Found this link on one of TMF’s premium boards and wanted to share. https://www.forbes.com/sites/miguelhelft/2016/09/14/the-wiza…
Bottom Line Up Front (BLUF):
Twilio has an impressive “let me show you by doing” culture which comes from founder Jeff Lawson. The founder and company seem to have a humble, but confident approach which I believe is part of what differentiates them. They also seem to have a high-performing, collaborative company culture. The article talks about new Twilians (employees) getting a Kindle w/$30 credit to encourage them to invest in themselves. A small but purposeful gesture.
Twilio has a 4.1 rating on Glassdoor which is pretty good and Jeff Lawson has a 98% approval rating which is VERY good. These are just subjective data-points and have their flaws, but I still like to look at Glassdoor.
- Twilio’s first “big land” was with Uber (this board knows this already). But what’s important to me, is the way it happened. Uber’s SMS provider was having an outage so their B2B and B2C communications were significantly affected. Lawson capitalized and soon after, Twilio was fully integrated into Uber’s core business functions – I believe this grass-roots approach will continue to resonate well with innovative companies trying to improve how they communicate internally and externally.
2015 Annual Rev 167M vs 399M in 2017. Up 139%
- Their TAM appears to be industry and technology agnostic. The article references the American Red Cross, ING, Match.com, Airbnb, Whatsapp, Lyft, Expedia, Netflix, Coca-Cola, Salesforce, and the New York Times as customers. I believe the trend towards a “Gig economy” and remote working will continue to gain momentum. I can’t think of a company that wouldn’t have some type of use case for a Twilio-like solution.
In the Forbe’s article, Salesforce CEO Marc Benioff said “He’s built a fantastic business." “This is something that every company will build into their applications, like we have.” – I wonder if SF (or anyone) has tried or might try to acquire Twilio. Not a reason to invest, but an interesting thought.
- Twilio has an approach that requires very little Sales & Marketing. From the article: “Twilio is exceedingly simple to use and charges no upfront fees, so programmers often use it to test an idea or product. Pretty soon that product scales and turns into a six- or seven-figure account that required no traditional sales process. “We onboard developers like consumers and let them spend like enterprises,” Lawson says. Like others that have embraced developer-driven marketing—Amazon for computing services, Stripe for payments, New Relic for analytics—Twilio benefits as companies increasingly turn to software for differentiation. “As that happens, and companies hire more developers, they come in with Twilio in their tool belt,” Lawson adds.”
Interesting note on New Relic in there.
Sales and Marketing Expense as a % of Annual Revenues:
Lawson experienced the .com crash and lost everything he had gained after his first startup (Versity.com) was acquired by CollegeClub.com for shares, which eventually become worthless as the company went bankrupt. He was also on the team that helped develop and launch AWS in 2004.
Competition: there is definitely competition from legacy providers (Avaya, Genesys, and others) trying to defend their market share. There’s also a very attractive opportunity which is sure to attract new competition as well. However, I believe Twilio is out to a very strong lead and this is a type of platform that becomes very sticky once organizations start to shift their processes over to Twilio enabled communications.
I really enjoyed this article. It’s a couple years old, but after reading I’m even more confident in Twilio’s leadership, execution, and market opportunity.
I am long TWLO. I’m not nearly as experienced as many on this forum but TWLO is about 12% of my portfolio making it my 3rd or 4th largest holding behind PSTG, NKTR, and possibly NVDA (need to check).
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