Twilio to Acquire Customer-Data Platform Segment for $3.2B

Twilio  (TWLO) – Get Report shares rose Monday after the cloud-communications platform said it would buy customer-data platform Segment for $3.2 billion of stock.

Twilio shares recently traded at $322.79, up 5.4%. They had more than tripled year to date through Friday.

“Data silos destroy great customer experiences,” Jeff Lawson, co-founder and chief executive of the San Francisco company, said in a statement.

Closely held Segment, also San Francisco, “lets developers and companies break down those silos and build” complete pictures of customers. 

“Combined with Twilio’s customer engagement platform, we can create more personalized, timely and impactful engagement across customer service, marketing, analytics, product and sales,” he said.

“The businesses that deliver the best experiences are the ones that know their customers well and use customer data to provide more relevant interactions,” Twilio said.

“However, wrangling these customer insights is extremely difficult as the information is typically spread across disparate systems and functions throughout an organization. … Twilio can now alleviate this pain for businesses by delivering a single, unified view that helps companies better understand their customers.”

The combined company will have a total addressable market of $79 billion, Twilio said.

Both boards have approved the transaction, and the companies hope to close the deal in the fourth quarter, subject to conditions they didn’t specify.

Morningstar analyst Dan Romanoff likes Twilio but not its share price. 

“Many of the uses for Twilio represent greenfield opportunities, and we believe the company has ample opportunity to increase revenue over the decade as it continues to expand uses for its platform,” he wrote in an August report.

But he put fair value for Twilio’s stock at $153.

Twilio confirms it is buying Segment for $3.2B in an all-stock deal

Twilio today announced its biggest acquisition to date, spearheading a strong move into customer data management alongside its existing API-based tools for building and running customer communications services. Twilio is paying $3.2 billion “in Twilio Class A common stock, on a fully diluted and cash free, debt free basis” to acquire Segment, a marketing technology startup that lets organizations pull in customer data from one app into another, by way of APIs, and use its platform to better control the movement of that customer data.

The deal is expected to close in Q4 2020, and Segment will become a division of Twilio, the companies said.

The deal was first reported to be in the works on Friday. (FWIW we’d also gotten the same tip and had been investigating it when that story got published. Our sources had said that the deal was going to be between $3 billion and $4 billion, and announced possibly as soon as Monday.)

“Data silos destroy great customer experiences,” said Jeff Lawson, co-founder and CEO of Twilio, in a statement. “Segment lets developers and companies break down those silos and build a complete picture of their customer. Combined with Twilio’s Customer Engagement Platform, we can create more personalized, timely and impactful engagement across customer service, marketing, analytics, product and sales. We are thrilled to welcome Segment to the Twilio team.”

“Together, Twilio and Segment have an incredible opportunity to build the customer engagement platform of the future,” added Peter Reinhardt, Segment’s co-founder and CEO. “We created Segment to help businesses set themselves apart in the digital age and deliver rich, connected customer experiences built on high-quality data. By joining forces and applying our customer data platform to Twilio’s engagement cloud, we’ll be able to make the entire customer experience seamless from end-to-end.”

This is Twilio’s

Twilio is buying customer data startup Segment for between $3B and $4B

Sources have told TechCrunch that Twilio intends to acquire customer data startup Segment for between $3 and $4 billion. Forbes broke the story on Friday night, reporting a price tag of $3.2 billion.

We have heard from a couple of industry sources that the deal is in the works and could be announced as early as Monday.

Twilio and Segment are both API companies. That means they create an easy way for developers to tap into a specific type of functionality without writing a lot of code. As I wrote in a 2017 article on Segment, it provides a set of APIs to pull together customer data from a variety of sources:

Segment has made a name for itself by providing a set of APIs that enable it to gather data about a customer from a variety of sources like your CRM tool, customer service application and website and pull that all together into a single view of the customer, something that is the goal of every company in the customer information business.

