitched Decagon, his AI customer support startup.

Two years later, that "obvious" idea has become a $1.5 billion unicorn. Decagon builds AI agents for large corporations' customer support operations, hitting seven figures in ARR within just six months and growing exponentially since.

In this interview, Zhang reveals how being "customer-obsessed" from day one, moving faster than legacy players, and leveraging generative AI at the perfect moment turned a crowded market into a billion-dollar opportunity.

Jesse: I was born and raised in Boulder, Colorado. I grew up doing a lot of things like math contests, science research, stuff like that, and I ended up studying computer science at Harvard. I would say I was very focused on trying to build something and so most of the time I spent outside of classes was towards learning how to build things, talking to my friends about building things.

I finished college fast for a bunch of different reasons. I thought that I had already gained what I needed to from college and I was excited to just start building things. And so at Harvard there's a program that allows you to graduate a year early pretty easily.

After Harvard I started my first company. It was a very different startup. We eventually got acquired by Niantic, then decided to start this company.

Jesse: So specifically the problem we're solving is a lot of these companies have very large, not that efficient, operations in terms of answering customer questions, looking up data, dealing with tickets, and many of them will outsource to large BPOs and things like that to have a lot of human agents answering.

So if you're able to use some of the new generative AI technology, you're able to automate and just improve the customer experience by answering a lot of these questions automatically, looking up data automatically, doing all of the sort of things that a human agent would do.

Jesse: Every startup's biggest advantage is you're obviously able to move quicker. You can kind of cater towards the customers a lot more and make sure that you really capture their needs. A VC might ask you it's like, OK, what do you do when Google starts doing this? Honestly, a lot of our advisers or investors were telling us, hey, support's gonna be too crowded. It's like such an obvious idea.

But on the flip side, that's also a good thing because it allows you to get to adoption very quickly because our customers also see the value when they start using it. They immediately get ROI. This is what our customers are telling us. Our customers are telling us that there's need here, that they're willing to pay for a solution if it works and so that's kind of what led us there.

Jesse: That's also what's made us successful in terms of competing against the older generation of chatbots because if our customers were happy with those then they wouldn't have told us in the first place they wouldn't have even mentioned that hey we're willing to try you out and so we're able to basically capture a lot of the newer needs and a lot of what was not possible before by building from the ground up using generative models.

A lot of older players, they will have a huge product built already and they probably have hundreds of customers and so when they're shipping new features they have to build things that kind of satisfy the average customer. They're just slower to adapt because they have to carry along all this product they've already built out so I think when you're a startup like us, we've done a good job at executing and so we move really fast.

There's been a new technology introduced, right, large language models. If you just think about the more traditional chatbots where there's some intelligence built in but it's not AI, it's not generative and if you're able to adapt faster then you have a big advantage when you're competing against them. I think we've just built a better product.

Jesse: When we first started we were very open minded. We're not super opinionated about like this is exactly what we need to build we kind of just let our customers tell us what the need is when you're early it's hard to have a very coherent strategy. You're just trying to get as many customers as possible and so in the early days it was just us trying everything we could to get new customers, get new introductions, things like that, and with each customer we would have the same process of going in and really trying to understand what they needed and what they wanted instead of trying to push like our product vision on them.

For a lot of our early customers, Vanto would be a great example. Vanto was one of our first customers. We just kind of came in with the mindset of, hey, you may have some issues that you're dealing with, and we just wanna see if we can solve them in a good way. And I think if that's your mindset, then it makes it easier. Because you're again putting the customer first and like really being customer driven.

Jesse: Fortunately at the time they actually did have a very concrete situation which is around having automation to answer customer problems it's a complicated product and so when people come in they have a lot of questions and if you're able to answer them well then customers are happy and they're happy so that's how we got started we were able to ship a initial version very quickly. They liked it and then we tested out on real customers and they liked it as well and so we just went from there.

For the first 6 months we didn't build anything that wasn't a direct request from one of our customers and now obviously we're slightly farther along so we have our own views on what makes a good product but we still are extremely customer first. We really love talking to our customers. They give us a lot of direction and that's how we approach product building.

