The Email Startup Graveyard: Why 80%+ of Email Companies Fail

(forwardemail.net)

92 points | by skeptrune 6 hours ago ago

50 comments

  • personjerry 38 minutes ago

    Pretty sure this is AI written, hence the inconsistencies mentioned in this comment section.

    • tomas789 2 minutes ago

      Yes. I’d rather read the prompt than this.

  • sethammons 4 hours ago

    I was engineer 12 at SendGrid and left after IPO and subsequent acquisition by Twilio. Being infrastructure and the backing many email marketing companies, we did really well. Kind of like selling shovels in the gold rush. We struggled more on the product front breaking into the much larger marketing space. Learned a lot there leading and scaling teams and scaling the email infrastructure to support over 8 billion daily sends.

    • zaik 2 hours ago

      > email marketing companies

      This means spammers, right?

      • an hour ago
        [deleted]
      • colechristensen 2 hours ago

        No, in order for their traffic to not get blackholed, places like sendgrid have to follow the rules and make their customers follow the rules. The marketing emails they send will be somewhere between things people actually want to see and mildly annoying. There are plenty of things I subscribe to which are marketing emails I want to see.

        • friendzis 31 minutes ago

          > places like sendgrid have to follow the rules and make their customers follow the rules

          i.e. juggle between allowing allowing some paid spam and not being outright blocked by google/microsoft. That's the service they provide: VC-backed connections to get traffic unblackholed on behalf of their spammer customers.

        • BiteCode_dev an hour ago

          "mildly annoying"

          That's another name for spam.

          • fc417fc802 an hour ago

            Perhaps historically, but these days I think spam refers to senders that don't play by the rules. Unsolicited (ie didn't obtain the recipient's address in a legitimate manner), no unsubscribe link (or not honored), technical measures intended to circumvent various filters, etc.

          • thorncorona an hour ago

            marketing emails are mildly annoying until you want to buy something and they become useful for the 20% coupon

            • distances 43 minutes ago

              If I want certain marketing emails for these purposes, I create a rule to mark it read on arrival and moved directly to a certain folder where I can find it when needed. It will still never see my inbox.

            • iancmceachern an hour ago

              Or the band you love is in town

  • AnonC 28 minutes ago

    If Fastmail is included in the startup category, why aren’t email companies like Posteo and Mailbox.org included? Runbox.com is a one person operation. They’ve all been around for decades and are still going strong. Posteo hasn’t even taken any VC investment (which could be one reason, as the article points out, for failure). Migadu has been around for quite sometime and doesn’t find a mention in this list.

  • laborcontract 3 hours ago

    My first thought was wow - 20% of email startups succeed? That’s actually pretty good.

  • ajjenkins 4 hours ago

    I’m surprised Hey isn’t mentioned. That’s the only example I know of someone recently trying to reinvent email. Maybe it wasn’t included because it’s part of Basecamp and not its own company. But I think it’s important to discuss if your argument is that ā€œno one has successfully reinvented emailā€.

    • CaveTech 32 minutes ago

      It is mentioned, there's an entire section named "The HEY Experiment".

    • tristan957 2 hours ago

      By reinvent are you referring to UX? Fastmail is reinventing email through superior open protocols.

      • ericrosedev 41 minutes ago

        Obligatory ā€œas far as the customer is concerned, the interface is the productā€

      • BiteCode_dev an hour ago

        UX is what made the difference between the first iPhone and a palm.

    • 22 minutes ago
      [deleted]
  • dvt 44 minutes ago

    > Electron Performance Crisis: Modern email clients built with Electron and React Native suffer from severe memory bloat and performance issues. These cross-platform frameworks, while convenient for developers, create resource-heavy applications that consume hundreds of megabytes to gigabytes of RAM for basic email functionality.

    No (real) customer has ever, or will ever, care about this. Discord and Slack are pretty much case-in-points: bloated Electron apps that just about everyone on the planet has installed on their computers. I personally hate React, but technology decisions are irrelevant to the long-term success of startups. (As long as they don't grossly interfere with customer experience, the feature set, etc.)

    > Final Warning: After analyzing hundreds of email startups, the evidence is overwhelming - 80%+ fail completely. Email isn't broken, and trying to "fix" it is a guaranteed path to failure.

    First, I'd bet money that figure is actually wrong: the failure rate is likely way higher than 80%. And I'm honestly not sure how anyone could seriously think a 20% exit rate is bad in just about any vertical (but especially a "boring" one like email).

    > Resources: Volunteer developers can't sustain enterprise-level software

    What am I even reading here? Author does realize openssl[1], Linux[2], and many other "enterprise-level" pieces of software are entirely (or almost entirely) maintained by volunteer developers, right?

    Anyway, the post had its opposite intended effect on me: it made me think about ways I could reinvent email.

    [1] https://github.com/openssl/openssl

    [2] https://github.com/torvalds/linux

    • shwouchk 21 minutes ago

      > bloated Electron apps that just about everyone on the planet has installed on their computers

      i guess im the one guy left that has neither

      edit:quote

    • egglemonsoup 41 minutes ago

      I am a real Discord customer who is actively looking for an alternative due to how terrible the performance is on my M1 MacBook and on my gaming PC. I'm just one person—I'm not claiming to represent the 'average' customer. But I am part of the average.

      • CaveTech 34 minutes ago

        The other part of the average is the 200m+ monthly active users who can't seem to find the uninstall button.

