Twilio acquired SendGrid for $2B to expand its automated communications platform

Twilio added email to the list of its automated communications tools with the $2B acquisition of email platform SendGrid.

October 16, 2018

Yesterday evening Twilio, a software company that makes tools to send programmatic phone calls and text messages, acquired email platform SendGrid for $2B.

The deal (Twilio’s largest to date) will position the company to offer end-to-end communication tools for developers — and both companies are getting a hefty stock boost.

First phone calls, then text messages…

And now emails. By purchasing SendGrid’s email service (and its 74k paying customers who send 45B emails a month), Twilio wants to position itself as a one-stop shop to help companies for automated communications.

Once the deal is closed in the first half of 2019, the combined company is expected to have more than 100k customers and bring in $700m in annual revenue.

SendGrid sent both stocks through the roof

After the announcement of the acquisition (which offered a significant premium over the company’s $1.4B market value), SendGrid’s stock surged almost 14% in after-hours trading to more than $35 a share, more than 2x the $16 share price at which it went public just last year.

But if SendGrid had a good year, Twilio has had a great one: Although shares at the company dipped slightly yesterday afternoon, they are up 220% so far this year.

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