Jesse: My first company Lowkey was very different from what we're currently building. First of all, it was a consumer company and so we didn't have paying customers off the bat. We were much more concerned about getting users and getting a lot of them very quickly. What we did was we were building software for people that played video games to capture their clips, edit them, share them, and just explore clips in general.

By far it was just being a new grad and not knowing much about stuff. I was a solo founder for most of it I didn't really know what things were important to work on, what things weren't. I didn't really know how to evaluate if an idea was good or not. Every day you're working hard but maybe you're not working on the right thing and just after a few months go by, it just feels like a lot of the time was wasted.

Jesse: So I think that's very natural for first time founders because especially younger ones because you don't really have that perspective. What kept me going was more just being young and having a lot of energy and being a little bit naive is also helpful because you don't really have that much perspective on how hard things are or how hard things can be, so that was by far the hardest part for me.

I think being a consumer company exaggerated that a bit because there's not really like customers paying a lot of money that you can talk to and like, all right, what do you need? I'll build it. So that was by far the hardest part, once you start scaling, of course you know what you're building, but there's still that element of, OK, you're at 10,000 users, how do you get to 100,000? And then once you're at 100,000 users how do you get to a million, and the answer for those might not be the same, and you have to keep figuring out new things to try.

Jesse: As a founder you can always overthink things and you can always rationalize different things, but at the end of the day it doesn't really matter. You just have to get to a point where you have customers that really appreciate and value what you're doing, and that speaks for itself in terms of the growth of the business.

So this time around when we were in the very early stages of building Decagon, my co-founder Ashwin is very similar background, also successfully sold the company before we just decided, hey, let's not overthink it. We just wanna go out there and see what people actually want and what they're willing to spend money on and that just made the initial ideation phase much easier, and we really did not wanna spend too many cycles going back and forth in that stage.

Jesse: I think number one you need to line up a lot of customer calls and so you can get those from asking your friends to introduce you, asking investors to introduce you, reaching out cold, and once you have them set up, you wanna make sure the calls are very structured and after you leave the call you feel like you learn something concrete.

So part of that is you have an exploratory phase where you're kind of just listening to their problems and seeing what could possibly be solved and then the next phase of the call is you're talking about hypothetical solutions and then the last part of the call is super important to get a sense of how much people would pay for it because many times you could get in a conversation where people are telling you, oh this would be super useful, but at the end, there's no budget or they would only be willing to pay a decent amount and how much they're willing to pay for it is the only real metric for how useful it is to them really.

Jesse: I think when you're young, the biggest disadvantage is you just don't know how things work really. You might feel like you're very smart or you can work really hard, but you don't really know how you make revenue or you don't really know how companies work in general. So I think the biggest thing is just staying patient with that and trying to talk to as many people as possible to get that intuition.

The biggest advantage you have when you're younger is you just can put a lot of hours in and work really hard. I think for me I would just describe the difference between a lot of successful entrepreneurs that I know and not so successful ones is mainly just intensity.

So I think a lot of our friends who have built huge companies or a lot of our advisers or investors, they all have intensity. I think it's impossible to build a big company without intensity, and intensity just kind of means you're always going, you're always pushing, you have very no excuses attitude where you just get things done and that's what we admire about a lot of the folks who help us and that's what we want to have in our DNA as well.

Jesse: I don't know if we have the best perspective to give advice on the global AI space level. I think for us the way we think about it is there's the core fundamental players who are building new language models and building new infrastructure. We of course sit on top of them. We are an application we interface with our end customers.

If you're building in a space that is deep enough and it's complex enough to have a bunch of features, a bunch of product decisions, and a pretty big and deep product, no one really is gonna be able to replace your application because the big players are building models, right? They're not in the business of building customer support agents.

I think that's one piece which is what you're building has to be deep enough and complex enough for it to be its own product and be its own company, and I think there's a big advantage when you are the one interfacing with end customers because when you're interfacing with end customers, you're the actual one that understands their needs. And this goes back to what I've said many times, which is you have to have a good relationship and a deep relationship with your customers, really understand what they need. And everything they say and everything they do gets baked into your product. You're the only one that has that, right, because all the big players and the Googles of the world, the cloud providers, you're building on top of them, but they're never gonna have that access to the exact customers.