Segment launches customer journey tool to build fine-grained personal experiences

Twilio Segment announced a tool, which is available starting today, to help marketers create fine-grained customer journeys. Up until now the company has enabled marketers to build buyer personas and broader audiences, but this enables users to have much greater control of their interactions with a customer.

Company co-founder and CEO Peter Reinhardt says that marketers have been craving the ability to build more customized customer journeys and this tool gives them that. “It’s basically taking the power that existed in personas and audiences and actually putting it fully in marketers’ hands to build their dream journeys across every channel with the best data,” he said.

This enables marketers to stitch together a whole sequence of audiences. “Say when someone comes to the top of the funnel, they want to do X, then if they want to branch it and use X or Y, then do two different things, and you can keep branching and personalizing via this whole journey to cover the whole lifecycle.”

He says this capability has existed in some tools, but the Twilio Segment offering enables it to be used in more than 300 tools in the Segment ecosystem. “This is the first time that we’re going to be able to really do that and orchestrate this way, not just for a limited subset of channels, but across all of the channels,” he said.

Marketers can build branching by dragging and dropping journey components to send people on different paths depending on things like if they are a regular customer or a first-time customer or just about anything you can think of. Reinhardt says that flexibility is a key attribute of the new feature.

While it’s competing with some major players like Adobe and Salesforce in this space, Reinhardt believes this capability really gives Twilio a leg up over the competitors. “I think if you look at more of the legacy journey builders, [their products] are not built on real time data, meaning that they’re actually missing basically all of the interesting behavioral data that marketers actually build on,” he said.

Segment was acquired by Twilio last year for $3.2 billion, and part of the reason for that was to increase its customer engagement capabilities. Segment gives Twilio a customer data platform to build on top of its other communications tooling, and today’s announcement expands on that capability.


By Ron Miller

How Segment redesigned its core systems to solve an existential scaling crisis

Segment, the startup Twilio bought last fall for $3.2 billion, was just beginning to take off in 2015 when it ran into a scaling problem: It was growing so quickly, the tools it had built to process marketing data on its platform were starting to outgrow the original system design.

Inaction would cause the company to hit a technology wall, managers feared. Every early-stage startup craves growth and Segment was no exception, but it also needed to begin thinking about how to make its data platform more resilient or reach a point where it could no longer handle the data it was moving through the system. It was — in a real sense — an existential crisis for the young business.

The project that came out of their efforts was called Centrifuge, and its purpose was to move data through Segment’s data pipes to wherever customers needed it quickly and efficiently at the lowest operating cost.

Segment’s engineering team began thinking hard about what a more robust and scalable system would look like. As it turned out, their vision would evolve in a number of ways between the end of 2015 and today, and with each iteration, they would take a leap in terms of how efficiently they allocated resources and processed data moving through its systems.

The project that came out of their efforts was called Centrifuge, and its purpose was to move data through Segment’s data pipes to wherever customers needed it quickly and efficiently at the lowest operating cost. This is the story of how that system came together.

Growing pains

The systemic issues became apparent the way they often do — when customers began complaining. When Tido Carriero, Segment’s chief product development officer, came on board at the end of 2015, he was charged with finding a solution. The issue involved the original system design, which like many early iterations from startups was designed to get the product to market with little thought given to future growth and the technical debt payment was coming due.

“We had [designed] our initial integrations architecture in a way that just wasn’t scalable in a number of different ways. We had been experiencing massive growth, and our CEO [Peter Reinhardt] came to me maybe three times within a month and reported various scaling challenges that either customers or partners of ours had alerted him to,” said Carriero.

The good news was that it was attracting customers and partners to the platform at a rapid clip, but it could all have come crashing down if the company didn’t improve the underlying system architecture to support the robust growth. As Carriero reports, that made it a stressful time, but having come from Dropbox, he was actually in a position to understand that it’s possible to completely rearchitect the business’s technology platform and live to tell about it.

“One of the things I learned from my past life [at Dropbox] is when you have a problem that’s just so core to your business, at a certain point you start to realize that you are the only company in the world kind of experiencing this problem at this kind of scale,” he said. For Dropbox that was related to storage, and for Segment it was processing large amounts of data concurrently.

In the build-versus-buy equation, Carriero knew that he had to build his way out of the problem. There was nothing out there that could solve Segment’s unique scaling issues. “Obviously that led us to believe that we really need to think about this a little bit differently, and that was when our Centrifuge V2 architecture was born,” he said.

Building the imperfect beast

The company began measuring system performance, at the time processing 8,442 events per second. When it began building V2 of its architecture, that number had grown to an average of 18,907 events per second.