While Twilio’s main focus since it launched in 2008 has been on making it easy to embed communications functionality into any app, it signaled a switch in direction when it released the Flex customer service API in March 2018. Later that same year, it bought SendGrid, an email marketing API company for $2 billion.

Twilio’s market cap as of Friday was an impressive $45 billion. You could see how it can afford to flex its financial muscles to combine Twilio’s core API mission, especially Flex, with the ability to pull customer data with Segment and create customized email or ads with SendGrid.

This could enable Twilio to expand beyond pure core communications capabilities and it could come at the cost of around $5 billion for the two

Twilio to buy cloud customer data startup Segment for $3.2 billion: Forbes

FILE PHOTO: A banner for communications software provider Twilio Inc., hangs on the facade of the New York Stock Exchange (NYSE) to celebrate the company’s IPO in New York City, U.S., June 23, 2016. REUTERS/Brendan McDermid

(Reuters) – Cloud communications platform provider Twilio Inc TWLO.N plans to buy customer data infrastructure company Segment for $3.2 billion, Forbes reported on Friday.

The deal, which had not been finalized as of Friday afternoon, was expected to be at least partially based on Twilio stock, the report added, citing two sources it did not name.

San Francisco-based Segment has recently been open to acquisition offers, according to the report.

Twilio declined to comment to Reuters. Segment was not immediately available for comment outside regular business hours.

Segment raised $175 million in a Series D funding round in April 2019. The startup said in September that it worked with more than 20,000 businesses including Intuit, FOX and Levi’s, employing more than 550 people.

Cloud companies have seen a surge in demand this year as more businesses use their services to meet the demands of the switch to work from home due to the coronavirus outbreak.

“Twilio is a beneficiary of pandemic-catalyzed digital transformation acceleration,” brokerage JP Morgan said in a note this month.

Last week, Twilio estimated third-quarter sales above its previous forecast, as the switch to remote working and learning boosted demand for cloud services.

Reporting by Juby Babu and Kanishka Singh; Editing by William Mallard

Source Article

$45.5 billion cloud communications company Twilio is reportedly getting ready to acquire data startup Segment for $3.2 billion



a man sitting on a leather couch: Jeff Lawson, co-founder and CEO of Twilio, launched his business during the recession. (Photo by Steve Jennings/Getty Images for TechCrunch)


© (Photo by Steve Jennings/Getty Images for TechCrunch)
Jeff Lawson, co-founder and CEO of Twilio, launched his business during the recession. (Photo by Steve Jennings/Getty Images for TechCrunch)

  • Cloud communications company Twilio is set to acquire data startup Segment for $3.2 billion, sources tell Forbes, though a deal is not yet final.
  • Twilio has emerged as a winner in the pandemic economy, with its stock price just about tripling since the beginning of the year. The company now commands a market cap of over $45 billion.
  • Segment was last valued at $1.5 billion in an April 2019 funding round, and counts Accel, Y Combinator, and Alphabet’s GV (formerly Google Ventures) among its investors.
  • Segment laid off 10% of its staff in May, in anticipation of a tougher IT spending environment amid the pandemic. However, the company indicated in September that it now has over 20,000 customers — up from 19,000 at the time of the layoffs. 
  • Visit Business Insider’s homepage for more stories.

$45.5 billion cloud communications company Twilio is acquiring data analytics startup Segment for $3.2 billion, two sources told Forbes, although the deal is not yet finalized.

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This would be Twilio’s largest acquisition to date: In 2018, the company acquired email marketing platform SendGrid for $2 billion, in what had been its biggest deal up to that point. A Twilio spokesperson told Forbes that it does not comment “on any rumors or speculation.” Twilio and Segment did not respond to a request for comment from Business Insider at the time of publication.

Twilio has emerged as a winner in the pandemic economy, with its stock price just about tripling since the beginning of the year. The company’s technology allows developers to build software that can make and receive phone calls and send text messages, and counts