Superhuman: Breakout Jobs Memo #2
“If you join a company, my general advice is to join a company on a breakout trajectory.” — Sam Altman, President at Y Combinator
In this second edition of Breakout Jobs Memos, we profile Superhuman, the fastest email client ever made.
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What is a Breakout Job?
We, at Xpo Network, define a Breakout Job is that one role which puts you on the map. Best examples which hit my mind are Andrew Chen heading Growth at Uber, Erik Torenberg leading Community at Product Hunt.
What is Superhuman?
Superhuman is the fastest email experience ever made. It’s what Gmail would be if it were built today, not 15 years ago.
Here’s what a16z wrote about Superhuman in their Investment Announcement
The founders have spent nearly a decade in the “idea maze” of email. First described by Stanford professor and former a16z general partner Balaji Srinivasan, and then popularized by my fellow general partner Chris Dixon, the “idea maze” is what enables certain founders to succeed with their startups over others. Rahul has traveled the email idea maze for nearly a decade: He previously founded Rapportive, a much-loved product that added social profiles to Gmail; it became the first Gmail plugin to scale to millions of users, kickstarted a whole ecosystem of email enhancements, and was ultimately acquired by LinkedIn.
Product
The Fastest and Minimalist Email Client for Gmail which helps you reach Inbox Zero easily.
Potential Move to this Product from Incumbents
- Google can come up and add the “Superhuman” features to their email client which is unlikely but their Integration with services like Zoom, Calendar makes them a very solid candidate.
- A potential startup could simply copy Superhuman’s features and push it to the broader market at a lower price.
Strengths
Community as a Moat: Superhuman’s community of users is one of the most loyal ones that very few products have been able to achieve in their lifetime.
For an example of this, check out Superhuman Wall of Love.
Speed of Execution: The team at Superhuman executes super fast. We saw it with the recent privacy incident. More on this below!
Virality: The companies does a 1-hour on boarding call with every user who gets introduced to the product. Due to this, they have only 15,000 users right now with more than 180k people trying to get access to the product.
Backed by Top Investors:
The company is funded by top VC funds such as a16z, First Round Capital, Naval Ravikant and others.
Concerns
- Is $30 a reasonable price?
Well, it seems so. $30 for a few hours of extra time month, people are willing to pay for that. It’s just that no product really was worth $360 a year before Superhuman came along.
2. Privacy Concerns
Few days, many people raised concerns about the “Read Receipts” that Superhuman was sending.
I’d suggest you to read this Twitter thread below and you will get an idea of what I am talking about.
However, the company was quick to address this concern and they released an update one day later.
Team
Rahul Vohra: Sold his last company to LinkedIn, kicked off the Gmail Extension ecosystem, he’s one of the best product minds around in Silicon Valley.
Conrad Irwin: CTO of SuperHuman, Prev: Founding Team at Rapportive, Senior Engineer at LinkedIn
Vivek Sodera: Co-founder, Superhuman (Series A+, 170k+ waitlist), Airseed (shut down), Rapleaf/LiveRamp (NYSE: RAMP)
How the Team Got Together
The team has been together since their first startup together. They sold Rapportive to LinkedIn in 2012 and started building their next company, Superhuman, in 2015.
Motivation [Source: a16z]
As an industry, we first witnessed the consumerization of the enterprise. As consumer software became increasingly polished and delightful, we then came to expect the same of our business software. We are now at the start of a new wave: the prosumerization of the enterprise. It does not matter whether I was CEO, corporate executive, or general partner — my needs as a prosumer have been ignored for years. And yet there are tens of millions of power users just like me. Now, a new category of prosumer tools can give these users superpowers.
Superhuman = superpowers
When viewed through the prosumer lens, email alone is a multi-billion dollar category. And given how central email is to productivity (and much more!), Superhuman is incredibly well positioned to expand to adjacent categories.
Perhaps you’ve seen the way people talk about Superhuman, it’s nothing short of a phenomenon. People praise how they get through their inbox twice as fast. People praise how they become much more responsive — especially to the emails that matter. People praise how — for the first time in years — they actually stay at Inbox Zero! Talk about superpowers.
But that’s not all. People experience joy when using Superhuman. Instead of feeling frustrated by email, they feel happier and even more relaxed. But one of the best things I’ve seen is Superhuman described less as an email productivity tool and more as a wellness product. [Source: a16z]
Other Notable Things:
- Rahul Vohra, CEO of the company did around 300–400 on boarding calls himself helping users figure out everything about the product in the initial days. This gave him good insights about how people are using their email apps.[For prospective, each on-boarding call lasts around 30–45 minutes.]
Market Size and Valuation Estimate
Superhuman is definitely not expecting every person who uses email to pay $30 for the client.
They only expect the top knowledge workers who use email extensively during the day to pay $360 a year to help them cut through the email faster than ever before.
Let’s check some numbers:
Gmail currently has 1 Billion users.
Superhuman is only targeting the top 1% of that. That turns out to be 10 Million Users.
Even if Superhuman is able to capture 10% of this category, that makes up for $360*1,000,000= $360M in Revenue.
Even if we go by a pessimistic 5x multiple of Revenue, that values the company at $1.8B.
Competition
- Spark Email
- June.ai [Invite only, Not much traction]
- Spike
- Newton
- Polymail
- Gmail
- Hotmail
- Yahoo Mail
- Samsung Mail
- Thunderbird
- Other Small Email Clients
Email Client Market Share
Financing
- Superhuman has had 4 funding rounds since its inception in 2014.
- It’s latest round of $33M was led by a16z, one of the best venture firms in business which valued the company at $260M.
- The Series A was led by First Round Capital.
- To date, the company has raised $51M in capital.
Risk of Further Funding
- Given the 180,000 people in the waiting list, raising money and getting follow-on investments from the current investors should not be a problem for the Superhuman team.
- A new competitor might come in and take the entire wave of Pro-users away by creating a similar/better experience at a low price.
- Gmail might simply copy the features and give it away for free which is a low probability scenario.
Market Size
- Today, there are over 3.8 billion email users worldwide, and this figure is expected to grow to over 4.2 billion by year-end 2022.
- Revenues for all segments of the Email Market combined are expected to total over $33.1 billion in 2018, and will grow to over $64.2 billion by year-end 2022, an average annual growth rate of 18%. This revenue growth is driven mainly by the migration of on-premises mailboxes to cloud mailboxes.
Source: https://www.radicati.com/wp/wp-content/uploads/2018/01/Email_Market,_2018-2022_Executive_Summary.pdf
