Transactional and marketing email infrastructure
SendGrid vs Mailgun for SaaS Email
For most SaaS teams whose first job is transactional mail, Mailgun is the stronger pick. Its Basic plan starts at $15 a month for 10,000 emails, and its Free plan allows 100 emails a day while you build the integration. SendGrid is the better choice when you want one account to hold transactional sending and a marketing campaigns product, because its Marketing Campaigns free plan covers up to 2,000 contacts and 6,000 emails a month.
Short answer
Choose Mailgun if the mail that matters most is product mail: password resets, invoices, trial reminders and alerts sent from your application code. Its plans are priced by monthly email volume, and the API and SMTP relay sit at the centre of the product.
Choose SendGrid if you also need onboarding campaigns, newsletters or segmented marketing sends under the same vendor. Its Basic plan is listed at the same $15 a month, and the Marketing Campaigns tier gives you a free starting point for smaller lists.
Side-by-side overview
| Area | SendGrid | Mailgun |
|---|---|---|
| Best for | Teams that want a transactional API and a marketing campaigns product on one account | Teams whose main job is sending application mail through an API or SMTP relay |
| Entry price | Basic at $15/month, billed monthly; the plan selector lists it for up to 300,000 emails/month | Basic at $15/month for 10,000 emails/month, billed monthly |
| Free option | Email API free trial: 100 emails/day for 60 days. Marketing Campaigns free plan: up to 2,000 contacts and 6,000 emails/month | Free plan: 100 emails/day, with the RESTful email API and SMTP relay |
| Key limitation | The plan bands in the selector overlap, so the cheapest suitable plan takes some checking. Marketing is a second product to configure | Paid plans step up at fixed volume bands, and overages are billed by usage. Marketing campaigns are not its focus |
What the list prices cover
Both vendors publish monthly plan prices, but the monthly figure is only the starting point of the bill. The comparison that matters is between the plan that fits your volume, the usage charges that sit on top of it, and the cost of any product you add later. This section explains what each pricing page includes so you can build a realistic model before you talk to sales.
Mailgun prices its plans by monthly email volume. The Basic plan starts at $15 a month for 10,000 emails. Foundation is $35 a month for 50,000 emails, and Scale is $90 a month for 100,000 emails. Mailgun's pricing page describes one month free on Foundation and Scale, after which the listed monthly prices apply. Its model also includes usage-based charges for emails beyond a plan's allowance and for validation, so the plan price is not the whole invoice.
SendGrid organizes its plans differently. Its selector lists Essentials at $19.95 a month for 50,000 to 100,000 emails, Pro at $89.95 a month for 100,000 to 2,500,000 emails, and Basic at $15 a month for up to 100,000 contacts and 300,000 emails. Advanced is listed at $60 a month for up to 200,000 contacts and 1,000,000 emails. Premier and Custom are priced on request for high-volume senders. The bands overlap across plans, so the figure you should check is the one the selector assigns to your exact contact count and monthly send volume.
The Marketing Campaigns product is priced separately from the API. Its free plan covers up to 2,000 contacts and 6,000 emails a month. Above that, the paid tiers depend on your contact count, so a newsletter list that grows past the free ceiling will change your cost even if your transactional volume stays flat.
Cost at three list sizes
The table uses monthly list prices in US dollars for three realistic monthly send volumes. Each row names the plan that the vendor's pricing page lists for that volume. Overage charges and validation fees are not included, because their rates are shown on each vendor's page and vary with usage.
| Emails per month | Mailgun plan and price | SendGrid plan and price | Notes |
|---|---|---|---|
| 10,000 | Basic, $15/month (10,000 emails/month) | Basic, $15/month (band up to 300,000 emails/month) | Same list price. Choose on features and the Marketing Campaigns need |
| 50,000 | Foundation, $35/month (50,000 emails/month) | Basic, $15/month (same band) | SendGrid has the lower listed price at this volume. Mailgun's first month on Foundation is free per its pricing page |
| 100,000 | Scale, $90/month (100,000 emails/month) | Essentials, $19.95/month (band 50,000 to 100,000 emails/month) | SendGrid's band includes this volume. Confirm the plan in the selector before you commit |
To turn these figures into an annual budget, multiply the monthly price by 12. For example, Mailgun Foundation at $35 a month is $420 a year before overages, and SendGrid Essentials at $19.95 a month is $239.40 a year before any usage charges. The SendGrid figures we read for its plans show the same monthly amount whether you bill monthly or annually, so check the billing toggle on the pricing page rather than assuming a discount.
