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July 31, 2019 · 21 min read

Innovating a mature product: making email smarter, easier and safer with Alexis Panagides of mxHero

With over 50 years of existence, email is one of those things we just take for granted. But it is by no means solved: there is an ongoing conflict between security, control, and user experience. Who hasn’t struggled to organize all the information scattered through emails ahead of an important call?

Alexis Panagides is the CEO of mxHero, which specializes in improving the email experience for businesses and end users through easier access, better control, and enhanced safety.

Alexis shares his vast experience around email, from his beginnings in Brazil  to his ongoing challenges as an innovator in this space. He and Ledge also talk about the benefits of remote teams. Alexis shares his favorite tools and tips for working with distributed teams and his thoughts on why right now is the best time to become an entrepreneur.

Alex Panagides

Co-Founder and CEO of mxHero

Alexis Panagides is co-founder and CEO of mxHero. MxHero is a Silicon Valley start-up revolutionizing how email is used in the enterprise today. Prior to mxHero, Alex worked for the World Bank and then went on to found another email startup in Brazil, Inova Technologies, that is now a leading email technology firm in that country.

Read transcript

Ledge: Alex, great to have you here.

Alex: Ledge, great to be on. Love the stuff that you guys are doing.

Ledge: Thank you so much. Could you give a two or three minute background story, yourself, your work and what you’re doing, just so the audience can get to know you a little?

Alex: Sure. MxHero is a company that we founded in 2011. It comes from a prior company that we started… I wasn’t actually with the World Bank in the very early nineties. Was sent to Brazil. The Brazilian internet went online when I was there around ’94.

I saw the opportunity, an entrepreneurial opportunity, so jumped ship from the World Bank and started a technology company in Brazil. It quickly focused on email, because that was really what was needed in the early days of any internet.

We grew from there and, over time we survived through the dot com bust and I got a lot of really great resources on my team. We knew that, as email was progressing, it was a great technology, it was heavily used, every company uses it, but there’s still major issues.

We could have gone in two directions. We were kind of looking at, what can we really do at a global scale and not just confine to the Brazilian market? The thing about email, we can design something new to replace it or we can make it better.

Certainly there’s a lot of companies since then that have gone the route of, let’s try to do something new – like Slack and Facebook Workplace – trying to re-envision.

Our strategy was, can we interconnect other technologies and enhance email? In other words, instead of throwing the baby out with the bathwater, use what email does well but enhance it with best-of-breed technologies.

We started a new company around that. We wanted to go through the US. We wanted this to be a more global ambition. We got funded in 2012 and the team, I took the best from my prior company in Brazil, which does very well it’s one of the leading email technology companies in Brazil. That was the genesis of mxHero, which was really, what technologies can we connect to to email?

One of those technologies in the early period… We were attaching all of these different types of capabilities, and one of those that we connected was box storage. We said, what would happen if you take a cloud storage – this was really a new category at the time, I think 2013 or so that we made that integration – and it became very obvious.

I liken it to how it must have been for Steve Jobs or Bill Gates to go into Xerox PARC and look at the graphic UI. You just know that that was the future.

So, we looked at this and we said, that’s clearly the future of email. Making this connection and eliminating file sizes. It solved problems of security. It solved problems of productivity. We were early so we certainly suffered as we were building out. Companies were just adopting cloud storage, and even the whole cloud storage market you couldn’t predict what it would become today. It was kind of a bet but it turned out to be the right bet.

The times caught up with us, and what we’re seeing are some really tectonic shifts in where data is going and how organizations are dealing with that data. It boils down to, there is so much data right now that’s just coming off of everything; not just email, it’s coming off devices. But particularly in the case of email, you’ll have problems around security, around governance, around productivity, there’s cost.

Email was developed in the early seventies in a very different era. Far more naive or innocent. Today it’s become very different. Nobody suspected that state actors would be going after your company’s email. That just wasn’t thought of.

I’m sure at some point back in the day they probably were putting together email and saying, let’s add attachments and let’s just limit it at a crazy size of attachment, something unimaginable, 10MB. No, that’s crazy. We’ll never get there. Suddenly nowadays you pop off a photo and it’s 14MB and now you’re stuck.

