" senior leadership of USPS made it clear that they would never participate in any project that would limit junk mail and that they were immediately shutting down our partnership."
This part is really interesting. Why would USPS do that ? Can someone from outbox elaborate on this ? I would love to get rid of the junk mail that I receive on a daily basis in my mailbox. It is crazy and I have to waste time in taking it out of my mailbox, sorting through them to ensure they indeed are junk and then throwing them into my recycle bin. Not to mention that the recyle bin then needs to be placed bi-weekly outside to be picked up. It is time we had a donotcall.gov equivalent for junk mails.
Sad to see these guys go. The business model sounds like something I would have tried as a user. Funny though that never heard of them personally. Guess need to watch more Jay Leno!!
You think that the email spam industry collectively employs more than 500,000 full-time voting adults, rather than a relative handful of humans and tons of bots? It's fine if you do, my hunch is just different.
LOADS of what people classify as "spam" is simply stuff they signed up for and forgot about. Just last night a client had someone write in saying "I'm not getting your emails!". After some back and forth they had - 2 days prior - marked it as "spam" because they didn't recognize the name of the list, and so weren't getting any more mails (or, they were getting junked).
You may be able to make an internal distinction between "the spam industry" and "email" but many people can't or don't. Or perhaps more to the point, many people classify spam as "anything I don't like or didn't ask for" (even if, by dint of entering in to a transaction, they do in fact grant permission to get necessary emails now and then).
Something like 80 or 90% of USPS revenue comes from junk mail / mailers, companies pay them to guarantee that it shows up in your mailbox.
There are services that let you unsubscribe from junk mail (after a ruling that said that there has to be a way for consumers to unsubscribe, similar to like in email) like https://www.catalogchoice.org/
doughj3 is right, postal mail would have been in the toilet so to speak, a long time sooner if it wasn't for the massive amount of junk mail that as he puts it "subsidizes" the service.
Up here in Canada I've almost got my mail to a point where I can tell them (Canada Post) to suspend service to my home. My estimate is that I'll have about 6 pounds less paper waste to drop into the recycling bin every month.
Employee unions at the USPS worried about further job losses due to technology. Can't do anything that would decrease revenue, even if it means technological progress.
Of course, that's purely rational. Get a bunch of $100K/year programmers in a room and ask them to build software that improves the workflow of working with offshored $7/hour developers, and see the response you get.
Imagine you're the CEO of a business that is bleeding cash left, right, and center, and someone comes to you with a plan that will reduce your revenue 20% while reducing your costs 50%. You don't think you'd consider that plan even for a second?
I'm not saying such a plan would work for USPS, and definitely not saying Outbox could have brought that sort of value proposition to USPS, but reducing revenue is not always a poor business decision.
Sadly, USPS sees bulk mailers as their customer; American citizens (and our kitchen tables) are their product. It's like the old line: if you aren't paying for the service, you are the product. If curious, listen to a full story of it here: http://kut.org/post/austin-startup-says-you-ll-never-touch-s...
50 cents to send a piece of paper across the continent in just a couple of days is a bargain as far as I'm concerned. A dollar will even get your piece of paper across the world in just a few more days than that.
It's quite unbelievable that it works so well for such a cheap price.
I'm addressing my wedding invitations and skimming through Hacker News this afternoon. $25 to mail about two dozen envelopes (invite plus stamped rsvp), and half a dozen more with international addresses or additional weight that I'm taking to the post office in half an hour. And that's the bare minimum I could get away with sending paper invites to, everyone else is getting evites. Then there's a round of rehearsal dinner invites and thank you notes going out in the next couple months...
Not to mention I have two packages to return, and a bunch of my wedding accessories shipped USPS. All this week, before I consider any business-related needs (another 6-7 envelopes).
Not a terrible service at all. Could be better, fairly cheap for what it is, and I wish I could pay to not get junk mail, but...not too bad. Definitely better than Ontrac ;)
I may be wrong, but my impression of Outbox has always been that they were designing an impressive solution to the wrong problem.
