SendGrid, an email delivery and performance platform that helps marketers track their email performance stats, has raised a fresh $33 million round led by Bain Capital Ventures, with participation from Bessemer Ventures and the Foundry Group.
Founded out of Colorado in 2009, SendGrid serves up the infrastructure for companies to manage their transactional email initiatives, including shipping notifications, newsletters, and sign-up confirmations. It has an impressive arsenal of customers, including Uber, Airbnb, Spotify, LinkedIn, and FourSquare. Today, the company says that its platform is responsible for sending more than 1 billion emails per day for 42,000 customers in more than 100 countries.
Prior to this latest Series D round, SendGrid had raised more than $45 million, including a $21 million tranche back in late 2014. The latest cash influx will be used to “accelerate its product roadmap,” according to a company statement, as well as expedite its global expansion plans.
Perhaps most notably, the company has reiterated its plans to IPO in 2017 and is already “IPO-worthy,” though it wouldn’t reveal details about its post-money valuation. SendGrid did claim to be profitable, however, grabbing $20 million in revenue in the last quarter — 38 percent up on the previous year.
But while business is apparently looking rosy for SendGrid, there’s no ignoring the oft-repeated mantra that “email is dead,” or at least on its way out. There is little question that email has been impacted by the likes of Facebook, Twitter, and the myriad messaging apps out there, but email remains in good health in the B2C and B2B realms, even with Facebook continuing to push Messenger as a B2C platform. SendGrid delivers more than 30 billion emails each month, and company CEO Sameer Dholakia insists that email is the “gravitational center of digital communications,” with unique elements that cannot be replicated through other means.
“Email will certainly continue to evolve, but we are not worried that email will become redundant,” he told VentureBeat. “Email has the best ROI [return on investment], and, according to the Direct Marketing Association, email remains one of the most cost-effective ways for businesses to communicate with customers and prospects, with an estimated ROI of $38 for every $1 spent.”
It’s true that most people still have email addresses that they use to sign up for online services, but it’s equally true that a growing number of services bypass email altogether and instead ask for your Google, Facebook, or Twitter credentials, or even your mobile phone number. Email is still a key communications conduit, for sure, but things can change rapidly, so is there a contingency plan should email suddenly jump off a cliff? It seems the answer is “yes.”
“Our mission and vision is to become the world’s most trusted customer communications platform that drives engagement and growth,” Dholakia said. “This will involve us adding more platforms over time to add to email, including push, in-app messaging, display retargeting, and potentially platforms like Facebook Messenger, WhatsApp, and Slack. As a company, SendGrid will continue to evaluate how to best leverage these channels to drive engagement and growth for our customers. If our customers are engaging with their customers better to drive growth — and are successful doing so — then we are successful.”
For now, however, email is still king for SendGrid. The company says it’s sending 30 billion emails a month on behalf of more than 40,000 customers, with eBay alone responsible for 1 billion of those. And it’s this kind of traction that led the company to not only raise its latest round of funding, but also to lay legitimate claims to being “IPO-worthy.”
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