Israeli AI Training Startup Bites Raises $40 Million in Series A

Israeli startup Bites, which has developed an AI platform for personalized employee training, has successfully completed a $40 million Series A funding round. This latest investment brings the company's total funding to $55 million. The round was led by PeakSpan Capital, with participation from existing investors Vertex Ventures, Horizon Capital, Rittenhouse Ventures, and Lyra Ventures. The funds will be used to expand the company's operations, particularly in the U.S., and to further develop its platform. Bites' technology aims to transform employee training into a tool for improving and measuring performance in sales, service, and operations.

Founded in 2020 by CEO Eran Chafetz, COO Tal Nagler-Almog, and CIO Hagai Horowitz, Bites focuses on training frontline workers who do not typically sit at a desk, a segment representing about 80% of the global workforce. Chafetz, who previously co-founded restaurants and bars in Tel Aviv and the real estate company Anshei Ha'ir, drew inspiration from his own experiences with the challenges of training staff in the hospitality industry. Nagler-Almog and Horowitz, who met while working at the educational company Kidum, developed early learning tools together before co-founding Bites.

The Bites platform uses AI to convert procedures and documents into training videos within minutes. These videos are tailored to the organization's work environment and delivered directly to employees via WhatsApp or Teams in their preferred language, without requiring app installation or system login. The platform also includes an "Ask-AI" tool for employees to get instant professional answers to work-related questions. It integrates with existing sales, CRM, and HR systems to combine business data with employee learning data.

Bites' AI-driven system can automatically identify performance dips in specific branches, shifts, or individual employees, generating targeted training modules. It also measures whether the training leads to improved business outcomes, such as increased sales during promotions. The company currently employs 30 people across its development center in Tel Aviv and its headquarters in New York. Its clients include major international corporations like Unilever, Coca-Cola, Shake Shack, Wynn Resorts, and The Venetian, as well as numerous Israeli companies in the hospitality and retail sectors.

Chafetz stated that the company's breakthrough came in the last year as the product became suitable for large enterprises, with AI acting as a significant booster. He emphasized the focus on employees who are not desk-bound, a segment often overlooked by traditional training companies, and highlighted how AI underscores their importance. The new funding will support the expansion of the Israeli development center, further AI engine development, and the growth of sales and customer support teams. Bites also plans to enter the banking and insurance sectors and expand its reach to organizations with contract and external workforces.