Outbox

» see outboxmail.com as it lived, on the wayback machine

~ the eulogy ~

outbox was founded in 2012 by evan baehr and will davis, two new york political-economy types who decided that physical mail was a software problem. the pilot opened in austin in june 2012. drivers in branded outbox vehicles came to your house three days a week, opened your mailbox, took everything inside, drove it to a central facility, scanned every page, and uploaded the images to a clean ipad and web app. junk mail you could unsubscribe from with one tap. bills you could pay in the app. anything you actually wanted on paper got physically returned to you the next week. it cost $4.99 a month.

by mid-2013 outbox had moved out of beta in austin and launched in san francisco, raised a $5 million series a led by floodgate, and started serious conversations about scaling. that was when the us postal service stepped in. customers had to file a mail-forwarding-style consent to let outbox open their mail, and the postal service held the levers on whether that was permitted in bulk. the two founders went to washington in october 2013 to meet postmaster general patrick donahoe. donahoe's response, recounted in their january 2014 shutdown post, was direct: "you disrupt my service and we will never work with you."

on 21 january 2014 outbox announced it was shutting the mail-scanning service down. current customers had until 28 february to download their archive. the team pivoted to "a new product" that did not materialize publicly. about $5 million had gone into the company by the close. the postal service kept delivering paper.

i was not in the us when this happened, so the practical question (was the post office going to let two guys in austin intercept your mail) was someone else's problem. in turkey ptt did the same job and nobody was scanning anything. but i remember reading the shutdown post on hacker news in january 2014 and finding the donahoe quote remarkable, mostly because the founders had published it.

~ the dossier ~

~ the unit economics ~

even before the postal service kill, the numbers were tight. customer acquisition cost was over $50 a lead per the team's own disclosure. service cost was about twenty percent above their break-even target. converting the waitlist into paying users yielded under ten percent of signups. the drivers were a fixed cost that scaled linearly with the route. unless the post office cleared the regulatory path for cheap mail forwarding at scale, the cost curve would not bend, and donahoe had said no.

~ the regulatory kill ~

the usps move against outbox became a small case study in libertarian policy commentary. the r street institute and aei both wrote it up later as an example of a public-sector monopoly using its statutory position to block a private competitor. true or not, the regulatory point landed. nobody else built a mail-scanning consumer startup in the same shape after outbox closed. the b2b mail-scanning industry continued (earth class mail, traveling mailbox) but those services routed mail through a customer-leased forwarding address, sidestepping the issue outbox had run into. the consumer mailbox-at-home angle stayed dead.

~ what it left ~

outbox is a marker for what happens when a software startup runs into a federal monopoly with bipartisan congressional protection. it sits alongside the on-demand collapse of 2016-2017 ([[beepi]], [[homejoy]], [[sprig]], [[maple]]) as a 2010s startup that promised to digitize a physical service and could not make the unit economics work. unlike those, outbox died from regulation rather than from raise dynamics. baehr later wrote a book about it.

@}-->--

              )
             (_)
            .-'-.
            |   |
            |   |
            |   |
            |   |
          __|   |__   .-.
       .-'  |   |  `-:   :
      :     `---'     :-'
       `-._       _.-'
           '""""""

« previous  ·  random  ·  next »