EvoApp, a Durham software company poised to profit from the fast-growing influence of social media, has raised $1.2 million in funding from an all-star group of investors.
The company, founded in mid-2009 by 21-year-old whiz kids Joe Davy and Alexey Melnichenko, has grown from 11 employees in December to 21 today. Now, thanks to its new funding, EvoApp expects to add 20 workers by the end of June, said Davy, the company's CEO.
Faster-than-expected sales at the end of last year triggered the company's decision to raise new capital just a few months after it raised $500,000 from investors last fall, Davy said. He declined to disclose specifics on revenue from the company's software, which the company began selling in September.
"We wanted to be as aggressive as possible with our expansion plans for the year," Davy said. "We didn't want to leave any growth on the table."
EvoApp's software enables businesses to analyze what's being said about them on the likes of Twitter and Facebook and mount a coordinated response when necessary. The company has dubbed this "relationship intelligence."
"I think they can build themselves a really substantial company," said Triangle venture capitalist Steve Nelson of the Wakefield Group. Nelson personally participated in EvoApp's latest funding.
In addition to the $1.2 million EvoApp raised from investors this month, Davy anticipates closing on $300,000 more in a matter of days.
Among the more than 15 individual investors in the latest round, in addition to Nelson, are:
Joe DeSimone, the renowned scientist who holds faculty positions at UNC-Chapel Hill and N.C. State University and is the founder of several companies, including Liquidia Technologies.
Tom Darden, founder and CEO of Cherokee, a Raleigh company that specializes in cleaning and redeveloping contaminated properties.
Timothy Buckley, former chief operating officer at Red Hat.
Lee Buck, co-founder of software firm Extensibility, which was sold for $100 million in stock in 2000.
Christy Shaffer, former CEO of Inspire Pharmaceuticals, and Tom McMurray, a former partner at Sequoia Partners, one of Silicon Valley's most successful venture capital firms, participated in both rounds of funding. McMurray also is the new chairman of EvoApp.
"It's truly a dream team," said Shaffer. "We created a list of who we would like to be investors in EvoApp and, to be honest, I think everybody invested."
Even though this latest round of funding came just a few months after the first, Shaffer said it was an "up round." In other words, the investors in the privately held business paid more for their shares.
Moreover, the funding came in at lightning speed. "A lot of companies spend a year" raising new capital, said Shaffer.
On Duke Street
"I think it's a validation of the management team we have put together. ... the product we have put together and our potential," said Marco Fregenal, the company's chief operating officer. Fregenal is co-founder and former president of Internet media company How Stuff Works.
EvoApp moved to 6,000 square feet on Duke Street near Brightleaf Square in downtown Durham at the beginning of January. It went international last month, opening a sales office in the Philippines and a software development office in Germany.
EvoApp software starts at $699 a month, although large customers could pay more than $10,000 a month. MTV Networks is among the company's customers, Davy said.
EvoApp also has teamed with two corporate partners - including Zendesk, a software company that boasts more than 5,000 business customers - to market a lower-priced version of its software to small businesses.
