The Email Startup Graveyard: Why 80%+ of Email Companies Fail
46 comments
·July 1, 2025sethammons
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
> email marketing companies
This means spammers, right?
null
colechristensen
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
> 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
"mildly annoying"
That's another name for spam.
personjerry
Pretty sure this is AI written, hence the inconsistencies mentioned in this comment section.
dvt
> 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.
shwouchk
> 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
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
The other part of the average is the 200m+ monthly active users who can't seem to find the uninstall button.
laborcontract
My first thought was wow - 20% of email startups succeed? That’s actually pretty good.
ajjenkins
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 “no one has successfully reinvented email”.
CaveTech
It is mentioned, there's an entire section named "The HEY Experiment".
tristan957
By reinvent are you referring to UX? Fastmail is reinventing email through superior open protocols.
ericrosedev
Obligatory “as far as the customer is concerned, the interface is the product”
BiteCode_dev
UX is what made the difference between the first iPhone and a palm.
worthless-trash
We have regressed as a society.
null
null
andrewshadura
Not sure why they attack Fastmail and JMAP all the time.
muratsu
Mailbox raising 6M, having a 100M exit and getting called out failure is crazy
runako
Rapportive listed at having raised $120k for a $15m exit also stands out.
chevman
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.
chazeon
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.
null
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.