Once a denizen of the corporate world and now a startup founder and entrepreneur, Steven McAuley is no stranger to working hard, being patient, and waiting to see results.
After working on a go-to market strategy and pilot stage for nearly three years, his efforts paid off today when he and his team finally officially launched Privatis Technology Corporation, a startup based around the vertical he’s most comfortable with – the auto sector.
McAuley had left the corporate world and been working in consulting for about two years when he spotted a need in the auto market. He noticed many classified ads sites for car sales were plagued by telemarketers and scammers who saw sellers’ email addresses and phone numbers online.
“The problems were more pervasive than we thought,” says McAuley, adding his company’s metrics estimate about 55 to 60 per cent of inbound calls between buyers and sellers are actually from telemarketers.
“It was really evident that this particular problem of harassment, telemarketing scams, email fraud and now SMS … was a problem that the marketplace has really struggled with,” he says. “And they were quite reluctant to talk about it because of the brand damage that they were concerned about. Their customers were complaining and saying hey, I just put my ad live on your site and two days later, the only phone calls I’m getting are from these marketing people and they won’t stop calling.”
It was getting so bad, he says, that even when email services began filtering out scammers through keywords, scammers would text sellers instead, expressing their interest in cars for sale and asking to get emails with more photos. In reality, they were just trying to add sellers’ email addresses to a database to generate sales leads, or to dupe them into falling for shipping or overpayment schemes.
“Sites were not able to remedy it for their users, so their users would cancel their ads, they would ask for refunds. Some users would threaten litigation,” McAuley says. “It became more than just a nuisance or a customer service issue. It was really a legal issue and a brand issue.”
Together with his friend Joseph Cohen, now Privatis’ chief technical officer, they began developing a telecommunications and email service, as well as a messaging dashboard for users that would keep out unwanted scammers. It runs algorithms to ensure emails and calls only come from serious buyers and sellers.
The messaging system also masks phone numbers and email addresses so users can communicate anonymously with each other. Unlike Craigslist, this masking can occur for the entire dialogue of back-and-forth emailing, unless users choose to reveal their contact details. This way, scammers can’t reach users through their personal contact information.
Privatis’ system is now up and running on U.S.-based AutoTrader.com under the name “Privacy Shield,” providing a secure messaging dashboard that pulls calls, texts, and emails into one user interface. It also lets users listen to calls and voicemails from the dashboard, and it sets up personal blocking controls so users can ensure they aren’t harassed or bothered.
So far, the service is offered in a few pricing packages on AutoTrader.com, although Privatis will soon offer it to all users, hopefully under a freemium model.
Seeing the need to give sellers control over their communication was something he wouldn’t have been able to do if it wasn’t for his experience in the auto industry, McAuley says.
“I was comfortable in understanding what was it like to be a buyer and seller,” says McAuley, who spent most of his professional life working for auto companies like GE Capital Fleet Services and United Auto Group.
“We found ourselves solving a very large problem for a very large market.”
While McAuley founded Privatis in September 2010 in the U.S., he and his team formally incorporated the company in January, opting to place its headquarters in Canada and bringing all of its U.S. assets into the fold, too.
As Privatis slowly built up the number of its employees to 12 and moved into its Vancouver’s trendy Gastown-area digs this April, the company was a long time in the making. But Canada was McAuley’s country of choice because his family is here and because the Canadian government offers a lower tax rate to businesses, compared to the U.S.
That creates a great ecosystem and structure for startups, and Privatis has taken advantage of that, McAuley says.
In terms of future plans, Privatis is working on releasing a consumer-facing mobile app in September, as well as branching out to AutoTrader Canada, AutoTrader U.K., Craigslist, Kijiji, and some online dating sites.
And while it took some time to build up Privatis, McAuley says he’s satisfied his startup is solving a problem in an industry he’s known well for over a decade.
“My whole career has been automotive and I was very much a corporate person … As it evolved, it really became so evident this was such a serious problem,” he says. “It really comes down to a personal passion and desire to build something important and valuable … All of my corporate experience was really lending itself to this solution.”