Jevon LaRue: They didn't want to complain, they didn't want to have to chase up something you should have just got right. So we flipped that model completely and we fixed the problem before the customer even knows it exists. Kiyu is like an immune system. You don't think about it when it's working, but it's constantly defending the experience. We're not trying to re educate people to shop. We're taking away something they never wanted in the first place.
Nathan Bush: Hey, it's Nathan Bush or Bushy joining you from the land of the terrible people here in Brisbane, Australia. I became really interested in today's guest when I came across their website and the idea really resonated with me straight away.
Nathan Bush: They were claiming not just to fix customer service, but to prevent it. In an age where AI is claiming to be able to process tickets at the speed of light and to be
Nathan Bush: able to automate a lot of the
Nathan Bush: customer service, this company stood out to me because they wanted to prevent customer service, get to the root of the problems, not just expedite the mess at the end of it. And I think that's really interesting and I think it follows up well on our episode recently with Emily Elvey where
Nathan Bush: we dove into customer service really for
Nathan Bush: the first time and we looked at
Nathan Bush: what makes a great customer service team
Nathan Bush: and how to run it efficiently. This episode today is a great build on that.
Nathan Bush: Jevin Larue is the co founder and the CEO of Kyu, an AI powered
Nathan Bush: operations platform that fixes fulfillment, payment and delivery issues before customers even notice that there's something wrong.
Nathan Bush: Not only is Jevin the co founder of this startup, he actually has a
Nathan Bush: really great background in retail, leading brands such as Surf, Stitch and PE Nation. So he knows the ins and outs of what makes a large scale E commerce business. Jevin saw firsthand how disconnected systems and
Nathan Bush: manual processes were and that they were
Nathan Bush: burning out CX and ops teams at the same time as having a pretty rubbish customer experience.
Nathan Bush: So he, along with his co founders built KU to change that and he's
Nathan Bush: already working with some really big names
Nathan Bush: like Decuber, PHP Labs and Budgie Smugglers
Nathan Bush: to change how they think about customer service from a reactive to a proactive approach.
Nathan Bush: In this conversation we get really practical
Nathan Bush: around what this means and we talk
Nathan Bush: about what preventive customer service actually looks like in action, the kinds of tasks
Nathan Bush: that you can expect ops teams never to have to do again thanks to AI and automation, how to measure the
Nathan Bush: impact of problems that might never happen
Nathan Bush: again if you fix them, and what the future of Proactive operations looks like
Nathan Bush: as AI agents start quietly running E
Nathan Bush: commerce in the background by diagnosing problems before they become significant. Now, before we jump into today's episode,
Nathan Bush: I want to say a huge thank
Nathan Bush: you to our sponsors, Shopify and Klaviyo, who have supported ADD to CART all through the year. Thank you for powering the Add to CART community and helping us bring you these amazing interviews every week.
Nathan Bush: All right, let's get into it.
Nathan Bush: Here is my conversation with Jevon LaRue, co founder and CEO of Kieu. Jevon, welcome to Add to Cart.
Jevon LaRue: Hey, Nathan, great to see you, man. Thanks for having me.
Nathan Bush: Oh, I am very much looking forward to this. We had an interesting pre chat where I had to ask you, I was like, look, I know we've had a few conversations before this, but I've never had to actually ask you, how do I pronounce your name correctly? Is it Chevin? Is it Siobhan? Is there some other version of it? Because I'm a Bogan and, you know, I want to make sure I get it right. And then you said you've come up with a whole new realization that there's a whole bunch of people saying it in a way that you'd never heard before.
Jevon LaRue: Yeah, yeah. So there's this thing called Jevons Paradox and that the AR world seems to be grabbing onto that goes back to the 1800s and they've been talking a lot about it now and. And it's sort of weird when you've heard your name one way and then people in Silicon Valley are saying, oh, Jevons Paradox. Jevons Paradox. And how important it is to. To the world of ALR, even though it goes back to the 1800s. So, yeah, it's good to hear my name pronounced correctly.
Nathan Bush: There we go. And your Silicon Valley bros have just changed the way your name's pronounced for everyone else.
Jevon LaRue: Yeah. Crazy.
Nathan Bush: Now, we have so much to cover today because you've got a rich history in retail from your first job of selling door to door for Billabong, through to managing the teams at PE Nation and Surf Stitch, through to developing ku, which we're going to talk about today. Quite a journey there.
Jevon LaRue: Oh, yeah. And thrown into that, a bit of coffee franchising and, you know, so like a whole bunch of different stuff.
Nathan Bush: Right.
Jevon LaRue: But yeah, it's been an interesting journey. I actually started my career as a professional surfer in the mid-90s. Yeah, mid-90s. Competing on the world tour for like a bunch of years. And that sort of led to Bill along and yeah, from being a billabong sales agent in the 2000s to building AI agents for E commerce operations, it's quite a journey and with a few stops along the way with different adventures. And that's the good part about building something ground up from nothing is it's not an unfamiliar place. I've. I've sort of had to do it a few times and it's good fun.
Nathan Bush: Yeah. Wild. Do you still surf?
Jevon LaRue: Not as much as my son.
Nathan Bush: You pass the gene on.
Jevon LaRue: Yeah, not as much as him. He gets in the water way more than I do.
Nathan Bush: Love it. Well, I want to start where you are today with Kieu and then I've got no doubt that we're going to hear some stories from your background as well weaved in there. But when we were chatting, I thought this was fascinating because recently we've had Emily Elvey on the show and for the first time we really dug into customer service and she gave us a great perspective on that and how to do that effectively, how to measure it and how to make sure customers get what they want and you keep your team happy, especially over peak season. It really caught my interest when we were talking because if you bring up the Kiyu website and anyone following along at home, Kyu as in K double E Y U bring up the website and the first thing you see is help desk managers complaints, Kiyu prevents them. And it's a really interesting concept, one that I haven't seen out there before. What do you mean by that?