Those things, with some engineering, we connected those two. The idea was taking what is good about email – the ubiquity and the familiarity – and then tying that together with what is the good of this new modern technology for data handling.

That solves some tactical issues for email, but there’s also a much larger picture that that also solved for email, or data in general. Getting all that content into a single location, a secure silo, companies can now much better really apply AI, machine learning, natural language processing on all of their data. Not only their documents, but also the communication which is so critical.

I know you asked for two or three minutes, I apologize there. That was kind of how the journey started. It started humbly with email and you have email-type service, to what is really becoming the new way in which data is being stored, the way it’s going to be analyzed. Then eventually if you take data information to knowledge, how can we more efficiently operate as an organization once we have all of the content in one place? Then you have all the other benefits around security and governance.

Ledge: One thing that must come up all the time is, so wait a second you going to search everybody’s email the way Gmail runs ads against me for corporate knowledge?

I’m sure you deal with having to go, okay, here’s what the machines can and can’t do, and here’s how we protect against, well, if you’re bitching about your boss on your company account that’s not going into the corporate knowledge store.

Alex: First of all, a safety note – you shouldn’t be bitching about your boss on the company’s email.

Yes, in a way it is taking… At least here in the US. Not all. Argentina I know has different legislation. In the US, the company is the owner of the email system. They’re providing it to you. That is company property. You should always take care what you write to on email, as we know, regardless. Even your personal emails. My general rule is, if you’re not comfortable with whatever you writing on the front of your New York Times, then you shouldn’t be writing, you should just pick up the phone and make a phone call.

The idea is really, how can we make it easier and not more invasive? I think we all know the struggles of trying to find something in email, or the struggles of trying to look for something that actually is not in your email, perhaps it’s in your colleagues email who’s on vacation. Or, having to observe securities. If you’re in healthcare, you need to use a secure portal to send that email. Why can’t you just send it? Then the file size. All of those kind of limitations.

To be fair to email, email was never designed for any of this. It’s just all the things that we trying to jerry-rig email into, can we make it a seamless process?

So, interesting, just a silly statistic. The security issue of email. PGP, S/MIME, those exist. Those technologies exist. They solve the security problem. The reality is, if the end users do not adopt, there’s no such thing as secure. It really is, ultimately, a user adoption issue.

If we’re going to layer in security it has to be completely transparent.

There was an interesting study by Forrester a couple of months ago where it had 41% of workers admitted to deliberately bypassing security policy. Fifty-seven percent of those employees stated that was because it was the most efficient way to get things done. We’re trying to get through all of these hoops just to get stuff done.

Ledge: Right. I think people just get this idea that it’s like corporate espionage.

Alex: It’s not.

Ledge: It’s like, opening this encrypted stupid thing from the Cisco router or whatever came to my email, and going to the site, and more passwords and two-factor authentication, then it’s just a basic email. It’s just not going to happen. You’re getting in the way of people’s workflow, and they’re going to bypass it.

In the same way it’s not a security issue, it’s a process issue. It’s like finding the shortest path between two dots. You don’t walk around the field.

Alex: Yeah. To the CSO’s point, he’s got to lock it down. The threats are becoming more and more. I was talking the other day to a company that had a phishing attack and their servers were completely tied up. But at the same time, how do you not break the company’s productivity, and especially in a world where you have to be more and more agile?

It is a tough nut to crack, but there are ways that this can be put together.

Absolutely. It’s that challenge of finding that fine line between facilitating but at the same time securing. Again, it has to be like we say a seatbelt is a great device. A security device, if you use it. If you’re not using it, all bets are off.

That’s been really interesting. It was interesting arriving at that intersection and seeing what happens. I think a lot of innovation occurs at the edges, at the overlaps of different technologies. That certainly was our case. When we mixed email with cloud storage, that’s where we saw a number of things that we had never anticipated originally. We thought this would be great for file sizes. We had no idea the implications on governance and security.

One big trend that’s occurring right now, by the way, is companies are putting very short retention policies on email. So we have companies down to three months. They’re deleting emails after three months.