Sorting my important mail from my junk mail is just not something I need help with. And the extraordinary wastefulness in my mind of paying a company to follow postmen around and take back the mail just delivered to my box seems so ecologically wrong that I couldn't support it on that ground alone.
I'd honestly be happy just to see a service in the "use us as your mailing address" market with lower and less byzantine pricing than Earth Class Mail ($20/mo plus $5/mo for searchable PDFs, $1.50/piece to actually scan mail, $20 to deposit a check, $4.95/mo to shred mail, $0.30/mo/piece to store mail, etc.) and without the subtly deceitful tactics of VirtualPostMail (auto-applied promo codes that hide what the actual ongoing service limits are, big listed pricing that actually doubles after 3 months, etc).
The VirtualPostMail pricing page may be confusing, but I think calling it deceitful is a stretch. I think the prices are reasonable for the service they provide. It may even be cheaper than it looks, as I don't think they enforce the storage limits (I've definitely had stuff sitting there for many months with no fees). It's true that their web app could use an overhaul, but it was nicer than ECM's at the time I compared them.
(I have no affiliation, I've just been a satisfied customer for a few years.)
Well, that's why I said subtly. It's not blatant about it, but it is a deceitful approach.
These kind of tactics are familiar to me from previously working in the web hosting industry, where the tricks of "the eye-catching price is actually the temporary one, you have to look in the details for the real price" and "a coupon code makes it look like your service can do more than it can" are very common.
So is the aftermath, with many people who are confused and upset when the "temporary" part runs out but not quite confused and upset enough to cancel the service.
The half-price for the first few months is misleading, I admit. I'm a careful reader so it didn't bother me.
The coupon code thing is a little weird, but I don't see how you can complain about it: it only increases your limits. It's just a way for them to offer two types of plans: one for people who like to scan most mail, and one for people who don't.
I've been using Traveling Mailbox (travelingmailbox.com) for about a year and they've been great. First class customer support and very reasonable prices. My only complaint would be that using the NV satellite address introduces some lag as they forward items to NC for processing. Their web interface is functional and easy to use.
I used to be an ECM customer way back when, before they tripled their pricing as you mentioned.
zyxley, have you found any other good options? One issue it seems w/ all these services is it seems like it's easy to setup w/ a Form 1583, but none of these guys provide any sort of forwarding options for when you want to cancel!
I agree 100%. It's a pretty epic idea they had, but I know few people who need it.
I also found the government bashing at the end to be pretty weird, given that they failed to explain why the USPS should want to partner with them, let alone how the entire government is backwards.
I'd agree on the surface, but I thought I'd support a fellow Austin startup and try the experience anyway. The manual labor I knew was a hack. Beyond that, it's been really nice. Just lower cognitive load - I used to just pile mail when I came home, not interested in sorting through it. If email spam filters were a paid service, that would totally be worth $5 too. Pushing all those big images around must've been taxing for the app, though - its sluggishness took away some of the fun of pushing my physical mail around on a touchscreen.
Good luck with the next thing, guys! Glad you tried for a big problem.
This is really disappointing - first time in a while I've seen an "we're shutting down" announcement and been really, truly, genuinely disappointed by it.
Physical mail is but one of many small parts of daily life that's increasingly feeling like an anachronism.
The fact that we have to regularly physically go to our mailboxes, open them, receive physical paper communication, and then shred/dispose/keep it all is annoying. I was really looking forward to Outbox growing and spreading to other cities.
(BTW: It's worth noting that my rejection of paper mail doesn't mean I reject the notion of the nice parts - hand-written letters, greeting cards, wedding invitations. Those are great. But I'd be totally happy seeing a high quality digitized version of those appear in the email inbox.)
I do hope someone figures out a good solution here, because I'm certain there's demand for this service in some form or another.
(edit: As a friend pointed out - $5/month is probably far too cheap. Earth Class Mail starts at $20. I'd gladly pay that for Outbox - probably more.)
Totally agree with this. Their business never made much sense in charging only $5 to "undo" what USPS does, but it worked great and is really useful when travelling. They should have tested a $19.99 price point before shutting down. I'm not sure i would have kept paying it for too long, but worth a shot.
