a16z- and Benchmark-backed 11x has been claiming customers it doesn’t have

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Last year, AI-powered sales automation startup 11x appeared to be on an explosive growth trajectory.

However, nearly two dozen sources — including investors and current and former employees — told TechCrunch that the company has experienced financial struggles, largely of its own making.

Numerous people in the U.S. and U.K. told TechCrunch that the situation has become so tenuous that 11x’s lead Series B investor, Andreessen Horowitz, may even be considering legal action. However, a spokesperson for Andreessen Horowitz emphatically denied such rumblings, telling TechCrunch that a16z is not suing.

11x offers an AI bot for outbound cold sales duties, including identifying prospects, crafting custom messages, and scheduling sales calls. It's one of a number of AI startups in the hot area known as AI sales development representatives, or AI SDRs.

Founded in 2022 by Hasan Sukkar, 11x said it approached $10 million in annualized recurring revenue (ARR) just two years after launch. It moved from London to Silicon Valley last July and announced a $24 million Series A led by Benchmark in September. TechCrunch broke the news of a $50 million Series B led by Andreessen Horowitz later that month.

Three current and former 11x workers told TechCrunch that most of its early customers took advantage of “break clauses” in their sales contracts to discontinue using the product. Customers faced issues such as the emailing product not working as expected or hallucinations, according to sources.

There was some internal drama, too. Employees described an arduous, stressful work environment — even for those who embrace hustle culture. They pointed out that out of the early employees in the photo published by TechCrunch at the company’s launch, only Sukkar, the CEO, remains.

Logos on 11x website
Logos on 11x's website include companies that say they were not customers

Fake customer endorsements

Like many startups, 11x proudly showcases customer logos on its website that signify customer endorsements and are typically shown with a customer’s consent.

However, TechCrunch learned that multiple companies with logos on 11x's website were not actual customers and that at least one is threatening legal action over it.

“We did not give them permission to use our logo in any manner, and we are not a customer,” a ZoomInfo spokesperson told TechCrunch. The logo wasn’t removed until after March 6, when a source close to TechCrunch inquired about it. But even after that date, the company’s phone AI agent continued to repeat the customer claim.

ZoomInfo, which offers sales data and automation tools, conducted a short, one-month trial of the AI SDR from mid-January through mid-February, the spokesperson said. “During the pilot, 11x’s product performed significantly worse than our SDR employees, and we did not move forward afterward.”


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