Last year, AI-powered sales automation startup 11x appeared to be on an explosive growth trajectory.
Numerous people in the U.S. and U.K. told TechCrunch that the situation has become so tenuous that Andreessen Horowitz, 11x’s lead Series B investor, may even be considering legal action. However, a spokesperson for Andreessen Horowitz emphatically denied such rumblings, stating that a16z is not suing.
What is 11x?
11x offers an AI bot for outbound cold sales duties, including identifying prospects, crafting custom messages, and scheduling sales calls. It is part of the growing AI Sales Development Representative (AI SDR) market.
Founded in 2022 by Hasan Sukkar, 11x claimed to be nearing $10 million in annualized recurring revenue (ARR) just two years after launch. The company moved from London to Silicon Valley in July 2024 and announced a $24 million Series A led by Benchmark in September. Later that month, TechCrunch broke the news of a $50 million Series B led by Andreessen Horowitz.
Customer Complaints and Fake Endorsements
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
- AI hallucinations affecting sales outreach
Like many startups, 11x showcased customer logos on its website as endorsements. However, multiple companies told TechCrunch they were never actually 11x customers.
- ZoomInfo, a sales data and automation provider, conducted a short one-month trial but did not proceed further. Yet, 11x still claimed them as a customer for four months.
- Airtable also conducted a short trial but never approved its logo’s usage on 11x’s website.
ZoomInfo’s lawyer has now threatened legal action, citing trademark infringement, misappropriation of goodwill, and false advertising.
Misleading Revenue Reporting
Several former 11x employees claim that the company inflated its revenue metrics by using a misleading calculation method.
Instead of reporting actual revenue from long-term contracts, 11x included revenue from trials with break clauses—even if customers canceled early.
A former employee revealed that churn rates were as high as 70-80%, while ARR calculations made 11x appear much more successful than it actually was.
Product Performance Issues
Multiple customers and employees reported that 11x’s AI SDR failed to deliver:
- It did not perform significantly better than human SDRs
- Some customers found it unreliable or inaccurate
- Others reported billing issues, including double charges for trials
A Medium review harshly criticized the product, claiming it was less effective and costlier than competitors—though 11x disputes the legitimacy of this review.
What’s Next for 11x?
11x claims that its retention rate is now 79% and that product improvements have reduced churn. However, multiple investors and employees remain skeptical about its long-term success.
Benchmark and Andreessen Horowitz continue to back the company, but the startup’s credibility and future growth remain uncertain.
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