Jevon LaRue: You know, before I dive into that, this may be sort of like frame up the crux of the problem we're solving first. So let's just take us back to where a consumer is and you know, we've all been there. We order, order a birthday gift online, it never arrives. There's an email, no reply, make a phone call, no pickup, chat with a bot, no resolution. And finally we get, we give up. And you know, for them, it's a hassle. For the brand, it's a lost customer and a hit to trust. And this happens millions and millions of times a day, right? Each delayed or missing order is a small crack in customer loyalty. Behind the scenes, CX teams are buried in where's my order tickets. Chasing data across 5, 7 siloed systems. And that result is always one thing, right? Late deliveries, missed refunds, wasted hours, frustrated teams. So in every single one of those issues, costs, time, money and repeat customers. So really to hit to your question, I guess today most customer service tools are built to do one Thing react to complaints. A ticket comes in, it's because of a late delivery, a missing item, a refund delay. And the help desk is really built to manage tickets so that customer service teams can triage them. Right.
Nathan Bush: Clear tickets as quickly as possible.
Jevon LaRue: Clear tickets as quickly as possible. And you measured on first response time, resolution time, customer satisfaction. Because you're fixing something that they didn't want. They didn't want to complain. They didn't want to have to chase up something you should have just got. Right. So we flipped that model completely and we fixed the problem before the customer even knows it exists. So if a parcel hasn't left the warehouse, we catch it and push it out. If a payment fails, we retry. If an item is out of stock, we place it on backorder. If a return is stuck, we flag it for resolution. So sort of instead of managing these complaints, we're preventing them. Because if you fix the ops issue at the root, there is no complaint. And that's proactive e comm ops. And that's the difference. And it means teams spending less time firefighting, and customers never have to ask again, where is my order?
Nathan Bush: So let's dive into one of those. Maybe pick where is my order? So I think that's a very common problem, is that maybe dispatch times get blown out, which leads to longer lead times, longer delivery times for a customer. So instead of it leaving the warehouse within 24 hours, we've got had Black Friday, whatever it is, it's blown out to seven days or the item's not available where we thought it was. How do you catch that? And how are you catching that? That the WMS or other systems aren't catching?
Jevon LaRue: Yeah. So we're in a unique position because what we are is an orchestration layer. Right. We're not a point solution. And the way orders run today is they captured on a storefront, they process through a payment portal, they go through an erp, wms, pick pack, ship, carrier integrations, deliver and return. And each of those point solutions are doing a good job performing their function, but they're not designed to detect if an order doesn't push through is held up. And so what we do is we connect all those systems together into one centralized platform and we use the customer promise, which is order before 12, pay express, ship, same day, get tomorrow. And we use that customer promise and work backwards along every single touch point and say, oh, this order hasn't progressed to where it should be at this point. And then we flag that in the centralized platform in a Very clear, visible way. And that then is either red, as in it's broken the service level, or it's amber, it's about to, or it's blue. It's moving through according to plan and when it hits amber or red, then kicks off a workflow that's associated to resolving that issue that our AI agent then comes, takes on and runs through the resolution all the way through. So let's use an out of stock, for example, and lost in transit, for example. We identify that that order hasn't moved between different stages for a certain amount of time and then that is likely lost in transit. And then we start the process of finding alternative stock, placing an order, putting it onto express so the customer gets it. Next day, shipping it out to the customer, sending them a notification, hey, your order's been lost in transferred and you're going to get it tomorrow. It's on a different tracking number. Yeah, it is. Sorry about that, but we picked it up before you did. And then it goes through the process of sorting that out with Auspost. So fully automated, where the agent is taking on updating systems, communicating and facilitating resolution.
Nathan Bush: So when you hit that amber or red status, is it effectively doing two jobs depending on the scenario? It's one, getting ahead of it with customers to give them communication on where you're at, to kind of prevent that them adding another ticket through email or chat or phone. It's like they're kept in the loop. But is it also then triggering something in the ops to find a solution as well?
Jevon LaRue: Correct. So an out of stock might have seven ways to be resolved and it then determines the best course of action and then runs that resolution through all the way to the end. Sometimes things are resolved without the customer knowing, Sometimes the customer's involved, sometimes teams are in the loop, sometimes they're not in the loop. So it really depends on the problem that the agent has to solve.
Nathan Bush: And are these all predetermined problems or scenarios with a retailer and are they unique for each retailer?
Jevon LaRue: They're all predetermined and we do work with the retailers to ensure that their ops is well taken care of. So we've built an infrastructure that is plug and play that we can easily onboard customers within five days. And that's taken a long time to get that because every retailer is unique. But there really is just a bunch of toolkits if you want to call it, and you just drag and drop and you connect it all together. And then we do final sort of like customizations based on specific uniqueness. Per each retailer.
Nathan Bush: I wouldn't say it's a radical idea, but it's a different approach to proactive customer service that I haven't seen before, especially here in Australia. Yeah, where did you come up with the idea? Where was the origins of Kiyu?
