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Cloud Communication Platform Twilio Raises $12M

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Twilio, a cloud communications platform, announced it has raised $12 million in a Series B round led by Bessemer Venture Partners. The San Francisco company allows other developers to build on top of its pay-as-you-go telecommunications platform, creating a wide array of text and phone-based applications.  The beauty of the software-as-a-service platform is that it does all the back-end work so developers can plug in apps using a common set of APIs. More than 20,000 customers have built communications apps on top of Twilio, including Salesforce, Ebay, and Media Temple and start-ups like GroupMe, which recently launched a group text messaging service.

Twilio’s other investors include Union Square Ventures, angel investors and Dave McClure’s 500 Startups, which established a dedicated $250,000 Twilio micro fund in September. Twilio, which will use the money to expand, announced Ty Wang, former senior director of the business communications unit at Oracle, was joining Twilio as its vice president of business development. Byron Deeter from Bessemer will also join the Twilio board. Twilio raised an earlier $3.7 million round last year.

Twilio makes money by charging for phone calls and text messages. That adds to the costs of start-ups but the platform seems to have wide support from developers who are responsive to Twilio’s focus on them.

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One Response to “Cloud Communication Platform Twilio Raises $12M”

  1. I used to refer to this stuff as “Stupid Phone Tricks”. Saw demonstrations of an identical platform at Nortel in 1996, worked with partners building similar stuff in 1999 while @ Cisco, more recently we saw RIBBIT — and of course there exists VOXEO, which Twilio is a carbon-copy of, but which is based in Florida and so of course tech journalism is blissfully unaware of its existence.

    All of these companies must contend with the competing pressures of the traditional telecom paywalls (they want to charge you to traverse their networks in any way) and commodification (no one thinks minutes have any tangible value and view voice as “free”). It takes a very seasoned team to navigate that narrow channel successfully and I see that as a problem for Twilio.

    Knock Twilio around for their humbug VOIP offering and they’ll fire back with SMS… another service which exists on a similar delta. SMS is cool for feature phones but the rise of smartphones + apps + push messaging is quickly rendering SMS obsolete.

    I am just flabbergasted that such forward-looking investors have dropped in on such an unoriginal, commodity technology deal. There’s a lot to scratch your head about when it comes to Twilio. Best exit prospect is to a dumpy old ILEC/IXC looking to add the thin veneer of modernity to their crappy TDM network.

    And if you don’t know what the terms ILEC, IXC, or TDM mean then my guess is you must be a Twilio investor.