Direct is developing AI chatbots while publishers ban AI web crawlers

Direct is developing AI chatbots while publishers ban AI web crawlers, To ingest publishers’ content, Direct can leverage RSS feeds or, with permission, scrape the website.

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The publishers’ chatbot experience itself can also be placed wherever the publisher wants, including directly on their website with a few lines of code, within partnered messaging apps that reach a collective 260+ million users. (Supported apps include Google Messages, SMS, and Viber, with Messenger and WhatsApp to soon come.) And, later this quarter, social media will also be supported. In the case of the latter, Direct is launching an integration with Instagram where users can comment on the publisher’s post, which will trigger the chatbot to initiate a conversation in Instagram’s DMs.

Today, the company has 75 brands on its platform, including names like Good Housekeeping UK, Women’s Health UK, ClutchPoints, Bob Vila, Dance Magazine, Hollywood.com, Indy100, Popular Science, The Drive, Domino, Field & Stream, Outdoor Life, Task & Purpose, Car Bibles, Popular Photography and others.



Within the chats, the bots serve links to publisher content, which see an average clickthrough rate (CTR) of 24.16%, compared with the average email CTR of 3.48% per active campaign. One customer, Mitch Rubenstein, founder of the Sci-Fi Channel and owner of Hollywood.com & Dance Magazine, said Direqt has boosted time-on-site by over 200%.

In addition to providing direct traffic, Direct has a hybrid business model. Publishers can choose between a SaaS approach where it’s paid a platform licensing fee based on transaction volume, or a revenue-based model where Direct takes a cut of the in-chat ad revenue that runs inside the platform. Those ads can be sold by the publishers or can include ads from Direqt’s 500 advertiser partners and other partners.

For publishers dependent on ad revenue, chat appears to be a good solution.

“There’s market data that suggests performance in the chat is significantly higher to the order of 10% and 10x, depending on which source you’re looking at, that in-chat ads outperform traditional advertising,” Martin notes.

In addition to Martin, formerly the co-founder and COO of a sports equipment manufacturer, Direqt was co-founded by serial entrepreneur John Duffy, a co-founder of another chatbot company 3Cinteractive; Myk Willis, a former Citrix engineer, and co-founder and CEO of streaming radio company Myxer; and Bill Madden, a former IBM product engineer.

The team has now raised its first round of capital, a seed round of $4.5 million from investors including various entrepreneurs and executives, including Todd Parker, former global head of Business Development for Business Messaging at Google; NFL Hall of Famer Dan Marino; Peter Callahan, former CEO of American Media; Ron Antevy, founder & CEO e-Builder; and Dave Walsh, partner at Kayne Anderson.



The funds will help Direct accelerate product development, roadmap, and go-to-market, and allow it to double its headcount from 15 to about 30 people by the end of next year. The Seattle-headquartered company aims to improve the core conversational engine it offers, increasing its monetization capabilities and unlocking more distribution with the new funds, as well.