Jevon LaRue: There's probably two parts to that. My co founders and I met back in 2020 at PE Nation and I was the CEO there. And Tracy was heading up customer service and Tahir was heading up technology. And you know, Tracy had spent decades in customer service and e commerce ops and she had sort of worked out, just because of painful situations, that if she could fix the issue manually before it snowballed, well, then it just wouldn't become a complaint. And it wasn't until I moved on from that, that business and went into another one where there was a lot more pain. And Tracy came along and Tahir came along and I said, look guys, we've got to fix this. Let's build some kind of system. And Tahir was like, well, why build a system for a company when we can build a solution for every e commerce retailer in the world? Because Tracy had had a unique insight that if you manually sift through all these systems and find the. She was manually sifting through all these systems, finding that, that failure and then manually fixing it, which just took forever, right? And she would work obscene hours. And then we were like, well, hang on a sec. Surely if we can find this issue using technology and then automate the resolution, it's saving teams an incredible amount of. Of manual effort, but at the same time, putting businesses on the front foot because their customers will always get what they want on time as promised. And we all know the best customer service is if the customer never needs to talk to you, never needs to call, never needs to complain. It just works. And that's what we're building.
Nathan Bush: And this might be a silly question. Is it hard to build?
Nathan Bush: Because I could imagine that as an
Nathan Bush: orchestration layer in the middle of it all.
Jevon LaRue: You.
Nathan Bush: And because you're working with clients like Tacuba, ehplabs, Budgie Smuggler, everyone will have different systems from front end through to erp, through to warehouse management systems, through to shipping carriers, different data, different APIs. It sounds like an absolute nightmare of a problem to solve for me. How do you productize that?
Jevon LaRue: You know, I think we're probably a bit naive. Went all in on this and there were a few really smart people in E commerce that, you know, sold their business for hundreds of millions and they're like, this can't work, you know, it's just impossible. Everybody's business is different and we're like, yeah, it is. But Tahir is a real genius. In fact, one of our customers said he's a wizard and he came up with a way, a way, I don't know, I'm not the technical co founder, but he came up with a way to be able to build this, that you're tumbling all this data in a way that it washes up in a uniform sort of format. And yeah, we've got, we've got eight engineers right now. Four of them are onshore, four of them are offshore. A lot of building really aggressive timelines to deliver on a very powerful roadmap. But it took time and we built in the open. We onboarded our first customer 18 months ago, two of them, and then went to three and then we kind of hit pause for six months while we built with them. And we're learning. We certainly didn't build a perfect product and then launch. We built in real time in users hands every single week, making iterations. I remember when we brought in our third customer, the platform couldn't cope with the volume and it just froze. And Tahir had to go into like a radical rebuild and rebuilt the platform ground up. But there's certainly a lot of magic is done because as you pointed out, one, we've got to, we've built 50 plus integrations now and we're heading towards a hundred by the middle of next year. And each one of those have been systemized in a way that we can bring on these brands super fast and be able to connect all the points of data that we need to drive. And we've been able to find that data in a lot of unique ways either through APIs, webhooks, even browser operator using agents. FTPs are just a bunch of different ways.
Nathan Bush: Awesome. So what's the process? So when you're speaking to a new retailer for the first time, I'm keen to understand what discovery looks like in terms of you needing to understand the tech, what integrations you already have, what you need to deliver, but then also from a customer perspective, what problems are you going to start with?
Jevon LaRue: Yeah, so we're definitely not a product led sales business. We are a sales lead business. And so there is a bunch of work that's it's done upfront in the sales process. A discovery call, a customized demo, then, then a mutual action plan and then a scoping call. But for the retailer it's actually fairly painless. And we built that in a way that it is about three to four hours of their time upfront and what we're looking for from them is three lots of, three lots of information. Yes. What are your, your API keys, How do we connect to all your systems? So we define what is your tech stack. So what storefront are you on? What erp, what inventory management, what warehouse management system? What are your carrier integrations? Who are your carriers? Do you have marketplaces? Do you have ship from store, click and collect? Multi geo warehousing? Do you have a return solution? What's your help desk? So we gather all of the access details and credentials from that and that takes about one to two hours depending on the retailer and their responsiveness and then about another hour where we gather the customer promise and that can vary between multi go so you know you'll or east coast, west coast or express or perk product or we gather that information and then we work with them around their workflows and determine what are the workflows that they want implemented. That's three to four hours of heavy lifting for them. We go off, we do about five days worth of work. If their tech stack matches the pre built integrations that we have, if their tech stack doesn't match it's about 10 or 15 days worth of work and then we do an onboarding session with them and they often run in on day one.
Nathan Bush: Who's the ideal retailer? Like who do you think this fits? Because obviously there are some retailers, especially in E commerce that are set up with a very typical tech stack. Shopify into Klaviyo, into Gorgeous out to a ship. It maybe, you know what I mean? Like pretty straightforward system and then there's some that are very, very complicated. Where do you sit in the world?
Jevon LaRue: Yes, that's a really good question. I mean I've, I've probably done 50 odd discovery calls over the last three months and out of those probably five or ten were just not the right and that was because their business didn't have the volume or the complexity of storefronts or the amount of integrations and there is sort of a tipping point but not just the complexity of their business model, it's also the mindset they have. We've got some retailers that were, you know, that were at the startup program and they didn't have a really complex business but they said hey, I'm growing fast and I don't want to have to scale with people I'd rather scale with automation is one thing. I don't want to have to Be putting out fires and deal with things reactively. So I'd like to have a system that is able to prevent complaints, keep my customers happy, keep them locked in. So there is a bit of a mindset. But we certainly, as you go up to the level of complexity say Dekuba has, which is multi geo, multi fulfillment locations, pick and pack, ship from store, click and collect, same day delivery marketplaces. We really do an incredible job pulling that all together and just giving them this single, single clear view of what's going on. But we got everything from retailers doing a couple hundred orders a week to doing tens of thousands of orders a week.