Yeah, i guess it was just too crazy of an idea to work. I personally would have paid $20/month for at least the next 6 months as I am travelling a lot and get tons of value from remote mail access. I agree, though, that with the general value prop if its not worth $5 for most people, it is certainly not worth $20! As a side note: I'm surprised they only had 2k users with a 5M investment round. Seems like they burned cash in some expensive marketing channels.
"total yield from the waitlist was under 10 percent" that's 10% paying customers that's definitely not as bad as they made it sound.
I'm a little surprised why did they think it would be a cheap operation. They send someone to pick up the mail from your house, that's insane. Of course that will be expensive. And it's only $5 per month. There are a few old school services that do the same but they ask the customer to redirect their mail to a specific new address. I wonder why outbox didn't go down that route.
I read this kind of quickly but did they actually say that they raised $5,000,000 6 months ago, decided in that time that their business model would not work then decided to go into 'stealth mode' and work on their next fancy?
I'm an Outbox customer and am really sad to see it go. I did it expect it though. In fact, every time I thought of Outbox it was always accompanied with worry about them shutting down. I just couldn't see how they could afford to do what they do when customers only pay $5 per month.
I didn't read the entire post yet but I wonder why they never tried to or considered raising prices. I would of paid substantially more for the service.
I don't see all that much value in the service for my personal mail but for my business mail, I purchased a UPS mailbox and have all mail sent there and outbox takes care of it for me without me having to go there all the time. I just renewed my UPS mailbox for the year too!
Just a FYI there are a handful of companies already doing something very similar. Except instead of physically picking up your mail, they receive it on your behalf (made possible by USPS form 1583 [1]). Then they digitize and forward (you pay S&H.)
I'd been wanting something like this as I have a few physical mailboxes but rarely need the physical mail itself. Do you have any useful links to the 1583-based providers?
I used to work for one of the Commercial Mail Receiving Agencies (CMRA) as defined by the Form 1583. Here's a non-comprehensive list:
myus.com, earthclassmail.com, usglobalmail.com, bongous.com, usamail1.com, maillinkplus.com, usa2me.com, usabox.com, reship.com and probably 50 or so other.
The google keywords you want to search with are "mail forwarding" or "international mail forwarding" or "virtual mailbox" to get started. Not all of them offer pictures of the mail or scanning, but some of them definitely do.
It's a REALLY fractured industry because there's essentially zero M&A activity. The Form 1583 is a giant pain to fill out and it ties you to a specific both company and address. Furthermore if you decide to switch from one to another you can't take advantage of the USPS' normal "fill out this form to get your mail forwarded" feature because as far as the USPS is concerned that's the CMRA's problem, not theirs.
In fairness to the USPS it's a really tough task to determine not only what address mail is going to but what person's name (and box/suite/apt/whatever number) it's going to at that address. Then once you figure that out, you have to figure out if that's one of the probably 500 people who are on the "forward" list at any given time. I know because I built a system to that and more for the company I worked at and it wasn't foolproof. So if it can't be automated easily the only alternative is to have the postal worker on the route do it. Where I worked we got many thousands of letters a day, it would have taken our mailman/woman half a day or longer to go through everything trying to match recipients up against the list of 500 people who want forwarding.
The 1583 form is a big hurdle for potential customers to get past. You have to get it notarized, which is something most people don't do regularly, so they have to spend time looking up a local notary, and there's usually a small fee involved.
Also, of course, then you have to contact everyone who sends mail to get them to send it to the new address. (I did it as part of a move, so I had to do that stuff anyway.)
This is sad to see. As the co-founder of http://www.paperkarma.com who's had to deal with some of the same issues (USPS regulations) I was keeping an eye out & pulling for them to succeed. We need further legislation to enable citizens better control over unsolicited mail. You guys built a great service & should be very proud!
[edit: spelling]
Seems really strange that they're shutting down. With a substantial customer list and some infrastructure that's hard to build, that's a business that could be sold for something -- perhaps not substantial exit money, but still.
That said, they were charging less than what the service cost to provide, and -- judging from the comments here -- less than what their customers valued their services for. So perhaps they didn't have a good idea of what value is and how to sell it.
