Insight Bite: Email Acquisitions Heat up as Twilio Closes SendGrid Deal

Cloud communications platform Twilio, which lets companies like Airbnb and Amazon interact with customers through texts and push notifications, has expanded into email with the acquisition of SendGrid.

This will push the firm forward in its goal of creating a go-to platform that caters to every business communication need:

“The two companies share the same vision, the same model, and the same values” said Twilio co-founder and CEO Jeff Lawson. “We believe this is a once-in-a-lifetime opportunity to bring together the two leading developer-focused communications platforms to create the unquestioned platform of choice for all companies looking to transform their customer engagement.”

SendGrid’s email delivery infrastructure will now be absorbed into Twilio’s rapidly expanding cloud communications ecosystem. But, the company will continue to be led by SendGrid CEO Sameer Dholakia, and operate as a wholly owned subsidiary.

Both companies have seen considerable growth over the past few years, and since the acquisition was first proposed in October 2018, shares in Twilio have increased by 70 percent, pushing the price from $2 billion up to $3 billion.

Twilio hasn’t always been so prosperous, however, and this period of growth follows a moment of uncertainty for the company when Uber, which accounted for 12 percent of revenue at the time, dropped the company’s services in favour of developing its own alternative.

On the news, Twilio stock dropped, but has since skyrocketed as the cloud company embarked on an acquisitions campaign that has seen them purchase companies including Authy, a two-factor authentication firm; Beepsend SMS, an SMS messaging provider; and Ytica, a provider of workforce optimisation software.

This expansion has helped drive explosive growth, setting the stage for the acquisition of SendGrid. As Twilio’s biggest ever purchase, this is a significant step for the company, and puts them in the same category as software giants like Salesforce, Oracle and IBM, which have absorbed several leading players in the email marketing industry in recent years.

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