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Whiz kid lures investors, hires team for startup

 
- Staff Writer

A Durham software startup led by a 21-year-old whiz kid has attracted a blue-chip group of investors and a veteran management team seeking to capitalize on the explosion of social media.

EvoApp was co-founded 18 months ago by CEO Joe Davy, a part-time student at UNC-Chapel Hill. Its software enables businesses to analyze what's being said about them on Facebook, Twitter and the like, and mount a coordinated response when necessary. The software can also analyze e-mail and other digital communications with customers.

"We can parse out a customer's feelings from their communications," Davy said, whether those communications are directly with the company or floating somewhere in digital-land.

The company has coined the term "enterprise relationship intelligence" to describe what its software does.
 

"It will be an industry term in a few years, so keep an eye out for that," Davy predicted.

Clearly, Davy's youth hasn't hurt his self-confidence. (Nor has it kept him from being focused. "I've lost multiple girlfriends because the only thing I can talk about is my business on a lot of days," he said.)

EvoApp's software products are dramatically cheaper than competing products. Unlike them, EvoApp's products don't take months to install, Davy said.

EvoApp sells and supports software that is available over the Internet and can be set up in a day.

Blue-chip investors

That sales pitch recently helped Davy, who is already on his third technology startup, and co-founder Alexey Melnichenko, also 21, the company's chief technology officer, land about $500,000 in backing from a group of investors.

They include: Christy Shaffer, the former CEO of Inspire Pharmaceuticals of Durham; Ryan Allis, co-founder and CEO of iContact of Morrisville; and Tom McMurray, a former partner at Sequoia Partners, one of Silicon Valley's most successful venture capital firms.

That funding is being used to market the company's software, which the company quietly began selling in September, and build a management team. The team includes Marco Fregenal, previously co-founder and president of Internet media company How Stuff Works and president of Ultimus, who is chief operating officer; and Mike Preston, formerly a principal at venture capital firm Southeast Interactive Technology Funds, who is chief financial officer.

HQ in Brightleaf Square

Today EvoApp has 11 employees and is in the midst of moving to 6,000 square feet of space on Duke Street near Brightleaf Square in downtown Durham.

Shaffer calls Davy "the next Jud Bowman," referring to the CEO of PocketGear, a Durham company that runs "apps" stores for smart phone makers. Bowman founded the company while still a teenager.

Both Davy, who grew up in Buies Creek, and Bowman are graduates of the N.C. School of Science and Math.

McMurray said Davy and Melnichenko are "extraordinarily smart" and have ingeniously developed software with "a totally new architecture." McMurray is a North Carolina native who now lives in Chapel Hill.

"There is some real technical secret sauce in making this product do what it does," he said. The potential market for EvoApp's software is so large that "it is really in the company's hands how big they get," McMurray said.

The software starts at $699 a month, although "large enterprise customers" could end up paying more than $10,000 a month.

Within the corporate world, McMurray said, "it is so inexpensive ... you can't afford not to try it." Behemoths such as Procter & Gamble and Thomson Reuters are already test-driving the product, he added.

Tests seem promising

Bandwidth.com, a Cary company that provides phone and Internet service to small and mid-size businesses, has been testing EvoApp's software for the past 30 days. It's too early for a thorough assessment, but it looks promising thus far, said Earl Wright, the company's vice president of operations.

"It can give you a real-time customer pulse," Wright said. "I have never seen anything that quite does what EvoApp does."

Davy and Melnichenko aren't making any effort to conceal their youth as their startup woos mainstream business customers. Their bios on EvoApp's website include their photos and highlight that they are 2007 graduates of the School of Science and Math.

"Anybody that has a problem with my age is not somebody I want to work with," Davy said. "We aren't desperate for customers ... or investors. We think the fact that we are young is a huge asset to the team. Our age means we are smarter than everybody else out there and work harder than everybody else out there."



Read more: http://www.newsobserver.com/2010/12/07/848058/whiz-kid-lures-investors-hires.html#ixzz17WrURCLh