I get the startupland thing. The point I'm making is -- couldn't they have tried Flippa or something? Startupland isn't "valuable asset land" when it comes to folding.
There is one small nugget in the article that demonstrates exactly why they failed:
"This final challenge—product market fit"
They invested a very large amount of money, and put the most important challenge at the very end.
"This final challenge" should never, ever, ever be the final challenge. Product-market fit should be the first challenge. Everything flows from matching the product to the market. The fact that they believed this was "the final challenge" shows that they were making decisions in the wrong way -- a way that brought them failure.
I only hope they consider profit/market fit BEFORE they spend more of their investors money.
It sounds like their original business model got shut down due to positioning: they pitched it as reducing postal spam, and in the proces they attracted unwanted attention from the USPS, who profit from postal spam.
Meanwhile, Earth Class Mail (https://www.earthclassmail.com/) seems to be going strong following the same "digitize your mail" approach. They don't seem to build their business around spam reduction specifically, just around paper reduction, which doesn't threaten the USPS.
Clearly there is no need for physical paper mail/envelope delivery to most people's home. With just a few exceptions, I haven't received a single piece of USPS physical mail "directly" since 2003. I was moving that fall, so I had picked up a PostOffice Box (And I had been using paytrust for all my paper bills since 1999) - and when I moved back to the Bay Area - I just never told anyone what my home address was, and put a big "DONOTDELIVER" on the post office box that came with my apartment.
The only exceptions to that, were in 2010, when I needed to get a California ID, and they would only mail it to my home address. Soon thereafter I started getting Jury Summons (Ironic for this Canadian) - with those two exceptions - no paper sent directly to me, couldn't be happier.
Pro Tip - A Post Office box at a "friendly" POBox location will throw away all your junk mail (probably in violation of some kind of USPS statute) and for a small fee, remail it to you anywhere in the world. Never have to change your address ever again. Never receive any direct mail.
Very sorry to hear this outcome, and I wish the best for the team. Perhaps you can sell standalone products? There is still value in never having to touch paper, and I would have been a happy customer had I known the wait list was done. It was such a promising product!
Most interesting quote to me, and thank you so much for the candor.
> After several months of testing and refining, we reasonably concluded that we were executing well and collecting good data—it told us that there wasn’t enough demand to support the cost model. Our monthly operating deficits were too high, and even though we continued to get better at acquisition, each small success actually saw our cash curve decline further because our density remained flat. For longer than we would be willing to tolerate, we would lose money for each additional customer we gained. Despite the massive interest in our company, we learned that the product we built did not find fit in the market we targeted.
P.S. I am doubly sorry to hear that the USPS shut down the partnership due to threatening unwanted!! ad revenue... this is making me feel even more sad.
I'm terribly sad about this. I was eagerly anticipating their rollout to my market and would've happily paid more than the $5/month charge for the benefit of never opening another piece of junk mail again.
I am a current customer of Outbox and also a customer of VirtualPostMail (VPM) for both personal and business mail. And I am a former EarthClassMail (ECM) and PayTrust customer.
Since many seem to be asking about alternatives, I have generally positive views about VPM and ECM. They get the job done, though neither of them will blow your socks off from a technology standpoint (e.g., search, image resolution). I used ECM for 2 1/2 years and then switched to VPM, which I've been using for the last 2 1/2 years. VPM is considerably less expensive than ECM (which probably targets pricing for SMBs rather than consumers).
For reasons I can't grasp, I consider dealing with physical mail one of the most undesirable "life maintenance" activities imaginable. In 2000, I started using paymybills.com (became Paytrust/Intuit) -- basically VPM for bills only plus online bill pay. I paid ~$10/month and easily would have paid double that. I emailed them around 2001 and suggested they expand to provide the same service for all mail. When Intuit acquired Mint, I emailed Aaron Patzer a suggestion that they look into doing to mail what Mint did for financial information. He put me in touch with a product manager he said was looking into this, but apparently it never went anywhere.