You might ask, well, why would you be deleting emails after three months? There’s a lot of reasons. You could talk about storage, but the reality, the real reason is the liability. Having that pile of email there and you have an opposition legal team asking for your email record, with that much email they will find something. Some comment. Something that can be interpreted in one way or the other.

Companies are looking to eliminate that policy just by saying, hey, we have a retention policy, those emails are gone.

The challenge is though, how do you throw out emails without throwing out the ones that you have to have for regulation, but also the ones that might be important? This is key communication between me and my supplier or whatever.

The solution that we’ve been delivering to the market is the ability to go in and cherry pick those emails and move them into your Box cloud storage or your OneDrive, and then let the deletion process continue. That’s where the governance aspect of it is.

Where things are really getting interesting, and you can see how this is going to benefit everybody at least in the workplace is, once this content is into a platform like Box… Box has launched Box Skills, which is their AI play on data. We’re looking at a near future where you’re going to be able to surface content from your email. Like, “Show me the attachment of the image of a man playing tennis in New Balance shoes.” Or, “Show me the email where Paul disagreed with me about the latest progress requirements.” That’s going to become a reality.

It’s not a reality today because, not that the technologies don’t exist, it’s that the email data sitting in an email server that is completely opaque, there’s no way to access that data.

Ledge: Right. There’s so many solutions. I’m thinking, right off the top of my head, how many millions of dollars of productivity and software do we invest as companies into CRMs, which are really just manual email and phone call sorting machines? If you had all that stuff in one place, you could quickly discern, with commercially available AI now, at what stage a deal is in with a particular person and who’s working on it. You don’t need to manually tag that. We’re using our hard-won sales resources as a sort of metadata taggers. That’s all possible if, in fact, it was all in a place that you could.

Alex: Exactly. To your point, it’s not that the technology doesn’t exist, it’s just that where do I aim this technology?

That’s why several years ago, and Smart and the other players are doing as well, Box moved itself into becoming a platform. They realized the value is not in file sharing, but it’s being this platform from which you have an ecosystem, and then you make your APIs available, and then a whole ecosystem can bring value because now you have all that data in a location where you can bring in a myriad of technologies, and they can all work that data in many different ways. Whether it be for AI, whether it be for statistics or whatever.

That’s essentially what legacy email is today. It’s data that you have no access to which just becomes junk.

Ledge: Let me ask you this. The first thing that comes to mind for probably 99.9% of people when you think email is client-side. It’s like, the email client is your interface to this universe. A lot of what you’re talking about is beyond the client in the next layer upon layer of security and processing and all these things.

What is the user experience, the user who doesn’t care. The consumer of email, how does this get back to the client-side UX?

Alex: That’s a good point. Most of what we do is server-side because we’re responding mostly to the CIO, to the CSO, that type of thing.

Our approach was, if you’re going to mess with the client-side be very careful because old habits die hard. People don’t like to see changes. In fact, the history of email client startups is littered with dead companies. It’s extremely hard to deploy a client where somebody buys their iPhone, they buy their Android, it has the built-in email client. There’s a micro population that’s actually going to use your email client.

If we’re going to influence the end-user experience, for example, how do we influence? If I send you an email with an attachment, one of the capabilities that we have is that attachment automatically gets uploaded into my cloud storage account into the appropriate folder. It may be your folder in my account. A link is dropped into its place and it’s delivered to you.

For me, there is no change. I’m using emails always. What about for you? I can’t break your experience. You might be my vital client. We make sure that, as we swap out those attachments and put in links, we actually insert little attachments dot pdf, which just relists the links that we put into the email. The reason we do that is to maintain that paperclip.

It’s amazing how, when we started off, not having that paperclip was completely disorienting. You can be transformative but not disruptive. That’s especially true in a legacy technology.

We can deploy a lot of new stuff, and we can decide what that looks like or what the look and feel is, but if you’re talking about email that’s a really deeply entrenched technology. It’s probably the oldest one out there in mass use. You’ve really got to keep it the same, and compatible with every email client out there at the same time.

