Why email is still important, Scott Heimes, CMO, SendGrid

By @SimonCocking interview with Scott Heimes Chief Marketing Officer at SendGrid, a leading, cloud-based customer communication platform for transactional and marketing email.

What do you guys do, 1 min pitch?

SendGrid is a proven, cloud-based customer communication platform that drives engagement and business growth. A leader in email deliverability, SendGrid successfully delivers over 30 billion emails each month for Internet and mobile-based customers like Airbnb, Pandora, HubSpot, Spotify, Uber and FourSquare as well as more traditional enterprises like Intuit and Costco.

For those that don’t know, what is transactional email, and how can it help businesses?

Transactional emails include receipts, password resets, notifications and social alerts. For example, we deliver all of Uber’s emailed receipts. That’s a transactional email. Transactional emails help customers connect with and engage their audiences and ultimately, grow their businesses. Furthermore, when these types of emails are not delivered into the inbox, the results include lost sales, churn and poor customer service.

Transactional email now consists of 20 percent of all email sent in the world, and SendGrid is among the top 3 email senders by volume according to Cisco SenderBase, an email and web traffic monitoring network. When SendGrid was founded in 2009, it helped create the transactional email market. Nearly seven years later, the overall market for transactional email has grown substantially.

We couldn't be more proud of the success Marketing Campaigns achieved with your help: https://t.co/NwsO5QO2FZ pic.twitter.com/TQZxgmGrj5

— SendGrid (@SendGrid) February 1, 2017

How was 2016? What were your big wins?

2016 was a standout year for SendGrid:
We launched Marketing Campaigns, our marketing email solution in December of 2015 over the course of 2016, we acquired 5,000 paying customers, delivered more than 9 billion emails via Marketing Campaigns, and substantially broadened SendGrid’s market opportunity.

Our London office opened in October 2016. Over ? of SendGrid’s business comes from outside of the U.S. and we were serving over 10,000 customers in Europe without a physical presence. London is the first office in our international expansion plans and the expectation is to add other offices overseas to continue seeing growth and adding more international customers.

SendGrid’s Expert Services offering, launched in October 2016, provides new and existing customers (Pro plan and above) with a variety of service packages to ensure customers are able to maximize the value of their email program. We offer a positive value add compared to our direct competitors in this space.

SendGrid sent 1.6 billion emails on Black Friday. We’ve been sending over 1 billion emails a day for the better part of the year but Black Friday stands out as a massive peak with sustained volume over the weekend. No other holiday generates as much email traffic as Black Friday. We’re sending 3x as much email today as we did just two years ago on Black Friday, which means we’re able to uncover more patterns and insights that help our customers better engage with their customers.

SendGrid closed $33M in a Series D round of funding in November 2016. The capital allows us to accelerate our product roadmap, including our recently announced Marketing Campaigns email marketing product and Expert Services offering.

We announced our new Global Headquarters in Denver, CO in May 2016. The new office nearly triples SendGrid’s previous multiple Colorado office footprint in a single Denver location and can accommodate more than 2x the current CO employees over time. We now have ~325 employees and our 2020 plan calls for a total of 900 so we have big growth plans.

What sort of companies are you working with, and how have you helped them?

SendGrid drives digital conversations at scale by sending over 1 billion emails per day (double the volume of Twitter) to 1.6 billion unique email addresses per month, on behalf of 45,000+ paying customers from over 100 countries around the world. Customers include brands like AirBnb, Pandora, eBay, Spotify, Uber and FourSquare as well as more traditional enterprises such as Walmart, Intuit and Costco.

Here are 3 customer examples:

For example, eBay leveraged SendGrid to completely transform its email marketing via machine learning that sends customized experiences and offers in real-time at massive scale. eBay started with a batch-and-blast approach as many peers do but they wanted to create value for customers with true 1:1 personalization. eBay has built an entirely customized content management system that sits on top of SendGrid that their internal users leverage to create dynamic content to send to their users based on recent purchases, browsing history and interests. eBay has been able to seamlessly scale up their email program in a very short period of time.
Rentalcars.com is a mutli-national car rental service that is part of the Priceline.com Group. Rentalcars.com sends hyper-targeted promotional emails to its users in order to drive revenue via special offers emails and support its customer retention and brand goals. Rentalcars.com segments its customer list in order to tailor its messages to different users that have unique needs (e.g. business travelers who travel more frequently than traditional consumers). Rentalcars.com leverages Marketing Campaigns to send to its segmented users, update content design and measure campaign results. Rentalcars.com also chose SendGrid because of prompt email delivery times and best-practice coaching from our Deliverability Consulting Services team.
Bandsintown, a SendGrid customer since 2011, has an audience of over 20 million music lovers that have registered with Bandsintown to track their favorite artists and learn about upcoming live performances in their areas. Bandsintown sends 50 million emails monthly to their various recipients. While Bandsintown communicates with users via push, SMS, and email messages, they’ve embraced email as their core communication channel because it helps them achieve two key goals: user engagement and revenue growth. Bandsintown uses SendGrid to send users transactional emails about their account settings, as well as marketing emails that inform fans about the artists they’re tracking. “SendGrid offers a service that goes well beyond just providing the utility needed to send our emails. SendGrid works with us to optimize the emails we send, by helping to understand our customers and our goals. They have helped us achieve impressive results, through ongoing working sessions, check-ins, and recommendations that are specifically based on our customers and our needs.” – Todd Cronin, co-founder, Bandsintown

