I worked at Twilio for nearly 10 years and it's hard to overstate what a gift it was to work there and see Jeff operate as CEO up-close.
He created an environment where (at our best) we could have fun doing work that had a real impact, and we could it with people we enjoyed doing the work with. He pushed us to be creative to authentically empower and inspire developers. Wanna build a video game that teaches developers how to code and use Twilio? Let's try it! Wanna build an AI application with Tony Hawk and have Tony Hawk debug the code live on stage? Sure!
And Jeff would always be spending time with developer tools and Twilio's products himself, to the point that he could live code at the drop of a hat to show off what we'd been working on. This meant his own understanding of developers and their problems never ceased to amaze me.
But more than all of that, he was a rare CEO that led with empathy, humility and care.
Thank you, jeffiel. We can't wait to see what you build next.
Because Jeff wanted to be a celebrity CEO, and it was to the detriment of the company.
All of Twilio's growth (as a public company) happened on George's watch.
I don't think it's a coincidence that well after George left, on Jeff's watch - they had to do 3 different layoff for a total of ~24% of their entire public company being let go.
Note: former senior level Twilio employee, posted anonymous for obvious reasons.
For a public company, the CEO has to be a public CEO. Everyone takes on a different persona (some sell themselves as business geniuses, others as creative geniuses, and others as someone you wanna grab a beer with). Some really like it, and some do it begrudgingly. But at the end of the day, you can't be the same CEO of a public company as you were when you were private.
I've never known Jeff to hobnob with celebrities, travel in luxury or abandon his company. I'm not sure he's a "celebrity CEO" as much as he just became a public one, although I don't know him personally.
(FWIW, this is the reason I'd never want to go public. I personally don't like the system, but that doesn't mean it's not how the system works.)
George Hu cut his teeth under Benioff during the most meteoric rise of both Salesforce and Benioff's celebrity. I would be very surprised if Jeff's desire to be a public facing CEO would even cause George to notice, let alone bristle at.
It's more likely that someone as smart as George might have just looked at the fundamentals of the business and decided it could not keep this up over the long term.
or... it might have just been epic timing too. Probably.
Being a celebrity CEO makes sense when interest rates are low and your main job is to keep convincing investors to pump in money. Of course when interest rates are high, and your main job is business and company fundamentals that's a lot less useful. I'm seeing a lot of startups (and public companies) with CEOs like that floundering right now.
I don't know the specifics of these two CEOs, but those were two very different eras financially in the tech sector. To nail all of it on just a CEO's door feels reductive, at best.
Please. George joined the company when it was damn near a decade old, and already a publicly-traded company. It's embarrassing to ascribe anywhere near the agency to someone like that than to a founder.
People who weren't there don't understand, but the world before "Ask Your Developer" was completely different than the world we live in today where developers are at the heart of how decisions are made, products are built and how the world itself is changing.
I joined Twilio in 2012 and I saw first hand how pivotal Jeff was in supporting the idea that in order for a platform to be successful it needed to treat developers like first class citizens, and not simply the recipient of a "directive to integrate" from the CTO.
This idea wasn't simply a fist bump to devs for cool points, it was a recognition that developers themselves held the key to innovation and creating radically new things. This culture led to entirely new ways of building API docs, designing developer dashboards, creating developer events, and so on.
So many of these things have become mainstream and the new baseline for platform companies that people forget how unlikely it was in the beginning and how hard Jeff had to fight to keep the company from treating developers as a means, and not as an end. And I think all developers who are happily hacking away on a free tier of a cool API with excellent docs and a vibrant developer community should tip their hat to a person who helped make this normal and influenced a generation of leaders to do the same.
> Wanna build a video game that teaches developers how to code and use Twilio? Let's try it! Wanna build an AI application with Tony Hawk and have Tony Hawk debug the code live on stage? Sure!
These are the strange effects of ZIRP and infinite QE. Many companies never had to care at all about profit and could just do things "for fun", and still see valuations skyrocket as long as they hired more people. What a time.
I think this is a bit reductive. Sure ZIRP created an environment where people could get away with trying crazy things, but there was still an expectation of growth in pursuit of some longer time-horizon market dominance. These kind of things may be more risky, but they still can be justified in the pursuit of market awareness and growth. Also, when you're building software products, there's real value to engaging the creativity of the team.
The fact that the music continued so long and led to incredible valuation inflation over the last 15 years made the excesses look a lot worse, but even in a more sane financial environment I'd argue you'd still want to do these things to be competitive in an attention-economy, just maybe not to the extremes we saw.
In my 32 years in the industry the best performing companies always did these things regardless of the macroeconomic climate. It’s when you ceded leadership to the accountants and shifted gears to maintenance mode that companies stopped growing. You never did these things for fun, you did these things because they had some knock on effect that made it potentially worth it, and in a portfolio of many small bets some would blow up into your next big product. Even the ones that seem far left field they created an environment where people felt allowed to dream at all, and their knock on effect was in creation of a risk taking culture.
