Since co-founders Georg Petschnigg, Andrew S. Allen, Julian Walker, and Jonathan Harris launched the company nearly a year ago, its drawing app has become a sensation. It’s been downloaded more than 7.5 million times, and those 7.5 million or so users have logged in over 500 years of use in 2012 alone. Chinese filmmakers draw up storyboards for their movies with Paper; doctors use the app to communicate with patients who have trouble speaking.

Its user-base also includes some of Silicon Valley’s elite. Square CEO and Twitter inventor Jack Dorsey has admitted he loves Paper and uses it for some Keynote presentations, including his speech at TechCrunch’s Disrupt conference last fall. Flipboard CEO Mike McCue, uses it to sketch out new ideas for his curated news app and draw up storyboards, so he can present each step of a new product feature to his team. “I’ve been looking for an application like this for the last 20 years!” he says.

“The most powerful way to communicate an idea is through an image, and Paper makes that pretty easy but doesn’t dumb it down,” explains Petschnigg of the startup’s success.

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While Paper isn’t the first drawing app, it is one of the easiest to use and one of the most elegantly designed. You can tap on an existing or new page, at which point Paper’s palette tool pops up so you can immediately start drawing or sketching. There are no distracting buttons or other settings to get in the way. The app includes an eraser, a drawing pen, and a set of color inks for free, and charges more for additional tools like a soft pencil, a watercolor brush, or a color palette mixer. (Users can also opt to buy them a la carte or pay $7 for the whole package.)

Minimal as the interface is, there are thoughtful design flourishes throughout. Thanks to custom graphics software, the result of months of development, the app uses the same graphics technology normally reserved for games, so pencil lines and brush strokes appear like they would on actual paper — a small, but welcome touch. Want to undo something? Use two fingers and rotate them counter-clockwise to go a step back.

Indeed, Paper’s less-is-more attitude is so well-executed, Apple (AAPL) selected it as one of the best iPad apps of 2012. Part of the app’s polish may come surprisingly from Microsoft (MSFT), where many of the startup’s 22 members worked on various projects, including the Redmond, Wash.-based company’s much-hyped, but ultimately killed dual-screen Courier tablet. Although Courier never made it to market, it seems to have left its mark on ex-employees like Petschnigg and Allen.

“When you go through Microsoft’s entire list of products from the last decade — Kinect, Kin, Windows 8, Windows Phone — they’re trying to break the mold in terms of user experiences,” he says. “You could argue about their market success, and were those products successful or not, but there’s no denying they’re pushing for new user experience paradigms.”

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If there’s one thing they learned from starting Courier, it’s that the tablet doesn’t have to be just for consumption — it can be for creation, too. “The tablet is very powerful technology, but looking at the way it’s sort of been treated to date, and certainly the way Apple has often portrayed it and marketed it to us, it was very much as a consumption device,” explains Allen. It’s not just for reading books, browsing the Web, or tossing off a quick game of Angry Birds. “We really saw the potential for these always-on, always-connected devices moving into the creation sphere. That was something you started to see then, and I’m sure as you could tell with Courier, that was really the defining characteristic of the device.”

Petschnigg and Allen remain relatively tight-lipped about their plans for Paper this year, but one thing users can count on are features encouraging collaboration among users. The firm raised a small undisclosed amount of seed funding from Shana Fisher’s Highline Venture Partners in New York and Ron Conway’s SV Angel firm in San Francisco and is already profitable.

“Now the question is really, how do you pool your ideas together?” explains Allen. “Where do they do it, and what does it mean to work with someone else? If you have an idea, how do you share it with someone and get feedback on it? That’s really where we’re pouring a lot of our energies into right now.”