Rackspace Acquires Email Application Integrator Mailgun

Rackspace snaps up Mailgun for an undisclosed sum to expand its portfolio of cloud-based email services and applications.

Cloud computing specialist Rackspace announced it has acquired Mailgun, a provider of Web services for integrating email inboxes into applications. The move is aimed at enhancing Rackspace's product portfolio-making it possible to integrate cloud-based email services into applications and Websites without managing an email server.

The acquisition is expected to close this week, according to a company release, which did not disclose the financial terms of the deal.

Mailgun's service optimizes the email capability of an organization's applications and Websites with all the analytics and data needed to measure the impact through a set of application programming interfaces (APIs) that allows users to send, receive and track email from within their applications. Mailgun is integrated into platforms such as Heroku, AppFog and Engine Yard, and counts among its current customers collaboration software developer 37Signals, native mobile software developer kit (SDK) specialist Parse, and the Financial Times news service.

"Rackspace is dedicated to providing the tools that our customers need to build their technology stack on the Rackspace Open Cloud," Pat Matthews, senior vice president of corporate development at Rackspace, said in a prepared statement. "Mail is a core component of nearly every Website and application today. Our customers are asking for this, and Mailgun is the right company to help us deliver it in a tightly integrated way."

Headquartered in San Francisco, Mailgun is funded by Y Combinator, an organization that provides seed funding for startups. The company makes small investments (rarely more than $20,000) in return for small stakes in the companies they fund (usually 2-10 percent). According to information provided in a Rackspace release, the Mailgun team will remain in San Francisco, which will add engineers to the presence Rackspace has in the city. Rackspace is based in San Antonio, Texas.

"Mailgun is excited to join the Rackspace family. We believe in their open cloud strategy, and we love the customer support mentality that permeates the company," Ev Kontsevoy, CEO and founder of Mailgun, said in a joint press statement. "Like Rackspace, we want to provide developers with the right products to make the lives of developers easier and more productive. We look forward to continuing this mission with Rackspace and building a strong future together."

On Mailgun's official blog, the company stressed that for Mailgun customers, it would be business as usual, and businesses would not need to make any changes to their code or account. The post also noted Mailgun customers will not have to use Rackspace's hosting products in order to use Mailgun, though it suggested integration with Rackspace software would be an alluring opportunity to deploy Rackspace services.

"We did not make this decision lightly, and we are confident that Mailgun will improve and thrive with the backing of Rackspace. By joining Rackspace, we have many more resources at our disposal to grow Mailgun and execute on our vision of offering the best email service for developers," the blog post said. "Everything will continue to work as usual, except the quality of service is going to be even higher. In addition, you have the comfort of knowing that a strong public company has got our back."