Montréal-based startup claims its conversational AI platform can reduce HR complaints. What are the risks?
Most Canadian and US workers want to have difficult conversations with their managers, but trust in leadership affects how comfortable employees feel broaching tough topics. Montréal-based artificial intelligence (AI) software company Nurau has secured a $1.5-million CAD seed round to help managers navigate sensitive discussions through its conversational coaching platform.
The all-equity financing, which was secured in October, was led by provincial investor Investissement Québec, who contributed $750,000. Angel investor Sylvain Authier and ACET Capital, the venture capital (VC) arm of National Bank, also participated in the round. The company hopes to increase the total funding of the round to $2.2 million within the next six months.
“We are not aiming to replace HR but rather to augment them.”
Justin Lessard-Wajcer
Nurau CEO
Nurau has developed eCoach, a natural-language-processing AI tool, to support HR workers when dealing with sensitive workplace situations. The platform offers step-by-step guidance on difficult conversations by providing managers with phrases to use and predictions of potential employee responses. The company claims the tech can help managers avoid escalations and reduce costs by limiting turnover.
“Our goal is to improve employee engagement and employee experience at scale in industries with high turnover,” CEO and co-founder Justin Lessard-Wajcer said.
Nurau was co-founded by Lessard-Wajcer, CTO Sonia Israel, and COO Saba Saremi. The team raised a smaller friends-and-family financing round in 2022 with participation from angel investors Sylvain Authier, Holden Wajcer, and SecureDev Consultants Inc. The new financing brings Nurau’s total funds raised to date to $2 million CAD.
The latest funding will allow Nurau to expand into the US market and improve sales development while attracting more retail and manufacturing customers.
Nurau’s revenue model currently includes an annual subscription fee to companies priced per user. However, the company said it will explore set pricing per company in the future as it looks to expand the use of eCoach to all employees, not just managers and HR departments.
Not an HR replacement
Nurau’s eCoach aims to avoid situations when a workplace incident is escalated to HR because the manager responsible can’t solve it.
Through its conversational coaching tool, eCoach supports the manager in ensuring the situation never makes it to that point, Lessard-Wajcer told BetaKit.
For Nurau, fewer escalations are a positive indicator of better employee experience and more effective management, thus limiting costly turnover rates.
The tech is not meant to automate a company’s HR department, however. Lessard-Wajcer said that its solution is “complementary” to human-driven HR solutions, but offers some attributes that humans cannot emulate: impartiality, constant availability, and consistency with a company’s internal policies.
“We are not aiming to replace HR but rather to augment them by allowing them to focus on high-risk cases and strategic initiatives,” Lessard-Wajcer said.
The Nurau president also warned that eCoach is not meant to act as a substitute for professional mental health support or handle emergencies directly, especially in high-risk cases.
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The company claims it also incorporates certain guardrails in its generative AI models, including safety filters to exclude harmful content, flagging emergency risks to appropriate resources either within or outside of the company, and guided advice that “avoids discriminatory or harmful suggestions.”
“It is ultimately the manager’s responsibility to apply their common sense and judgment, as they are the ones directly interfacing with the situation,” Lessard-Wajcer said.
Nurau claims that eCoach saves managers an average of four hours per week related to dealing with employee conflicts, according to data from some of its retail clients already using the platform. Clients listed on Nurau’s website include Canadian retailers Ardene and Bikini Village, as well as the Royal Bank of Canada.
Sensitive conversations, sensitive data
When it comes to HR conversations with personal information about employees, data security and privacy are paramount. Data breaches have grown increasingly frequent in Canadian corporate environments, according to a 2023 IBM study, incurring an average cost of nearly $7 million per cybersecurity incident.
Meanwhile, nearly a quarter of Canadian employees using generative AI tools in 2023 inserted company information in chatbot prompts, according to a KPMG study. Ten percent of respondents said they inputted private financial information.
According to Lessard-Wajcer, all information shared within the eCoach platform is “anonymized and securely processed.” These anonymized insights, however, are compiled and used to improve the software.
The feature fits into a larger trend of Canadian workplace management companies collecting data about employees: Montréal-based GPHY uses a mix of hardware and software tools to aggregate anonymous data about office space usage.
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Integrating AI into HR tools is an expanding space, as well. For instance, Toronto-based Hypercontext is using AI to streamline the employee performance review process, while Montréal-based Trustii is automating its risk management platform.
Nurau creates an AI model for every client company based on their internal policies and procedures, so the model is personalized to align with a company’s HR practices. Hypercontext’s AI tools follow a similar setup to avoid hallucinations, which is when a large-language model (LLM) generates inaccurate content not found in its training data.
“Without giving [away] our secret sauce, we use science-backed data,” Lessard-Wajcer said. When asked further about the kind of data eCoach’s AI model is trained on, the company said it uses trusted sources such as “scientific papers and leadership coaching content.”
Feature image courtesy Nurau.
