5 Hacks Mailchimp Used to Grow from Startup to $12 Billion

Did you know that Dan lied about coding during his first meeting interview with Ben but learnt it in just 2 weeks of joining him?

Ben Chestnut and Dan Kurzius started Mailchimp in 2001. Initially, they developed the platform as a side project while managing a web design and development company.
​

The core idea was to give companies an easy-to-use tool to efficiently manage their email marketing campaigns.

Unique Value of this Decacorn:

1. User-Friendly Interface: Mailchimp placed a high priority on usability, making it possible for non-technical users to create, send, and evaluate email campaigns without the need for complex technical knowledge.
2. Product Pricing: The platform was available to a broad user base thanks to its freemium strategy, which allowed small enterprises to launch for very little cost.
3. One-Stop Shop: Mailchimp offered a comprehensive solution for marketing requirements by fusing email marketing with extra capabilities like landing pages, automation, and analytics.

Did you know that Mailchimp's Mascot is "Freddie the Monkey" and is apparently so famous that customers were angry when Mailchimp considered removing him?

Financial Success:

• Immediately post shifting to Freemium Model in 2007, Mailchimp scaled to over 10 million emails a month and had about 400,000 Active Users. A focus on customer service and word-of-mouth recommendations drove this early success.
• They nearly grew 2000% in the next 6 years and saw 8 million people sign up on the site, and sending over 1 Billion emails monthly.
• In 2019 saw Mailchimp announced revenue of almost $700 million, mostly from subscriptions.
• On the back of strong user growth and product diversification, Mailchimp peaked to nearly $12 Billion in Valuation and was acquired by Intuit in 2021.

2 Major Triggers for Mailchimp’s Billion Dollar Growth:

1. Freemium Model: The freemium pricing strategy allowed users to start with free access to essential features. This approach attracted small businesses and startups, helping them build their marketing efforts on the back of validated Feedback.
   ​This model facilitated rapid user acquisition and created a strong community around the platform, leading to high conversion rates from free to paid subscriptions.
2. Strategic Partnerships: Mailchimp effectively integrated with various e-commerce platforms, such as Shopify and WooCommerce, allowing users to streamline their marketing efforts.These Integrations enhanced Mailchimp’s value proposition, making it a go-to solution for online retailers looking to leverage email marketing as part of their sales strategy.
   ​

Both Founders had been raised in entrepreneurial families — Chestnut’s mother ran a salon out of her kitchen and Kurzius’s father was a baker and they thought that email presented as an only low-cost marketing channel for companies on small budgets.

5 Strategies Used By Mailchimp to Gain $12 Billion Valuation:

1. UI/UX Design: Focus on creating a user-friendly product that addresses customer pain points. Mailchimp’s intuitive interface helped attract and retain users.
2. Freemium Strategy: A freemium model can be an effective way to build a large user base quickly. It allows potential customers to experience your product with no initial investment.
3. User Support: Providing exceptional customer service can differentiate your business and generate user loyalty. Mailchimp invested in support and resources to assist users as a top priority to drive active engagement of users.
4. Strategic Partnerships: Collaborating with complementary businesses can enhance your product’s value and reach. Mailchimp’s integrations with e-commerce platforms expanded its market presence and made it seamless for its users to perform multiple functions in a single Interface.
5. Product Innovation: Continuously Innovate your product to meet changing market expectations can put ahead of the curve in Product Development Lifecycle. Mailchimp regularly added new features based on user feedback and industry trends.