Blaming low interest rates on taking risk and doing highly speculative things, and investing in a culture that values that by funding off the wall stuff puts too much emphasis on the capital markets. If the company was a steel producer, fine. If it’s a company that essentially captures the stuff of dreams and produces a service that executes thought stuff in machines, you have to decouple your R&D from capital management to the extent your free cash flow can accept it.
Note of course low interest rates and other capital market looseness will create more opportunity for this behavior, and not every company doing these things is doing some is a well managed way. But they don’t have to - that’s the magic of capitalism. Through a Darwinian process only those who strike magic win and survive and the others recycle and try again. This feels like a feature not a flaw of zero interest rates - it creates enormous value by virtue of incentivizing taking risk at a time of high innovation. There are times in history where innovation rates were very low, and zero interest rates would just incentivize broken behavior. But at a time when almost all growth is coming from innovation, maybe loose credit is smart. ml
Were companies in other sectors besides so-called "tech" able to disregard profit and just keep hiring as a result of ZIRP and QE. If yes, what are some examples.
QE and ZIRP are deflationary policies because they reduce the amount of interest payments (which are no different from any other transfer payment) paid by the government.
Interesting. I tried to create a Twilio account 2 weeks ago and it was the worse developer experience I've ever had by far.
Like seriously.
They first make you deposit $20 to get started. THEN, they tell you to talk to customer support to activate your account (customer support took forever to reply).
Oh and then I had to fill out like 3 applications and my text messages are still randomly getting blocked - I have no idea why.
To be clear, this is literally just me using Twilio to text myself to test out the API. I'm not some spammer or something. It was impossible to get started.
This is industry self-regulation. See A2P 10DLC. Dealing with it at scale has sucked. If you want to send SMS, it's the price of admission everywhere--not just at Twilio. I know you said you wanted to send yourself an SMS, but you can test without sending using test credentials and magic numbers: https://www.twilio.com/docs/messaging/tutorials/automate-tes...
Strongly seconding this (especially as someone who was backstage with Jeff and Tony right before that demo). What's less visible is the impact and influence Jeff has had in enabling leaders and founders to do the right thing. So much of the pressure and industry influence on CEOs is to be short-term thinkers, to ruin their user experience, or to be harmful to workers.
I've seen, both personally and through others who've relied on his example or mentorship, Jeff be a force for good for those who were trying to do right while leading companies. And to even be someone to call in (or call out) a mistake when you make it — which a lot of bigger-name people are way too cowardly to do. He's also spoken up for his city, and for vulnerable communities, when it would have been so easy for someone of his stature to just stay silent.
It's obvious that Jeff is a brilliant technical innovator, but he is just as much of a pioneer of thoughtful and conscientious leadership in an industry that's become woefully bereft of it.
Twilio already uses aggressive sales strategies. They make you deposit $20 to test out their API AND THEN they tell you to get approved by talking to customer support.
I was unable to get approved so I guess I'm out $20 for no reason. They have the worst dev experience I've ever seen.
Probably as good at delivering shareholder value as anyone. Probably just didn't want to play ball when investors started asking him to strip out all the value to the customer and put the screws to the employees and purge anything and everything that might be mistaken for humanity and goodness. They love to do that shit and then pretend their new hollowed out strip mine is "lean".
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.
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.
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.
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.
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.
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 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.
I had the "pleasure" working for Twilio for over 4 years. I cannot tell how much this showed me how you can fake it til you make it in SF.
Twilio tried to expand into Europe and failed miserably. Customers (especially German ones) wanted exact locations of data, exact routes of packet transportation, wanted features Twilio promised on Slides but never delivered.
I was part of at least 4 customer meetings (the biggest in Europe) where the clients just called Senior levels in and told them off.
Twilio was great when it just handled voice and text messaging. It never grew substantially, it never delivered features customers were asking for years. Messy code base, hired product owners with no clue what they should actually build.
Jeff was famous for over-promising and under-delivering. 1 year into my Twilio career, it was clear that the company would fail hard. Colleagues and I had bets on when Jeff will be fired or the company sold. Well, the last few months have been telling.
A sad story, since they had a great core product, really smart people, great people working there. But especially through the pandemic, they grew an insane amount without actually building anything of substance.
this is pretty much my take as well - but as a non-employee - I was a big fan and user of twilio when they first came out, even attended the very first few twiliocon conferences in SF, (mostly developer focused) where they would announce and release new features - lots of excitement as new things got announced and rolled out during the annual conferences.
Then after not very long, you would goto the conferences where they would make announcements about what is coming, but no real timelines attached and some things that were announced, never really materialized - or not fast enough etc.
Then they started diversify like crazy into other areas, unrelated, and I think they really lost their focus - stopped using them (99% stopped) a long time ago for those reasons.
