Techstars Alexa Startups Address Settings Where Voice Is ‘Most Natural’

Smart speakers are becoming increasingly common in our homes. Users can instruct these devices to order takeout, give the weather forecast, or turn on or off various Internet-connected devices.

The Consumer Technology Association estimates that nearly 44 million voice-enabled assistants will be sold this year in the United States. Unit sales rose 279 percent from 2016 to 2017, according to the association. “We have entered the era of voice,” Jim Harris, a management consultant writes on the CTA’s website.

Aviel Ginzburg, who is managing director of the Techstars Alexa Accelerator, says he agrees. Ginzburg says the role allows him to get a sneak preview of how this emerging technology could affect how we live, work, and play. “It’s more than asking questions to control things in your home,” he says. “It’s saving time.”

The Alexa program was founded in 2017 and is part of the Alexa Fund created by Amazon (NASDAQ: AMZN) to invest in young companies innovating around voice technologies. In 2015, Amazon committed to invest up to $100 million through the Alexa Fund, then committed another $100 million next year to take the fund global.

Techstars invests $20,000 in each company, with the potential for an additional investment of $100,000 in the form of a convertible note, in exchange for 6 percent equity. The accelerator is now looking to connect with entrepreneurs overseas with a London program with three startups and efforts to make the Alexa APIs available in France.

When he was tapped to lead the Techstars Alexa accelerator, Ginzburg had been a Techstars mentor and also the founder of Simply Measured, a Seattle social media analytics startup, which was sold to Chicago-based Sprout Social in December for an undisclosed sum.

Ginzburg recently spoke with Xconomy by phone and shared more about the technologies the Alexa accelerator was working with, the development of “ambient computing,” and other topics. Our conversation has been lightly edited for clarity.

Xconomy: Give me the background on how the Alexa accelerator came to be and its mission.

Aviel Ginzburg: Amazon wanted to bring in early stage startups to target those markets, those that are doing something interesting and unique with [the] voice and Alexa platform. We help them with customer development, strategy, fundraising—we work closely with the Alexa team. This is Amazon’s way to help startups that are reaching out to the future. What is voice going to look like three to five years from now?

X: What are the technologies that Amazon is aiming to support? Are these of interest to Amazon specifically, in order to get first dibs?

AG: No, not at all. Amazon operates more like an investor, to invest in companies to help make them successful. [Amazon does] make acquisitions. Amazon ended up acquiring Ring, but the goal is to be an investor and supporter. The goal is to really create a vibrant startup ecosystem around voice. [The startups] do become Alexa Fund portfolio companies. … The idea is [to] work with startups to see new opportunities to better enable these awesome customer experiences.

X: Voice is the main star here. What uses do you see coming to light?

AG: You need to look at, what are the areas where voice really makes sense? Look at the initial rise of mobile. Everyone got excited and built an app, but a lot of times, there was no reason for the app. The market was better served with a website. So with voice right now, what are areas where, for example, you are using your hands, so having an interaction via voice is the right approach? This is the beginning of ambient computing, where you don’t have to direct your focus onto a screen, but you can interact with the environment in an ambient way.

Where is it just easier to use voice rather than open up an app? You think about accessibility and the elderly, and what happens when you can’t use your hands. What are those customer experiences where voice is not just a novelty, but the most natural way for a person to interact with technology? That’s where we’re going to see a lot of interesting applications. This year is the year that brands are getting much more involved in voice. It’s still really early, but when we look back five to 10 years from now … in the same way we think about how Uber was enabled with a mobile-first approach, maybe that [voice] company is being founded right now.

The art is to be really thoughtful on where does it make the most sense for voice, where is voice the most natural and truly the best technology.

X: How have you seen the Alexa-related technologies evolve in the two classes of the program?

AG: One really interesting way it’s different—we’re in the middle of the selection process for this year’s class—-is, last year a lot of companies already had a product. They were doing something but then realizing, maybe, instead of this being a mobile app first, maybe we should have voice as a key component and that’s how we’ll find product market fit. Now, they’re starting with voice at the center of what they’re doing.

A lot of companies are thinking about kids and education, how can we help age in place. [Ginzburg refers to the Alexa Echo Silver skit on “Saturday Night Live.”] That’s awesome, and that’s reality. There are companies building [voice technologies related to aging issues].

X: With the recent controversy involving Facebook (NASDAQ: FB) and Cambridge Analytica, what are your thoughts about privacy issues related to having these smart devices in our homes?

AG: One thing that has been really impressive to me, as I’ve worked with the Amazon folks, is how seriously they take privacy and how thoughtful they are about it. It is just a core pillar in everything in terms of what they think about voice. People will say, ‘Hey, how come we don’t get this data that we can get on this other competitive voice platform?’” Amazon is doing it right. This is a whole new thing for human beings, and [Amazon is] taking it slow in terms of how they’re adding things to the platform so there isn’t a misstep. We all know what happened in social media. We don’t want to find ourselves in the situation where we’ve misunderstood a technology that we’ve all come to rely on. When you understand how the tech works, it’s no different than having a phone in your house at the end of the day.

Angela Shah is the editor of Xconomy Texas. She can be reached at ashah@xconomy.com or (214) 793-5763. Follow @angelashah

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