I don't know much about what happened here, but I did meet the early Twilio team (not Jeff, unfortunately) back in 2009 and knew they were something special.
Jeff (and team) deserve a ton of credit for two massive things:
First, changing how people think about devtools. I know Stripe gets a lot of credit, but Twilio was 3 years earlier and really defined how we look at building, marketing and monetizing tools meant for devs. They were early (if not first) to the devrel space, and Jeff's live coding (paired with a phone literally vibrating) was something I had never seen before.
Second, I know a lot of people have lots of opinions about San Francisco, but I have a lot of respect to Jeff for always standing up and fighting for the city that enabled him to build his company. He seems to be a really good person, and is one of the few CEOs I find myself eager to emulate.
Good luck to Jeff, Twilio, and everyone else involved. Jeff built something really special in the early years. And jeffiel, now that you have a bit more time on your hands, hopefully we can finally cross paths!
When we started Iron.io in 2010, there were basically 3 companies at every developer event driving the API-first message: Heroku, Sendgrid, and Twilio. Back then, most thought Heroku (as the Platform) was going to be the one ending up in the public markets. Then they got taken out and Twilio bought Sendgrid. Congrats to Twilio and team for the years of success!
I used iron.io for years. Sad story there I think but I don’t know the details. Seemed like Great service for years then it kind of fell off, the service still worked thankfully. But no new features, and support would take days.
Thanks for using us! We ended up selling the service to private equity, hence the slowdown in features and support. Was an awesome and fun business to build but running a 24/7/365 service just as all the cloud providers were adding similar products was a slog.
I’m personally not a dev, maybe amateur dev, but I am a professional I.T. consultant and sysadmin, and I have used and thoroughly enjoyed Twilio’s tools for years. They are accessible enough for even low-skill amateur devs like me to be able to spin up test programs and functions that do really cool things. I am heartened to hear that my longtime support has gone to a company whose culture and leadership have been worthy. Hoping for the best to everyone involved.
Can't speak for the guy you asked, but I'm approximately his skill-set, and that's what I've used it for.
Long time ago, though; I can't speak to the developer experience now. $20 and contact customer support... What? It used to be easy. Like, create an account and ten minutes later your in business, easy. I used them for a number of (free-tier, I think) personal and (paid-tier) professional projects, and was a very satisfied customer.
I'm somewhat on top of the stock, here's my not financial advice take:
1. Growth rate slowed such that valuations had to come down (went from inevitable overtaking of Salesforce in size, to decades of growth required)
2. Environment -- Cashflow negative meaning another raise was required without fiscal controls and in a high interest environment that's really tough. A return to office end of covid anxiety meant the Covid bubbled stocks are returning to mean. (eg compare zoom has done relatively similar over past 5 yrs)
3. IMO a few execs were absurdly over compensated whilst investor pressure against dillution was targeted to rank and file employees. eg: Eyal Manor earned a reported $42M in compensation (and a $2.5M retention bonus that reading between the lines sounds like hush money), meanwhile ICs were often given below cost of living raises and no refreshers.
1-2 means outside investors had to lower the valuation and 3 meant a combination of dilution and morale hits.
A few other things that could contribute to a slowing growth rate:
1. People build software differently now. There's not as much reliance on text messages (fewer phone apps build built, 2fa via phone is considered dangerous, etc)
2. Gig economy is stabilizing. There was a huge increase in new companies for years, but at this point it feels like we've stalled on new innovations in that space (while a lot of VC-subsidized ones have faded out)
3. There's way more regulations on spam (good for us, bad for Twilio). I think Twilio did as good a job of avoiding spam as anyone could reasonably expect, but the barrier to entry to using Twilio for even reasonable projects now involves the government. Plus with the crackdown on spam (good!), a portion of their business has likely been affected.
I have no idea the breakdown of their revenue, but my understanding is that now they do a lot more than just the SMS they were famous for. Especially with all the companies they bought.