  • cedilla 15 minutes ago

    Is 80% even that high? I thought the idea behind VC was to fund companies where 90% are doomed to fail, 9% might do okay, in order to cash in big on the 1% that have stellar success.

    Am I way off with my numbers there?

  • 4 hours ago
    [deleted]
  • muratsu 4 hours ago

    Mailbox raising 6M, having a 100M exit and getting called out failure is crazy

    • runako 3 hours ago

      Rapportive listed at having raised $120k for a $15m exit also stands out.

  • chevman 4 hours ago

    What's left to conquer in email land?

    Most of the large marketing ecommerce/enterprise market was captured via ExactTarget/Salesforce, Oracle/Responsys/Eloqua, IBM/SilverPop/Acoustic, Adobe/Neolane/Marketo by the mid 2010's.

    SendGrid/Twilio was another a few years later, Amazon SES is ok, then you have some of the smaller market players (MailChimp, Constant Contact, etc).

    Hard to scale/grow a startup in any real way when there are so many fairly well entrenched solutions across industries and company sizes.

  • fyrn_ 9 minutes ago

    My god this "article" is an inconsistent pile of AI slop. It actively contridicts itself and changes the thesis several times as it goes on and on and on.

  • 4 hours ago
    [deleted]
  • 4 hours ago
    [deleted]
  • chazeon an hour ago

    Actually recent email innovation I enjoyed is Mimestream, the macOS native client for Gmail. Apple’s smart inbox is half baked but better than nothing. Cloudflare now also has a pretty good email forwarding service.

  • croisillon an hour ago

    I fell in love wirh Zenbe back in 2009 and i’m still angry at Facebook for acquishutting them down in 2010

  • jiveturkey 3 hours ago

    > Techstars alone has 28 email-related companies with only 5 exits - an exceedingly high failure rate (sometimes calculated to be 80%+).

    This is actually better than overall failure rate. At 80% I would absolutely be investing in more email companies!

    The entire analysis is skewed to satisfy their own messaging or perhaps internal motivation. Mentioning Cyrus IMAP and SpamAssassin is ... being stuck in a time warp.

    Being self-funded, their position is not surprising. However they really need some perspective.

  • JimDabell 4 hours ago

    This is a weird article. Email is a hodgepodge of terrible protocols that have progressively had more and more technical debt laid upon them for decades and decades. Vendor quirks are everywhere, and it’s incredibly unreliable. Its defining quality – it’s decentralisation – has been beaten out of it by IP reputation so everybody ends up sending through a handful of providers.

    The article kinda acknowledges that it’s a shitheap that’s awful to implement, but somehow still champions the idea that it all works fine.

    And what’s with the repeated jabs at the ā€œterribleā€ exit rate that actually seems pretty good?

    • jesterson 26 minutes ago

      > Email is a hodgepodge of terrible protocols that have progressively had more and more technical debt laid upon them for decades and decades.

      May I know what is so "terrible" about those protocols ans what "technical debt" are you talking about?

      > Vendor quirks are everywhere, and it’s incredibly unreliable

      That has nothing to do with actual email protocols. Generic email protocols are extremely reliable and resilient to any sorts of disruptions. I wish any of modern protocols exhibit similar simplicity and reliability.

      But of course if vendor would like to add their quirks and you would like to buy that - that's your choice innit.

    • nojs 11 minutes ago

      It’s AI slop

    • dboreham 3 hours ago

      > incredibly unreliable

      The underly technology is very reliable. Email not getting delivered to the recipient is more about low/no-cost providers preferring to filter almost all messages rather than spend money on doing a good job of spam filtering.

      • landl0rd 2 hours ago

        To what lever can one apply money to get better spam filtering with even remotely constant returns to scale?

    • delusional an hour ago

      > and it’s incredibly unreliable

      I will never understand where this sentiment comes from. I've run my own mail server for like 7 years at that point. It's so incredibly rare for my mail to not deliver that I can't remember the last time I had to debug it. The most annoying thing I've had to deal with was dovecot breaking compatibility with their config format, but even that was a couple of hours of work to get back on track.

      My most surprising experience was when I broke the mail setup while migrating servers once. Postfix was down for something like 7 days before I got around to fixing it. The cool thing was what happened after I fixed it. While my server was down, the other relays had been dutifully holding onto my mail, waiting for me to once again accept it. So after a week of downtime, I still got all my mail within 24 hours after starting up my server again.

      That's fucking reliable in my book.

  • andrewshadura 23 minutes ago

    Not sure why they attack Fastmail and JMAP all the time.

  • duxup 4 hours ago

    >But they ignore the fundamental reality: email works perfectly for what it was designed to do.

    Yeah the fundamental thing is email does it's job, and if you want to change that job in any dramatic fashion ... it no longer does its core job.

  • aussieguy1234 an hour ago

    If 1 in 5 takes off, is that really a bad success rate given that's widely considered the average startup success rate?

    • dvt 41 minutes ago

      Average startup success rate is 1/10 at best. The "90% of startups fail" metric that's often cited is likely inflated by B2B companies which find significantly more success (like, an order of magnitude more) than B2C.

  • patchtopic 3 hours ago

    compared to other businesses this number seems OK :-)

  • scarface_74 3 hours ago

    > The Acquisition-to-Shutdown Pipeline

    For the founders and their investors, that’s nut a bug it’s a feature

  • jpmi1 4 hours ago

    [dead]

  • throwaway843 5 hours ago

    [dead]