The Skinny blog is written by Rick Smith, editor and co-founder of WRAL Tech Wire and business editor of WRAL.com.
RESEARCH TRIANGLE PARK, N.C. – If EVER a startup seemed destined for success in the Triangle, EvoApp was it.
One technology executive raved about EvoApp, told The Skinny to check it out, that this team “has it nailed.”
Yet in just two years the Durham-based business intelligence and social media tracking startup has shut down with all 16 employees laid off as of Monday, its space in Brightleaf Square already leased to ReverbNation.
As reported first by The News and Observer and Triangle Tech Talk, EvoApp burned through some at least $2 million in startup capital provided by some of the region’s top thinkers and closed its doors on the eve of launching its new business intelligence product called “Bermuda.”
Banks have been labeled “too big to fail” dating back to the 2008 financial crisis. In the case of EvoApp, the term seemed to be “too smart to fail.”
Veteran entrepreneur and venture capitalist Kip Frey took over as CEO of EvoApp just last September. In what often takes place at startups, Frey replaced company co-founder Joe Davy (a young phenom likened to Jud Bowman of Appia/Motricity fame) as the veterans took over. EvoApp built a top-notch management team, as Chris Heivly (publisher of Tech Talk who also directs the Triangle Startup Factory) noted in his review of EvoApp’s collapse.
In an interview with The News and Observer’s David Ranii, Frey talked about expenses increasing and revenues falling as Bermuda was ramped up while bigger players in the market strengthened themselves apparently beyond challenge. Frey told The Skinny that time ran out for funding alternatives.
EvoApp promised “real-time, in-memory, big data analytics engine for solution providers and software developers.”
ABB and RTI were customers. Advertising firm McKinney partnered with EvoApp on very intriguing research about the effectiveness of advertising during the Super Bowl.
And some of EvoApp’s published research about how social media was forecasting events – such as stock prices and in politics (like the unraveling of the Herman Cain campaign) – really was eye-opening.
“Too many companies today focus on social monitoring without really understanding how the conversations occurring in the greater social web impact their business,” Frey said in a statement when he took over EvoApp. “EvoApp is a unique opportunity because its technology provides customers with the means to drive measurable business value.”
Tom McMurray, EvoApp chairman and former partner at venture investor Sequoia Capital, said that EvoApp picked Frey “based on his track record for leading developing organizations.”
Now EvoApp is gone.
The Skinny expects we haven’t heard the last of Davy and co-founder Alexey Melnichenko – and certainly not Frey. But the EvoApp crash is one Triangle failure that won’t soon be forgotten either.