The tech world is buzzing with the recent TechCrunch report on high-flying startup 11x, the AI-SDR that appeared to be on a meteoric rise just months ago.
11x Backstory and Controversy
Just last November, 11x announced a $50 million Series B funding round led by Andreessen Horowitz, just months after their $24 million Series A led by Benchmark in September. The company positioned itself boldly as "the leader in AI-powered digital workers for revenue teams" with a mission to "accelerate the era of digital workers."
Their pitch was compelling. According to their press release, "Only 30% of sales reps' time is spent selling, with 70% lost to non-selling tasks like data entry and system management." Their solution? AI digital workers that could supposedly replace the work of "11 full-time employees" each:
- Alice, their flagship AI SDR, promised to manage campaigns, source leads, and personalize outreach
- Jordan, their 24/7 multilingual phone rep, claimed to handle calls in over 30 languages
11x CEO Hasan Sukkar boldly proclaimed, "Each new digital worker will replace the work of 11 full-time employees, managing an even broader range of GTM tasks from lead management to pipeline analytics."
But things have taken a turn.
According to the TechCrunch investigation, 11x has allegedly been:
- Claiming companies like ZoomInfo and Airtable as customers when they weren't
- Using questionable ARR calculation methods, counting full-year contracts even after customers terminated at the 3-month break clause
- Experiencing 70-80% customer churn rates while projecting an image of explosive growth
- Delivering a product that reportedly underperformed, with issues including hallucinations and functionality problems
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The Industry Reaction
The response from the tech and sales community has been quick and revealing:
"Have talked personally with countless 11x users - almost everyone hates them. Like HATES them." - Shubh Agrawal
This sentiment is echoed across discussions, with Agrawal noting that "The AI agents (especially AI SDR) space has a massive massive churn problem." Companies like 11x raised enormous funding rounds and acquired users rapidly, but are struggling with retention.
From the VC perspective it doesn't sound much better.
Reid Christian, General Partner at CRV, summed it up perfectly:
"The day of reckoning is coming for AI SDRs. If growth is too good to be true it's often...not true." Christian notes that most of his portfolio companies have tried these services, but it's nothing new: "Spam emails -> outsourced SDR services -> AI SDRs."
“The moment we turned on Salesmotion, it became essential. No more hours on LinkedIn or Google to figure out who we're talking to. It's just there, served up to you, so it's always 'go time.'”
Adam Wainwright
Head of Revenue, Cacheflow
What Sales Leaders Have Been Saying All Along
The foundation of effective selling remains deep customer understanding and highly differentiated human interactions.
"Sales is about deep customer understanding and highly differentiated interactions between humans"
Shailendra Singh offers an insightful take: "players like 11x had early momentum because 99% of seed to series B SaaS founders have never written a cold email, don't know why or how to make your outbound system work. So they believe AI will magically deliver outcomes that sales teams internally could not."
The Path Forward
Despite all the setbacks, the future of AI in sales remains promising if pursued with integrity and realistic expectations. Industry consensus favors tools designed to enhance human sellers rather than replace them.
"Startups should focus on helping sales reps, not replacing them"
As Slinger notes: "AI SDR Voice agents (11x) don't work," but "AI sales systems with hyper personalization mechanism/systems/intent based targeting/realtime outbound multi-channel outreach/at scale - works." The distinction is crucial.
The most effective sales tech should help reps ramp faster, sell better, look after customers rather than attempting to replace them entirely.
The hold adage holds true: If something looks too good to be true, it probably isn't.
While AI will continue transforming how we sell, the human elements of understanding, empathy, and relationship-building remain irreplaceable.
“The Business Development team gets 80 to 90 percent of what they need in 15 minutes. That is a complete shift in how our reps work.”
Andrew Giordano
VP of Global Commercial Operations, Analytic Partners
About Salesmotion
At Salesmotion, we focus on helping sellers do what they do best and scaling that impact. Our approach centers on providing sales teams with the account intelligence they need to sell effectively.
We believe in equipping sellers with exactly what they need on each account to:
- Clearly identify top customer priorities.
- Effectively articulate unique value.
- Foster genuine, meaningful relationships.
It's the approach we think is right with the technology that's available. Nobody knows what the future holds but this is what works best, delivers value and make our customers happy.
Want to learn more about us? Book time here.
