With nearly one million active users (966,503 according to Chrome Store), Mailtrack, an email tracking extension for Chrome, is one of the most popular Gmail add-ons – and it’s built in Barcelona. The highly scalable startup that could be the next prodigy from Barcelona was created by a small team of engineers and two accomplished founders with a track record of several successful exits – and they’ve already started sprinting down the road to immense growth. Barcelona Startup News sat down with Mailtrack Co-CEO and Founder Eduardo Manchón to talk about how they managed to rally so many users to their banner, how they made friends with Google and what distinguishes a “real software business” from a “modernized” one.
One million users in five years
Mailtrack has gone through some really impressive growth. Can you give me the numbers?
Mailtrack has 2.8 million sign-ups, out of which 950 thousand are active users, and 34 thousand are paying customers. We use a freemium model, which means that you can start using Mailtrack for free, but to get access to premium features you need to get the Basic or the Pro version.
How did you achieve these incredible figures?
Mailtrack grew very well from the very beginning five years ago, it is a very viral product and people loved it. During the past two and a half years, we’ve completely restructured the company. We made a lot of changes and that’s when the growth in paying customers really started.
What was the turning point?
It was a combination of many things. The market of email tracking is pretty new. It’s a whole industry that is being developed right now. Most people don’t even know that you can track your own emails, even though they may have heard of email marketing services like Mailchimp.
Most importantly, the environment has changed. The Chrome store is getting bigger, and CRMs are integrating more and more smoothly with Gmail. At first Mailtrack was like a hack built over Gmail, and Google was a big liability because we didn’t know what they would think about email tracking – mainly because of its strange relationship with privacy.
But now, we have a privileged position with Google, especially with the release of the new Gmail UI. They have improved a lot of things that help us keep working well, and they’ve also added the Gmail add-on market, a market of add-ons with business-oriented features for Gmail. Mailtrack recently released an add-on, that’s why this change has had an impact on our growth. In the new Gmail, there’s a plus sign on the right hand side that allows you to install add-ons, and we’re number five on the list that pops up when you click it. So basically, we’re just one click away.
What’s the ratio of private individuals versus professionals using Mailtrack?
I really don’t know, because most people use it for both scenarios. We want Mailtrack to be a multi-purpose tool for email tracking. You can use it whether you’re sending bills, a quote to a potential client, or you just want to invite your partner to a dinner date. People usually want to remove the Mailtrack signature from the bottom if they’re sending tracked emails to potential customers. You can remove it manually every time, but once you see that the product gives you value, you can go premium and remove it forever. So the 34,000 paying customers are professionals.
We try to be a universal solution, and this is the key that has brought us so much growth. We have 4000 new signups daily, 100,000 per month. We’re growing much faster than our competitors. And I think the key is this multipurpose approach.
Email tracking is not as easy as it seems
How does email tracking work?
We place an invisible pixel in every email you send. When the recipient opens the email, our servers are notified that the pixel has been opened. It doesn’t work 100% of the time, for example, if the recipient doesn’t have images loaded by default. This is a limitation common to the entire industry.
It sounds really simple, but I’m sure it’s much more complex than the way you just explained it.
A lot of people tell us that this is a really simple service. Do we really need a company to do just that? The first person that thought this was me, before I joined the company. But then, you start to understand the different situations.
It’s relatively easy to add this one pixel if you control the email service, for example in Mailchimp. But doing the same in Gmail is pretty hard, because you need to add it in the middle of a process that you don’t control. So it’s basically a hack. There are a lot of issues, like how do you prevent self-opens? When you send an important email, sometimes you open your own email and read it again after you send it. So how do we know that it was you who opened it and not the recipient?
We have a patented technology to prevent these self-opens. You can prevent them easily if you’re in the browser on your desktop, but if you do it on your phone, you don’t have Mailtrack installed there. It’s an extension for Chrome, and extensions don’t work on phones. So we have to implement other ways to recognize self-opens.
We’re making a lot of small measures to make email tracking reliable. Our competitors have a reliability of maybe 75%, and ours is around 95%. That’s why we only do email tracking, and nothing else. It’s hard enough.
As of recently, Mailtrack is available in the Gmail app on Android too, right?
