How Intercom rose from the ashes by betting everything on AI | Eoghan McCabe (founder and CEO)

Overview

This episode explores how Intercom, under the leadership of Eoghan McCabe, transformed from a plateauing SaaS company into an AI-first business with its flagship product, Fin. The conversation delves into the cultural, strategic, and personal changes required to achieve this dramatic pivot, offering lessons for companies navigating the AI revolution.

Notable Quotes

- AI is going to disrupt in the most aggressive, violent ways. If you're not in it, you're about to get kicked out of all of it. – Eoghan McCabe, on the urgency of embracing AI.

- When I interrogate my heart and my mind, I believe AI agents are more personal than making customers wait days for a canned response. – Eoghan McCabe, on reconciling AI with Intercom's mission.

- Greatness is created when a CEO is willing to make brave, hard decisions and own the results. – Eoghan McCabe, on leadership during transformation.

🚀 The AI Pivot: From SaaS to Fin

- Intercom was facing stagnation, with growth nearing negative territory. Eoghan McCabe returned as CEO and pivoted the company to focus on AI.

- Within six weeks of ChatGPT-3.5's release, Intercom developed a prototype for Fin, an AI agent for customer service.

- Fin now leads the customer experience (CX) category, growing at over 300% annually and projected to surpass $100M ARR in under three quarters.

- The pivot was driven by a nothing to lose mindset, enabling bold decisions and rapid execution.

🛠️ Cultural Overhaul and Leadership Transformation

- McCabe rewrote Intercom's values to emphasize resilience, high standards, and shareholder value, cutting out ineffective cultural elements.

- A rigorous performance process was introduced, grading employees on both results and alignment with company values. This led to a 40% turnover but resulted in a highly aligned, entrepreneurial team.

- Despite initial resistance, including a soft coup attempt, employee satisfaction soared to 98% after the changes.

- Therapy and personal growth helped McCabe adopt a more centered, reflective leadership style, which he credits for his effectiveness during the transformation.

💰 Reinventing Pricing: From Hated to Loved

- Intercom's old pricing model was widely criticized for its complexity and perceived unfairness.

- The company simplified its pricing, aligning it with customer outcomes. Fin charges $0.99 per resolved ticket, a stark contrast to the $20–$30 industry average.

- This shift not only improved customer retention but also reinforced Intercom's commitment to fairness and transparency.

🤖 The Future of Work: Humans and Agents

- McCabe envisions a future where AI agents handle repetitive, operational tasks, freeing humans for creative and strategic roles.

- CX, sales, and other operational roles will see significant automation, but human connection and trust will remain irreplaceable in certain areas.

- He predicts smaller, flatter organizations with humans and agents collaborating seamlessly, driving efficiency and economic growth.

🧠 Lessons in Adaptation and Survival

- Companies must embrace AI or risk obsolescence. McCabe emphasizes the need for talent, speed, and a willingness to work hard to compete with AI-native startups.

- Founders of legacy companies must either fully commit to the AI transition or step aside for leaders who can.

- Intercom's transformation highlights the importance of bold leadership, cultural alignment, and a relentless focus on innovation.