The average email inbox is stuffed with spam, disguised viruses and irrelevant junk. But Goodmail Systems, provider of the CertifiedEmail platform that delivers only trusted emails, just landed $20 million in a third round of funding to help its users rise above the fray.
The Mountain View, Calif. company hopes to capitalize on a trend toward email use by banks, retailers and billing institutions that have hung on to snail mail for too long. If customers are to receive more critical personal information via email (a much cheaper mode of communication), they’ll want a clear and safe way to do so. That’s the idea behind CertifiedEmail, a higher class of email that allows users to confirm the source, security and legitimacy of messages before they open them. Emails sent through that system bypass content and volume filters and are distinguished by blue-ribbon envelopes in the inbox interface.
To make this possible, Goodmail has struck revenue-sharing partnerships with most major email and internet service providers like Yahoo, AOL and Comcast — the notable exception being Microsoft’s Outlook.
The product is targeted at large companies looking to send private data to their customers (receipts, balance statements, credit card bills, etc.). Goodmail is emphatic that it carefully screens its prospective clients before giving them access to CertifiedEmail tools, but it clearly still wants to make money. Right now, it transfers messages for about 500 diverse companies and government agencies, including Wal-Mart, McKinsey, the FBI, Dell and the American Girl Company. All told, it handles about 3 billion emails a month, charging its clients $2.50 for every 1,000 sent. It also offers a pretty decent channel for email recipients to give feedback. That way, any company abusing the system can be weeded out.
But Goodmail isn’t the only player to recognize the opportunity. A company called Return Path has devised a way to similarly white-list emails. In August, it absorbed smaller rival Habeas, which provided internet service providers with approved-sender lists to block out junk mail. Secure Computing, another firm offering email data protection options, was purchased earlier this week by antivirus software giant McAfee for $462 million. Goodmail has the traction it needs to remain competitive for now, but will need to continue making strong strategic gains to keep up.
The recent funding round should help. Contributors included Bessemer Venture Partners, DCM, Emergence Capital Partners and Softbank Capital. Previously, it had raised $20 million over two rounds in 2005 and 2006.