In early 2016 Mike Murchison and David Hariri had to tell their team it was over. Volley, the social app they had been building in Toronto, had found a following among young professionals but never reached the vision the two founders had sold their investors. They let everyone go and wound the company down.
Murchison had come to Volley by an academic route. He studied cognitive science, psychology and human-computer interaction at the University of Toronto, graduating in 2012. As a student he sat in on courses taught by Geoffrey Hinton and spent time in Steve Mann's wearable computing lab. Pure AI was not yet a business. It was something he watched from the back of the room.
Murchison had worked for several months as a frontline tech support agent before building Ada, so he knew what the job felt like.
The shutdown was the low point, but it was not the end of the relationship with Volley's backers. Version One Ventures, which had led the pre-seed round, did not pull away. What almost nobody expects from investors after a failure, they nudged the founders to look hard at a pain point they had lived while building Volley: talking to customers.
The two founders had a particular advantage. Murchison had worked for several months as a frontline tech support agent before building Ada, so he knew what the job felt like. They chose customer support, and by summer 2016 Volley had turned into Ada.
The first product was a chatbot that answered routine questions and could be edited by non-technical support staff, with set-up said to take under an hour. Medium, Kik and Wattpad were early customers. A seed round followed in October 2016, with a surprise term sheet from Bessemer, usually a later-stage investor, after one of its associates who had followed Volley since his Google days made the connection.
The company grew from there. Accel led a US$44 million Series B in March 2020. In May 2021 Spark Capital led a US$130 million Series C, valuing Ada at a reported US$1.2 billion and pushing total funding to about US$200 million. Customers later included Meta, Shopify and Verizon.
Murchison told University of Toronto interviewers that AI should be treated like a new employee who needs coaching, and his stated mission is to make customer service extraordinary for everyone.
The lesson is a quiet one. A closed company is not a closed career. Murchison's failure gave him two assets he could not have bought: a loyal investor and an irritating, specific problem he already understood.