I'm not the OP, but agree with their assessment and stayed 3.5 years despite that. For me, the reason was the vesting schedule: 4 years with a 1 year cliff.
I was in a similar situation. A year into a job with a large company, I realized the company had issues and that I didn't like most of the people I worked with.
I stayed for ~1 year after I realized I needed to get out: At the time I was getting paid very well, had very low expenses, and was saving to quit my job and start my own company.
My original plan was to stay a few months longer to build up some more savings, but "things happened" inside the company. I was re-assigned to a horrible manager; I hunted around for another assignment (on the advice of my boss's boss,) but that was going to be Flex-based. (And I bet correctly that Flex was going to fail in the marketplace.) I decided that I was better off quitting and self-teaching myself HTML + Javascript instead of getting paid to learn Flex. However, I could have stayed for a 2-3 more years, worked in Flex, made a boatload of money, and selectively applied for jobs elsewhere.
> One year into it you knew the company was going to fail yet you stayed on for 3 more years?
There's a lot of risk in changing jobs: If you "have a good thing going," it's best to bide your time until a better thing comes along. Interviewing is quite time consuming too, so don't assume that someone can just casually make a few phone calls and walk away with a "better" job. (This is especially the case if you have kids, a house, a mortgage, and a significant other who has their own career.)
Job mobility declines significantly with marriage, kids, and mortgage. I've toughed it out before, mostly to keep the good healthcare benefits. (This was prior to ACA eliminating the preexisting conditions BS. We didn't want the hassle, uncertainty of changing insurance during a pregnancy.)
Also, it's hard to job hunt when you're already over worked, both at home and the office.
Also, the devil you know. Every new job is a gamble. After a while, all the jobs kinda smell the same. So what's the point in playing frogger?
For starters, actually trying to deliver what they promised? Get the actual hard, boring job done bigger clients wanted. The not-sexy work behind the scenes. Main problem is that it doesn't look good on paper, and Twilio hired an absolute insane amount of people.
My guess is they profited _a lot_ from the crypto hype. Exchanges sprung up right, left and centre and they all needed customer call centres etc. So Twilio grew through that. Saw super high growth and thought: All is well. All the while the "real" customers didn't get the features they needed, and quit Twilio after a 6 month trial period.
The decline of Twilio's position has been as pretty clear for the last 18 months now, and has been a topic of conversation longer than that. Twilio never had the margins or control of their environment to nearly the degree you need to have in order to maintain software monopoly levels of growth over time.
Most of Twilio's business has been built on reselling network access purchased via SMS consolidators. These are companies who, decades ago, got their hardware installed inside the networks of the major phone carriers. This allows them direct access to send/receive SMSs. Twilio never really tried to own the network layer and these companies continued to demand higher and higher tolls for access. Short codes are a very good example of this. Twilio spent a lot of time and money trying to sew up access to those short codes.
On top of all that, high volume customers would move directly to these consolidators. Sometimes Twilio would keep some portion of the business if the sender used a round robin model to distribute sends, but often they didn't. OpenMarket and a handful of others were the goto providers at scale.
Add on to this the overall decline of the utility of SMS. Even as SMS volumes increased, they have not increased at the same rate as messaging overall. ie: other channels like iMessage and WhatsApp continue to pull volumes.
Cue Twilio's attempt to go up market. Flex and the purchase of Sendgrid were the best examples of this. Could CPaaS work for Twilio as a business model? I think we've seen so many fits and starts with the Flex product line and the integration of Sendgrid that it seemed like perhaps buying their way in to that market wasn't panning out.
Finally, as seen in the last year, the culture just seems to have gone off the rails at some point. [1] I don't know Jeff, but my respect for him is sky high. I've read all his writing over the years and he's been hugely influential for an entire generation of founders.
Unfortunately this seems like a bit of a hasty departure. I hope it isn't, but the choice of replacement CEO screams caretaker-CEO rather than shrewd strategic move.
Another commenter mentioned Stripe [2] and how they get a lot of credit for advancing DevTools. I agree that Twilio did it first and I think paved the way. Jeff Lawson and Twilio deserve more credit. "Ask your developer" was not a small thing at all.
I also think Stripe very likely is in a very similar position, but they are earlier in their cycle and they've avoided the scrutiny of being a public company. Credit card processors are gatekeepers and fully dominate in their markets. Stripe serves a purpose for them and dramatically improves access to their networks via great tooling and abstractions, but there is still a fixed cost toll to pay and what that toll is cannot be static for interminable time. Is Stripe in the "Commerce" market like Twilio is in the "Communications" market, or are they in the "payments" market, like Twilio is in the "SMS" market? (or somesuch)
In the early days of Twilio, carriers laughed at what we were doing. It didn't help that most of the people at Twilio pre-2014 didn't speak much "telecom." But to your point, it was tough to rely on these carriers who thought Twilio would be gone in a few years so they didn't put much stock in ensuring the infrastructure was redundant and robust.
