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Rackspace spinoff raises $50 million

February 22, 2017 GMT

Mailgun, a company offering an automated email product used by application developers, has raised $50 million to ramp up as it spins off from San Antonio-based Rackspace, Mailgun announced Wednesday.

The investment is led by San Francisco-based Turn/River Capital with participation by cloud-computing company Rackspace and San Antonio-based venture equity fund Scaleworks.

Mailgun, which provides tools that allow users to send, receive and track email from within applications, is headed by CEO William Conway. Conway previously was Mailgun’s general manager inside Rackspace.

The $50 million investment will be used to accelerate product development and expand customer support, Mailgun said.