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Twilio S-1

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Re: Twilio S-1

#91

Post by Eridrus »

Animats wrote: post #75

There's a lot there not to like: Revenue: $166,919,000 Net Loss: $38,896,000 So they're still not profitable. This is surprising, since they don't have any big capital investments. They're not doing anything that takes a lot of R&D. The thing runs on Amazon AWS. They've been operating for years and should be profitable by now. Yes, they're growing fast, but the costs don't rise in advance of the growth. You don't hav…

> This is surprising, since they don't have any big capital investments.

I haven't looked at the S-1 and I'm not sure if they even break this out, but user acquisition costs are all paid up front, while the value is realised over the life of the customer, depending on the average lifetime of a customer, this could be fine, if risky. And you often do prepay for AWS since it saves you money over the course of a few years.

Re: Twilio S-1

#94

Post by sulam »

pbreit wrote: post #42
toomuchtodo wrote: post #30

Earlier quoted context omitted.

But what moat? There are numerous competitors to Twilio who are either cheaper or provide more niche services. You can be Amazon when you're the 800lb gorilla. Twilio is not that gorilla.

Telecom/communication services like Twilio's are =extremely= sticky.

Not by most standards of stickiness. They don't have my data. They don't have a monopoly. There aren't any network effects that I can think of (they've worked the one angle here as well as they can -- developer mind share).

I'm not saying they aren't a good business, but I wouldn't call them particularly sticky, any more than Rackspace is sticky. Infrastructure is a hard business to be in.

Re: Twilio S-1

#95

Post by chipgap98 »

Eridrus wrote: post #91
Animats wrote: post #75

There's a lot there not to like: Revenue: $166,919,000 Net Loss: $38,896,000 So they're still not profitable. This is surprising, since they don't have any big capital investments. They're not doing anything that takes a lot of R&D. The thing runs on Amazon AWS. They've been operating for years and should be profitable by now. Yes, they're growing fast, but the costs don't rise in advance of the growth. You don't hav…

> This is surprising, since they don't have any big capital investments. I haven't looked at the S-1 and I'm not sure if they even break this out, but user acquisition costs are all paid up front, while the value is realised over the life of the customer, depending on the average lifetime of a customer, this could be fine, if risky. And you often do prepay for AWS since it saves you money over the course of a few yea…

Right but how expensive is that acquisition cost? So its about the average cost to acquire versus the average lifetime customer value. I think that's an important metric for them to break out

Re: Twilio S-1

#96

Post by runako »

toomuchtodo wrote: post #30
runako wrote: post #26

Earlier quoted context omitted.

They are not being managed for profitability; they are being managed for scale. They are growing at near 100% y/o/y, so management has decided to keep the pedal down until they win the market. Profitability comes in the out years, way down the line. Amazon is the most famous (successful) example of this. I don't work there, but I can assure you that nothing at Twilio is structured to be a profitable small company.

But what moat? There are numerous competitors to Twilio who are either cheaper or provide more niche services. You can be Amazon when you're the 800lb gorilla. Twilio is not that gorilla.

This is a great comment because it is almost verbatim what was said about Amazon. Actually, this is still frequently said about Amazon's retail operations.

I remember talk that eBay was a better business than Amazon because they had network effects and were thus more defensible. Oops.

Also worth noting: Amazon wasn't the 800lb gorilla when they filed their S-1 (valuation: $438mm).

Re: Twilio S-1

#97

Post by [deleted] »

hawkice wrote: post #73
ProblemFactory wrote: post #32

Earlier quoted context omitted.

The Risks sections are always like that. Any advertisements for stocks must have disclaimers about a wide range of possible risks, and that despite promising historical data you could lose your entire investment. Otherwise they could face expensive lawsuits when future shareholders claim that they were misled and not informed of these risks. For example from Facebook's S-1: "Growth in use of Facebook through our mobi…

I cannot disagree with your attitude more. This company is saying they have an existing threat to their ongoing operations that _will_ be fatal, that they are unsure will ever be solved. This is fundamentally different than saying ad blockers could impact Google's business. In a way, their honesty is unexceptional because they are required by law to be honest about their risks. But the level of risk is not usual.

[deleted]

Re: Twilio S-1

#98

Post by toomuchtodo »

runako wrote: post #96
toomuchtodo wrote: post #30

Earlier quoted context omitted.

But what moat? There are numerous competitors to Twilio who are either cheaper or provide more niche services. You can be Amazon when you're the 800lb gorilla. Twilio is not that gorilla.

This is a great comment because it is almost verbatim what was said about Amazon. Actually, this is still frequently said about Amazon's retail operations. I remember talk that eBay was a better business than Amazon because they had network effects and were thus more defensible. Oops. Also worth noting: Amazon wasn't the 800lb gorilla when they filed their S-1 (valuation: $438mm).

Want to make a long bet? I bet you Twilio doesn't turn into that gorilla. AWS is a far cry different than Twilio.

Re: Twilio S-1

#99

Post by cissou »

sulam wrote: post #85
cissou wrote: post #63

If someone with better knowledge of S-1s could shed light on this: where can we see the option pool / option grants awarded to employees? Must be somewhere in there, no?

Do you want to see the overall size of the pool? That's simply shares outstanding. Do you want to see shares owned by specific people? That's only going to be there for the largest holders. Keep in mind shares outstanding is almost certainly larger than the existing options held by employees for a few reasons. First, people probably haven't vested their options completely in many/all cases. Secondly, some reserve is…

OK thanks, it was more to get an idea of "how much stock do the employees own vs. VCs and execs" but it looks like we don't have enough data to compute that

Re: Twilio S-1

#100

Post by Fenntrek »

ShaneBonich wrote: post #92

Worst of all, lots of free Twilio alternatives are popping up, like https://www.bitrix24.com/alternatives/free-twilio-alternativ... Twilio is great but it's hard to compete with free.

You've mentioned Bitrix24 in 2 of your 3 posts on HN, either you're a fan and passionately advocate this product...

...Or you're not disclosing a interest in the company.

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