I was on several calls with providers begging them to put us on a more robust network. Especially in years when there was an election. In those early years, we had one customer doing more minutes than our entire customer base. In fact, at an early Twiliocon (pre-Signal) John and Jeff had to help build out an entirely separate environment for them because it was dragging everyone else down.
My point is that the early days were definitely the "Draw the Owl" days. We were figuring out things on the fly. Carriers were dubious and it was tough to get things working consistently. However, by 2015 those same carriers were developing APIs of their own.
Twilio changed the game for the telecommunications industry. Two years before joining Twilio I was putting in large-scale Avaya systems. The fact that I wrote four lines of code to make a phone ring blew my mind. Twilio and Jeff created something special. It's sad to see his run come to an end, but every company needs to adapt to the changing times. This is just Twilio's time to adapt.
> In those early years, we had one customer doing more minutes than our entire customer base. In fact, at an early Twiliocon (pre-Signal) John and Jeff had to help build out an entirely separate environment for them because it was dragging everyone else down.
As an early large customer, I wonder if that was me... sorry for messing up everyone else ;) I do remember some issues at times, but nothing we didn't see with other voice and SMS providers. Well, other providers didn't have an online log browser, so I never had trouble with browsing logs their logs.
Twiml was much easier to use than the other 'programatic voice' apis at the time, and I never had time to figure out how to run calls on sip directly. As I recall, it didn't take much time to setup voice calls, and then boom. It was helpful that quality was good and support was helpful when there were destinations with poor results.
Fwiw I think a key difference in stripe vs twilio in your example is that stripe has 2 levers that twilio doesn't have good analogs to:
- stripe can be a "financial home" for many of its customers and build higher-margin pockets of software functionality, using easy payments as an on-ramp. See: stripe billing, radar, sigma, connect, etc.
- stripe is more likely to be able to "swap out" the credit card rails than twilio would be able to "swap out" sms. If the financial ecosystem evolves to make eg debit cards or any other kind of payment easier, stripe can simply add them as payment methods, as they already do for non-CC payment types (most notable outside of the US). So stripe is already at the abstraction level of "move money from customer to me" instead of "run their CC".
I think those are good points and valid, but Twilio definitly had equivalent arguments in their own product.
Encumbents manage scale very very well and historically they tend to come to a market late. While Stripe is rushing up the value chain, the issuers are just slowly lumbering around.
Billing, Radar, Sigma, Connect are all very well built products which drive usage of their core revenue generator. I suspect the revenue mix at Stripe is still largely payment processing. Voice minutes and SMSs on a carriers network, or authorizations and settlements on an issuer network.
I am not saying Stripe is doomed, far from it, but it's a non trival problem to solve over the long term and the default state is attrition. I think Twilio is a very good example of how difficult this can be.
> On top of all that, high volume customers would move directly to these consolidators.
This is pretty key to understanding Twilio's prospects as a business. In my experience, they are fantastically easy to integrate at first.
But they come with a cost that blows up your financial model if your product is any kind of high-volume use case, or if SMS is factored in as a direct cost and you're talking to investors about unit economics. At some point you have to get off of them and onto a cheaper-per-SMS solution, even if it costs more dev hours to maintain.
When I joined the Twilio Developer Evangelism team in 2014, we spent a lot of our onboarding practicing the "five minute demo" where we live-code a Twilio app from scratch. I thought this was dumb, mostly because live-coding is so damn hard.
Six weeks into the job I watched Jeff live-code a Twilio app in front of 10,000 people at IBM Connect. It was as if he was saying to all of us, "Yeah, live-coding is hard. And if I can do this in front of 10,000 people, you can do it at your local Ruby meetup."
It was the first of many, many times over my nine years that Jeff led by example, set the bar, and pushed us all to reach levels we didn't know we were capable of. Working under Jeff's leadership was the privilege of a career.
I worked at Twilio from 2014-2023 and had an incredible experience during those 9 years, including all of my interactions with Jeff.
One of my favorite moments was running into Jeff in the hallway at our Beale Street office just before he had to do a quarterly earnings call after we went public. I said "good luck on the earnings call" and Jeff said thanks then asked what happened to a link to a specific Stack Overflow question/answer from one of our docs pages that got removed. He had just been building an application and felt like that answer was particularly helpful for context in a certain programming language, and was surprised it was removed.
Jeff's always been software developer at heart even though he had a ton of non-dev responsibilities. There are definitely advantages and disadvantages in that mindset! But he created a tremendous company along the way and I wouldn't change working there for anywhere else during those years.
I joined Twilio in May '11 the week of the private launch of Twilio Client. I was #18 or so.
My first day, we got briefings on what it was, what it will do, and then had to finish docs and re-arrange the office for our top customers. (At that stage, most people knew them by name. Shout out patio11!)