SendGrid in detail
Who it suits
SendGrid suits a SaaS team that expects to send both application mail and marketing mail from one vendor. The transactional API covers receipts, verification codes and usage alerts, while the Marketing Campaigns product handles onboarding series and product announcements. Keeping both under one account can reduce the number of credentials, dashboards and suppression lists your team must maintain, which matters when a customer who unsubscribes from marketing still needs billing mail.
Where it falls short
Two products under one login means two sets of configuration. Marketing contacts, segments and campaigns follow different rules from API sends, and a team that only needs transactional mail will carry complexity it does not use. The overlapping plan bands in the selector also make budgeting harder: the cheapest plan that fits your volume is not always the one you first see, so model it against the selector rather than the headline price.
Price and pricing page
Basic is listed at $15 a month, and Essentials at $19.95 a month, with Pro at $89.95 a month for larger volumes. The Email API free trial allows 100 emails a day for 60 days, and the Marketing Campaigns free plan covers up to 2,000 contacts and 6,000 emails a month. Read the current figures on the SendGrid pricing page, which is hosted under Twilio's email API product.
Mailgun in detail
Who it suits
Mailgun suits a team whose sending lives in code: password resets, invoices, webhooks that trigger alerts, and inbound routing for replies that need to reach a support queue. Its Free plan allows 100 emails a day with the RESTful email API and SMTP relay, which is enough to build and test an integration before paying for volume. The product is narrower than SendGrid's, and that narrowness is the point for teams that want to keep sending infrastructure separate from marketing tooling.
Where it falls short
Mailgun is not a marketing platform, so teams that want segmentation, campaign scheduling and newsletter templates will need a second tool. Its paid plans step up at fixed volume bands, which means a list that grows just past a band can change your cost quickly. Its pricing model includes usage-based charges for overages and validation, so the monthly plan price understates the bill for senders who need heavy list cleaning.
Price and pricing page
Basic starts at $15 a month for 10,000 emails. Foundation is $35 a month for 50,000 emails, and Scale is $90 a month for 100,000 emails. The pricing page describes one month free on Foundation and Scale, then the listed monthly prices. Check current overage and validation rates on the Mailgun pricing page before you finalize a budget.
Deliverability and list verification
Inbox placement depends far more on your sending setup than on the vendor name. Authenticate your sending domain on whichever platform you choose, keep a consistent From address, and stop mailing addresses that have hard-bounced or complained. Both platforms expose bounce, complaint and unsubscribe events that your application can consume, so the work is to route those events into your own user records and to block those addresses at the source. Read each vendor's event documentation before you design the integration, because the event names and retry behavior differ.
List verification is a separate job. Dedicated services such as ZeroBounce, NeverBounce and Kickbox check addresses before you import them, flagging invalid, disposable and risky mailboxes. They run as their own products with their own contracts and prices, so budget for them alongside your sending platform. Their rates are not part of this comparison. Verifying a list before the first send protects your sender reputation on either platform, and it matters more when you buy or merge a list than when customers sign up through your product.
If you verify addresses inside Mailgun, its pricing model lists validation as a usage charge. Model that charge against your import volume, not just your send volume. For SendGrid, check its pricing page for any validation or add-on line before you assume it is included in a plan.
Whichever you pick, set a monthly review of bounce and complaint rates. A sudden rise usually points to a stale import or a form that accepts bad addresses, and fixing the source is cheaper than paying to send to an unhealthy list.
Decision table
| If you need | Pick | Because |
|---|---|---|
| Transactional mail only, such as receipts, resets and alerts | Mailgun | The product is built around the API and SMTP relay, and the Free plan lets you test at 100 emails a day |
| Transactional and marketing mail under one account | SendGrid | The Marketing Campaigns product sits beside the API, and its free plan covers up to 2,000 contacts |
| The lowest listed price at about 50,000 emails a month | SendGrid | Basic at $15 a month against Mailgun Foundation at $35 a month, provided the band fits your exact volume |
| Validation charged within the same vendor | Mailgun, after checking the rate | Its pricing model lists validation as a usage line you can model directly against imports |
| Dedicated list cleaning before import | ZeroBounce, NeverBounce or Kickbox | These are separate verification products. Their rates are not part of this comparison |
How to choose
Start with the mail your product must send on the day something happens: a payment fails, a user signs up, a password is reset. That is transactional mail, and it has the strictest delivery needs because a missed reset email is a support ticket. If that is the whole picture, compare the two APIs against your language stack and your webhook design, and choose the one whose event model fits your code with the least glue.