Semi-related to your third point, I do not trust a text message from a company that does not use the shortened phone number system that was popularized by Twilio. It's the easiest way to detect phishing attempts because scammers don't use those.
Why wouldn't you? Anyone and their mother could get a long code number from Twilio for $1/mo, without any kind of verification or KYC process.
Meanwhile, a short code would run you $4500 for three months (IIRC, memory is fuzzy, and it's probably changed), and you had to go through an approval process with all the mobile carriers (that is, Verizon, T-Mobile, etc. had to individually approve the short code) where you explained your use case and promised not to spam.
(Obviously things are different now with the campaign registration and approvals requires even for long code numbers. But short codes are still harder to get, and the approvals more rigorous.)
You’re both pretty much right it looks like he vested all the RSUs in one year so he while he took it all home in 2021 it had probably vested over 4 years, the first 3 when it wasn’t reflected as comp.
I truly hope it's not the divide and sell that activists have been pushing for. The time to sell to CRM or ADBE was during pandemic highs, now both those are probably more interested in AI hype. I think AWS or another cloud provider would be an interesting pairing though, but with Jeff out so does the hopes of an Amazon relationship besides 2023's announcement
They spent a ton of money buying other companies. That’s always capital intense.
Software isn’t capital intensive the way a large industrial factory would be, but it still has unfavorable financial conditions that require raising. You can’t sell software until you’ve built it, so you have to incur a large employee/R&D expense for years until the product is ready. And of course none of that is IP that you can just get a loan against (unlike say, building a factory).
It’s funny to contrast that with the video game publishers. They’ll push to sell things that aren’t even close to finished, make bank, and do it again and again.
I think the common thread with Twilio the sms/sip product and Twilio the CDP / nee Segment is this: businesses outgrow them. Both of them work well for smb and lower midmarket, but as companies grow, become horrendously expensive and essentially strongly encourage migration off. A public company is not a failure, but when your product has a ceiling with your customers, that's painful.
I also had a really annoying experience with Sendgrid post acquisition. I'd used Sendgrid for my first company (as in I personally made the purchase, implemented the apis, and for a long time, was the sole and then admin account). I went to use it for my next company pre website launch and they froze my new account and their customer service was a pita. To be fair, the site wasn't up, but I needed the ability to send emails to publish the site (it's a crucial part of new account flow.) They wouldn't allow me to use sendgrid even though I was happy to share my linkedin, my previous history with their company, etc. We're happy sendinblue customers.
One can continuously grow a stock if they reduce the shares outstanding.
That being said iirc buy backs have notoriously all gone to executives. Essentially they buy back, and then award themselves options to re-dilute, but cannot readily find a source for that. So maybe incorrect.
When a business does a stock buyback, the business receives the stock, not any executive(s).
The business might pay the executive with stock per the board approved compensation package, but a CEO does not wake up and say “I want to give myself 5M shares so let’s do a 5M share buyback”.
A buyback benefits all shareholders equally by reducing supply of the stock and therefore increasing its price.
It's not that executives receive the bought back stock, but that their stock based compensation plans result in no net decrease in the amount of outstanding shares.
My take: ignore the pandemic. The stock price was around $90 before the pandemic hit, which isn't much higher than it is right now. Twilio was basically the perfect remote-work-enabling pandemic company. And the market piled on and thought Twilio was a great place to put money during a global pandemic, when so many other places seemed risky or disastrous.
After mid-2021, that $400+ stock price started looking a little silly. And the broader market downturn in 2022 hit Twilio even harder than it hit the broader market.
And, meanwhile, Twilio's growth numbers -- while still being an unprofitable company! -- look worse than they did at the beginning of 2020. $75 might be generous for how the company is actually doing.
(Full disclosure: former employee for ~10 years, and I still have a few shares left.)
My take: They're too expensive at volume (and they have competitors, just not famous ones) and not specialized enough / not best in class compared to tools like Klaviyo.
This. They're great for small/mid-sized developers, but they price themselves out once you're doing billions of messages a month. At that point companies start looking at aggregators one level down (i.e. closer to the carriers or raw SMTP).