Nathan Bush: You were telling me about Clutch the other day. Tell me how they're using because I think that's such an amazing story.
Jevon LaRue: Yeah, Clutch is a great brand. I really enjoy. Well, we all enjoy. Our whole team enjoys working with Clutch because they're really pushing the sort of innovation space. And we caught up with them the other day and we were like, hey, what would it be like if you didn't have TU today? I couldn't imagine because I'd just be putting out fires. I'd have to hire three, four more people to be able to manage all this complexity. That's been a good journey because what we came to understand is that they also have a big B2B business. And whilst we entered in on E commerce, they're like, hey, I got all this B2B pain. And it's the same thing, right? Like when you take an E commerce order, it's got a customer service level to a customer expectation, but it's the same with a B2B customer. And so now what we've learned from them is the opportunity to build out a B2B offering which be launching in February. Right.
Nathan Bush: Okay, that's going to be huge. And how do you measure the impact of proactive customer service when you don't see it?
Jevon LaRue: That is a good question. Because, you know, teams have got so good at measuring first response time, resolution time, CSAT and all of that. And we sort of come in with a new metric which is complaint prevention. Right. And complaint prevention is how many issues, OPS issues did we detect? How many of those OPS issues were we able to prevent in real time? How were they resolved positively with the customer? And so, you know, that sort of impact around how many times do we detect and fix something before the customer noticed? How many inbound tickets were never needed to be logged? How many hours of repetitive work didn't land on the OPS team? What's the improvement in on time fulfillment, we also track other sort of operational metrics, like what was the Wizmo ticket volume, how much manual task reduction was there, time to resolution, cost to serve. And then I think also the most important thing is that retention and customer lifetime value improvement, you know, because if customers get what they want on time as promised, always, no drama, they keep coming back. Right. Like last year, according to our post, like 1 in 5 shoppers did not get what they want on time. And they, they had a, they had a raise. That was 123 million hours wasted on customer service calls last year. That's a lot of pain, right? And so in some ways, Kiyu is like an immune system. You don't think about it when it's working, but it's constantly defending the experience. And for brands, that silent protection is often what drives the biggest impact.
Nathan Bush: Do you find that customers with that proactive service turns them into real advocates? It's almost like, and I'm not selling this for you, I just think is a really interesting concept around. It's unique to get a proactive piece of communication from a brand to say, hey, we're putting our hands up. This is going to be late, or this is lost, or we don't know what's going on here. We're aware of it, we'll get back to you, we're onto it. Does that come back in terms of public reviews or sentiment at all?
Jevon LaRue: Yeah. Well, I think of it, you know who really nails it well is Amazon. Nailed it. Well, like, they really nail it well. An order might be out for delivery. It's not going to reach you. You get a notification, hey, sorry, we've let you down, but you're getting it tomorrow. And I think people started shopping online because everyone was like, I don't want to go to the mall, don't want to deal with traffic, don't want to deal with queues. There was all that pain, right? Went online. But the anxiety when you hit bar, you don't know if you. If it's going to come on time. There's no guarantee, right. If brands can consistently deliver on time and keep customers happy, either because they get what they want on time or because you communicate really well with them. I think it's polite, like, it's like, hey, we've let you down, but we know about it and this is how we're resolving it. And this is the outcome. They just keep coming back, you know? And out of those one in five that complained, 75% of the one turned every year. And That's a consistent thing, right?
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Nathan Bush: I could imagine too, you know, someone who's had the leadership positions that you've had in retail. Having a system that lights up in amber or red when there are blockages at certain points of the customer journey would be really great to have at a decision making level in terms of where you need to invest resources or make significant changes. Do you find that that becomes part of the reporting structure as well?
Jevon LaRue: Yeah. So there's probably three lots of people that engage with our product. We've got customer service people that are using it to resolve issues or deal to prevent this thing and keeping in the loop with the agents. And then you've got the E commerce team, but it moves up to the C suite where the C suite are actually able to see well, this is what the health of my E commerce ops looks like. Oh, that's where a pain point is. Okay, what resources am I going to put on it? And that's the other product that we're busy building out right now, which is the insights where it's going to be both quantum qualitative where different people can engage with qu and get full reporting on the performance or the health of their E commerce operations. Be it for a Monday trade meeting or be it for a weekly wrap or be it for a monthly board pack or whatever it is. Different levels of people in the business will be able to get information out of Kiyou that helps them understand where the pain points are and then actually go fix those operational issues. We don't want to be ke's not about firefighting all the time. It's actually about helping our retailers understand the health of their business and then be able to make effective ops Changes to avoid that pain.
Nathan Bush: What are some of the most surprising findings or breakages that you found in the retail businesses that you work with? I could imagine that you've uncovered some pain points that retailers weren't even aware of.
Jevon LaRue: Yeah, you know, I'll give you a real example. One of our customers had a consumer place an order for about $500 for an express delivery. It was really early on when we were like testing this out and you know, the warehouse didn't pick up, it didn't pick it on the same day and normally that would have just got caught until the customer chased up or worse left a negative review. But Kie was able to spot that, that delay early. As I pointed out, it hit Amber and then our agent flagged that the pick and pack SLA had passed and order notified the fulfillment team who then escalated it, got it out the door and the customer received their order on time. And I remember getting that call from that customer and they were, it saved the situation and the consumer never knew there was a problem. And that's the shift that we're seeing. Instead of CX teams digging through these point solutions or reacting to compliance queues, detecting those issues midstream and fixes it before it becomes a drama. And we see this across other flows too, like failed payments that get retried automatically or stuck returns that get nudged through the system. All things ops teams usually catch too late or not at all.
