Nylas
Christine Spang had spent years building apps that touched email, including a Facebook app that displayed Gmail, a Gmail filtering tool, and a tool that turned emails into tasks. Each one required building email integration from scratch, because no API existed to handle it. That frustration became the seed of Nylas. The company was originally meant to be an email client for power users, but its founders recognized that building a client was too hard for a small team, and the advice they received was that it would take about 10 engineers and a year just to reach a basic version.
Instead, the team built a middleware layer: a modern REST API that connects to any email mailbox, calendar, and address book. Spang described it as Stripe or Twilio, but for email. Early on, the company spent about three or four months prototyping and iterating in coffee shops and a small office, then spent roughly six months writing the first version of the API and its IMAP sync code. The team released it as an open-source repository on GitHub in summer 2014 and later turned it into a SaaS service, which is the same service the company runs today.
The open-source release was central to getting initial traction. Spang noted that the repo sat largely unnoticed until the team ran a press push, including a TechCrunch article, and talked directly with developers who had the same problem. The team had to get developers excited and trust that Nylas would be a reliable provider. Funding also came through the founders' network in the Silicon Valley startup community, with the company raising about a million dollars in December 2013.
The email client, Nylas Mail, drew many downloads but suffered heavy churn, with one figure of roughly 90% churn within two months, and users who expected email to be free would not pay. The data APIs showed the opposite pattern: customers started small and usage grew over time, because they connected more mailboxes as their own user bases grew. The company shut down development of the client, spun it off as open source, and refocused entirely on the API, which charges per connected mailbox. The team also acknowledged that running both products at once was a strategic mistake.
Nylas has been operating for about five years, with a team of around 35 people, up from about 15 a year earlier. Spang says the company is making millions of dollars in revenue each year and has about 200 paying customers, using the platform for features in their applications and internal tools.
- •Turning a failed consumer-facing product into an infrastructure API let the team keep the technology while switching to a business model that compounds, since usage per customer grows as their apps add mailboxes.
- •Open-sourcing the core API built developer trust in a category where developers are wary of depending on a third party for something as sensitive as email.
- •Usage-based pricing per connected mailbox aligns revenue with customer success, which made the API's steady growth far more valuable than the client's churn-heavy subscriptions.
- •The founder's personal pain as a developer who had to build email integrations manually gave her unusual insight into what the API needed to abstract away.
- 1.Identify a painful, repeated integration problem you have personally hit, and confirm that other developers face the same issue before building.
- 2.Release a core version of the tool as open source on GitHub to earn developer attention and trust before asking for payment.
- 3.Pair the open-source launch with a deliberate press push and direct conversations with developers who have the problem.
- 4.Price on a metric that grows with the customer's usage, such as connected accounts, so revenue expands as customers succeed.
- 5.Abandon a consumer product whose metrics show high churn and focus resources on the infrastructure product with sticky, growing usage.
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