Twilio, a USA-based cloud communications platform, on Monday announced its largest acquisition to date. The company is buying the customer data startup Segment for $3.2 billion in Twilio Class A common stock, on a fully diluted and cash free, debt free basis.
Segment is a customer data platform (CDP) that helps collect, clear and manage customer data. This platform allows organizations to move customer data from one application to another through an API, and use the platform to better control how the customer data travels through the systems.
The deal is expected to close in the fourth quarter of 2020, and Segment will emerge as a part of Twilio. This acquisition could help Twilio expand beyond its core communications capabilities, and also could bring approximately $5 billion in revenue to both companies. This purchase is Twilio’s largest acquisition to date. Back in 2018, the company bought the email marketing platform SendGrid for $2 billion.
Furthermore, Twilio has been a winner in the pandemic economy, as its share price has almost tripled since the beginning of the year. The company’s market value increased to an impressive $45 billion on Friday. It is understandable how it can afford to combine Twilio’s API both with Segment’s capability to gather customer data, and with SendGrid’s effectiveness in delivering customized emails and add creation.
Jeff Lawson, co-founder and CEO of Twilio, in a statement said: “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,” commented Peter Reinhardt, Segment’s co-founder and CEO.