Nathan Bush: And those communications that are sent to a customer, are they sent via qu or are they sent via the help
Jevon LaRue: desk software via the help desk. So every single we're not yet a replace help desk ignore. We say help desk manage complaints que prevents them. We're not, we're not going after help desks. In fact, they're an important part of the integration. And why? Because they've got customer data.
Nathan Bush: Right.
Jevon LaRue: And they've got an easy way to communicate. And so when we identify an ops issue, it creates a ticket in the help desk if there is a reach out to the customer, if it's resolved past, it doesn't. But as soon as we interact with the customer, it's through the helpdesk system. And the comms are crafted based on a brand, on the brand's guidelines, but also on the customer history.
Nathan Bush: So the customer service team can still see all that communication history to that point. So even if there is a problem after that they can see that the customer has been updated along the journey.
Jevon LaRue: Yeah, these agents are not fully autonomous. They're being built user in the loop. We certainly like very aware that we got to augment teams so that they're doing less manual repetitive tasks. And they sort of focused on high value interactions with the customer that are driving revenue, not firefighting. And we built Q in a way that you can see every single issue detected in real time and then it being tracked and a full sort of history of what system did it go to, where did it gather info, how did it write that email. And if needed, the user is in the loop fully and can follow that whole thing through the whole chain and be across that detail. And if necessary it loops in. It loops in the user and says, hey, I'm stuck, I need your help, gotta resolve this.
Nathan Bush: I can imagine you've got a thousand ideas around how this can get smarter and more automated in time, especially with new AI capabilities going on. If I was to ask you how Keu works in 5 years time, what do you think your vision of it then is?
Jevon LaRue: You know, if we could wave a magic wand and sort of plug in one new data source, I'd say it would be real time customer intent signals. So right now we track everything operational. So like when an order is picked, packed, shipped, returned, refunded, but what we don't have visibility or don't have any idea about is what does the customer expect or how are they feeling in the moment. Like imagine if we could combine that operational data with intent signals like this is my birthday gift, must arrive by Friday, or I've contacted support before, I expect faster resolution, or this is my third order this month, I'm a high value repeat customer. That context will allow our agents not to just fix issues, but prioritize based on customer impact. Because not every late delivery causes the same damage. A delay on a bulk protein reorder might be fine, depending on how much of a gym bro you are, but it might be fine if it comes a day late, right? But a delay on a bridesmaid dress for a weekend wedding, you know, that's kind of a disaster. So if we could plug in real time intent and urgency and customer context, KYU could become even more precise, personal and preventative. But at the same time, I think there's a real opportunity. We're solving a problem of siloed systems. These point solutions that are good at returns or good at carry integration, or good at inventory management. And they've been built out over time, like as E comms evolved. New categories have been created. Order editing wasn't around two years ago. Before that, easy returns wasn't around, or instant refunds or you know, buy now, pay later. These are all new categories that have just made ecom better and better, but they've added complexity to the order journey. Now we're solving for that complexity. I guess the question is, can an orchestration layer become an end to end solution from after the buy button, so after shopify to when the customer gets a return, is that the real opportunity just to provide one end to end point solution?
Nathan Bush: We actually spoke about this a couple of weeks ago with Sylvan from Gander and Andrew from Convert Digital around the complexity that is coming through at checkout and post checkout. Like you said, being able to edit your orders, add more items after checkout, it's like checkout isn't the end of the journey anymore. Do you find that it's adding a lot of complexity for teams in the background?
Jevon LaRue: Yeah, it's certainly a cause to what it's making the shopping experience better. But it's just one more point solution to have to like manage the order journey and one more point of contact, you know, with order editing. It's super awesome in that it gives the customer a bit of flexibility and it saves some time. But it also creates some downstream pressure too, you know, on the warehouse because their fulfillment times get tighter. It's certainly the more siloed systems there are, the more potential points of failure there are. And that's where we come into play, where we're able to detect those system sync issues or orders aren't moving through as they should.
Nathan Bush: I love that idea that you said around being able to understand customer intent. And I see that mirroring up nicely with customer service. So you know, having whatever the future is in five years time, having a customer agent or your own customer help guiding you through the purchase journey, understanding exactly what you want to buy, what you're using it for, what your budget is, to give you something that's really special for you and your purpose. And then almost having that agent that helped you shop, drop off and then be your helper within the business after you place that order, to track it for you and to give you updates if anything's going wrong. It's pretty special to combine that pre and post help in one agent.
Jevon LaRue: Yeah, we certainly building Kiyom in a way that other agents can engage with our platform and be able to facilitate outcomes. Working with us, we've really clear on this. Like there is a bunch of legacy ERP systems out there that are closed and they're like we don't want you. And there's even warehouses like we don't want to let you in. And they've got these closed business models and that's going to be really challenging for them in the future if they're not opening themselves or, or any solution isn't opening itself up to this onslaught of agents where, you know, our solutions. We also see the opportunity for our solution to become the point contact for all agents and actually channel in. Agents work in because we're the only solution that's going to tap into every point solution to be able to solve this problem. Right. Like the existing solutions that are triaging customer complaints with ar, they're really, they're fixing a complaint and they don't have access to the depth of data that's required to be able to fill this in a, in a proactive way versus reactive. So we're feeling really positive about being able to ensure our platform is able to communicate with other agents to solve those, whether they're shoppers or not.