> One issue might be that Microsoft (as ever) launched a milquetoast competitor that sounds the same to a purchasing department in 2020.
AWS (and presumably Google) also provides a suite of telephony services with Chime, SNS, Connect, etc. I assume the strategy now is to sell to/merge with a smaller CSP to provide a competitive portfolio of services.
Not OP, but their approach to devrel was by itself a huge differentiator early on.
We’ve become so accustomed to developer-oriented marketing and programs that it’s easy to forget that Twilio was really at the cutting edge of this movement and should be credited (or at least acknowledged) for the easy on-ramps most developer programs now provide.
Twilio also pushed the envelope in terms of what it means to talk to their developer community. Greg Baugues’ talk titled “Devs and Depression” reached a lot of people who were struggling, and was one of the reasons I personally sought out therapy, and my life is much better for it.
Early Twilio was a very human-oriented company, and I think many developers and developer programs are better for it.
I'm Adam Washington. I was a couple of years behind you, but we bumped into each other socially a few times over the years. As a refresher, I was also the sophomore with the glasses in Shadiow's class that accidentally kicked over the trash can while trying to explain how graphs work.
Back in high school, I thought you were the brightest and chillest guy on the planet. My first Linux install was because I overheard you talking about it in class and I wanted to see what the fuss was about. Anyway, it's been a treat seeing you pop up again after all these years and discovering that my nostalgia lenses were right - you really are that smart and cool.
I was an intern at GigaOM in 2009 (a popular tech blog that ran conferences), and my first memory of Twilio was going to the sales people and trying to convince them to give Twilio a discounted booth because I thought the product was so great. I remember the salesperson laughing and saying "this booth costs more money than they have in their bank account", but there was some extra inventory and we got them the booth.
The early people all just had this vibe of technical-but-not-complicated. It's common now, but at the time it was such a breath of fresh air. They were one of the first companies to pitch "easy of use" (compared to "look at how amazingly complex we are!"). I know this is super obvious now, but back then I had never felt anything like that.
All the people I met (I specifically remember Danielle) were friendly and excited... not in a sales-y way, but in a "I just love what we're doing and want you to, too" way. And again, I know this doesn't feel unique now, but that's because Twilio helped shape how we think about all of this.
I loved their attitude, such as this talk from John Sheehan (https://www.heavybit.com/library/video/runscope-ceo-and-twil...) about how they look at customers. I remember him saying they would fly to any little city that would have them and buy pizza and just hang out. They caught on early that there were so many tech people out there around the country who would become lifelong supporters because of little gestures like this.
Overall, a lot of what I can say about Twilio is super obvious now. But it's kinda like how people watch Friends for the first time in 2023 and say "meh it's a pretty generic sitcom". It's because they created the whole genre and shifted how everything thinks.
> Overall, a lot of what I can say about Twilio is super obvious now. But it's kinda like how people watch Friends for the first time in 2023 and say "meh it's a pretty generic sitcom". It's because they created the whole genre and shifted how everything thinks.
I feel this way about most classic media. Famous movies and books almost always feel underwhelming to me because the notable ideas have been reused and referenced so many times that the original ends up feeling like a retread decades later. Interesting connection to tie this phenomenon to tech marketing and dev relations.
Jeff (and team) deserve a ton of credit for two massive things:
First, changing how people think about devtools. I know Stripe gets a lot of credit, but Twilio was 3 years earlier and really defined how we look at building, marketing and monetizing tools meant for devs. They were early (if not first) to the devrel space, and Jeff's live coding (paired with a phone literally vibrating) was something I had never seen before.
Second, I know a lot of people have lots of opinions about San Francisco, but I have a lot of respect to Jeff for always standing up and fighting for the city that enabled him to build his company. He seems to be a really good person, and is one of the few CEOs I find myself eager to emulate.
Good luck to Jeff, Twilio, and everyone else involved. Jeff built something really special in the early years. And jeffiel, now that you have a bit more time on your hands, hopefully we can finally cross paths!