It’s that time of year, where I — as a committee of one judge, but now in consultation with my Haystack colleagues Ian and Aashay — select one startup in the tech ecosystem that “broke out” and has the makings of an even larger outcome should things continue to go right. As a little tradition on this blog, I’ve singled out companies starting in 2012 with Stripe; there was Snap back in 2013; Slack in 2014 (after prematurely saying there wasn’t one); took a break in 2015-16, as I wasn’t inspired to select one then; in 2017 it was Coinbase; and last year, 2018, it was Airtable.
I’ll cut to the chase because things are busy, I haven’t time to blog for a while and, frankly, I’m rusty. This year is a bit different as I will select one “breakout” tech company, but whereas in previous years it was obvious to pick — that was not the case this year. At the end of the post, I’ll have an “Honorable Mention” section, but please do not expect that section to be here as standard operating procedure.
And with that, I present to you The Breakout Tech Company Of 2019: Superhuman.
Why did Superhuman get the nod?
1/ Prosumer Is The New Consumer: This trend gained momentum in 2018, but reached warp speed in 2019. As social platforms grow in power, acquiring consumer attention and wallet-share grows increasingly competitive and expensive. While that consumer window was no longer opening, individual consumers began discovering new software tools to make themselves more productive. They then, in turn, brought that software into their small businesses, their sub-groups within companies, and provided the kindling of distribution within work-related networks. Superhuman embodies this trend. Email is a tool nearly everyone uses daily, across devices, from their personal to work life — obviously. Recently this year, not only did the word-of-mouth for Superhuman noticeably increase (the company has been crafty at getting tech/social influencers on its cap table), I began to hear droves of employees at larger companies located far away from the Bay Area’s echo chamber say that switching over to Superhuman provided them with leverage and time back. This is not to say that Superhuman doesn’t face its own scaling and product challenges — they certainly do — but given the pervasiveness of email and the pain associated with it, the company has most definitely created a productivity experience with consumer-like sensibilities.
2/ Luxury Productivity SaaS: Another benefit to entrepreneurs of “prosumer being the new consumer” is that these customers have a willingness to pay for better software products. There are many reasons for this. Better software can make work feel fun. It can save time. It can be accounted for as a business expense. It exploits social networks and reputations at work for using the most cutting-edge tools. Most impressive about this trend, like Airtable from last year, these companies have demonstrated many people will pay single- to double-digits monthly subscriptions to use the software. Coming from an ethos where most information is free and that Google’s offerings are good enough for most users, growing markets and shifting generational preferences make this type of consumer business model possible.
3/ Unbundling G-Suite: Speaking of Google, we have yet another company breaking out by improving upon what G-Suite offers for free. Airtable takes on Google Sheets and Excel, and now Superhuman creates a faster, slicker interface for disaffected Gmail users who are willing to pay $30 a month. If you’re bullish on this product, there’s a world in which Superhuman moves from email to offering products for calendars and contacts, and it is entirely possible if those products are met with the same fandom, they could charge $100 a month for the Superhuman bundle.
4/ Competitive Financings: As is the case with most breakouts, there was a competitive financing for the company in 2019, ultimately led by a16z. That is not to say this matters at the end of the day, but it adds to the buzz and intrigue for any fledgling company to breakout from its initial fans into more mainstream discussions.
5/ Zoom, Slack, And Enormous Global Addressable Markets: Looking out to 2020, with Slack and Zoom out as public companies, it is not hard to see a world in which users around the world will want to invest in a better and faster email experience for themselves. This was not the case just a decade ago. With mobile growth and globalization and new generations coming online who are entirely digitally-native, the total addressable market for a product like Superhuman is simply much larger than we can imagine today.
For these reasons, Superhuman is the company which broke out from early-adopter echo chambers into the broader discussion. This year was difficult to select just one, however. Companies like Brex, Figma, and Notion deserve considerable honorable mentions as breakout candidates, too. Brex is one of the fastest-growing SaaS businesses ever created, and still quite young as a company; Figma has exploded in usage, to the point where I’ve randomly met engineers and designers at very large companies who mention without prompting that their entire organizations are moving to Figma ((disclosure: Haystack is an investor in Figma); and Notion, which is a brilliant reinvention of document creation and database management (disclosure: Haystack runs almost entirely on Notion). 2019, despite its mega-financings, and the news around Softbank’s Vision Fund, still proved to be a fertile year for breakout stories like Notion, Brex, Figma — and of course — Superhuman.