Despite declining volume, the United States Postal Service still delivers a massive 175 billion pieces of mail a year.
Lob has built an API that powers printing and mailing, to make it easier for organizations of all sizes to set up enterprise-scale printing infrastructure and send out mail from within applications. This Y Combinator backed company is already profitable, and has raised a hefty $2.4 million seed round to support continued growth, hire developers, and expand its library of APIs.
“We allow people to programmatically generate and send mail,” said founder Leore Avidar in an interview with VentureBeat. “Let’s say you had to send a customized letter to every person in the United States with their individual name on it. Before you would have had to spend 12 months and it would cost millions of dollars to do this. With Lob, I could do it by tomorrow.”
Avidar positioned Lob as a “Stripe for printing.”
It uses code to simplify and automate what is currently a lengthy and expensive process. Using the API, businesses can vary how much mail they send every week, scale up and scale down as demand changes, and customize the mail they send without having a human involved. Lob basically gives small startups the same access to commercial printing infrastructure and its capabilities as large, heavily-resourced organizations.
The Internet has triggered the demise of paper mail. Volume and revenue for the USPS is declining, but Avidar’s cofounder Harry Zhang said businesses of all sizes still rely on paper mail for billing purposes, renewals, notifications, special offers, etc.. It is a $77 billion industry in the U.S., which continues to operate on old school methods.
“There are hundreds of thousands of square foot facilities just dedicated to commercial printing, and direct mail is still a core part of many businesses because it has such high success rates,” Zhang said. “The government, insurance welcome kits, checks, utility bills — paper mail is a legal requirement for a lot of organizations. Printing is here to stay, and we can help bring entire print divisions into the cloud.”
Zhang also said that Lob could inspire businesses to get more active and creative with mail they send, because it lowers the friction involved.
“What if every time someone signed up for your site, you sent them a cool postcard, or bands could automatically send customized posters to the venues they are playing at in advance?” Zhang said. “Mail is a small portion of what we do, its a beachhead to get us into the enterprises, but we believe the next step is communicating orders via API.”
Lob is also exploring printing on physical products, like mugs, tee-shirts, posters, and photo albums. It is priced on a pay-per-piece model, so businesses don’t have to sign up for long term commitments or spend a minimum amount. The costs of printing, shipping, and delivery are bundled into one cost, which the cofounders said makes the pricing more accessible and transparent than the alternatives.
Avidar formerly worked as a technical business developer at Amazon Web Services and Zhang was a product manager at Microsoft. They founded Lob in May 2013 and participated in the most recent Y Combinator class. Lob’s beta was released in July 27th and the startup has already signed enterprise clients.
Investors include many of Y Combinator’s partners, who personal invested as angels. Kevin Hale, Paul Buchheit, Sam Altman, Garry Tan, Alexis Ohanian, Dalton Caldwell, Joshua Schachter, Polaris Partners and others contributed to this round.
Lob is based in Sunnyvale, California.