By Ron Miller

Twilio wraps $3.2B purchase of Segment after warp speed courtship

It was barely a month ago we began hearing rumors that Twilio was interested in acquiring Segment. The $3.2 billion deal was officially announced three weeks ago, and this morning the communications API company announced that the deal had closed, astonishingly fast for an acquisition of this size.

While we can’t know for sure, the speed with which the deal closed could suggest that it was in the works longer than we had known, and when we began hearing rumors of the acquisition, it could have already been signed, sealed and delivered. In addition, the fact that Twilio CEO Jeff Lawson and Segment CEO Peter Reinhardt knew one another before coming to terms might have helped accelerate the process.

Regardless, the two companies are a nice fit. Both deal with the API economy, providing a set of tools to help developers easily add a particular set of functions to their applications. For Twilio, that’s a set of communications APIs, while Segment focuses on customer data.

When you pull the two sets of tooling together, and combine that with Twilio’s 2018 SendGrid acquisition, you can see the possibility to build more complete applications for interacting with customers at every level including basic communications like video, SMS and audio from Twilio, as well as customer data from Segment and customized emails and ads based on those interactions from SendGrid.

As companies increasingly focus on digital engagement, especially in the midst of a pandemic, Twilio’s Lawson believes the biggest roadblock to this type of engagement has been that data has been locked in silos, precisely the kind of problem that Segment has been attacking.

“With the addition of Segment, Twilio’s Customer Engagement Platform now enables companies to both understand their customer and engage with them digitally — the combination is key to building great digital experiences,” Lawson said in a statement.

In a recent post looking at the reasoning behind the deal, Brent Leary, founder and principal analyst at CRM Essentials saw it this way: “This move allows Twilio to impact the data-insight-interaction-experience transformation process by removing friction from developers using their platform,” Leary explained.

With the deal closed, Segment will become a division of Twilio. Reinhardt will continue to be CEO, and will report directly to Lawson.


By Ron Miller

Twilio is buying customer data startup Segment for between $3B and $4B

Sources have told TechCrunch that Twilio intends to acquire customer data startup Segment for between $3 and $4 billion. Forbes broke 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. That 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, it provides a set of APIs to pull together customer data from a variety of sources:

Segment has made a name for itself by providing a set of APIs that enable it to gather data about a customer from a variety of sources like your CRM tool, customer service application and website and pull that all together into a single view of the customer, something that is the goal of every company in the customer information business.

While Twilio’s main focus since it launched in 2008 has been on making it easy to embed communications functionality into any app, it signaled a switch in direction when it released the Flex customer service API in March 2018. Later that same year, it bought SendGrid, an email marketing API company for $2 billion.

Twilio’s market cap as of Friday was an impressive $45 billion. You could see how it can afford to flex its financial muscles to combine Twilio’s core API mission, especially Flex, with the ability to pull customer data with Segment and create customized email or ads with SendGrid.

This could enable Twilio to expand beyond pure core communications capabilities and it could come at the cost of around $5 billion for the two companies, a good deal for what could turn out to be a substantial business as more and more companies look for ways to understand and communicate with their customers in more relevant ways across multiple channels.

As Semil Shah from early stage VC firm Haystack wrote in the company blog yesterday, Segment saw a different way to gather customer data, and Twilio was wise to swoop in and buy it.

Segment’s belief was that a traditional CRM wasn’t robust enough for the enterprise to properly manage its pipe. Segment entered to provide customer data infrastructure to offer a more unified experience. Now under the Twilio umbrella, Segment can continue to build key integrations (like they have for Twilio data), which is being used globally inside Fortune 500 companies already.

Segment was founded in 2011 and raised over $283 million, according to Crunchbase data. Its most recent raise was $175 million in April on a $1.5 billion valuation.

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 hadn’t heard back by the time we published.  If that changes, we will update the story.


By Ron Miller

How Twilio built its own conference platform

Twilio’s annual customer conference was supposed to happen in May, but like everyone else who had live events scheduled for this year, it ran smack-dab into COVID-19 and was forced to cancel. That left the company wondering how to reimagine the event online. It began an RFP process to find a vendor to help, but eventually concluded it could use its own APIs and built a platform on its own.

That’s a pretty bold move, but one of the key issues facing Twilio was how to recreate the in-person experience of the show floor where people could chat with specific API experts. After much internal deliberation, they realized that was what their communication API products were designed to do.

Once they committed to going their own way, they began a long process that involved figuring out must-have features, building consensus in the company, a development and testing cycle and finding third-party partnerships to help them when they ran into the limitations of their own products.

