When we introduced you to Wesley Zhao back in April, he was just a fresh-faced 18-year-old kid kicking around a new Twitter application with his high school buddy Ajay Mehta. At the time, we were extremely impressed with the smarts and entrepreneurial energy of both Zhao and Mehta, and a bit disappointed when the rising stars from Interlake High School in Bellevue decided to flee to Silicon Valley to pursue their startup dreams.
But, here’s the update: Zhao and Mehta are back in the Seattle area. And the entrepreneurial duo, along with colleagues Dan Shipper and Jesse Beyroutey, who turned 22 today is the elder statesman of the team, just launched a new startup called AvantCard that’s looking to transform the way people give gift cards.
Zhao, now 19, is so serious about the project that he just withdrew from his second year at The Wharton School at The University of Pennsylvania where he was studying finance and computer science. (Mehta plans to study in London next term, while Shipper is heading back to school until the project advances further).
“Doing something entrepreneurial at this age can be advantageous since you have less of a downside,” Zhao tells GeekWire. “No matter what happens, the worst case scenario is that I go back to school with a lot of experience and a lot of lessons learned.”
Zhao certainly is embracing the startup lifestyle. He’s been sleeping on an air mattress in a spare room at Mehta’s parents house in Bellevue, which also serves as the company’s worldwide headquarters.
“My back is fine. I actually don’t mind the floor,” said Zhao when asked about his sleeping set up. “It might be because I am young, or because I am stupid, but I don’t mind at all. I just need a place to stay and a place to set up my monitor and I am happy.”
The sleeping arrangements could change on August 28th when Zhao’s co-founder heads overseas, though Mehta’s parents have graciously invited the young entrepreneur to stay put in the makeshift office. Zhao said he’s considered it since the company is currently thinking about taking on some interns who currently live in Bellevue.
Asked what the profile of an intern looks like for a company run by 19-year-olds, Zhao notes that it is “someone who is 17 or 18 years old.”
“We definitely need help wherever we can find it. The only thing is that we need to make sure we get the right kind of help. We don’t want someone who doesn’t necessarily provide value,” he said.
Zhao and Mehta — who had applied for the Y Combinator technology incubator program — actually spent a few weeks in Silicon Valley where they were introduced to the fast-paced world of high-tech startups. Even though they found a sweet deal renting a space in San Jose mansion, the drain on the business was just too much.
“After a month of being down there, we realized that at this early of a stage, the money that we were spending to live down there wasn’t necessarily worth the benefits of being in that community versus being in the Seattle startup community,” said Zhao, whose family lives in Sammamish.
So, they packed their bags and relocated to Mehta’s home, choosing between the basement, garage and spare room for the office space.
AvantCard faces a strong line-up of rivals, including Seattle’s own Tango Card (profiled on GeekWire in June) and Plastic Jungle. Zhao admits that they are trying to solve a similar problem, which is that people often provide gift cards that never get used.
“TangoCard seems to be offering a card to replace the American Express/MasterCard open loop cards, but without the fee and in a web 2.0 fashion,” explains Zhao. “That’s great and we think their product is awesome. We are looking to play towards the much more popular existing user behavior of buying a regular store branded gift card, and making that better.”
With AvantCard, Zhao notes that recipient can log into the site and exchange it for gift cards at more than 80 retailers such as Apple, Target and Macy’s. Incorporating the flexibility of the AvantCard costs $3 for those cards under $50 in value and $5 for those with more than $50 in value.
The company, which is considering going out on the financing trail in the coming weeks, already has some top-notch advisers. They include Zillow CEO Spencer Rascoff; ePinions founder Nirav Tolia and Wharton professor Kartik Hosanagar.
Those advisers are adding credibility to a team whose average age stands at just 20 years old.
“We’ve realized, since we started, that age can be a barrier,” said Zhao. “And the way that we sort of tackled that is by surrounding ourselves with really smart and experienced people.”