What we’ve done, though, in that experience is we’ve already changed things. Suddenly, those links are trackable. I’ll know when you hit those links. I could have sent a 50MB file, but now it’s been transparently turned into a 50K link. There’s a number of benefits.

That’s the other thing. If you’re going to change something, change it for the better. Otherwise you’re going to have pushback.

For companies – and this leads to a kind of interesting story – if you think about the number one threat factor being email, particularly phishing, one of the risks of email is – just because it’s so accessible and we deal with it without too much criteria – an infected attachment. Essentially a Trojan horse coming in and you click on that – the doc file or image – and you’re executing that or opening it up locally on your machine.

That’s a great position to be if you’re the hacker. You’re on the inside and you’re getting opened up on the inside on the device.

Is there a way we can mitigate that? Well, just in the same model that I explained to you is the sending of an email having a view only first. So look at it through the cloud-stored viewer.

As a cautionary tale, there’s a lady that I know who suspected her husband was cheating on her. She found out through the newspaper the services of a hacker, a guy who would produce an image file essentially that wasn’t an image file, send it to your husband, and have him click on it. So she did, and he said, oh, it didn’t work. In doing that, he installed a key logger. Sure enough, she got his password, and sure enough discovered that this gentleman was cheating on her.

I tell that story because that woman is my today wife and that gentleman is her ex-husband. So I was the beneficiary of that story.

That illustrates how… So yes, I do sleep with one eye open.

Ledge: Good thing she wasn’t using mxHero.

Alex: That’s right. Brazilian wife, so be careful when you go to Brazil. No. I was, again, the beneficiary of that.

To show not only an attack can be played out, but also how accessible it is. My wife’s not a technical person. It’s accessible. These are easy things to do. It’s not complex.

One of the points for security officers is, the hacker only has to be successful once. On the other side, the defense’s side, you have to be successful every single time. So it’s really a nascent measure of warfare.

How can we do that with email? One way, really the best way to secure email is just to get content out of email. If you can, do it in a way that’s not disruptive to the email process.

Despite the technologies that are out there, email has been in the weekly news cycle. There’s an email breach of some type all the time. We have to have a different model.

One of the interesting things that we’re seeing is that, if we fast forward, where is email going? First of all email is still big, still large, but where we feel that things are going – and this might be surprising to some people – is that if you draw the line, go through the dots, the category of modern cloud storage, their purpose is for the sharing and collaboration of content. That’s their purpose built for that. That is the same manifest as email, is for the sharing and collaboration of content as well. Cloud storage is providing the same service, the same benefits, the same objectives, but doesn’t have the ubiquity. It doesn’t have that open protocol.

There was an article in the Wall Street Journal this week saying that email is back, essentially. It’s the realization that email is an open standard technology. It’s not a Facebook. It’s not a Google. It’s not somebody who’s looking at all your data. You can stand up your own server and communicate with anybody in the world over SMTP. There’s no CEO of email, and that makes it like international waters. Because there’s no owner, no controller, we can conduct trade and we can securely communicate over that path.

What we see is eventually a merging of these two technologies where, at some point, a seamless experience with communication and file sharing. How this is going to be done we’re not sure. It could be extending cloud storage to SMTP, to different protocols that exist. It would have to be something along those lines.

We feel that, at some point, the email client that we have today with this chronological listing and all that, it’s going to become more I’m communicating with you, there’s a location that everything I have relative to you, including my communication and files that are shared is going to be part of that UI experience. Then when I want to see where you and I and somebody else have communicated that’s going to be…

In other words, the line that divides the communication and the content of the files, et cetera, that’s going to dissolve and you’ll have it all through one interface.

Ledge: It’s 2019. I have to ask, you’re describing the emergence of combined and/or different, new protocols immediately comes to mind. Distributed ledger sits somewhere in there. Are you guys thinking about that?

Alex: Sure. At the same time we’re talking I’m thinking my next startup.

Yes. Leveraging the blockchain is I think a key part of all of this. It’s hard to know exactly what it will look like, but we know that things will start morphing together. We see it right now. That’s what we’re essentially doing. MxHero is morphing email with cloud content storage and getting traction on that theme.

