Sources told ProWellTech that Twilio intends to acquire Customer Data Startup Segment worth between $ 3 and $ 4 billion. Forbes unveiled 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. This 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, provides a set of APIs to collect customer data from a variety of sources:
Segment has made a name for itself by providing a set of APIs that allow it to collect data about a customer from a variety of sources such as your CRM tool, customer service application, and website and bring them all together in one view customer, something that is the goal of every company in the customer information industry.
While Twilio's primary focus since its launch in 2008 has been to simplify the integration of communication features into any app, it signaled a change of direction when it released the Flex Customer Service API in March 2018. More Later that year, it bought SendGrid, an email marketing API company for $ 2 billion.
Twilio's market cap on Friday was a whopping $ 45 billion. You might see how he can afford to flex his financial muscles to combine Twilio's core API mission, specifically Flex, with the ability to extract customer data with Segment and create personalized emails or ads with SendGrid.
This could allow Twilio to expand beyond pure core communication capabilities and could come at a cost of around $ 5 billion for the two companies, a good deal for what could prove to be a substantial business as more and more companies seek ways to understand and communicate with their customers in more relevant ways across multiple channels.
As Semil Shah of early stage VC firm Haystack wrote in the company's blog yesterday, Segment saw a different way of collecting customer data, and Twilio was wise to swoop in and buy it.
Segment's belief was that a traditional CRM was not robust enough for the company to properly manage their pipe. Segment inserted to provide customer data infrastructure to deliver a more unified experience. Now under the Twilio umbrella, Segment can continue to create key integrations (as they did with Twilio data), which are already being used globally within Fortune 500 companies.
Segment was founded in 2011 and raised over $ 283 million, according to data from Crunchbase. Its most recent increase was $ 175 million in April on a valuation of $ 1.5 billion.
Twilio stock closed at $ 306.24 per share on Friday, up $ 2.39%.
Segment declined to comment on this story. We also sent a request for comment to Twilio, but had not received a response at the time of publication. If that changes, we'll update the story.