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We're set up with CiviCRM and Sendgrid but don't have bounce processing as far as we can tell, and are not sure how to fix that. All information on using the SendGrid api is pretty old and we have no idea if it'll work given the present civi version (that being 5.x rather than the info I'm finding re: 4.x).
For example, the Sendgrid Event notification processor is 4.4, 4.6 and 4.7 only.
OK, found what appears to be the solution: Airmail from AGH Strategies for "Unified CiviCRM bounce event handler for SMTP services", including Sendgrid.
It wasn't in the CiviCRM extensions directory but it's on GitHub and pretty up-to-date, with simple instructions for Sendgrid.
Will update this answer with our experiences.
I am in the same spot. I found this one: https://lab.civicrm.org/extensions/sendgrid
