MessageGears is making email marketing a well-oiled machine for big companies. The Atlanta tech startup is a cog-turning engine that sends more than one billion messages every month for enterprise clients like Expedia, Musictoday and Runkeeper. Recently, scoring a $2.35 million Series A funding round, MessageGears is now ramping up operations. They are on a hiring spree to double head count, with the goal to boost staffing for award-winning software that both sends mass emails and manages data with synchronicity.
The vision behind MessageGears originates from its co-founder and CEO, Dan Roy. A seasoned technologist, he served as CTO at Accucast, a pioneering email marketing platform acquired by PGi, and was instrumental in launching e-commerce for Delta Air Lines. He sat down with Hypepotamus (literally between hiring interviews) to discuss why MessageGears is disrupting the email marketing industry with a hybrid, SaaS solution that makes messaging super easy.
How did MessageGears start?
I have been in the email space for a long time. I first got into it at Delta, when was I was working there on Delta.com, during the DotCom boom. We were collecting tens-of-thousands of email addresses everyday and no way of using them. It became a problem, as an engineer, that I was trying to solve some 20 years ago. So, we connected with a company here in town that served as a consultancy. Delta basically said, Here is a business idea, go out and build this product and we will take a look at it. It developed into a company called Accucast, which I joined as CTO. We were selling to customers like, not only Delta, but Travelocity, Bank of America, Walmart and some huge brands. I became immersed in the enterprise software business. It was on-premises software. Our customers loved it…
It dawned on me, going through this experience of being responsible for fully on-premise and SaaS versions of the product, that we can solve some problems by combing the best of both of these models. We have a light piece of software and a cloud-based deliver system. We have open APIs that connect the two together. Now, we have the benefit of putting the app to where the data is and we don’t have all this technology that we have to support. From a vendor standpoint, having a SaaS pricing model on its user base is really beneficial.
So about six years ago, I had an opportunity while working for PGi to develop some of their products. I told them I wanted to take this and run with it. So we spun out, got some seed funding. We were able to buy our way out of it, and get our intellectual property back. That was about a year after we started the company. We were then off and running. We owe a lot to PGi for helping us get our start.
What has it been like to grow your business in the South and get money here?
It is interesting. When we started, it was really difficult to raise money. Everyone thought, Email marketing is so 10 years ago, nobody wants to put money into that. We had to scrap hard to put money together, to take the seed money that we got from PGi and actually get some customers before anyone would really listen to us. We wound up landing some investors, including a round a couple of years ago with $750,000. This got us out of the bootstrapping mode and odd consulting jobs to make ends meet. Then it was about showing how we could grow the company. We were able to get Expedia and others. Once we got Expedia, we knew that it was time to go for another round, to go for another million, at least. We have been profitable throughout our history, and that helps, if you have clients and can show that you can be profitable.
We connected with Jon Hallett, who I really respected and had met before. When we were considering raising another round of money, we were looking for someone who could provide more than just money. We were looking for someone who could be on our board of directors and contribute to providing advice on going into a growth mode. We are expecting to go into a VC round later down the road, so having someone like Jon on the board is a big boost to our credibility. With him involved, it says a lot about the VC community that knows him pretty well.
You are hiring new people and have more in the pipeline with this recent funding. What is on deck for MessageGears?
It is about maturing our sales and our marketing processes. We really have under-invested in sales and marketing and invested heavily in engineering. Half will go toward that, and half will go toward innovating our products. We have never had the intention of just being an email platform, so multichannel marketing and communication tools are part of our vision.
The wow is seeing big data companies saying that they want to build it themselves, but we are offering them an alternative. We are offering this new hybrid solution that combines with on-premise. It’s not a bad word, because that is where your data is. Our market is huge, if you consider multichannel, which could be a $10 billion market. There are no other startups that are trying to do what we are doing, who are competing with giants like Oracle, IBM and Salesforce. Going forward, it will be about getting some big market share. It’s all about providing agility to the enterprise marketer.