Nathan Bush: It's a fascinating space. And we had David Brudnall on a couple of months ago from Decider and he was talking about agents and his vision for agents is that we have agents in our business where instead of telling them a task to do in terms of go find all the missing orders and update customers, it's we give each agent a mission or a goal. So if you're a customer service agent, your mission is to increase customer spend by 20%. So yes, solve the problem, but then we want to upsell them or we want to introduce them to other things and be a sales agent, not just a customer service agent. Or it could be that you're a marketing agent and your goal isn't necessarily to write meta ads, but your goal is to find X new customers every month. However you choose to do that, it's going to be pretty interesting when we take that agent approach, especially those integrated agents that you talk about, from being task oriented to outcome driven, whether that's an outcome for the customer or an outcome for the business.
Jevon LaRue: Yeah, there's. That's going to be a bit of time. Right. Because that's going to require thinking and I don't think the text there because right now it's solving mathematical problems. It can't maybe. I mean, I'm not really like I've got my bubble and I got my lane and I'm just so focused.
Nathan Bush: I've got a lot of little bubbles
Nathan Bush: but no deep bubbles.
Jevon LaRue: Yeah, yeah. And we just like we deep in this thing. Right. And I remember when we had to go hire engineers to build this we couldn't find anyone that's done anything, anything that to solve this problem. And my guys are like in the fly figuring this out and going, oh, we can do it this way or do it that way or do it that way. So I think the specialists will be able to solve the general across the board, but we certainly focused on what we're doing and have a good understanding of how to solve this problem.
Nathan Bush: And I guess you're in a really good position too as an orchestration layer that integrates with all the platforms in that you're not embedded with any individual platform or solution because they're all changing so much at the moment. And so you just remain that orchestration layer that can adapt to whatever is happening and whatever's moving out in the market.
Jevon LaRue: Yeah, exactly. And we see ourselves as Switzerland, so to speak. You know, we're not like we're providing a service to any retailer that has any combination of systems. In fact, today I had a reach out from someone that's on Magento and we haven't built an integration from Magento. So I pick up the phone, hey Tahir, how long is it going to take us? He look, click three goes 10 days, you know.
Nathan Bush: Surprised I didn't hang up on you.
Jevon LaRue: Yeah. So we certainly feel like that that is our usp because that does does drive a moat for our business where it took a lot of time. Each integration is five to 10 days. So we've got a head starting what we're building with 50 plus integrations. And that took a lot of time with a bunch of engineers in Pakistan for a while to do that heavy lifting initially.
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Nathan Bush: Speaking of moats, you've obviously caught the eye of investors and raised some great initial money there. You're not the typical SaaS model that they might back because it's still solution oriented, depending on what retailer is and customising it for their needs. How did you go about raising money that initial money with investors?
Jevon LaRue: Yeah, I think the first thought was we got good support from startmate and they back ambitious founders that have. When we got into startmate the beginning of last year, we had no product, no customers, we just had a problem. And that problem was clearly messy. So. And it was simple to understand, hey, I buy something online, it's not guaranteed to arrive on time. I have to complain, and that's painful. And they backed us, I think, also because we're an experienced founding team, lots of experience. They're like, if they believe there's this problem. So we got some traction with them and then we got traction with awesome early investors like Paul Greenberg, who's got a real good name and he. And he could clearly see it too. And so that sort of first round of funding was a bunch of angel investors that were backing a founding team. We had a vision, we didn't have a product, we didn't have customers, but they were backing a founding team to solve a problem that they knew we were close to. And we've recently done a round with institutional investors, some great VCs came on board and you know the sort of short answer, it was a little trickier because you throw in the word E commerce and they're like, we don't fund E commerce businesses. No, no, we're solving a customer service problem. And so we had to really work hard to get our narrative right. And most investors, I would say out the gate, they could understand where is my order? They could get that and they get the symptom. But what they didn't always see straight away is the operational complexity behind it. And what helped was showing how reactive most CX knops teams still are, even at scale. And we had a sort of demonstrator. I remember us doing this video going, well, this retailer's got eight brands in four geographies. They say 16, 24, 32 storefronts, 32 tabs on their browser, they're open and they're clicking between all of them constantly all day. So hey, we're pulling all that data. They're not having to do it manually, they're not having to react to issues. And when we showed a few of them live demo when they started speaking to customers, one of them rung up a customer and got really deep into the problem. They're like oh this is a real painful problem and these are paid problem but, but it's complex to solve and it's complex to build for. And that's when the investors that backed us this round they could really see the moat we were building around the messiness of the complexity. Because when we were raising there was a lot of, a lot of AI agents coming out but they were solving horizontal problems, just simple systems to plug into, not a vertical problem that's got vertical data and complexity around resolutions. So we really got good support this time around. And for us now it's about getting more customers, getting it out into users hands and building that customer base and proving that this is a new way of running E commerce operations. New way of running post purchase.
Nathan Bush: Why didn't the VCs like that? You're an E commerce. What's the stink on E commerce with VC at the moment?
Jevon LaRue: Just remember I don't understand E commerce. Okay, great. Well the ones that backed us funny enough had come from an E commerce background. One of them had actually built a pet supply business and sold it and then went into vc. And the other was super curious and got us speaking to Dekuba who became a customer and got us speaking to Jackson Group and then said hey, we want to speak to your customers. And when they got talking they were like oh, this is not an E commerce solution, this is a customer service solution. This is solving a real pain.
Nathan Bush: So obviously you've started with retailers, but do you see KYU expanding out into other industries then?