It’s just, how far does that go? What does it look like? It’s hard to know that right now. It’ll be interesting. Email is not going anywhere soon, but it may look different if we have this conversation in 5 or 10 years from now.

Ledge: I had the CEO of Resilio on. That’s the BitTorrent Sync evolution, and they’re talking about similar things there. Distributed cloud storage. That communication vector is very obvious there. Of course, I hope that we take the quantum communication leap so that we can just tie up our qubits and call it a day.

Alex: That would be. Yeah.

Ledge: Let me ask you. Obviously, you’ve been in and around and run a technology and engineering organizations going back to the dawn of internet time. We’re deeply embedded in the space of trying to figure out the very best ways, the heuristics of evaluating engineers and finding the very best talent.

You’ve had to do that over and over again. You talked about bringing some of your old team along, things of that nature.

What are those heuristics? How do you know when you’ve got you’re A+ technical talent, and telling the difference between them and everybody else?

Alex: We do a lot through the network. Now, where that network leads to is quite a distributed experience. There’s the truth that the best two offers are in your zip code, but that’s not true. Especially the zip code where we are it’s a very tight labor market, very expensive. There is so much high quality talent elsewhere.

A lot of our team is in Brazil, Argentina, Spain. Access to information and to developer knowledge, it’s all accessible online. You can have brilliant developers anywhere.

I think the trick is, how do you work effectively as a team? That’s become far easier today than ever. It’s just the number of video sharing communication platforms. At any minute, I can talk to one or the whole team from anywhere from my phone. That accessibility is important.

I think you do have to, every now and then, bring the team together, meet face to face. The ability to work as a distributed team effectively is very real, and companies that do adopt that have that competitive edge, that can manage that distribution.

People will also work for less if they can work from home. They’re going to be happier. Quite frankly, they’re going to spend more time working because they don’t have to deal with the commute and everything else. That’s benefited us, for sure.

Ledge: That’s excellent. Tips and tricks for distributed work. Tools that you guys use, and maybe even techniques too, because it’s how you use the tools. Obviously, there’s email and yet I think a lot of us in the distributed workforce would say, hey, there’s a lot of things. There’s Slacks and Jira or Google Docs.

What have been successful for you guys for remote and potentially async communication, because you are dealing across a distributed time zone environment?

Alex: For async communication, we do default a little bit to email. For synchronous, we use like Zoom, GoToMeeting we were using for a while we moved to Zoom. Or we use Whatsapp or Hangouts for those quick chats. That’s it.

It’s important that there has to be a certain cohesion in the group as well, I think. That’s important. Obviously, in any environment, whether everybody’s together or not, personalities and cohesion are important.

For tools, I would say it’s the usual suspects. It’s that which works best. The video is a good component as well. It really is impressive how, just on your phone, you can have access to everybody at any time.

We use email also to be more formal, to have a record. Certainly, when dealing with customers having that cc and that paper trail is part of that.

Slack and those. We use Workplace by Facebook. That’s for your internal communication. Those are great solutions while you’re internal to the degree that you need to interact with somebody outside. You don’t have to go to the lowest denominator, being email or chat tool or video chat tool.

It’s never been easier. It really has never been easier to work as a group effectively remotely.

The development team of course uses tools. So all that, scrum boards, everything, our ticketing system. It really is amazing. I’m from the days where, if you wanted to set up a service, you hauled your server down to the data center and you strapped that thing in. Now, AWS and everything, it’s amazing how much ability a very small group of people can deploy. Not only in how they interact and communicate, manage, but also provide their services. The whole serverless opportunities, capabilities, et cetera.

The minute we need more power, you just add a few more vCPUs and you’re off to the races.

So yeah, I think it’s a great time to be an entrepreneur. You can provide services and compete with large companies. Maybe the competitive edge is really yours. You are just so much smaller and so much more agile than the big companies. You don’t have the infrastructure restraints that we used to have.

It’s interesting times. I think it’s a great time for entrepreneurship.

Ledge: Well, Alex, thanks for the insights. Thanks for joining us today.

Alex: Alright. It has been a pleasure, Ledge.