Yes, this is a new thing. Three months ago, Google launched the add-ons market on Android. It’s only up to them when they make it compatible with iOs, but as we all know, those companies don’t get along very well. So we created an add-on that allows you track emails from your Gmail app on Android. It’s similar to what we do on desktop. It’s something new that Google released in a very experimental way. I won’t say that it’s perfect, in fact, it’s very limited. But we thought it was a good opportunity to integrate in the Gmail app. Tracking emails from the Gmail app has never been possible. We are the only solution in the market that does this.
Our competitors all created new native apps to track emails. But most people don’t want to download an app just to do email tracking. So we decided that we don’t need our own app: actually, that was one of my first decisions, to cancel the mobile app project.
MBA guys’ startups or real software businesses?
Mailtrack is not your first startup project. You founded Panoramio.com, which was acquired by Google, and previously you were at Loquo.com (acquired by eBay). How has your perspective as an entrepreneur evolved? Is there a major lesson that you learned?
I’ve always been working in software projects, and I think that the main advantage of the internet is not that it’s a different way to offer a service. It’s not that you used to have a physical shop and now you can have an online one. That’s just a way to modernize a business – it doesn’t have the scalability or all the benefits of software businesses. The business fundamentals are still offline, and there are a lot of decisions involved that have nothing to do with technology.
I like purely software businesses where the competitive advantage is the software, and not the product margin, for example. The more clearly I can see the scalability of the model, the more I like it. Sure, it’s risky, it’s speculative, but that’s what allows Silicon Valley to be what it is. It makes amazing growth possible.
There’s a fine line between a “real software business” and a “modernized business”, as I like to call it. Because, for example, some online shops like Amazon have business fundamentals that really are based on software, while other businesses simply offer a solution that was already available offline.
For me, the real difference is between a software-oriented company and a company that is good at doing business, good at advertising, and has great salespeople.
In the case of Mailtrack, a very small team can serve hundreds of millions of users. We process 25 million emails per month. It scales very well, I can hire the best people, and I see innovation as a competitive advantage. The more difficult it is, the happier I am. Eventually everyone hires salespeople, but I don’t want my business fundamentals to be based on them. The value of real software companies is measured in the value of the people they have, the users they have, and what they can do with their users.
How do you see startups in Barcelona?
Here in Barcelona, we need more of the “real software businesses”. These projects are always a bit crazy, because they’re very speculative. You never know how much your users are worth.
Here in Barcelona, some local founders try to create what I call “MBA guys’ businesses”. These are smart guys who see a gap in the market, offer a service through the internet and they will have fantastic margins. But they will not change the ecosystem radically. We need more crazy projects. Of course, crazy projects fail more. Maybe one out of fifty succeeds. But these are the companies that have the potential to completely change the ecosystem all by themselves. Here, maybe Typeform is the only one with this capacity. It’s a real software-based company.
It’s very easy to see what each software company relies on: you just look at the pricing. If their prices are high, then it’s a salespeople-based company, and if they’re lower, they’re relying on their software and their users.
What’s your ultimate goal with Mailtrack? Is it to scale, to sell…?
In the last year, the ecosystem has changed a lot. At first it wasn’t clear how long the company could survive, but now we have a brighter future. So we need to decide what we want to do with the company. We really don’t know yet, there are too many options. But we have an opportunity to think in the longer term. We want to universalize email tracking. We would like people to perceive it not as spying, but something that benefits both sides.
Read confirmation is already the norm is messaging apps. It has become the standard.
Yes. But for us it’s different. When we’re being interviewed by journalists from outside the Barcelona ecosystem, they always mention that Mailtrack is spying on people. Who’s the owner of an email? Ethically it’s not clear who’s doing something wrong, if anyone. Maybe the problem is that people don’t know that their emails are being tracked. If they knew, it would be like in the messaging apps. Maybe we should bring that to email tracking too. For the moment, the signature in the free version says it. So maybe instead of hiding it, the sender wants to make it clearer. It’s also a way to tell people: I know whether or not you’ve read my email, so you have to take me seriously.
If you’d like to get to know more startups from Barcelona, check out our latest interview with chatbot startup Hubtype!