Meta Acquired His Company for $1 Billion, Then Changed Its Mind. Now, He’s Charting a New Path

Not all things are meant to last: In 2023, Meta spun Kustomer off, leaving it independent once again. On Thursday, the customer service and CRM company announced a $30 million Series B funding round as it orients itself toward an AI-centric future. The $30 million round was led by the investment firm Norwest and also saw participation by prior backers Battery Ventures, Redpoint Ventures, and Boldstart Ventures, the company says. Kustomer is not yet sharing its new valuation.

The new injection of capital will go largely toward expanding the firm's AI offerings, says CEO and co-founder Brad Birnbaum, as well as growing its global footprint.

"We are going to invest some of that in international expansion, but the rest of the focus will certainly be on continuing to build the absolute best product to support our customers and really help transform the way that companies work with their customers using AI," Birnbaum tells Inc.

The firm has followed a winding path to its latest payday. Kustomer was founded almost exactly 10 years ago and raised several rounds of funding before Meta moved to acquire it in 2020 for what reports at the time indicated was around $1 billion.

After a regulatory waiting period, the deal finally closed in February 2022. But the following year, Meta CEO Mark Zuckerberg launched his so-called "Year of Efficiency," which saw widespread cuts across the business. Kustomer was soon spun off.

As it looked to chart its path forward, Kustomer raised a $60 million round, which Birnbaum describes as a new Series A for the post-spinoff Kustomer 2.0, or "K2." The investment left the CRM firm with a $250 million valuation, The Wall Street Journal reported.