Why Microsoft is deploying Builder.AI’s Natasha on Teams, despite launching Copilot

Sachin Dev Duggal, founder and chief wizard, Builder.ai

As the battle between tech titans to gain market share in the artificial intelligence (AI) business intensifies, Microsoft is leaving no stone unturned to maintain its current lead and early-mover advantage due to its collaboration with ChatGPT maker OpenAI.

It looks like Microsoft has spotted another startup to align with early on, as it continues to scout for enterprise-level AI capabilities to enhance its products.

Microsoft recently acquired stake in London-based software-as-a-service (SaaS) startup Builder.AI, and entered into a strategic partnership to deploy its bot Natasha.ai on Teams.

This comes barely two months after Microsoft launched its AI assistant Copilot for all Office 365 apps and services, including Word, Excel, PowerPoint, Outlook, Teams, and Business Chat. So why add another AI bot.

Builder.ai offers AI-based solutions to develop applications that require limited to no coding, for businesses. Its solution helps clients develop apps faster and at a lower cost. But as an AI assistant, Natasha.ai has a very different use case. Builder.AI’s founder and “chief wizard” Sachin Dev Duggal strongly feels that it makes sense for Microsoft to adopt Natasha.ai along with Copilot.

“We have an internal project called Hummingbird, which is designed on how Natasha can be right at the edge where conversations are happening between teams in an enterprise. So you could be in a team that looks at warehouses and you're talking about a problem. Natasha can tell you that a warehouse scanner might help resolve the issue,” says Duggal.

For instance, if there are five warehousing teams globally in a company, Natasha would know if the person is in the New Delhi team, and inform him in case the Tokyo warehousing team has already developed an app that largely addresses his issue. “The Delhi team can just add a couple of features (if required) to the same app and be in the market in three weeks,” he adds.

All of such conversations on Teams can be tracked by Natasha for the right solutions, besides other use-cases.

In comparison, Copilot, which is also available on Teams, is more of a productivity enhancement tool used for tasks like taking notes, etc., said Duggal.

While Microsoft got a headstart in deploying AI for its Bing search engine as well as Office 365, at the recent annual developer conference Google I/O, its rival also announced an AI-infused auto email composing feature and search engine. The search giant also unveiled Bard, which competes with ChatGPT. There are other AI tools that are also gaining prominence among enterprise clients, such as Bedrock and DALL-E. Bedrock is a service that helps build generative AI applications on Amazon's cloud computing platform. OpenAI’s Dall-E is a generative AI technology that enables users to create images with text prompts.

Despite its leadership in productivity tools among enterprise clients, Microsoft’s Teams still faces competition from Zoom and Google Meet, besides others. Hence, it is imperative for the company to accelerate the adoption of AI to boost its customers’ productivity.

Funding and expansion

Founded in 2016 by Duggal, Builder.ai has till date raised $450 million. In May, the startup had raised a $250-million Series D round led by Qatar Investment Authority (QIA), with participation from Iconiq Capital, Jungle Ventures, and Insight Partners.

Around 35-45 percent of the fresh capital will be used for R&D, and the rest will be ploughed into market expansion. Builder.ai is also looking at geographical expansion and potential mergers and acquisitions.

Duggal said the company’s key markets include India, Singapore, the GCC, the US; and the UK, where it plans to expand further. In India, the startup has its offices in the Delhi-NCR area.

Speaking of the scope of the partnership with Microsoft, Duggal said, “Microsoft is a special partner for us, where there is a shared vision for the product, technology, and go-to market.” At present, Builder.ai is working towards its plan to enable building 77 apps per hour by 2030.

“The focus for us is to get more customers that need less knowledge around building apps, and get them to be more productive by supporting them with software,” he said.

Dangers of AI

As the startup ecosystem globally is riding on the buzz and promise of AI and ChatGPT, around $1.7 billion was raised by generative AI startups in the first quarter of 2023, according to PitchBook. Another $10.68 billion worth of deals were announced in the same quarter but are yet to be completed. Microsoft too had announced a $10 billion infusion into OpenAI in January.

Amid a funding winter and cut in tech spends due to macroeconomic uncertainties, AI has become a sunrise segment for both venture capital firms and IT services companies. But the extent of its risks and dangers are yet to be estimated. Also, whether this trend is here to stay or will it become a fading fad like the metaverse remains to be seen.

While top Indian and international IT services companies are developing generative AI-related offerings for their clients, Duggal advises caution.

“We are still early. I feel enterprises are just starting to flirt with the use of AI for productivity. If it's anything more than productivity, it could be a little dangerous. Because companies don't fully understand the impact (of AI),” Duggal said.

He added, “The SI (IT systems integration and services) companies most definitely do not understand the impact of AI. But they're selling it as a shiny, new toy just to get a few more Dollars from clients. Not only is this dangerous, it’s also a little irresponsible.”

Examples of what could go wrong with generative AI that could be replicating a politician’s voice, creating fake social media posts, etc., added Duggal.

(Note: This copy has been updated to reflect Builder.AI’s responses after Moneycontrol published the story earlier today.)