A Victoria tech startup decided to test drive its big idea by temporarily moving its team to Silicon Valley last year. The risk paid off. Sendwithus returned to Victoria with the talent, the funding and the business acumen to start working on their next goal: to grow into Victoria’s largest tech company.
At Spacestation, Fort Street’s purpose-built, shared workspace, a company called Sendwithus is moving at rocket speed to realize their very big idea. With founders Brad Van Vugt and Matt Harris at the helm, the Sendwithus team handles over 10 million marketing emails daily for web giants including Donorschoose.org, 8tracks.com
and Teespring.com. The rapidly growing company, which also operates a permanent office in San Francisco, provides a direct link between Victoria and the world’s technological hotbed.
Incorporated in 2013, Sendwithus is the first company to optimize business-to-customer transactional emails — automated, personalized emails such as password requests, purchase invoices or welcome emails for new clients who sign up on a website.
As the first B.C. founded company to incubate in the Silicon Valley’s prestigious Y Combinator tech startup accelerator program, Sendwithus emerged from the world’s biggest tech hub last spring with over $2 million in seed funding. Some of their notable investors include Baseline Ventures, Y Combinator, SV Angel; and local investors Rasool Rayani, Andrew Wilkinson and Dave Arnsdorf.
With 24 employees between their two offices, and a growth rate of 30 per cent month over month, Harris and Van Vugt plan to expand as far and fast as the market will take them.
The Big Idea Started with a Big Problem
As contract developers building mobile apps for Victoria startups, Van Vugt and Harris stumbled across a very big problem facing companies of every size: there were currently no tools in place for managing transactional emails. Frustrated by having to build apps over and over, the pair turned to friends at Dropbox and Amazon. They asked: How do you manage marketing emails effectively without having to involve developers and designers every time you want to update content? How do you ensure your email content engages your customers creatively and effectively so that email does what it’s supposed to do: generate revenue?
As it turned out, nobody was managing email well.
“Amazon had a team working on this problem, and they didn’t want to be working on it,” says Harris. “None of the companies we talked to were happy with their current system.”
The duo realized that they could build a service that would solve a problem faced by companies of all sizes, all around the world.
Silicon Valley Bound
Armed with an untapped market, the support of local angel investors and some big, prospective clients, Harris and Van Vugt’s next move was to hone their business model and build the product. Where was the best place to do that? The mecca of everything tech: Silicon Valley.
“We both had small networks in the Valley when we started,” says Van Vugt. “We knew Y Combinator was an option, but hadn’t planned on applying or getting in (less than two per cent of applicants are accepted). If we hadn’t been accepted, we’d have continued building the business as planned.”
But they did get in. In January 2014 they rented a house in Sunnyvale and took themselves and their six-person team to California to take part in three intense months of networking and product development, mentored by a YC partner. At the end was Demo Day, where Sendwithus had two and a half minutes to pitch their business to 1,000 top investors; among them celebrities like Ashton Kutcher.
Was it intimidating?
“There was a bit of imposter syndrome at first,” says Harris, who adds that being surrounded by the smartest minds in the tech world was definitely daunting, but also energizing. “YC is an unstructured program; sink or swim is the general idea. We knew it was a big opportunity, and we made the most of it.”
With $2.3 million in seed funding after the YC program, Sendwithus got to work in their San Francisco office and here in Victoria. With “heavy metal Fridays” and daily 10-minute “standup” meetings, Van Vugt and Harris have fostered the kind of team work culture that encourages collaboration, creativity and plenty of fun.
Why Email Still Rules
“Email is the lifeblood of how people communicate with companies,” says Harris, adding that it’s also an important legal record.
Transactional email is worth doing right because it can, and should, generate sales. The Sendwithus service is packed with built-in analytical tools like A/B testing so that companies can track exactly which emails are opened and whether emails route customers back to the website and generate sales. Sendwithus also offers easy-to-use templates so clients can update emails whenever they want.
“A core part of our value proposition for larger companies is our knowledge of how email can impact the customer experience,” says Van Vugt, who says everyone on the Sendwithus team is an industry expert in modern email communication.
“When used properly, email should be an extension of your product and can delight your users the same way your website or app does.”
They created resources like the Pirate’s Guide to Email (or How to Send Email Like a Startup) to help industry leaders create effective marketing strategies. Van Vugt notes the team is now sought after to speak at product design and marketing events throughout North America.”
The Way Forward
“There’s a big opportunity to grow a large, Canadian company,” says Waterloo graduate Van Vugt, who wants to see Sendwithus expand to 100 to 200 employees, with built-in employee initiatives to ensure the company always has a positive impact on the local environment.
The founders also constantly feed their experience and success back into the tech ecosystem by mentoring new startups and doing educational outreach with computer engineering/science students at UVIC, from which Harris is an alumnus.
Too often, Harris says, computer science classes become stale. “We want to show students what tech looks like in the real world, so that they’ll get excited about their future.”
“Boosting the whole ecosystem together is part of our big idea,” says Van Vugt, who adds that he and Harris are very approachable. “We’re happy to grab a coffee with anyone who wants to build something new or just bounce ideas off us.”
That kind of pay-it-forward outlook is integral to Silicon Valley culture, where networking is all about sharing ideas and valuable contacts so that each new company has the best chance of success. For Harris and Van Vugt, that includes giving their employees the skills to launch their own companies, too. They see giving back as the best way to create the tech community they want to see in Victoria.
“There hasn’t yet been a big, Victoria breakout company,” says Van Vugt. “Outside the area, Victoria is still unheard of as a tech hub. We want to change that.”