Jevon LaRue: Absolutely. Like I said earlier, we certainly are going to expand into B2B and retail operations and we're launching that platform next February. We've had some companies reach out to us that are in the logistics space saying hey could you work with us? But we feel The E Com B2B retail, that sort of omnichannel offering is where we want to play out initially and build that out, you know. So our view is really we would rather focus on owning everything after the buy button at some point in the future across B2C and B2B. And that underlying problem isn't retail specific. It really is about like fragmented systems, reactive workflows, lack of automation across auto life cycles. And that's what Q was really built to solve at the end of the day.
Nathan Bush: Brilliant.
Jevon LaRue: We're starting with retail because the pain is the loudest. Right. But the long term play is much bigger, which is proactive ops across any transactional business. There's no reason why we can't expand across.
Nathan Bush: Absolutely.
Jevon LaRue: Into other verticals. Yeah.
Nathan Bush: And question I should have asked earlier for what's the commercial model here? So, you know, there's a bit of work upfront to be done, a bit of investigation, maybe some custom stuff. How do you actually price this?
Jevon LaRue: Yeah, so we don't actually price. We've got no integration fee, no custom fee. It's just pure monthly subscription and we charge a flat monthly platform fee based on order volume and AI agent usage. So each plan includes a set number of orders, up to 5,000, up to 15,000, 30,000, 60,000, 60,000amonth, for example, and a block of AI agent resolutions, be it 250, 500, 750, whatever it is, unlimited users, rebuilt integrations depending on the tier. And we've really kept it simple. To start with, there's four plans, Starter, Grow plus and pro. And so for example, a brand doing up to 15,000 orders a month would typically go on to our grow plan, which is $1,550 a month. And that includes I think it's like 750 AI agent resolutions in that price. But if they need more agent capacity, say during peak trade, they can top up with extra block. So they're only having to pay for what they're actually using. But I think the key piece is really in terms of ROI and how we help teams track is in our platform, you can see how many issues keys resolved automatically, the time it's saved versus manual workflows, the drop in support tickets, the drop inbound support tickets, an increase in on time fulfillment. And also we track customer lifetime value in real time. We display in the platform. You've got X amount of customer lifetime value at risk if you don't fix this issue. So they can see how many issues they've got as a percentage of total orders, the amount of customer lifetime value at risk, and if they fix that issue, how much customer lifetime value they protected. And so on the platform in real time, you can see all those metrics.
Nathan Bush: Brilliant.
Nathan Bush: I've got to ask you, and I'm
Nathan Bush: sure it's a loaded question for the next 12 months, where's your focus? Because I saw that you just released v3 of KU. I can imagine you've got a roadmap of developments that you're going to keep the team busy on. Where are your priority areas over the next 12 months?
Jevon LaRue: So, yeah, we launched v3 of the platform about a week ago and the day it got launched we put up a countdown clock of 99 days in the office and each day that clock comes down to our next launch, which is in February. And the team are like very. They come in to work and they're like this clock ticking but X amount
Nathan Bush: of this damn clock.
Jevon LaRue: They quite like it. It's really energizing, really energizing for them. But right now we've got the core Ecom platform and we've got the AR workflows and so our next 12 months is to increase the amount of workflows and get them across every single customer. We've got about 25 brands on the platform now, so to get them out to all the customers. And then the next phase, which is February, we've got three products launching in February and that is the Insights and the AI Assistant. So it's Ask Kiyu and that's natural language requests instead of workflows. So you'll be able to solve problems by asking questions and then the B2B part of it. Once we've got that launched in February, we're then going to really work out on how we can automate the onboarding cycle for customers, how we can get them on using agents so that it's low touch, frictionless, and how do we get this patch platform to become more useful across the business for every single department. So our sort of focus for the first half of next year is to grow our customer base in Australia, launch new products, but at the same time start focusing on building out some customer traction in the us.
Nathan Bush: Awesome. I've got to ask you what's better, being a tech entrepreneur or a retailer leader?
Jevon LaRue: I'm going to say neither.
Nathan Bush: A surfer. A surfer is the best out of the lot.
Jevon LaRue: I think neither, to be honest. It's probably not a good answer. Like, I do miss trading, right? Retail is real dirty. You're like in the weeds, you're chasing down. It's like every day is every transaction, it's every this, it's every that. There is a lot in that. But I'm really enjoying building a tech company because it's a sort of longer term play. Right? When you're building a retail business, you can generate revenue from day one. Like, you know, we're not generating revenue to cover our overheads, that's why we got investment. But it's super fun building something that you know is changing the lives of people. We were, we were at a Costa the other day and it's like, hey, if you didn't have kieu, what would you do? And she was like, I wouldn't come to work anymore. And then the other one said, oh, I wouldn't go work for another company if they didn't have kieu. And it's changed my life. And that's really rewarding when you see the positive impact it has on employee engagement. It's not just like customers are happy, brands are happy, but employees are happy too, because they don't come to work firefighting anymore. Yeah, they've got all the tools to do their job. Awesome. And they're having really good conversations with customers. Not negative conversation.
Nathan Bush: Love it. There was something that you wrote on LinkedIn last week that caught my eye and I wrote it down here and it was linked to what you said there. AI won't replace people, but it will replace problems. And I think that's a really nice way of thinking about what you're doing here. Not that it's all AI, there's a lot more to it than AI, but not replacing people, but replacing problems. Because like you said, no one goes to work to firefight and customers don't purchase to follow up. We're doing things that neither party wants to do.
