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

guest · Oct 12, 2020

Twilio is buying customer data startup Segment for between $3B and $4B
October 11, 2020
https://techcrunch.com/2020/10/11/t...r-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: [...]
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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.

As Semil Shah from early stage VC firm Haystack wrote in the company blog yesterday, Segment saw a different way to gather customer data, and Twilio was wise to swoop in and buy it.
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guest · Oct 12, 2020

Twilio confirms it is buying Segment for $3.2B in an all-stock deal
October 12, 2020
https://techcrunch.com/2020/10/12/t...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.

“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.”
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This is Twilio’s biggest acquisition since it picked up SendGrid for $2 billion to add email to its range of communications tools back in 2018. Segment was last valued at $1.5 billion at its last raise.
Acquiring Segment could potentially bring a lot more customers to the Twilio platform, opening the door to upselling those customers with other services Twilio offers.

You might argue that customer service (the main idea of what Twilio has been building) and customer experience (Segment’s jam) are different things, but the two are connected: one of the big by-products of communications is data, and companies will be looking for better ways of linking up the creation of it, with the repurposing/use of it. In other words, the two complement each other.
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guest · Oct 12, 2020

Twilio’s $3.2B Segment acquisition is about helping developers build data-fueled apps
October 12, 2020
https://techcrunch.com/2020/10/12/t...ut-helping-developers-build-data-fueled-apps/

The pandemic has forced businesses to change the way they interact with customers. Whether it’s how they deliver goods and services, or how they communicate, there is one common denominator, and that’s that everything is being forced to be digitally driven much faster.

To some extent, that’s what drove Twilio to acquire Segment for $3.2 billion today. (We wrote about the deal over the weekend. Forbes broke the story last Friday night.)

“A lot of people have thought about us as a communications company, but we think of ourselves as a customer engagement company. We really think about how we help businesses communicate more effectively with their customers,” Chew told TechCrunch.
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Brent Leary, founder and principal analyst at CRM Essentials, sees Segment helping to provide a powerful data-fueled developer experience.

“This move allows Twilio to impact the data-insight-interaction-experience transformation process by removing friction from developers using their platform,” Leary explained.
In other words, it gives developers that ability that Chew alluded to, to use data to build more varied applications using Twilio APIs.
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guest · Nov 3, 2020

Twilio completes US$3.2 billion acquisition of Segment
November 3, 2020
https://www.itwire.com/deals/twilio-completes-us$3-2-billion-acquisition-of-segment.html

Completion of the deal - originally announced by the two companies last month - sees Segment become a division of Twilio.

"Nearly every company is focused on acquiring, retaining and growing their customer relationships through digital engagement," said Jeff Lawson, Co-Founder and CEO of Twilio.
“With the addition of Segment, Twilio's Customer Engagement Platform now enables companies to both understand their customer, and engage with them digitally — the combination is key to building great digital experiences."
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“Twilio’s acquisition of Segment will help customers better address the increasingly digital-first nature of customer engagement, and help deliver digital journey information to agents when live interactions are required,” said Sheila McGee-Smith, President & Principal Analyst, McGee-Smith Analytics.
“This is especially important for B2C customers who need a single view of their customer to make customer engagement across every channel more personalised, timely, and impactful.”
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Twilio: Twilio Acquires Segment, the Market-leading Customer Data Platform

We're excited to announce the close of Twilio's acquisition of Segment. You can read more about the details in our press release.
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