All that work culminates this week when Twilio holds its annual Signal Conference online Wednesday and Thursday. We spoke to In-Young Chang, director of experience at Twilio, to learn how this project came together.

Chang said once the decision was made to go virtual, the biggest issue for them (and for anyone putting on a virtual conference) was how to recreate that human connection that is a natural part of the in-person conference experience.

The company’s first step was to put out a request for proposals with event software vendors. She said that the problem was that these platforms hadn’t been designed for the most part to be fully virtual. At best, they had a hybrid approach where some people attended virtually, but most were there in person.

“We met with a lot of different vendors, vendors that a lot of big tech companies were using, but there were pros to some of them, and then cons to others, and none of them truly fit everything that we needed, which was connecting our customers to product experts [like we do at our in-person conferences],” Chang told TechCrunch.

Even though they had winnowed the proposals down to a manageable few, they weren’t truly satisfied with what the event software vendors were offering, and they came to a realization.

“Either we find a vendor who can do this fully custom in three months time, or [we do it ourselves]. This is what we do. This is in our DNA, so we can make this happen. The hard part became how do you prioritize because once we made the conference fully software-based, the possibilities were endless,” she said.

All of this happened pretty quickly. The team interviewed the vendors in May, and by June made the decision to build it themselves. They began the process of designing the event software they would be using, taking advantage of their own communications capabilities, first and foremost.

The first thing they needed to do was meet with various stakeholders inside the company and figure out the must-have features in their custom platform. She said that reeling in people’s ambitions for version 1.0 of the platform was part of the challenge that they faced trying to pull this together.

“We only had three months. It wasn’t going to be totally perfect. There had to be some prioritization and compromises, but with our APIs we [felt that we] could totally make this happen,” Chang said.

They started meeting with different groups across the company to find out their must-haves. They knew that they wanted to recreate this personal contact experience. Other needs included typical conference activities like being able to collect leads and build agendas and the kinds of things you would expect to do at any conference, whether in-person or virtual.

As the team met with the various constituencies across the company, they began to get a sense of what they needed to build and they created a priorities document, which they reviewed with the Signal leadership team. “There were some hard conversations and some debates, but everyone really had goodwill toward each other knowing that we only had a few months,” she said.

Signal Concierge Agent for virtual Twilio Signal Conference

Signal Concierge Agent helps attendees navigate the online conference. Image Credits: Twilio

The team believed it could build a platform that met the company’s needs, but with only 10 developers working on it, they had a huge challenge to get it done in three months.

With one of the major priorities putting customers together with the right Twilio personnel, they decided to put their customer service platform, Twilio Flex, to work on the problem. Flex combines voice, messaging, video and chat in one interface. While the conference wasn’t a pure customer service issue, they believed that they could leverage the platform to direct requests to people with the right expertise and recreate the experience of walking up to the booth and asking questions of a Twilio employee with a particular skill set.

“Twilio Flex has Taskrouter, which allows us to assign agents unique skills-based characteristics like you’re a video expert, so I’m going to tag you as a video expert. If anyone has a question around video, I know that we can route it directly to you,” Chang explained.

They also built a bot companion, called Signal Concierge, that moves through the online experience with each attendee and helps them find what they need, applying their customer service approach to the conference experience.

“Signal Concierge is your conference companion, so that if you ever have a question about what session you should go to next or [you want to talk to an expert], there’s just one place that you have to go to get an answer to your question, and we’ll be there to help you with it,” she said.

The company couldn’t do everything with Twilio’s tools, so it turned to third parties in those cases. “We continued our partnership with Klik, a conference data and badging platform all available via API. And Perficient, a Twilio SI partner we hired to augment the internal team to more quickly implement the custom Twilio Flex experience in the tight timeframe we had. And Plexus, who provided streaming capabilities that we could use in an open source video player,” she said.

They spent September testing what they built, making sure the Signal Concierge was routing requests correctly and all the moving parts were working. They open the virtual doors on Wednesday morning and get to see how well they pulled it off.

Chang says she is proud of what her team pulled off, but recognizes this is a first pass and future versions will have additional features that they didn’t have time to build.

“This is V1 of the platform. It’s not by any means exactly what we want, but we’re really proud of what we were able to accomplish from scoping the content to actually building the platform within three months’ time,” she said.


By Ron Miller

Microsoft challenges Twilio with the launch of Azure Communication Services

Microsoft today announced the launch of Azure Communication Services, a new set of features in its cloud that enable developers to add voice and video calling, chat and text messages to their apps, as well as old-school telephony.