Since I knew nothing and the docs were.. weak, I decided to take out the garbage. I grabbed the bags and asked where the dumpster was. Jeff Lawson stopped me and asked if I had an office key card to get back in. Oops, nope. So he grabbed a bag and we took it out together.
So yes, Jeff opened doors for me. ;)
Despite the last year or so of chaos, he founded and built a company that redefined telecomm specifically and tech gtm as a whole. Not a bad track record.
And the infamous five minute demo.. we drilled on that constantly. At my peak (2013), I was giving it 2-3 times a week in front of small groups, with the occasional sales reps, and in front of huge events.
My favorite times were:
- for one of Bob Metcalfe's courses at UT Austin. Yes, that Bob Metcalfe, the co-creator of ethernet. I talked about the origin of Metcalfe's Law here too: https://news.ycombinator.com/item?id=35259442
- 1:1 for Werner Vogels at SXSW. I gave it to one of his senior guys and he said "wow, this is great, let me go get Werner" which was intimidating as f.. a lot. But I managed to nail it.
Keep in mind his voting structure changed in May meaning he lost some shareholder power.
> Its use of supervoting shares, which gives CEO and co-founder Jeff Lawson a voting stake of 21.8% even though he owns only 3.7% of the stock, [1]
No derogatory remarks intended to Jeff, Jeff certainly has had great moments, but Kho is also a fantastic leader and capital allocator, who's made some truly uncanny calls (like raising in the market near the top,and share buy back near the bottom). I think Kho is the right person for the job in the times that Twilio finds themselves. It's something I've hoped for for years, as a shareholder. Jeff deserves praise for the humility to step down and promote from within a well groomed and talented successor.
Any exec who actually tries to sell the stock high, and buy it low is a winner in my book.
Most just follow the crowd and do shareholder dilutive buybacks at nosebleed valuations.
If you can buy a long duration US treasury yielding more than twice what your shares yield, maybe stop to think before doing any buybacks.
Though I've written it up to mostly short term-ism towards increasing their own compensation through pressuring share price in the immediate term. The alternative is that all these CFOs and others are financially illiterate or incompetent
Reminded me of another point on the board for Kho, He was smart enough to grab a billion in 10yr bonds at like 3% which was genius for the growth rate (if you can grow money at 10% then you should take every penny you can get below that).
The only party he missed was putting our cash reserves in BTC. (which is an inside joke). It would have made the money like $4-5B based on the time of the suggestion. I think investors will be happy to hear he flatly outright said no to that. It looked like a missed opportunity (at $64k)... until it didn't. (back at $16k)
Agree with this. For folks not familiar with Twilio leadership, I would liken Kho to Twilio's version of Tim Cook. For the size and stage of growth that Twilio's at, he's the best possible replacement for Jeff.
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He created an environment where (at our best) we could have fun doing work that had a real impact, and we could it with people we enjoyed doing the work with. He pushed us to be creative to authentically empower and inspire developers. Wanna build a video game that teaches developers how to code and use Twilio? Let's try it! Wanna build an AI application with Tony Hawk and have Tony Hawk debug the code live on stage? Sure!
And Jeff would always be spending time with developer tools and Twilio's products himself, to the point that he could live code at the drop of a hat to show off what we'd been working on. This meant his own understanding of developers and their problems never ceased to amaze me.
But more than all of that, he was a rare CEO that led with empathy, humility and care.
Thank you, jeffiel. We can't wait to see what you build next.
Because Jeff wanted to be a celebrity CEO, and it was to the detriment of the company.
All of Twilio's growth (as a public company) happened on George's watch.
I don't think it's a coincidence that well after George left, on Jeff's watch - they had to do 3 different layoff for a total of ~24% of their entire public company being let go.
Note: former senior level Twilio employee, posted anonymous for obvious reasons.
For a public company, the CEO has to be a public CEO. Everyone takes on a different persona (some sell themselves as business geniuses, others as creative geniuses, and others as someone you wanna grab a beer with). Some really like it, and some do it begrudgingly. But at the end of the day, you can't be the same CEO of a public company as you were when you were private.
I've never known Jeff to hobnob with celebrities, travel in luxury or abandon his company. I'm not sure he's a "celebrity CEO" as much as he just became a public one, although I don't know him personally.
(FWIW, this is the reason I'd never want to go public. I personally don't like the system, but that doesn't mean it's not how the system works.)
It's more likely that someone as smart as George might have just looked at the fundamentals of the business and decided it could not keep this up over the long term.
or... it might have just been epic timing too. Probably.
A CEO has to be the face of the company and needs a good reputation. It seems like he was a good leader.
From an outsider it looks wrong.
I joined Twilio in 2012 and I saw first hand how pivotal Jeff was in supporting the idea that in order for a platform to be successful it needed to treat developers like first class citizens, and not simply the recipient of a "directive to integrate" from the CTO.