Next, decide whether marketing mail belongs on the same platform. If your onboarding sequence, product updates and newsletters are a small list and you want one vendor, SendGrid's combined account is the simpler answer. If you already run a marketing tool, keep Mailgun or SendGrid purely for transactional sends so that a campaign problem cannot slow down a password reset.
Then build the cost model. Take your expected monthly sends for the next twelve months, add a margin for growth, and find the plan each vendor's selector assigns to that number. Add usage charges for overages and any validation you will run. Compare the totals, not the headline prices, because the cheapest entry plan can be the most expensive once overages are included.
Finally, pilot. Send the same representative set of messages through both platforms to seeded test addresses you control, then compare delivery timing, bounce handling and how easily each event reaches your application. A pilot of a few weeks will tell you more about your workload than any comparison table, including this one.
Setup and migration checklist
If you are moving from one platform to the other, the risk is in the details that are easy to skip: suppression lists, authentication records and webhook endpoints. The table below lists the steps in the order that prevents an outage or a compliance mistake.
| Step | Task | Done when |
|---|---|---|
| 1 | Export suppression lists, bounces and unsubscribes from the current platform | The export is stored and its row count matches the vendor's dashboard |
| 2 | Add the sending domain to the new platform and publish the DNS records it gives you | The platform reports the domain as authenticated |
| 3 | Import suppression data before the first live send | Test addresses on the suppression list are blocked by the new platform |
| 4 | Point webhooks at your application and confirm event delivery | Test bounce, complaint and delivery events reach your logs |
| 5 | Replace SMTP or API credentials in each service that sends mail | Each service sends through the new platform in staging, then in production |
| 6 | Run both platforms in parallel for a short window and compare bounce and complaint rates | The new platform's rates are in line with the old one before the old account is closed |
Keep the old account open until you have a full billing cycle of clean events on the new one. Closing it early removes your only record of past bounces and complaints, which is exactly the history you need if a mailbox provider later asks about your sending practices.
Related reading
Frequently asked questions
Which is cheaper for 10,000 emails a month?
On list price the two are level at this size. Mailgun Basic is $15 a month for 10,000 emails. SendGrid Basic is also $15 a month, and its plan selector lists it for volumes up to 300,000 emails a month. Choose on the features you need, then confirm the band in each vendor's selector before you sign up.
Which is cheaper at 100,000 emails a month?
SendGrid is cheaper on list price in this band. Its Essentials plan is listed at $19.95 a month for 50,000 to 100,000 emails. Mailgun Scale is $90 a month for 100,000 emails. The SendGrid selector also lists overlapping bands, so check which plan the selector assigns to your exact volume.
Does Mailgun charge for email validation?
Mailgun's pricing page describes its model as monthly volume plans plus usage-based charges for email and validation overages. Read the current validation rate on that page and add it to your model if you plan to verify addresses inside Mailgun. The monthly plan price alone will understate your bill for a list that needs heavy cleaning.
Can one vendor handle receipts and newsletters?
SendGrid is the closer fit for that. It offers a transactional API and a separate Marketing Campaigns product, with a free plan for up to 2,000 contacts and 6,000 emails a month. Mailgun is built around application sending. If you run newsletters on Mailgun too, plan for a second tool or a separate marketing platform for segmentation and campaign management.
Is the free tier enough to test an integration?
Mailgun's Free plan allows 100 emails a day, with its RESTful API and SMTP relay, and that is enough to build and test a sending integration. SendGrid's Email API free trial allows 100 emails a day for 60 days. Both limits are small, so test with a staging list and real deliverability checks before you rely on either for production mail.
How hard is it to switch from one to the other?
The work is mostly in DNS and data. You need to set up domain authentication on the new platform, import or re-create suppression lists so unsubscribed and bounced addresses stay blocked, re-point webhooks, and update the SMTP or API credentials in your code. Running both platforms in parallel for a short period lets you compare bounce rates before you cut over fully.