Drift CTO Elias Torres and CEO David Cancel, who are among the few Latinx founders on Forbes' second ... [+]
David Cancel remembers his first meeting with future business partner Elias Torres as a pleasant surprise. In Cancel’s ten-year career as a serial entrepreneur in the tech industry, Torres was the first fellow Hispanic tech employee he’d met. It was 2008, and a venture capitalist had asked Cancel to help recruit Torres, then an IBM
Three companies and 12 years later, Cancel and Torres are the founders of Drift, an AI-powered sales software startup that features on Forbes’ second annual AI 50 list of the most promising U.S.-based startups, one of nine companies building productivity tools for enterprise businesses. Cancel, 48, is CEO and Torres, 43, chief technology officer at the Boston-based startup, which has raised $114 million to date with revenue in the eight-figure range. Its latest fundraising, in 2018, brought its valuation up to $360 million, according to PitchBook.
Drift launched in 2015 with chatbots for companies to make B2B sales decisions even when a human sales representative is not available. It’s since added email and video products designed to help salespeople identify and close more deals, part of Cancel’s goal for Drift to challenge Salesforce
Cancel and Torres got to where they are by teaching themselves. Both grew up in low-income households, both raised by single mothers. Cancel, the son of Ecuadorian and Puerto Rican immigrants who spoke only Spanish at home, was born in the Bronx and raised in Queens. His elementary school did not offer ESL classes, so he resorted to learning English by watching TV shows like The Brady Bunch. Torres immigrated from Nicaragua at 17 after his family lost their house, hitting a “dead end” in their native land.
“One of the hardest challenges for Latinx and immigrants is what we don’t know,” Torres says. “You do not know about negotiations, you do not know how to network. We did not go to school with the [venture capitalists] who are funding us.”
Growing up, Cancel knew little about tech beyond the video games he played on early consoles like Atari and Coleco. At Queens College in the 1990s, he discovered the internet at the library, the only spot on campus equipped with Web browsers at the time. “I basically stopped going to all my classes because I was obsessed with the internet,” he says. He dropped out of college during his senior year and quickly found a job writing code for an early internet startup.
At age 28, Cancel went into business for himself, selling online marketing tools. “I started the first company, not knowing anything, at the worst time to start a company: in 2000, post-[dot-com] bubble,” he recalls. Nevertheless, that startup resulted in the first of a string of successful acquisitions for Cancel’s companies—and it led to his fortuitous meeting with Torres. He hired Torres in 2008 to be vice president of engineering at his second company, advertising social network Lookery (acquired by Adknowledge). The following year, they launched Performable, a sales campaign software company, which was acquired by HubSpot
Artificial intelligence was a logical next step, Cancel says, because “nobody cares about software anymore.” People only care about the outcome—for example, the product they are purchasing—and AI can expedite that process by minimizing time spent on software, he says. He and Torres launched Drift with the idea in mind that existing sales software, like Salesforce’s products, is outdated.
Still, the existing market was saturated with software options. Drift struggled to find a market fit early on, a process so painful that Cancel now admits, “I never want to go back.” It struck a vein finally with its initial chat product, which used AI-powered chatbots to help customers make B2B purchases at any time of day. The software works like other AI chat tools, using machine learning to sift through human chat transcripts to learn how to talk to humans. But the AI “is not just about the bots,” Torres says. Instead of replacing humans, it can give salespeople tips on how to respond to a question and reveal areas where customers’ needs are not being met. Today, the software is used by more than 50,000 businesses (the company offers both free and paid software, but will not disclose how many customers are paying).
“Drift’s AI helps you understand who’s on your website, who’s more likely to buy, and engage them for you, at scale, until [it understands enough of] the customer to hand them off to the right individual at the company,” Torres says.
Cancel says Drift could hit break-even profitability in “a couple of years” but has chosen not to do so in favor of growth. Unlike with his past companies, he says he’s sticking with Drift for the long haul, with hopes of going public: “This will be my last company, so I’m gonna make it last.”
He and Torres hope also to make a lasting impact in their community—serving as the Hispanic role models that they did not have themselves. Drift incorporates diversity as a core component of its recruiting and philanthropy strategy, but Cancel says the community outreach must go beyond the professional level. With their decision to dive into the rapidly emerging world of artificial intelligence, the pair are in a prime position to influence a new generation of techies, and they’re doing so by advocating careers in STEM to underrepresented minorities in grade school. “That’s the only way we’re going to make change in the world,” Cancel says.
“I want to be a role model of what an immigrant and what a person of color can accomplish in this country, so we’re going big or we’re going home” Torres says. “We’re building a company that has to be a $10 billion company.”