This idea wasn't simply a fist bump to devs for cool points, it was a recognition that developers themselves held the key to innovation and creating radically new things. This culture led to entirely new ways of building API docs, designing developer dashboards, creating developer events, and so on.
So many of these things have become mainstream and the new baseline for platform companies that people forget how unlikely it was in the beginning and how hard Jeff had to fight to keep the company from treating developers as a means, and not as an end. And I think all developers who are happily hacking away on a free tier of a cool API with excellent docs and a vibrant developer community should tip their hat to a person who helped make this normal and influenced a generation of leaders to do the same.
These are the strange effects of ZIRP and infinite QE. Many companies never had to care at all about profit and could just do things "for fun", and still see valuations skyrocket as long as they hired more people. What a time.
The fact that the music continued so long and led to incredible valuation inflation over the last 15 years made the excesses look a lot worse, but even in a more sane financial environment I'd argue you'd still want to do these things to be competitive in an attention-economy, just maybe not to the extremes we saw.
Blaming low interest rates on taking risk and doing highly speculative things, and investing in a culture that values that by funding off the wall stuff puts too much emphasis on the capital markets. If the company was a steel producer, fine. If it’s a company that essentially captures the stuff of dreams and produces a service that executes thought stuff in machines, you have to decouple your R&D from capital management to the extent your free cash flow can accept it.
Note of course low interest rates and other capital market looseness will create more opportunity for this behavior, and not every company doing these things is doing some is a well managed way. But they don’t have to - that’s the magic of capitalism. Through a Darwinian process only those who strike magic win and survive and the others recycle and try again. This feels like a feature not a flaw of zero interest rates - it creates enormous value by virtue of incentivizing taking risk at a time of high innovation. There are times in history where innovation rates were very low, and zero interest rates would just incentivize broken behavior. But at a time when almost all growth is coming from innovation, maybe loose credit is smart. ml
Like seriously.
They first make you deposit $20 to get started. THEN, they tell you to talk to customer support to activate your account (customer support took forever to reply).
Oh and then I had to fill out like 3 applications and my text messages are still randomly getting blocked - I have no idea why.
To be clear, this is literally just me using Twilio to text myself to test out the API. I'm not some spammer or something. It was impossible to get started.
I've seen, both personally and through others who've relied on his example or mentorship, Jeff be a force for good for those who were trying to do right while leading companies. And to even be someone to call in (or call out) a mistake when you make it — which a lot of bigger-name people are way too cowardly to do. He's also spoken up for his city, and for vulnerable communities, when it would have been so easy for someone of his stature to just stay silent.
It's obvious that Jeff is a brilliant technical innovator, but he is just as much of a pioneer of thoughtful and conscientious leadership in an industry that's become woefully bereft of it.
In my experience they’ll bring someone in to try to apply aggressive sales strategies to a dev tools company & it never goes well.
But my feeling is they really just want to strip the company for parts and/or sell it to private equity.
I was unable to get approved so I guess I'm out $20 for no reason. They have the worst dev experience I've ever seen.
Jeffiel kept the fun and weird alive and it was a helluva ride. Kudos Jeff!
Dead Comment
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!
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.
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.
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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.)
Stagnant revenue and declining free cash flow means that the company doesn't have many tools in the toolbox to be valued higher.
[0] https://www.fool.com/investing/2020/09/25/microsoft-declares...
Can you share more insights on how you knew they were special?
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.
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.
Twilio tried to expand into Europe and failed miserably. Customers (especially German ones) wanted exact locations of data, exact routes of packet transportation, wanted features Twilio promised on Slides but never delivered.
I was part of at least 4 customer meetings (the biggest in Europe) where the clients just called Senior levels in and told them off.
Twilio was great when it just handled voice and text messaging. It never grew substantially, it never delivered features customers were asking for years. Messy code base, hired product owners with no clue what they should actually build.
Jeff was famous for over-promising and under-delivering. 1 year into my Twilio career, it was clear that the company would fail hard. Colleagues and I had bets on when Jeff will be fired or the company sold. Well, the last few months have been telling.
A sad story, since they had a great core product, really smart people, great people working there. But especially through the pandemic, they grew an insane amount without actually building anything of substance.
Then after not very long, you would goto the conferences where they would make announcements about what is coming, but no real timelines attached and some things that were announced, never really materialized - or not fast enough etc.
Then they started diversify like crazy into other areas, unrelated, and I think they really lost their focus - stopped using them (99% stopped) a long time ago for those reasons.
One way a company can be mismanaged is burning money it can't afford on ridiculous employee perks, like when Twitter got its own DJ.
I stayed for ~1 year after I realized I needed to get out: At the time I was getting paid very well, had very low expenses, and was saving to quit my job and start my own company.
