From mental health to marketing

• Eyes Singapore, Malaysia, Indonesia e-commerce markets
• Long-term goal is for chatbot to pass the Turing test

WHEN Taiwan-born entrepreneurs Wilson Kao (pic) and Jin Hsieh founded the mental health video chat startup KaJin Health in 2015 they had no idea that it would lead to Kao ending up in Malaysia to start their second venture.

Digital News Asia caught up with Kao recently to talk about their new venture, a startup that has created a chatbot for e-commerce companies who want to get a handle on their marketing and customer behaviour. Called Pentabots, the two-month-old startup is based in Kuala Lumpur. According to Kao, they chose to open an office in Malaysia to act as the Southeast Asian base.

Kao, who is chief executive officer and co-founder of Pentabots, explains that the idea for a chatbot came from KaJin Health. “We found that while there is a level of discretion with video chat and that it is beneficial, people tend to talk more and express more of their feelings through text.”

The duo was surprised that users would write long essays about their lives, their backgrounds and how they came to be depressed, via text. “We found it more helpful for users to convey their problems via text chat. That’s how we figured out that maybe chatbots would not only be complementary, but would also eventually replace video chat for mental health therapy,” Kao adds.

According to Kao, that’s why they started work on an artificial intelligence (AI)-powered chatbot, as they reckon people are willing to open up to a robot that has the intelligence of a human being.

While running KaJin Health, they received many calls and enquiries from Southeast Asia for potentially applying chatbots to B2B and e-commerce businesses.

He says that most of the enquiries have been from Singapore and Malaysia, however they have also been getting interest from Indonesia.

“E-commerce is something I haven’t had prior experience with, but I was intrigued by the possibility of using chatbots to maximise sales leads and improving sales cycle for users. So that’s how we started with Pentabots and developed an e-commerce, AI-powered chatbot.”

Helpful without being intrusive

Kao explains that the Pentabots-created chatbot helps make recommendations. “For example, if you are looking for shoes it can make recommendations based on parameters such as size, brand, and you can make purchases through the chatbot. Right now, we are still in the development phase, but eventually we’ll improve the NLP [natural language processing], where people can type anything and the chatbot would recognise and understand what you need.”

The chatbot, he says, won’t be intrusive by supervising the whole sales cycle, but function as a personal shopper or friend recommending what products to choose.

“E-commerce is the next big thing and we want to revolutionise e-commerce in Southeast Asia. So, it was a natural transition from a video chat startup to a text-based chatbot.

“So, we hope eventually the chatbot will be more like a human being in terms of its responses to questions you ask. There’s still a lot more to improve,” he adds.

When pressed for more details, Kao gives an example. “If you asked the chatbot ‘What’s the weather like?’, it will probably give you the temperature. Your second question ‘How is the weather?’ is the same question, and our chatbot will be able to recognise it.

“But if you have a question: ‘Do I need a sweater?’ we hope the chatbot will eventually recognise it as the same question as the previous ones. This is very much a work in progress but eventually we will reach that goal in making it as human as possible.”

That said, there are digital marketing agencies who are also using chatbots, what differentiates Pentabots from them? Kao points out that Pentabots’ chatbot is is AI-powered, provides analysis in a dashboard.

“It creates leads on the front end, but also from the backend, it helps you understand customer behaviour. You can actually communicate with the chatbot and get insights. That’s our competitive advantage.”

He says that while they haven’t patented their chatbot algorithms yet, they algorithms are patentable and that this is something they are working on.

Bootstrapped and looking to expand

Kao explains that Pentabots is bootstrapped and that they are not currently seeking funding, but focused on further development of their chatbot. He did however, share that they received venture capital and angel investor funding for KaJin Health, amounting to US$130,000 (RM550,542) and that the startup is already profitable.

As for paying customers, Pentabots has already two in its stable. “One is a Malaysian company selling contraceptives that wanted a chatbot that enables customers to purchase contraceptives, the other customer is a credit guarantee services company that recommends loans and approves them,” Kao shares.

He adds that the key e-commerce markets they are hoping to get traction from are Singapore, Malaysia and Indonesia, based on their research data and enquiries. “These countries are poised to adapt quickly to the new stage of e-commerce, that’s why we’re excited to be based here in the centre of the action.”

He notes that Thailand and Vietnam are definitely interesting markets, but have their own languages and that the Pentabots’ chatbot is currently only in English. Although it is easy to train chatbots to be multilingual, for now the company is focused on improving its English language chatbot.

In the short-term, the plan he says, is tweaking the chatbot to be more intelligent and allowing people to talk with chatbots seamlessly.

“And within the next three to five years, as the e-commerce industry matures, we hope that the chatbot will pass the Turing test. So far, no chatbot has passed the Turing test. You can definitely tell the chatbot is a machine currently. We hope that the chatbot will be as human as a human customer service representative. So that is our five-year plan,” he concludes.

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