Avoca's founders on YC, $1B valuation, and turning the dreaded CSR job into a revenue engine

Avoca (YC W23) co-founders Apurva "Arv" ShrivastavaDealroom has a profile for this one. Try Dealroom → and Tyson ChenDealroom has a profile for this one. Try Dealroom → sat down with Y Combinator's Garry Tan to explain how they built "the AI workforce for the physical economy," starting with home services. In roughly two years the company has reached eight figures in revenue — doubling in a single 90-day period — and recently raised over $125M at a $1B valuation. The two MIT engineers, who met at a poker game and lived together for five years, found product-market fit by turning missed phone calls into booked revenue for HVAC, plumbing and electrical businesses.

The starting insight. 85% of a home-services business's revenue comes from phone calls, and a single call can be worth $20-30k — versus $30-40 for a restaurant. They scouted 100 restaurants first; "home services found us."

From 1% to 15% of wallet. Software historically captured ~1% of a service business's spend (the ServiceTitan layer). Avoca targets the labour budget — customer care (3-5%), inside sales, and marketing (7-10%) — a 15%+ opportunity, "15 times as big."

Explosive ACV expansion. Starting from an AI CSR wedge, top customers now see 5-10× ACV expansion; in some cases Avoca already captures 2× what the customer spends on their CRM.

It helps the workers, not replaces them. CSR roles have ~100% attrition over two years. Avoca takes the 60-70% of "nuisance calls," freeing reps for outbound sales — some get promoted to dispatch or to a new role training the AI agents. One Carolinas HVAC customer saw retention skyrocket; another went from 100 CSRs to 30 via natural attrition.

The Rescue Air origin story. Their first home-services customer was paying $3,000/month for a "glorified voicemail" answering service they'd switched five times in a year — the painfully obvious wedge. "If the pain is big enough, the customer will try to find a solution even if it's not perfect."

YC's lesson — customer love over market size. VCs kept asking about market; YC partner Dalton Caldwell kept asking "can you sell it, will they pay for it." Following customer love over the "VC game" of picking ideas is, they say, the only reason Avoca got this big.

Forward-deployed DNA. Both came from Retool and Nuro; they apply Palantir-style forward-deployed engineering and fly team members to live in customers' offices for a week per major deployment. Early growth was almost entirely referrals through home-services "super-connector" influencers and Facebook contractor groups.

The vision. Avoca aims to be the "system of intelligence / system of action" for these industries — more valuable than the CRM — and to expand from home services into adjacent verticals. On being a unicorn: "a unicorn is not at all the goal… the goal is to see how great we can be."

Source: Y Combinator with Garry Tan (June 2026).