Interactions Buys Digital Roots to Bolster Social Media Offerings

Interactions, a Franklin, MA-based company using artificial intelligence technologies to power virtual assistants for enterprise customers, today announced it has acquired Digital Roots, a metro Detroit startup focused on AI-based customer engagement on social media. The specific terms of the deal were not disclosed.

Digital Roots is headquartered in Northville, MI, in a building that formerly housed a Ford plant making engine valves for the Model T. That may not be accidental, as Digital Roots has grown rapidly since it launched in 2009, thanks in part to all the customers it has in the auto industry.

Those “particularly productive” relationships with automakers were a factor in Interactions’ decision to pursue Digital Roots, according to Mike Iacobucci, Interactions president and CEO.

The two companies met at a trade show, which sparked Interactions’ interest. Iacobucci was impressed with Digital Roots’ products, technology, and team. “What Jay and his team built is really significant for social media,” he says.

Jay Wolcott, Digital Roots’ founder and CEO (he’s now Interactions’ vice president of social engagement product), recalls when the two companies first met.

“We had known about Interactions for a long time and thought they were doing fascinating things,” says Wolcott (pictured). “We struck up a conversation because they didn’t have a social media solution. There are strong synergies with our approaches—Digital Roots complements what Interactions is doing.”

Interactions is a 13-year-old venture that services companies and brands both large and small. It relies on a combination of AI technologies—speech recognition and natural language processing, for example—and human oversight to address customer service requests, saving time and money.

“The traditional approach to modern customer interactions is changing,” Iacobucci explains. “We threw out the old interface and came up with a new way.”

Both Interactions and Digital Roots saw an opportunity to create an “omni channel experience” where customer engagement could be carried out across multiple means of communication. For example, a customer service request could start on social media and continue over e-mail or the phone without missing a beat.

“Any way the customer wants to communicate should be able to persist no matter if it starts as a phone call or on social media,” Iacobucci says. “We can go beyond the prevailing technology to allow human-like conversations. When all channels are on a single platform, it’s easier to control the conversation and the results.”

Digital Roots says it incorporates some of the same AI-related technologies to help “global household brands”—including car companies—interact with customers on social media. The software combs huge volumes of social content to find and prioritize actionable posts, and then suggests responses to those posts.

Iacobucci says Interactions considers itself the fastest-growing company in the customer care sector. In 2014, the company snapped up AT&T Watson, language processing and speech recognition software developed in-house by AT&T’s research and development lab.

Last summer, Interactions closed on a $56 million funding round, bringing its total haul since inception to $167 million. The company’s investors include Comcast Ventures and Revolution Growth, led by AOL co-founder Steve Case.

The entire 16-person Digital Roots staff will be absorbed by Interactions—which has roughly 350 employees across multiple locations—and will continue to work out of the Northville office and Ann Arbor SPARK’s co-working space in Ann Arbor, MI. Wolcott expects to hire at both locations soon.

Sarah Schmid Stevenson is the editor of Xconomy Detroit/Ann Arbor. You can reach her at 313-570-9823 or sschmid@xconomy.com. Follow @XconomyDET_AA

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