My original plan was to stay a few months longer to build up some more savings, but "things happened" inside the company. I was re-assigned to a horrible manager; I hunted around for another assignment (on the advice of my boss's boss,) but that was going to be Flex-based. (And I bet correctly that Flex was going to fail in the marketplace.) I decided that I was better off quitting and self-teaching myself HTML + Javascript instead of getting paid to learn Flex. However, I could have stayed for a 2-3 more years, worked in Flex, made a boatload of money, and selectively applied for jobs elsewhere.
> One year into it you knew the company was going to fail yet you stayed on for 3 more years?
There's a lot of risk in changing jobs: If you "have a good thing going," it's best to bide your time until a better thing comes along. Interviewing is quite time consuming too, so don't assume that someone can just casually make a few phone calls and walk away with a "better" job. (This is especially the case if you have kids, a house, a mortgage, and a significant other who has their own career.)
Also, it's hard to job hunt when you're already over worked, both at home and the office.
Also, the devil you know. Every new job is a gamble. After a while, all the jobs kinda smell the same. So what's the point in playing frogger?
My guess is they profited _a lot_ from the crypto hype. Exchanges sprung up right, left and centre and they all needed customer call centres etc. So Twilio grew through that. Saw super high growth and thought: All is well. All the while the "real" customers didn't get the features they needed, and quit Twilio after a 6 month trial period.
Most of Twilio's business has been built on reselling network access purchased via SMS consolidators. These are companies who, decades ago, got their hardware installed inside the networks of the major phone carriers. This allows them direct access to send/receive SMSs. Twilio never really tried to own the network layer and these companies continued to demand higher and higher tolls for access. Short codes are a very good example of this. Twilio spent a lot of time and money trying to sew up access to those short codes.
On top of all that, high volume customers would move directly to these consolidators. Sometimes Twilio would keep some portion of the business if the sender used a round robin model to distribute sends, but often they didn't. OpenMarket and a handful of others were the goto providers at scale.
Add on to this the overall decline of the utility of SMS. Even as SMS volumes increased, they have not increased at the same rate as messaging overall. ie: other channels like iMessage and WhatsApp continue to pull volumes.
Cue Twilio's attempt to go up market. Flex and the purchase of Sendgrid were the best examples of this. Could CPaaS work for Twilio as a business model? I think we've seen so many fits and starts with the Flex product line and the integration of Sendgrid that it seemed like perhaps buying their way in to that market wasn't panning out.
Finally, as seen in the last year, the culture just seems to have gone off the rails at some point. [1] I don't know Jeff, but my respect for him is sky high. I've read all his writing over the years and he's been hugely influential for an entire generation of founders.
Unfortunately this seems like a bit of a hasty departure. I hope it isn't, but the choice of replacement CEO screams caretaker-CEO rather than shrewd strategic move.
Another commenter mentioned Stripe [2] and how they get a lot of credit for advancing DevTools. I agree that Twilio did it first and I think paved the way. Jeff Lawson and Twilio deserve more credit. "Ask your developer" was not a small thing at all.
I also think Stripe very likely is in a very similar position, but they are earlier in their cycle and they've avoided the scrutiny of being a public company. Credit card processors are gatekeepers and fully dominate in their markets. Stripe serves a purpose for them and dramatically improves access to their networks via great tooling and abstractions, but there is still a fixed cost toll to pay and what that toll is cannot be static for interminable time. Is Stripe in the "Commerce" market like Twilio is in the "Communications" market, or are they in the "payments" market, like Twilio is in the "SMS" market? (or somesuch)
1: https://news.ycombinator.com/item?id=36382361 2: https://news.ycombinator.com/item?id=38913134
I was on several calls with providers begging them to put us on a more robust network. Especially in years when there was an election. In those early years, we had one customer doing more minutes than our entire customer base. In fact, at an early Twiliocon (pre-Signal) John and Jeff had to help build out an entirely separate environment for them because it was dragging everyone else down.
My point is that the early days were definitely the "Draw the Owl" days. We were figuring out things on the fly. Carriers were dubious and it was tough to get things working consistently. However, by 2015 those same carriers were developing APIs of their own.
Twilio changed the game for the telecommunications industry. Two years before joining Twilio I was putting in large-scale Avaya systems. The fact that I wrote four lines of code to make a phone ring blew my mind. Twilio and Jeff created something special. It's sad to see his run come to an end, but every company needs to adapt to the changing times. This is just Twilio's time to adapt.
As an early large customer, I wonder if that was me... sorry for messing up everyone else ;) I do remember some issues at times, but nothing we didn't see with other voice and SMS providers. Well, other providers didn't have an online log browser, so I never had trouble with browsing logs their logs.
Twiml was much easier to use than the other 'programatic voice' apis at the time, and I never had time to figure out how to run calls on sip directly. As I recall, it didn't take much time to setup voice calls, and then boom. It was helpful that quality was good and support was helpful when there were destinations with poor results.
- stripe can be a "financial home" for many of its customers and build higher-margin pockets of software functionality, using easy payments as an on-ramp. See: stripe billing, radar, sigma, connect, etc.
