Twilio to Acquire Segment for $3B

Reports indicate that Twilio is planning to purchase customer data platform Segment for a valuation ranging from $3 billion to $4 billion. The initial report of a $3.2 billion price tag surfaced on Friday evening from Forbes.

Several sources within the industry have confirmed the potential deal, suggesting a possible announcement as soon as Monday.

Both Twilio and Segment operate as API-based businesses. This means they offer developers simplified access to specific functionalities, reducing the need for extensive coding. As previously detailed in a 2017 article concerning Segment, the company provides a suite of APIs designed to consolidate customer data from various origins:

Twilio, since its inception in 2008, has primarily focused on streamlining the integration of communication features into applications. However, the release of the Flex customer service API in March 2018 signaled a shift in strategy. This was further reinforced later that year with the acquisition of SendGrid, an email marketing API provider, for $2 billion.

Twilio’s market capitalization stood at a significant $45 billion as of Friday. This financial strength allows the company to strategically invest in expanding its API offerings, particularly by integrating Flex with Segment’s customer data capabilities and SendGrid’s personalized email and advertising solutions.

This acquisition could allow Twilio to move beyond its core communications services, potentially representing a $5 billion investment in two companies poised for substantial growth as businesses increasingly prioritize understanding and engaging with customers across diverse channels.

Semil Shah, of Haystack venture capital, highlighted Segment’s innovative approach to customer data collection in a recent blog post, noting Twilio’s astute decision to acquire the company.

Founded in 2011, Segment has secured over $283 million in funding, as per Crunchbase data. The company’s latest funding round in April valued it at $1.5 billion, raising $175 million.

Twilio’s stock price concluded Friday’s trading at $306.24 per share, reflecting a 2.39% increase.

Segment has not provided a statement regarding this matter. A request for comment was also sent to Twilio, but a response was not received before publication. We will update this article if additional information becomes available.