An American startup Nate, using artificial intelligence to automate shopping, was suspected of employing Filipino workers to manually process transactions. The Information reports.
According to two sources familiar with the company’s technology, in 2021 the share of manually processed transactions ranged from 60% to 100%. Another informant said that during fundraising the startup concealed from investors the fact that it used outsourced workers.
According to the report, the software faced bot blockers used by online retailers to prevent automated purchases. Because of them, most orders had to be placed manually. In some cases, processing delays of several hours.
Journalists also found that by the end of 2021 the number of transactions through the service fell to 100 per day. In response, Nate launched a social media marketing campaign offering new users a $50 coupon for purchases at certain stores. This raised transaction volumes to 10,000 per day.
Later it emerged that users created multiple accounts using the same payment details but different email addresses. After removing duplicates, the daily transactions fell to 75-100 per day.
A Nate spokesperson described the figures ‘incorrect’, and the claims casting doubt on the patented technology were ‘groundless’.
The startup was founded in October 2018. The Nate app automatically fills customer information for $1 per transaction, saving time when shopping at various online stores.
In June 2021, in a Series A round, the company raised $38 million, with total investments of about $50 million.
Earlier in May, authorities in Singapore reported growing popularity of assistant robots used by local businesses amid the migration crisis.
In January, researchers warned that by 2040 widespread automation in workplaces will deprive 12 million Europeans of jobs.
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