Introduction: What Does DXwand Do?
Exploring the history of Artificial Intelligence (AI) innovation before it reached mainstream recognition can be truly captivating. DXwand is an intriguing case in point.
Before AI became a household term earlier this year, companies like DXwand toiled in the shadows of a technology that seemed so futuristic that it was truly out of reach, fueled by a profound belief in the technology’s potential. Not so far back as early 2022, AI was a niche domain, and convincing businesses and investors to invest in AI solutions required unwavering dedication.
DFDF made a direct investment in DXwand in March 2023. Its Co-founders, Ahmed Mahmoud, and Mahmoud Gomaa,
created an AI platform from the ground up for AI-powered conversational digital assistants. Their core infrastructure is a knolwedge mining engine that tackles current limitations in LLMs for reliable and consistent knowledge retrieval. Their engine produces knowledge in English, Arabic, and other languages.
Ahmed and Mahmoud also saw that businesses across the Middle East struggled to use conversational AI in Arabic. Every Arabic country (and often even within countries themselves) has its own local dialect, making it especially difficult when it comes to understanding conversational content.
On top of the engine that Ahmed and Mahmoud built from scratch, they developed a conversational knowledge mining and knowledge retrieval AI application, as the first application of the core technology. DXwand’s offering now includes Arabic virtual agent software that empowers businesses to automate interactions with customers and seamlessly interact and retrieve enterprise knowledge. This virtual assistant handles a wide array of tasks, from answering queries to executing actions within a company’s systems. Effectively, DXwand enables companies to provide a seamless and automated customer experience across various channels, including call centers, WhatsApp, mobile apps, and websites, allowing them to engage with their Arabic-speaking customers at scale.
In this blog post, we cover the journey of how DXwand was founded, from the point of view of the Co-founders who saw the opportunity to integrate AI to power a solution to a mass problem that they identified.
The Challenges of Building an MVP in a New Product Category
In developing their platform, DXwand began with the end result in mind — how their solution can enhance operations, streamline efficiency, and deliver quantifiable benefits to prospective business customers. Further, Ahmed and Mahmoud emphasized the importance of preserving existing human behavior when building their technology, which was especially important given that they are selling the ability for businesses to have scalable conversations with people. So, they focused on integrating their product seamlessly into their customers’ users’ behaviors, emphasizing that it not only maintains but enhances human interaction styles. They anticipated that this would overall improve response times, customer acquisition, and retention.
Throughout development, Ahmed and Mahmoud observed that as their MVP transitioned from obscurity to ubiquity, they could better anticipate how to sell their solution to prospective customers. However, despite how complex the development of the technology may be, Ahmed and Mahmoud still wanted to offer personalization to their customers. Lucky for them, a core feature of machine learning technology is the ability for specialization, which would allow for customer-specific solutions over time. customization So, taking this bespoke approach to the market was not as cumbersome as it might be for other software-as-a-service businesses to offer the same without sacrificing scalability. Even as they took the product to market, the founders found themselves continuously tweaking their technology as they adapted various aspects of it to suit individual customers’ needs.
The Challenges of Selling an Unfamiliar Product to Customers
DXwand encountered initial challenges when selling its product as the technology was novel, making it difficult for prospective customers to grasp its potential. To overcome this hurdle, DXwand employed creative strategies to convey their product’s value, from which lessons learned can be derived for founders looking to sell their technology that is still not mainstream enough to have predictable, swift sales cycles:
- Customer-centric design: Focusing on how the technology benefits your customers as opposed to explaining features that don’t resonate with them will help them better understand your product’s practical utility.
- Simplify your pitch: Presenting to prospective customers in non-technical lingo (i.e. refraining from overusing tech jargon — which can be tempting at a time when the term “generative AI” is commonly used these days) can help them better understand how your technology can practically help them.
- Educate within your sales cycle: Offering a solution that is unfamiliar in the market requires a longer time to close leads as you would need to spend time educating customers about why what you’re offering is better than what they’re currently using. Creating thought leadership content that you can share with prospective customers for education purposes can also be helpful.
- Leverage market trends: Selling a solution that the market is looking for is a factor to take in your favor. The more the general population understands and demands a technology that was only recently nascent, the easier the sales process will inevitably be. Though initially you’ll benefit from first-mover advantage, as the market adapts and competition increases, being able to maintain a competitive edge becomes critical.
If I go to a client now and say generative AI, it has, I would say, a meaning in their mind that I don't need to explain. But back in, like, one year ago, it may take us a month to explain why this is important.
Thriving in a Saturated AI Market
In an industry that is — at the time of publishing this article (approximately two years after Ahmed and Mahmoud started developing DXwand) — saturated with generative AI offerings, staying competitive requires constant innovation, differentiation, and a relentless focus on delivering unique value to customers. Ahmed and Mahmoud share with us their strategies to remain at the forefront of AI innovation:
- Strategic Data Acquisition: Invest strategically in traditionally challenging areas, particularly data acquisition.
- Quality and Specificity: Focus on the quality of the data that you use in your models and their use cases across various industries.
- Flexible and Scalable Solutions: Offer your customers the flexibility to host their solutions on your own data centers, if needed. This adaptability positions them favorably, especially when catering to highly regulated customers like government agencies and banks.
Our Value Creation Efforts for AI Companies
We recently collaborated with the Dubai Center for AI, an initiative led by the Dubai Future Foundation (DFF), and were appointed as the official Venture Partner. The Dubai Center for AI, situated within the innovative space of Area 2071, is a flagship initiative driven by the Dubai Future Foundation. Its mission was to seamlessly integrate artificial intelligence into various government services, effectively ushering in a new era of efficiency and innovation in Dubai’s public sector.
The Dubai Center for AI recently hosted 28 forward-thinking AI startups, with two of them, DXwand and Camb.ai, being companies within our direct investments portfolio. These startups worked closely with government agencies to develop an impressive portfolio of unique AI use cases that promise to transform the way government services are delivered.
Through this collaboration, we committed to fueling the growth of AI startups that are selected through comprehensive support that encompasses venture capital training, mentorship, networking opportunities, and more. For example, we facilitated introductions to government entities, enabling collaborative efforts to address real-world challenges through AI-driven solutions.
Ahmed and Mahmoud credit the UAE’s Ministry of AI for playing a pivotal role in supporting DXwand, facilitating talent acquisition, and providing access to essential computational and research facilities — two critical aspects for an AI company.
Conclusion and Additional Resources
DXwand’s journey reflects the transformative power of belief in AI technology, creative sales strategies, and adaptability in the ever-evolving landscape of AI. Their commitment to customer-centric solutions and continuous innovation positions them as a key player in the exciting world of generative AI.
At DFDF, we look forward to a future marked by groundbreaking AI innovations, collaborations, and a thriving ecosystem that benefits the entire community. If you are a founder who is passionate about building innovative AI solutions in the Future of Finance or Future Economies industries and meet our investment thesis, we invite you to apply for consideration for direct investment. You can also learn more about our Direct Investments deal lifecycle process here.
In addition to providing capital to support the growth of our portfolio companies, we offer our value creation capabilities to assist them in building commercial partnerships, receiving guidance from experienced experts, and more.
If you’re interested in learning more about today’s generative AI investment landscape, you can download a report that we published earlier this year here.