What is the SendGrid Accelerate Startup program?

As one of the most successful companies to come out of the Techstars Program, SendGrid understands what it requires to take off as a startup, so we want to give back to the next generation of founders via the SendGrid Accelerator Program.

SendGrid Accelerate is our initiative designed to help startups succeed. We’ve been there ourselves and understand what it takes—the tools and resources startups need to really take off. Startups that are a part of our accelerate program get technical and business mentorship from our Community team, a healthy dose of SendGrid credits, top of the funnel marketing and anything else we can do to provide assistance.

Benefits of the program include access to our proven tools with a provided SendGrid account and support to get them dialed in as well as strategic mentoring and game-changing introductions from our passionate, experienced, global team. We have partnerships with over 200 accelerators and early stage VC funds in over 15 countries. The Accelerate team is globally distributed and works directly with founders, accelerators, and VC funds by hosting dedicated office hours and private workshops for their companies.

Congrats to Katrina Lindholm on winning the coveted SendGrid Yoda Award! pic.twitter.com/HYKiRchJrM

— SendGrid (@SendGrid) January 31, 2017

What are the common challenges startups face that you are able to help them with?

Startups play an essential role to SendGrid’s core business as our customer base includes a large community of startup developers who build cloud-based applications that leverage our platform.

Our customers engage with us daily to solve an incredibly valuable problem, how they can better engage with their 1.6 billion customers to grow their business. One thing is common across all of our customers: they’ve struggled with the complexity of email and they turn to us for our ability to help them solve their problem. Because of the unique characteristics of email, they’re hard to deliver. In fact, (20% of emails don’t make it to the inbox ) — which has a very high financial impact. Think about how much large digital businesses like Spotify make every day from email campaigns. Doing email right means we have to offer technology, scale and expertise to ensure the mail is delivered. Every email battles a tangled maze of filters, blocks and traps to reach its recipient. SendGrid eliminates these obstacles by clearing a linear path to the inbox. Through unmatched deliverability, reliability, scalability and customer service we make the most effective way to communicate also the easiest.

Whether it’s our largest customer sending billions of emails, or our smallest customer sending fewer than a thousand, they rely on our ability to get our email to their intended target, because it means billions of dollars of potential revenue for them.

We met you at Slush, how did you find it, what tips would you give to people thinking of starting up a company?

We found Slush while researching conferences and events that target the Nordic region, a region that we don’t always have the opportunity to network with. It seemed like a unique opportunity and audience and we’ve been very pleased with our experience there.

Some tips for entrepreneurs starting up a company include:

Make sure you’re passionate about the business. Starting a business can be all-consuming therefore, you need to love what you do.

Set realistic goals. Are you trying to be worth $1B or are you comfortable with $5M/year in revenue? Are you building a company to last or do you want to sell within a few years?

Make sure you have strong marketing and sales people. Technical founders often undervalue these roles but they are critical to a startup’s success and growth.

Tips for other startups in terms of how you find new customers – is it referrals, word of mouth, or a mix of that and other strategies?

This depends a lot on the business model…for us growth came mostly from self-serve signups via referrals and word of mouth. A startup struggling to find customers could be a sign that there is a lack of product/market fit, and marketing or sales might not even be the problem.

Startups also tend to undervalue email. Email marketing ROI is massive compared to other channels, and we often see startups with social media and content strategies but no email strategy. That’s almost always a mistake.

Some startups also tend not to test their marketing assumptions to the degree that they should. If they don’t have any data to inform why and how they are targeting a certain demographic, it’s time to step back and do some more planning and testing.

What are SendGrid’s plans for 2017?

Our vision is to be the world’s most trusted communication platform. In 2017, our goals are centered around customer satisfaction, employee engagement, financial strength and innovation to ensure our customers and employees continue to love SendGrid and that we excel financially and with innovation to drive engagement and growth for our customers.

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