SendGrid sees explosive growth in first three years

By: Kate Forgach Monday November 5, 2012 0 comments Tags: Boulder, Haulix, Jim Franklin, Matt Brown, Pinterest, Robert Phillips, Ryan Park, SendGrid, SendGrid Labs, TechStars

Boulder company finds rapid scalability in cloud-based email delivery

By Kate Forgach

BOULDER -- What began as a three-person startup in 2009 has grown so exponentially that SendGrid just hired its 100th employee to manage the company's cloud-based email infrastructure.

The Boulder-based company, which handles "transactional" email, has offices in several regions around the world, including throughout the United States, England and Germany. SendGrid also recently opened a Denver office and now serves customers in more than 150 countries.

"We're just a three-year-old company and our primary goal is to scale and grow to become a $100 million business by moving the world's wanted email," said SendGrid CEO Jim Franklin. "We want to be the global transactional email choice for developers to create the next killer applications."

Jim Franklin
Transactional email typically is triggered by a user interaction with a web application, such as email registration, password changes, notifications, purchases and "friend of follower" requests.

"What often happens is, when someone creates an application, they start off thinking they'll only have to deal with a handful of emails," said SendGrid Vice President of Marketing Robert Phillips. "Within months, they can be sending millions of emails and, if the process isn't handled properly, they can lose customers."

On average, 20 percent of commercial emails never reach a person's inbox. It's a big headache for all involved when customers can't access their account registration, password change, purchase confirmation, etc.

On average, SendGrid sends an astounding 110,000 emails per minute for more than 60,000 customers. Their clientele includes Pinterest, Foursquare, Haulix, Spotify, Pandora, Airbnb and Uber.

And customer response has been appreciative.

"Their account management team is responsive and proactive, providing us with the space we need to focus on strategic plans rather than day-to-day email management," said Ryan Park, Pinterest's operations engineer.

"SendGrid took the weight off of our team of developers so they could concentrate on building out the platform rather than on email deliverability," said Matt Brown, CEO of Haulix.

Double-digit growth

"The most exciting thing is that our core business is scaling very quickly," said Franklin. "We have been experiencing double-digit, month-on-month email growth for some time."

In addition to scaling to keep pace with client growth, SendGrid provides ISP and deliverability outreach, whitelist services and real-time analytics. ISP outreach ensures a healthy relationship with receiving ISPs and webmail providers.

"An email white list indicates you're essentially a good sender," said Phillips. "It's similar to the blackhat and whitehat designations for Search Engine Optimization. As receivers add layers of spam protection, legitimate email has more hurdles to navigate.

Robert Phillips
"Getting email delivered reliably is harder than it used to be. Email deliverability sounds fairly simple, but it's actually quite complex."

According to a recent SendGrid survey, web applications are taking advantage of a consumer embrace of transactional email. Nearly half of user actions now trigger an outbound email, and 93 percent of survey respondents said they expect to increase user-triggered email volume in the next year.

When asked to evaluate the importance of transactional email to their business, 79 percent of respondents ranked it as "important" or "very import" for acquiring customers, while 90 percent rated it highly for customer retention.

TechStars graduate SendGrid has already raised just over $27 million in funding from the Foundry Group, Highway 12 Ventures, Bessemer Venture Partners and several notable individual investors, including Postini founder Scott Petry, WordPress founder Matt Mullenweg and Dave McClure from 500 Startups.

"We just announced a newsletter application," said Franklin. "It will allow our customers to have the same reliability with their marketing newsletter as with their transactional email programs. We're also working on other projects for developers as part of SendGrid Labs."

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Kate Forgach

About the Author: Kate Forgach

Kate Forgach is a lifelong journalist and public relations specialist who has written extensively about science and business.