RALEIGH – Investors don’t put cash into startups based purely on speculation like they did in the days of the “dot com boom,” backing business plans drawn up on napkins over lunch. These days. backers want to see sales, value, potential – and real magic.

Thus Raleigh entrepreneur Jesse Lipson landed $6 million from a group of investors to drive more growth for Real Magic and its Levitate relationship app.

Rick Smith, WRAL TechWire’s editor and a cofounder and author of The Skinny blog.

He’s already drawn a lot of positive exposure at his first effort [such as making Triangle investor Scot Wingo’s respected “Tweeners” list of promising startups] since selling ShareFile to Citrix in 2011 then leaving that company before again striking out on his own.

In a Q&A with The Skinny, Lipson describes the secret sauce of Levitate and why he chose now to raise new funding in a Series A round that exceeded his expectations of $2 million.

So let’s go behind the curtain to discuss Lipson’s secret sauce.

  • What sets Real Magic apart from the competition other than your magic wand?

Our specific focus on relationship-based businesses is a big point of differentiation for us. At ShareFile I learned the value of focusing on a specific set of industries rather than building a totally general purpose solution, and we’re using those lessons to help build Real Magic as well.

[This graphic below helps explain Levitate.]

Real Magic image

Explaining the Levitate app

  • Why raise the money now?

We launched our first product 15 months ago, and at this point we feel we’ve had enough market validation with 300 paying customers to accelerate our customer growth so we can continue to scale and learn from our customers at a faster rate.

We will be investing across the board in our company, from R&D to sales, marketing, and customer support.

  • Since you were able to raise capital you must be growing – how would you describe it? 

We’re in a super fast growth phase right now since we started from zero just about a year ago. We have over 300 paying corporate customers now and expect to double by the end of the year.

Raleigh startup exec Jesse Lipson lands $6M for Real Magic app startup

  • What factors are driving the growth?

Our growth right now is mainly driven by our ability to get the word out about our product, Levitate (www.levitate.ai). We find that often once we are able to explain what we do to customers in our target market (relationship-based businesses like Insurance agents, real estate agents, financial advisers, consultants, and lawyers) they are very interested in giving it a try.

So we’ve been scaling our awareness efforts over the past year and that’s the main driver for us.

  • What do you and investors see as the market opportunity – how big is it?

We certainly see a multi-billion dollar market opportunity with our first product, Levitate. We operate at the intersection of several billion-dollar markets, including CRM [customer relationship management], Email Marketing, and Contact Management.