Jevon LaRue: Exactly. I mean, we're taking away the most painful part about E commerce, the frustrating, the anxiety around not getting something on time. Right. No one wants that. We're not trying to re educate people to shop. We're taking away something that they never wanted in the first place. So tick. And we thought long and hard about this, like really hard. What are we building here? How's it going to have a positive impact? And that positive impact is that these teams are going to be augmented. They're going to have something sitting alongside of them that's doing all that manual, repetitive stuff they don't enjoy doing. Checking systems, writing emails, waiting for answers, taking it on the chin from a customer, updating systems. They leave work trained and they're not going to feel that way. You know, when they've got keys supporting them, they're doing less manual, repetitive things and they're just having these high value, positive conversations that are driving revenue and that creates more jobs. It doesn't take away jobs. We're not there to replace teams, we're there just to augment them so they can be better at what they do.
Nathan Bush: Well, you keep this up, you might be Saint Gevon. The patron saint of customer service teams worldwide.
Jevon LaRue: Yeah, my co founder Tracy Will, she's the sponsor. I'm just the one isolate.
Nathan Bush: I love it.
Nathan Bush: So if people want to get in
Nathan Bush: touch with yourself, Jevon or the Kiyou team, what's the best way to go about that?
Jevon LaRue: Yeah, the best way is to head to kyu.com, which is K-W-E-Y-U kiyu.com and we've got a link there that you can book a custom demo with us. We will then run a discovery call and like understand the business. And you can also connect with me on LinkedIn. I think my name should be somewhere over here. Like click down the bottom there.
Nathan Bush: We're not that smart. We can't do picture in picture links but we'll put in the show notes.
Jevon LaRue: Yeah, connect with me on LinkedIn. Not hard to find my search me on LinkedIn. Just type my first name.
Nathan Bush: Love it. Jevon, thank you so much for joining us today. I've got a feeling we are just at the start of this journey. We're going to have this chat again in a few years time and we're going to be in a totally different spot with whole new technology solving maybe already solved the problem, but it's going to look a lot different. But I love the trajectory you're on and your mission in the world, especially for those customer service teams who are battling this every day. So thank you for sharing that with us today on Add to Cart.
Jevon LaRue: Yeah, awesome. Thanks for having me on Add to Cart, Nathan. It's a real, real pleasure.
Nathan Bush: Now if you're anything like me, I'm sure that sparked some big ideas on what the future of customer service and
Nathan Bush: e commerce operations could look like in the future.
Nathan Bush: I love the idea of talking about how brands can stop firefighting and start forecasting and start fixing problems before they become major, before they even touch a customer and before they even impact our brand. That to me seems like a nirvana that Jevon and the team are really close to executing for a lot of brands. And I'm hoping that in the next few years we see a real evolution in thinking rather than clearing tickets to preventing tickets. Here are three ideas that I took from this episode. Number one, the idea of preventative customer service. How could I not go past this? But customer service, no one in retail goes into retail to run a customer service team and no customer buys a product so they can contact you afterwards with a question or a problem. No one wants it. So why are we not trying to make it extinct? I love that Jevons point that the best customer service is when the customer never has to contact you. But I think it can go a step further because the bar is so low on customer service at the moment. But even when there is an impending bad experience coming up, such as a late parcel or a wrong item or a damaged good, that you can get ahead of the game and tell the customer that you recognize there's a problem and that you're in the process of fixing it. That to me, not only reduces workload, but has the opportunity to put your brand above others in the mind of a consumer where they're not having to do the work for you anymore and
Nathan Bush: they're surprised by that proactive approach that
Nathan Bush: isn't common in E commerce. There's a real opportunity there. Secondly, proactive operational issue resolution. This is the part of the QU system that I never fully understood before our conversation today. Even though we'd had a few conversations about it, I never understood that it was also a DOT diagnosis that it could diagnose internal problems through that traffic light system of green, ember and red. Being able to understand how big problems are, where the blockages are and the potential impact of those blockages, that's huge for a team to understand before it
Nathan Bush: gets out of hand.
Nathan Bush: If you can add them to your dashboard and your reporting dashboard, that's going to save you a lot more money than those incremental improvements could and have a bigger impact on your customer experience than anything else. If you can have that simple framework, green mean running smoothly, amber showing friction, and red signaling something that needs fixing. Now, I can't think of any other report that I'd want to see. First and third, sometimes it's not just a Shopify app problem. We've had amazing solutions come through add to CART over the last couple of years where it is as simple as downloading a a Shopify app for your store to add a new functionality or a new offering for your customers. And those point solutions are fantastic, but as you heard from Jevon, They've got over 50 integrations now and they act as an orchestration layer between all the technology. For a retailer, this means that often they will have to do some customization and the implementation process isn't a couple of minutes, but might be a couple of weeks or a couple of months to get it right, to make sure it's solving the right problems. But that upfront effort is worth it to be able to be customized for your business and to prevent all those issues where you would be spending time and money down the track. Sometimes as much as we would love it, it's not as easy as just an Install this app to solve your problem. Sometimes the most value comes from going deep and creating a solution that is just for your business to solve those problems. As Jevin put it, the complexity is where the opportunity hides. Now if this got you thinking differently around how your ops and your CX teams work together and get ahead of issues, make sure to hit subscribe wherever you listen. Whether that be Spotify, Apple, YouTube. Hit that subscribe button. We're going to bring you plenty more of great e commerce ideas and innovations for you for the rest of the year and into next year. And as always, if you are an e commerce professional, whether you are an independent consultant, a retailer, technology provider, come on over to the Add to Cart community. We've got over 500 e commerce professionals in there who are helping solve each other's problems every day. We'd love you to be a part of it. Head into add to cart.com to apply to join and we'll see you in there. As always, a big thank you to our partners Shopify and Klaviyo for supporting Add to Cart and helping our community keeping these conversations rolling. We'll catch you next time on Add to Cart.