The company describes the new set of services as the “first fully managed communication platform offering from a major cloud provider,” and that seems right, given that Google and AWS offer some of these features, including the AWS notification service, for example, but not as part of a cohesive communication service. Indeed, it seems Azure Communication Service is more of a competitor to the core features of Twilio or up-and-coming MessageBird.

Over the course of the last few years, Microsoft has built up a lot of experience in this area, in large parts thanks to the success of its Teams service. Unsurprisingly, that’s something Microsoft is also playing up in its announcement.

“Azure Communication Services is built natively on top a global, reliable cloud — Azure. Businesses can confidently build and deploy on the same low latency global communication network used by Microsoft Teams to support 5B+ meeting minutes daily,” writes Scott Van Vliet, corporate vice president for Intelligent Communication at the company.

Microsoft also stresses that it offers a set of additional smart services that developers can tap into to build out their communication services, including its translation tools, for example. The company also notes that its services are encrypted to meet HIPPA and GDPR standards.

Like similar services, developers access the various capabilities through a set of new APIs and SDKs.

As for the core services, the capabilities here are pretty much what you’d expect. There’s voice and video calling (and the ability to shift between them). There’s support for chat and, starting in October, users will also be able to send text messages. Microsoft says developers will be able to send these to users anywhere, with Microsoft positioning it as a global service.

Provisioning phone numbers, too, is part of the services and developers will be able to provision those for in-bound and out-bound calls, port existing numbers, request new ones and — most importantly for contact-center users — integrate them with existing on-premises equipment and carrier networks.

“Our goal is to meet businesses where they are and provide solutions to help them be resilient and move their business forward in today’s market,” writes Van Vliet. “We see rich communication experiences – enabled by voice, video, chat, and SMS – continuing to be an integral part in how businesses connect with their customers across devices and platforms.”


By Frederic Lardinois

As companies accelerate their digital transitions, employees detail a changed workplace

The U.S.’s COVID-19 caseload continues to set records as major states move to re-shutter their economies in hopes of stemming its spread. For many workers the situation means more time in the home office, and less time in their traditional workplace.

What the world will look like when safety eventually returns is not clear, but it’s becoming plain that the workplace will not revert to its old normal. New data details changed employee sentiment, showing that a good portion of the working world doesn’t want to get back to its pre-COVID commute, and, in many cases, is eyeing a move to a different city or state in the wake of the pandemic and its economic disruptions.


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The changing workplace has shifted — accelerated, you could say — demand for all sorts of products and services, from grocery delivery to software. The latter category of tools has seen quickening demand as the world moves to support newly remote workforces, helping keep them both productive and secure.

TechCrunch has covered the accelerating digital transformation — industry slang for companies moving to a more software-and-cloud world — before, noting that investors are making big bets on companies that might benefit from its ramping pace. Thanks to new data from a Twilio-led survey, we have a fresh look at that trend.

Undergirding the digital transformation is how today’s workers are adapting to remote work. If many workers don’t want to stop working from home, the gains that companies serving the digital transformation are seeing could prove permanent. New data from a Qualtrics -led survey may help us understand the new mindset of the domestic, and global worker.

At the union of the two datasets is a lens into the future of not only how many information workers, to borrow an old phrase, will labor in the future, but how they’ll feel about it. So, this morning let’s explore the world through two data-driven lenses, helped as we go with notes from interviews with Qualtrics’ CEO Ryan Smith and Twilio’s Chief Customer Officer, Glenn Weinstein.

What workers want


By Alex Wilhelm

Why we’re doubling down on cloud investments right now

Years from now, people will look back on the COVID-19 pandemic as a watershed moment for society and the global economy.

Wearing a mask might be as common as owning a phone; telework, telemedicine and online education will be more of a norm than a backup plan; and for the global economy, the cloud will have transformed the underlying infrastructure of businesses and entire industries.

COVID-19 is a turning point for the cloud and cloud company founders. For its computing power and as a delivery model of software, the cloud has been embraced as a solution to many challenges that businesses face during today’s economic downturn and recovery. Not only is the cloud industry more resilient than other industries, but the cloud model offers businesses a promising future in the age of social distancing and beyond.

We believe that once founders find shelter in the cloud, they’ll never go back.

Cloud’s resiliency amid historic volatility

Over the past decade, there’s been a massive market shift from on-premises to cloud, as 94% of enterprises use at least one cloud service today. 2020 was already a milestone year for the cloud industry, as aggregate SaaS and IaaS run-rate revenue each crossed $100 billion, and the BVP Nasdaq Emerging Cloud Index (^EMCLOUD) market cap crossed $1 trillion in early February. Yet in a matter of days, as the COVID-19 pandemic spread, fear tore through financial markets.

