I had the great fortune of both having wonderfully tasting chai at The Cup Boulder and meeting up with Tim Falls of SendGrid. We were meeting to talk about his work at SendGrid and the importance of the Boulder start-up community.
Tell me a little about SendGrid and how you are different than other email delivery companies.
SendGrid is an email delivery service that allows companies to use our email infrastructure to support their outbound email delivery efforts. Many companies start off with an home-made email system hosted in the cloud, but once that company begins to expand its customer base, then logically their email patterns increase and become more complicated to maintain. If you have a company with 10,000 users, consider the number of emails and other social communications they generate, the resulting email volume can quickly cause problems with delivery.
We also manage and monitor how ISPs, like Gmail, handle an email – like if they are accepting it or not. There are a number of ISP requirements email distributors must adhere to: certain number of emails sent within a specific time frame, validation of sender information, confirmation that the recipient actually wants to receive the email, and confirmation that you, the sender, are who you say you are. We take all of those additional requirements out of a company’s hands, so a business can concentrate on their core competency and doesn’t need an entire team dedicated to email management.
ReturnPath, a local company in the email deliverability space and a company with whom we often work, did a study that revealed 20% of all legitimate email does not get delivered. So, any company that relies on transactional emails, like shipping receipts and password reset notifications, or bulk email, like customer newsletters, can use our infrastructure to send out and manage their outbound email. We also extend our service to include metrics, so companies know if an email was opened, if links within the email were clicked, or if someone unsubscribed.
How long has SendGrid been around?
We launched in August 2009 at the end of TechStars, so it’s been about 18 months. We currently have 20,000 customers, who have sent over 7 billion emails. We are averaging around 1billion emails sent per month. We are growing very quickly.
What’s been the biggest surprise during the initial startup phase of Send Grid?
I don’t know if this was so much a surprise as the timing was, but in January 2011 Amazon introduced a competing product. It was big news, especially from our startup perspective, to have Amazon come into this space and offer a competing product. Theirs is less expensive but lacks a lot of the metrics features our product offers.
So, we are basically maintaining our position as a premium service, serving the same customer segment and offering a much fuller service. We have advanced analytics that can provide insights into customer behavior once they receive an email, which can then be used to inform content changes. Amazon can confirm only that the email has been delivered, bounced, blocked or reported as spam.
We are really focused on the customer experience, which is why we offer dedicated IP addresses. Providing this type of service is more expensive, but it also ensures that we are able to more fully support our customer’s sending reputation. If you use a shared IP address and another company using that same IP address is not following best practices, such as maintaining list hygiene and sending quality content, then that also hurts your sending reputation, and thus, your delivery rates.
So, our focus is on helping our customers maintain a high sending reputation, improving their email deliverability and providing analytics on what’s working and what isn’t working in their email campaigns
How has the Boulder Community helped SendGrid? How important is the Boulder Community to the success of SendGrid?
Boulder was important enough for our original CEO and co-founder to relocate his whole family here. Our experience at TechStars was key to helping the team figure out the best way to attack the problem we wanted to fix. From that experience, we gained some amazing mentors, advisors and customers. Companies in the startup community, who wanted to help out, became customers and provided great feedback on the product plus spread the word about us. Within the first 8 months, we had 6,000 customers from word-of-mouth marketing; we hadn’t yet done any formal marketing.
What does the future hold for SendGrid?
We have new leadership to take us to the next level of company maturity. We’ll be digging into channel partnerships to speed up growth to establish ourselves as an industry leader in email delivery. We are also focused on having an international presence.
What’s the one piece of advice you would give to someone contemplating a startup idea?
Come up with an idea that solves a problem for enough people to make it a viable option. You want to have a solution to a serious business problem that people are willing to pay for. Of course, the hurdle to get over is identifying that idea that solves a particular problem. Make sure you have firm data and that you are talking to the right people about your solution.