Investing in Postscript — The Future of Commerce

Over the last decade, I’ve founded and built companies in both DTC eCommerce and eCommerce SaaS. One massive trend I’ve leaned into is asynchronous chat.

I co-founded Humin, an intelligent contacts app, acquired by Tinder. The most popular user action was to text out so we built a separate chat app called Knock Knock. At Sole Bicycles, the DTC brand I co-founded, SMS has grown to make up ~20% of our sales. Finally, I had a front-row seat to enterprise brands like AirBNB, Nike and Uber leaning into messaging to solve complex business challenges while I was leading BD at Snaps, acquired by Quiq.

I’ve written some about the future of messaging and SMS here, here, and here.

The pandemic forced brands to accelerate their marketing strategies and find new ways to reach consumers in their homes. SMS was at the forefront of this, and today represents the single fastest-growing marketing channel.

Today, I’m so excited to announce my investment into Postscript, the #1 Shopify App for SMS.

I’m thrilled to invest alongside Dick Costolo & Adam Bain’s venture firm 01 Advisors and also Twilio Ventures, Greylock, Accomplice, Elephant, and OpenView.

From a macro perspective, eCommerce growth, as a percentage of total retail, is continuing to increase, driven primarily by an increase in mobile traffic. SMS is the only owned (non-platform, non-walled garden), mobile-native channel through which merchants interact with their customers. Email effectiveness as a direct marketing channel is decreasing due to SPAM, overcrowding of inboxes, promotions tab filtering, and a lack of functionality in-channel. Email open and click rates remain at all-time lows for merchants. Retention and customer relationships are more important than ever for merchants, driving initiatives to differentiate customer experience and build direct, highly valuable customer relationships.

In just three years of operation, fueled by bottoms-up adoption and strong merchant demand, Postscript works with 8,000 brands on Shopify — a base that has more than doubled since I first looked to invest in the company. On average, Postscript customers see a 25X return on their investment. They have over 1,700 five-star ratings in the Shopify app store today and were named a category leader by reviews site G2.

One critical point is Postscript’s average NDR is the highest I’ve ever seen.

In my perspective, there are different kinds of NDR: headcount, usage, and revenue. Asana & Linkedin are headcount based. Snowflake & Twilio are usage-based. Stripe & Shopify are revenue-based. Headcount NDR is the least optimal to have because the customer base can max out (ie: there are only so many employees who can use a product. With this recession, I expect more layoffs). Usage NDR is one of the best (this is what Postscript primarily offers today). However, they are also growing Postscript Pay wildly fast which means Postscript will not just make money from each text sent but ALSO a from percentage of every transaction. This is an extremely strong NDR and indexes to the highest revenue growth.

Excited to watch Postscript continue to lead as a platform critical to the future of commerce.