In early March, public markets experienced the steepest crash in history with volatility we haven’t seen since the Great Recession. The cloud index market cap dropped to ~$750 million and cloud multiples returned close to their historical averages of ~7x while the VIX volatility index spiked to the mid-80s. Both at global highs in February 2020, the ^EMCLOUD and the S&P 500 traded off by roughly 35% by mid-March. Over the next two months, though, the ^EMCLOUD recouped those losses, charging to a new all-time high on May 7.

The cloud index has continued its rise since then, and as of the close on May 11 has a market cap above $1.2 trillion and has returned to the lofty 12x forward run rate revenue multiples from 2019. Similar to Adobe in 2012, we expect many enterprises to transition over to the cloud model, and the index will continue to expand. As we predicted in this year’s State of the Cloud 2020, by 2025 we expect the cloud to penetrate 50% of enterprise software.


By Walter Thompson

Checkly raises $2.25M seed round for its monitoring and testing platform

Checkly, a Berlin-based startup that is developing a monitoring and testing platform for DevOps teams, today announced that it has raised a $2.25 million seed round led by Accel. A number of angel investors, including Instana CEO Mirko Novakovic, Zeit CEO Guillermo Rauch and former Twilio CTO Ott Kaukver, also participated in this round.

The company’s SaaS platform allows developers to monitor their API endpoints and web apps — and it obviously alerts you when something goes awry. The transaction monitoring tool makes it easy to regularly test interactions with front-end websites without having to actually write any code. The test software is based on Google’s open-source Puppeteer framework and to build its commercial platform, Checkly also developed Puppeteer Recorder for creating these end-to-end testing scripts in a low-code tool that developers access through a Chrome extension.

The team believes that it’s the combination of end-to-end testing and active monitoring, as well as its focus on modern DevOps teams, that makes Checkly stand out in what is already a pretty crowded market for monitoring tools.

“As a customer in the monitoring market, I thought it had long been stuck in the 90s and I needed a tool that could support teams in JavaScript and work for all the different roles within a DevOps team. I set out to build it, quickly realizing that testing was equally important to address,” said Tim Nolet, who founded the company in 2018. “At Checkly, we’ve created a market-defining tool that our customers have been demanding, and we’ve already seen strong traction through word of mouth. We’re delighted to partner with Accel on building out our vision to become the active reliability platform for DevOps teams.”

Nolet’s co-founders are Hannes Lenke, who founded TestObject (which was later acquired by Sauce Labs), and Timo Euteneuer, who was previously Director Sales EMEA at Sauce Labs.

Tthe company says that it currently has about 125 paying customers who run about 1 million checks per day on its platform. Pricing for its services starts at $7 per month for individual developers, with plans for small teams starting at $29 per month.


By Frederic Lardinois

Twilio 2010 board deck gives peek at now-public company’s early days

Twilio is best known for its communications API, which allows developers to add messaging, voice or video to their apps with just a small slice of code. The company’s tools are used by customers like Lyft, Airbnb, Salesforce, Box and Duke University.

The former startup went public in 2016 at $15 a share. Yesterday Twilio’s stock closed at $113.90, giving the company a market cap of about $15.6 billion (after a horrendous week on Wall Street). It’s easy to look at its value (among other measures) and declare Twilio a successful public company. But just like every former startup out there, its ascent wasn’t always so certain.

Founded in 2008, Twilio was once a tentative early-stage company feeling its way forward in the market with an unproven product and more future potential than actual results. Recently, the company’s CEO Jeff Lawson shared a Twilio board deck from March 2010.

Naturally, we read through it — how could we not? — but we also decided to analyze it for you, pulling out what we learned and using the snapshot of Twilio’s history to illustrate how far the company has come in the last decade.

The presentation’s original time stamp lands after Twilio’s Series A and just before its Series B, allowing us to see a company molting from a hatchling to something more sturdy that could stand on its own two feet. The company raised $12 million six months after the deck was presented.

To get everyone on the same page, we’ll start with a little history, and then get into the deck itself. Let’s go!

Where Twilio came from


By Ron Miller

APIs are the next big SaaS wave

While the software revolution started out slowly, over the past few years it’s exploded and the fastest-growing segment to-date has been the shift towards software as a service or SaaS.

SaaS has dramatically lowered the intrinsic total cost of ownership for adopting software, solved scaling challenges and taken away the burden of issues with local hardware. In short, it has allowed a business to focus primarily on just that — its business — while simultaneously reducing the burden of IT operations.