When I heard about ECM, I signed up for their service in a heartbeat. It wasn't perfect, but I considered their service to be (barely) worth the $800-$1000/year I paid them. When I learned about VPM, I quickly switched to them and remain a generally happy customer and average about $200/year in fees.
Similarly, I signed up for Outbox the instant I heard of it, wanting to test it out on the trickle of mail I still get at home to see if it might be an improvement on VPM. The one thing I never got from Outbox was peace of mind that they would be around for the long haul, so I thankfully never cancelled my VPM service. I sent Outbox an email in March 2013 inviting them to charge more because I knew today's announcement was inevitable if they did not make some fundamental changes. I never understood why they wouldn’t scan bulk mail I wanted open (you had to have it delivered). But I was cheering for them and am sad to see it come to an end.
This is one of those things that seemed sorta cool (but not really) and probably the future will look more like it than what we have today. But then you start thinking about the cost to operate it and trying to get people to pay for very marginal value. And it's pretty easy to predict demise. I'm sure folks will say that's not always the case so please provide some examples.
With the listed problems getting to breakeven density, marketing traction, and a mention of an email marketing campaign for what is a physical->electronic mail service, I can't help but wonder if Outbox had ever ran a physical junk mail campaign for targeted physical addresses in order to push up the customer density. (not meant as a criticism, just idle curiosity)
A truly great service. I'd even be willing to pay 3-4x. My apt building is from the early 1900s and my tiny mailbox overfills after 1-2 days -- it's been wonderful to not have to come back from vacation to a clogged box. Outbox has saved me all kinds of time and patience and am terribly sad to see them go. Best of luck to the team in their next project!
Hey everybody. Earth Class Mail is currently running a promo (OUTBOX2014) for people feeling aimless in the wake of Outbox's closure. It'll give you two months free and waive your sign-up fee. Shameless plug, I work there. I can vouch for the service, though; it's legit, and we're working really hard to grow the company.
Damn. I have a post office box located in SF that's my main mailing address, but I live in Seattle right now. I suppose it was my own fault relying on them exclusively and not having a backup plan, but does anyone know any service that does something similar to outbox mail? I'd love to keep using my SF address.
I despise mail. I check it once a month and my box is crammed the max with ads and the important mail items are crumpled. I would unsubscribe from all mail if such a thing was possible.
I loved Outbox and will miss the service, however I do agree with the poster below. 5$ seemed like a steal.
Very sorry to see them go and it was a beautiful product. However, this is no surprise at all. More surprising is that they were able to raise money for a business model that is fundamentally unsustainable (negative gross margins).
What a shame, I was really excited to try out their service. I never considered that USPS would ban them from providing their service, but I'm sure it has something to do with all the revenue that the USPS makes from spam mail.
I always thought it was absurd that they actually had people picking up your mail from your mailbox. I wanted a "Google Voice" for mail. Just let me give out some proxy mailing address that goes straight to their scanners.
Shouldn't one of the first sentences of the article contain a deadline on how long the service will remain functional? It's the most important thing current users have to know.
One of the best letters of this kind I've seen. I like how they were up front about the mistakes/miscalculations they made, and what they learned from it.
Why would they not pivot to being an Earth Class Mail competitor? At that point, they are not competing with or undermining, but rather contributing to the USPS.
I'm looking into Earth Class Mail and alternatives right now, and I think more modern/advanced competition could definitely do well (and leverage most of what Outbox has built).
Right now these services mostly target a very niche market of expats, travelers, etc, but I could definitely see an argument (just from a convenience perspective) of why this could be greatly expanded to a much more general audience.
This part is really interesting. Why would USPS do that ? Can someone from outbox elaborate on this ? I would love to get rid of the junk mail that I receive on a daily basis in my mailbox. It is crazy and I have to waste time in taking it out of my mailbox, sorting through them to ensure they indeed are junk and then throwing them into my recycle bin. Not to mention that the recyle bin then needs to be placed bi-weekly outside to be picked up. It is time we had a donotcall.gov equivalent for junk mails.
Sad to see these guys go. The business model sounds like something I would have tried as a user. Funny though that never heard of them personally. Guess need to watch more Jay Leno!!