ContentInsightsCavell Invest 2024: What you missed

Cavell Invest 2024: What you missed

In June 2024, Cavell held their annual Invest event at The Eight Club in London. Throughout the afternoon, there were three key panel discussions: are CX investments in the contact centre limited? Acquisition roll-ups and common pitfalls to avoid, and international expansion as a viable hypothesis. The event also gave cavell the chance to present its own channel insights platform.

After a brief networking session to begin with, Invest kicked off with a short introduction from Cavell’s Director, Matthew Townend, giving attendees a quick run through of the current state of the market and any key trends which have been identified through Cavell’s own research.

Townend highlighted challenges to key investment hypothesis including the total value of key geographic markets within communications. His keynote explored some of the key value drivers that investors are exploring with potential prospects, also highlighting market trends such as channel convergence, international expansion, and commercial challenges.

The first open panel discussion of the afternoon focused on customer experience (CX) investment, and whether it is solely limited to the contact centre (CC). Moderated by Cavell’s Senior Research Analyst, Finbarr Goode Begley, panellists included Co-founder of Ciptex Jolyon Parsons, CEO of Tollring Tony Martino, CEO of Puzzel Frederic Laziou, and CEO of Cirrus Jason Roos.

There is a large level of investment being poured into CCaaS, not only into data and analytics, which is key to any CCaaS solution, but more recently into self-service, automation, and generative AI. However, it was stressed how automation should not be able to outpace customer use cases. It was agreed that CCaaS should be designed to allow customers to communicate at their own speed and taking into account their own preferences.

An example provided examined how chatbot functions have occasionally cut off customer conversations, leading to a poor CX reputation. AI has undoubtably made a large impact in CCaaS so far with further disruption in the space likely. However, the panellists did voice their concerns over an AI skills gap.

An interesting perspective Jason Roos gave was that until AI can automate the full CCaaS experience and can replace a human agent, agent volumes might increase as more people call in. Even though the CX might be better, it may still need an agent to finish any complex issues which AI technology cannot.

Skills for CCaaS and AI are still expected to stay with the vendor (or SP) and not the channel. This was supported by the panellists who confirmed that these skills are not widely available. AI capabilities in the CC will inevitably advance, an opportunity vendors should take advantage of to reduce operational costs. It was revealed by one of the panellists that currently, 85% of the CCaaS cost goes solely towards the agent salary. Increasing adoption of intelligent virtual agents (IVAs) combined with their reducing costs overtime may alleviate some of these costs.

Billing for CCaaS services was a topic which panellists were slightly perplexed about, particularly when considering AI. Some panellists agreed charging based on AI outcomes, while others preferred to charge on the volume of interactions. AI commercial models vary widely within communications industries and a primary option has yet to become ubiquitous.

Before moving onto the second discussion, Invest also gave Cavell the opportunity to showcase its channel insights platform to attendees. The brief presentation showed how the platform enables users to gain access to industry insights on a single platform using advanced algorithms and data pipelines to examine more than 85 thousand channel partners and their offerings.

The focus then turned to acquisition roll-ups whilst avoiding a pile-up. Moderated by Cavell’s Director of Research Dom Black, panellists included CEO of Flotek Group Jay Ball, CEO of CloudClevr Steve Harris, Managing Partner of Inflexion Private Equity Humphrey Baker, and Managing Partner of Lloyds Development Capital (LDC) Aylesh Patel.

When discussing what makes a strong acquisition, LDC’s Aylesh Patel stated that there is a need to maintain discipline to achieve strategic mission during these role-up phases. It is also important after these role-ups to take a step back to ensure things such as integrations, sales, and cross sell is working, something Inflexion’s Humphrey Baker dubbed as a “pause”. This phase is used to take stock and evaluate success.

Cloudclevr’s Steve Harris stated the importance of capabilities, looking at the deep skills which would integrate well into the business a company wishes to acquire. Lastly, Flotek’s Jay Ball explained that it was key to make good use of the expertise at his disposal, particularly from individuals who have vast experience of navigating through challenging acquisitions.

There are numerous considerations to make before making a solid financial commitment to an acquisition, one of which is looking at various KPIs. When asked which KPIs the panellists look for, the responses were similar. Key KPIs which were important included cash generation, retention, CSAT score, relationships, cross sell, and available data.

When identifying common pitfalls, the panellists were very open and honest about what to avoid. However, there was a general agreement that mistakes may sometimes be made, advising attendees to not be afraid to reverse decisions instead of being naïve thinking you know it all.

Patel stated the importance of understanding the people of the acquired business as this tends to be where the USP is. A term Patell used to describe this was “buying and building rather than buying and breaking”.

Internal communication also was a popular theme during the last part of the session, with Baker highlighting the importance of being able to communicate with employees and customers and keeping them well informed, as there tends to be a negative stigma attached to businesses acquiring businesses.

The last discussion of the afternoon focused on international expansion, particularly from a U.S. perspective into Europe, and whether this is a viable hypothesis. Moderated by Cavell’s Director Matthew Townend, panellists included CEO of Dstny, Daan de Wever, CEO of CallTower Bret England, CEO of NUSO Matt Siemens, and Partner of Acuity Advisors (who very kindly sponsored this year’s Invest event) Marc Horn.

There has been much drive towards international expansion into Europe for numerous reasons. One of those reasons was mentioned by England, stating there is a large requirement from customers, particularly from enterprise who have international satellite locations.

Adding to the U.S perspective, Siemens highlights how the U.S. market has started to deaccelerate and lose traction compared to the European market where UCaaS and CCaaS penetration in countries such as Germany and France remain low. Due to this, international expansion from a European perspective is not as common. Horn further expressed how Europe still has a vibrant and fragmented market structure, meaning plenty of M&A activity locally.

International expansion is never a straightforward path, and the panellists were keen to share the challenges they themselves have encountered and the lessons learnt from them. Key lessons included being able to understand the people, to treat them well, and what makes them tick, evaluation against core objectives, gain an understanding of the regulatory environment, and being able to rotate management when required. These factors should be carefully monitored to ensure smooth transition.

In summary, the discussions gave some useful insight to attendees concerning future investments, acquisitions, and expansions. CX investment in automation and gen-AI remains a priority for businesses. However, for now, agents are an essential part of any CCaaS solution as AI capabilities develop in the future.

Acquirers should not just focus on buying a business. They should consider the future objectives when acquiring any business, the people who come with it, and being able to communicate with them, all while be able to take numerous pauses to reassess.

Lastly, international expansion occurs due to customer demand and opportunities to enter new markets. Although it is not a straightforward process, being able to plan accordingly, understanding the market a business wishes to enter, and knowing its customers, will make it easier long-term. For more information on any of the topics discussed or wider insight on the merger and acquisition landscape within the communications space visit