Today, SaaS adoption is increasingly ubiquitous. According to IDG’s 2018 Cloud Computing Survey, 73% of organizations have at least one application or a portion of their computing infrastructure already in the cloud. While this software explosion has created a whole range of downstream impacts, it has also caused software developers to become more and more valuable.

The increasing value of developers has meant that, like traditional SaaS buyers before them, they also better intuit the value of their time and increasingly prefer businesses that can help alleviate the hassles of procurement, integration, management, and operations. Developer needs to address those hassles are specialized.

They are looking to deeply integrate products into their own applications and to do so, they need access to an Application Programming Interface, or API. Best practices for API onboarding include technical documentation, examples, and sandbox environments to test.

APIs tend to also offer metered billing upfront. For these and other reasons, APIs are a distinct subset of SaaS.

For fast-moving developers building on a global-scale, APIs are no longer a stop-gap to the future—they’re a critical part of their strategy. Why would you dedicate precious resources to recreating something in-house that’s done better elsewhere when you can instead focus your efforts on creating a differentiated product?

Thanks to this mindset shift, APIs are on track to create another SaaS-sized impact across all industries and at a much faster pace. By exposing often complex services as simplified code, API-first products are far more extensible, easier for customers to integrate into, and have the ability to foster a greater community around potential use cases.

Screen Shot 2019 09 06 at 10.40.51 AM

Graphics courtesy of Accel

Billion-dollar businesses building APIs

Whether you realize it or not, chances are that your favorite consumer and enterprise apps—Uber, Airbnb, PayPal, and countless more—have a number of third-party APIs and developer services running in the background. Just like most modern enterprises have invested in SaaS technologies for all the above reasons, many of today’s multi-billion dollar companies have built their businesses on the backs of these scalable developer services that let them abstract everything from SMS and email to payments, location-based data, search and more.

Simultaneously, the entrepreneurs behind these API-first companies like Twilio, Segment, Scale and many others are building sustainable, independent—and big—businesses.

Valued today at over $22 billion, Stripe is the biggest independent API-first company. Stripe took off because of its initial laser-focus on the developer experience setting up and taking payments. It was even initially known as /dev/payments!

Stripe spent extra time building the right, idiomatic SDKs for each language platform and beautiful documentation. But it wasn’t just those things, they rebuilt an entire business process around being API-first.

Companies using Stripe didn’t need to fill out a PDF and set up a separate merchant account before getting started. Once sign-up was complete, users could immediately test the API with a sandbox and integrate it directly into their application. Even pricing was different.

Stripe chose to simplify pricing dramatically by starting with a single, simple price for all cards and not breaking out cards by type even though the costs for AmEx cards versus Visa can differ. Stripe also did away with a monthly minimum fee that competitors had.

Many competitors used the monthly minimum to offset the high cost of support for new customers who weren’t necessarily processing payments yet. Stripe flipped that on its head. Developers integrate Stripe earlier than they integrated payments before, and while it costs Stripe a lot in setup and support costs, it pays off in brand and loyalty.

Checkr is another excellent example of an API-first company vastly simplifying a massive yet slow-moving industry. Very little had changed over the last few decades in how businesses ran background checks on their employees and contractors, involving manual paperwork and the help of 3rd party services that spent days verifying an individual.

Checkr’s API gives companies immediate access to a variety of disparate verification sources and allows these companies to plug Checkr into their existing on-boarding and HR workflows. It’s used today by more than 10,000 businesses including Uber, Instacart, Zenefits and more.

Like Checkr and Stripe, Plaid provides a similar value prop to applications in need of banking data and connections, abstracting away banking relationships and complexities brought upon by a lack of tech in a category dominated by hundred-year-old banks. Plaid has shown an incredible ramp these past three years, from closing a $12 million Series A in 2015 to reaching a valuation over $2.5 billion this year.

Today the company is fueling an entire generation of financial applications, all on the back of their well-built API.

Screen Shot 2019 09 06 at 10.41.02 AM

Graphics courtesy of Accel

Then and now

Accel’s first API investment was in Braintree, a mobile and web payment systems for e-commerce companies, in 2011. Braintree eventually sold to, and became an integral part of, PayPal as it spun out from eBay and grew to be worth more than $100 billion. Unsurprisingly, it was shortly thereafter that our team decided to it was time to go big on the category. By the end of 2014 we had led the Series As in Segment and Checkr and followed those investments with our first APX conference in 2015.