- stripe is more likely to be able to "swap out" the credit card rails than twilio would be able to "swap out" sms. If the financial ecosystem evolves to make eg debit cards or any other kind of payment easier, stripe can simply add them as payment methods, as they already do for non-CC payment types (most notable outside of the US). So stripe is already at the abstraction level of "move money from customer to me" instead of "run their CC".
Encumbents manage scale very very well and historically they tend to come to a market late. While Stripe is rushing up the value chain, the issuers are just slowly lumbering around.
Billing, Radar, Sigma, Connect are all very well built products which drive usage of their core revenue generator. I suspect the revenue mix at Stripe is still largely payment processing. Voice minutes and SMSs on a carriers network, or authorizations and settlements on an issuer network.
I am not saying Stripe is doomed, far from it, but it's a non trival problem to solve over the long term and the default state is attrition. I think Twilio is a very good example of how difficult this can be.
This is pretty key to understanding Twilio's prospects as a business. In my experience, they are fantastically easy to integrate at first.
But they come with a cost that blows up your financial model if your product is any kind of high-volume use case, or if SMS is factored in as a direct cost and you're talking to investors about unit economics. At some point you have to get off of them and onto a cheaper-per-SMS solution, even if it costs more dev hours to maintain.
Six weeks into the job I watched Jeff live-code a Twilio app in front of 10,000 people at IBM Connect. It was as if he was saying to all of us, "Yeah, live-coding is hard. And if I can do this in front of 10,000 people, you can do it at your local Ruby meetup."
It was the first of many, many times over my nine years that Jeff led by example, set the bar, and pushed us all to reach levels we didn't know we were capable of. Working under Jeff's leadership was the privilege of a career.
I can't wait to see what he builds next.
https://www.youtube.com/watch?v=mPAe0rJApvk
One of my favorite moments was running into Jeff in the hallway at our Beale Street office just before he had to do a quarterly earnings call after we went public. I said "good luck on the earnings call" and Jeff said thanks then asked what happened to a link to a specific Stack Overflow question/answer from one of our docs pages that got removed. He had just been building an application and felt like that answer was particularly helpful for context in a certain programming language, and was surprised it was removed.
Jeff's always been software developer at heart even though he had a ton of non-dev responsibilities. There are definitely advantages and disadvantages in that mindset! But he created a tremendous company along the way and I wouldn't change working there for anywhere else during those years.
My first day, we got briefings on what it was, what it will do, and then had to finish docs and re-arrange the office for our top customers. (At that stage, most people knew them by name. Shout out patio11!)
Since I knew nothing and the docs were.. weak, I decided to take out the garbage. I grabbed the bags and asked where the dumpster was. Jeff Lawson stopped me and asked if I had an office key card to get back in. Oops, nope. So he grabbed a bag and we took it out together.
So yes, Jeff opened doors for me. ;)
Despite the last year or so of chaos, he founded and built a company that redefined telecomm specifically and tech gtm as a whole. Not a bad track record.
My favorite times were:
- for one of Bob Metcalfe's courses at UT Austin. Yes, that Bob Metcalfe, the co-creator of ethernet. I talked about the origin of Metcalfe's Law here too: https://news.ycombinator.com/item?id=35259442
- 1:1 for Werner Vogels at SXSW. I gave it to one of his senior guys and he said "wow, this is great, let me go get Werner" which was intimidating as f.. a lot. But I managed to nail it.
Keep in mind his voting structure changed in May meaning he lost some shareholder power.
> Its use of supervoting shares, which gives CEO and co-founder Jeff Lawson a voting stake of 21.8% even though he owns only 3.7% of the stock, [1]
No derogatory remarks intended to Jeff, Jeff certainly has had great moments, but Kho is also a fantastic leader and capital allocator, who's made some truly uncanny calls (like raising in the market near the top,and share buy back near the bottom). I think Kho is the right person for the job in the times that Twilio finds themselves. It's something I've hoped for for years, as a shareholder. Jeff deserves praise for the humility to step down and promote from within a well groomed and talented successor.
[1]: https://www.theinformation.com/articles/twilio-set-to-lose-s...
Most just follow the crowd and do shareholder dilutive buybacks at nosebleed valuations.
If you can buy a long duration US treasury yielding more than twice what your shares yield, maybe stop to think before doing any buybacks.
Though I've written it up to mostly short term-ism towards increasing their own compensation through pressuring share price in the immediate term. The alternative is that all these CFOs and others are financially illiterate or incompetent
https://www.spglobal.com/marketintelligence/en/news-insights...
The only party he missed was putting our cash reserves in BTC. (which is an inside joke). It would have made the money like $4-5B based on the time of the suggestion. I think investors will be happy to hear he flatly outright said no to that. It looked like a missed opportunity (at $64k)... until it didn't. (back at $16k)