Plaid, Segment, Auth0, and Checkr had only raised Seed or Series A financings! And we are even more excited and bullish on the space. To convey just how much API-first businesses have grown in such a short period of time, we thought it would be useful perspective to share some metrics over the past five years, which we’ve broken out in the two visuals included above in this article.

While SaaS may have pioneered the idea that the best way to do business isn’t to actually build everything in-house, today we’re seeing APIs amplify this theme. At Accel, we firmly believe that APIs are the next big SaaS wave — having as much if not more impact as its predecessor thanks to developers at today’s fastest-growing startups and their preference for API-first products. We’ve actively continued to invest in the space (in companies like, Scale, mentioned above).

And much like how a robust ecosystem developed around SaaS, we believe that one will continue to develop around APIs. Given the amount of progress that has happened in just a few short years, Accel is hosting our second APX conference to once again bring together this remarkable community and continue to facilitate discussion and innovation.

Screen Shot 2019 09 06 at 10.41.10 AM

Graphics courtesy of Accel


By Arman Tabatabai

Atlassian’s co-CEO Scott Farquhar will join us at TC Sessions: Enterprise

Few companies have changed the way developers work as profoundly as Atlassian. Its tools like Jira and Confluence are ubiquitous, and over the course of the last few years, the company has started to adapt many of them for wider enterprise usage outside of developer teams.

To talk about Atlassian’s story from being a small shop in Australia to a successful IPO — and its plans for the future — the company’s co-founder and co-CEO Scott Farquhar will join us at our inaugural TechCrunch Sessions: Enterprise event on September 5 in San Francisco.

Farquhar co-founded Atlassian with Mike Cannon-Brookes, in 2001. It wasn’t until 2010, though, that the company raised its first major venture round ($60 million from Accel Partners). Even by that point, though, the company already had thousands of customers and a growing staff in Sydney and San Francisco.

Today, more than 150,000 companies use Atlassian’s tools. These range from the likes of Audi to Spotify, Twilio and Visa, with plenty of startups and small and medium businesses in between.

It’s no secret that Farquhar and Cannon-Brookes consider themselves accidental billionaires, so it’s maybe no surprise that in 2015, ahead of Atlassian’s successful IPO that valued it at well above $10 billion, he also signed on to the 1% Pledge movement.

Today, Farquhar also makes his own venture investments as part of Skip Capital, which he co-founded.

TC Sessions: Enterprise (September 5 at San Francisco’s Yerba Buena Center) will take on the big challenges and promise facing enterprise companies today. TechCrunch’s editors will bring to the stage founders and leaders from established and emerging companies to address rising questions, like the promised revolution from machine learning and AI, intelligent marketing automation and the inevitability of the cloud, as well as the outer reaches of technology, like quantum and blockchain.

Tickets are now available for purchase on our website at the early-bird rate of $395; student tickets are just $245.

We have a limited number of Startup Demo Packages available for $2,000, which includes four tickets to attend the event.

For each ticket purchased for TC Sessions: Enterprise, you will also be registered for a complimentary Expo Only pass to TechCrunch Disrupt SF on October 2-4.


By Frederic Lardinois

Vonage brings number programmability to its business service

Chances are you still mostly think of Vonage as a consumer VOIP player, but in recent years, the company also launched its Vonage Business Cloud (VBC) platform and acquired Nexmo, an API-based communications service that competes directly with many of Twilio’s core services. Today, Vonage is bringing its VBC service and Nexmo a bit closer with the launch of number programmability for its business customers.

What this means is that enterprises can now take any VBC number and extend it with the help of Nexmo’s APIs. To enable this, all they have to do is toggle a switch in their management console and then they’ll be able to programmatically route calls, create custom communications apps and workflows, and integrate third-party systems to build chatbots and other tools.

“About four years ago we made a pretty strong pivot to going from residential — a lot of people know Vonage as a residential player — to the business side,” Vonage senior VP of product management Jay Patel told me. “And through a series of acquisitions [including Nexmo], we’ve kind of built what we think is a very unique offering.” In many ways, those different platforms were always separated from each other, though. With all of the pieces in place now, however, the team started thinking about how it could use the Nexmo APIs to allow its customers in the unified communications and contact center space to more easily customize these services for them.

About a year ago, the team started working on this new functionality that brings the programmability of Nexmo to VBC. “We realized it doesn’t make sense for us to create our own new sets of APIs on our unified communications and contact center space,” said Patel. “Why don’t we use the APIs that Nexmo has already built?”

As Patel also stressed, the phone number is still very much linked to a business or individual employee — and they don’t want to change that just for the sake of having a programmable service. By turning on programmability for these existing numbers, though, and leveraging the existing Nexmo developer ecosystem and the building blocks those users have already created, the company believes that it’s able to offer a differentiated service that allows users to stay on its platform instead of having to forward a call to a third-party service like Twilio, for example, to enable similar capabilities.

In terms of those capabilities, users can pretty much do anything they want with these calls — and that’s important because every company has different processes and requirements. Maybe that’s logging info into multiple CRM systems in parallel or taking a clip of a call and pushing it into a different system for training purposes. Or you could have the system check your calendar when there are incoming calls and then, if it turns out you are in a meeting, offer the caller a callback whenever your calendar says you’re available again. All of that should only take a few lines of code or, if you want to avoid most of the coding, a few clicks in the company’s GUI for building these flows.

Vonage believes that these new capabilities will attract quite a few new customers. “It’s our value-add when we’re selling to new customers,” he said. “They’re looking for this kind of capability or are running into brick walls. We see a lot of companies that have an idea but they don’t know how to do it. They’re not engineers or they don’t have a big staff of developers, but because of the way we’ve implemented this, it brings the barrier of entry to create these solutions much lower than if you had a legacy system on-prem where you had to be a C++ developer to build an app.


By Frederic Lardinois

Twilio launches a new SIM card and narrowband dev kit for IoT developers

Twilio is hosting its Signal developer conference in San Francisco this week. Yesterday was all about bots and taking payments over the phone; today is all about IoT. The company is launching two new (but related) products today that will make it easier for IoT developers to connect their devices. The first is the Global Super SIM that offers global connectivity management through the networks of Twilio’s partners. The second is Twilio Narrowband, which, in cooperation with T-Mobile, offers a full software and hardware kit for building low-bandwidth IoT solutions and the narrowband network to connect them.

Twilio also announced that it is expanding its wireless network partnerships with the addition of Singtel, Telefonica and Three Group. Unsurprisingly, those are also the partners that make the company’s Super SIM project possible.

The Super SIM, which is currently in private preview and will launch in public beta in the spring of 2019, provides developers with a global network that lets them deploy and manage their IoT devices anywhere (assuming there is a cell connection or other internet connectivity, of course). The Super SIM gives developers the ability to choose the network they want to use or to let Twilio pick the defaults based on the local networks.

Twilio Narrowband is a slightly different solution. Its focus right now is on the U.S., where T-Mobile rolled out its Narrowband IoT network earlier this year. As the name implies, this is about connecting low-bandwidth devices that only need to send out small data packets like timestamps, GPS coordinates or status updates. Twilio Narrowband sits on top of this, using Twilio’s Programmable Wireless and SIM card. It then adds an IoT developer kit with an Arduino-based development board and the standard Grove sensors on top of that, as well as a T-Mobile-certified hardware module for connecting to the narrowband network. To program that all, Twilio is launching an SDK for handling network registrations and optimizing the communication between the devices and the cloud.

The narrowband service will launch as a beta in early 2019 and offer three pricing plans: a developer plan for $2/month, an annual production plan for $10/year or $5/year at scale, and a five-year plan for $8/year or $4/year at scale.


By Frederic Lardinois

Twilio acquires email API platform SendGrid for $2 billion in stock

Twilio, the ubiquitous communications platform, today announced its plan to acquire the API-centric email platform SendGrid for about $2 billion in an all-stock transaction. That’s Twilio’s largest acquisition to date, but also one that makes a lot of sense given that both companies aim to make building communications platforms easier for developers.

“The two companies share the same vision, the same model, and the same values,” said Twilio co-founder and CEO Jeff Lawson in today’s announcement. “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 will become a wholly owned subsidiary of Twilio and its common stock will be converted into Twilio stock. The companies expect the acquisition to close in the first half of 2019, after it has been cleared by the authorities.

Twilio’s current focus is on omnichannel communication, and email is obviously a major part of that. And while it offers plenty of services around voice, video and chat, email hasn’t been on its radar in the same way. This acquisition now allows it to quickly build up expertise in this area and expand its services there.

SendGrid went public in 2017. At the time, it priced its stock at $16. Today, before the announcement, the company was trading at just under $31, though that price obviously spiked after the announcement went public. That’s still down from a high of more than $36.5 last month, but that’s in line with the overall movement of the market in recent weeks.

Today’s announcement comes shortly before Twilio’s annual developer conference, so I expect we’ll hear a lot more about its plans for SendGrid later this week.

We asked Twilio for more details about its plans for SendGrid after the acquisition closes. We’ll update this post once we hear more.


By Frederic Lardinois