DECEMBER 4, 2023 — 300 LAYOFFS
In another round of layoffs, spurred on by activist investors, 300 employees will be laid off.
Organizational changes to better support our growth and profitability needs
Twilions,
Last year, we set out on a path to reorient our business toward profitable growth. Specifically, we streamlined our more mature, scaled Communications business to focus on efficiency and profit, and we organized our TD&A business to optimize for growth.
We’ve made tremendous progress in Communications, even overachieving on our goals; however, we’ve underachieved on growth in TD&A. So we’re taking some steps to create a more effective GTM motion for Flex and recalibrate our investments in Segment, which combined will unfortunately mean parting ways with approximately 5% of Twilio’s workforce. Those who are impacted will receive an email within the next two hours.
I want to walk you through each of these changes in more detail, as well as what impacted Twilions can expect.
Last year, we made the decision to invest, ahead of growth, in go-to-market for Segment. Unfortunately, that bet hasn’t led to the growth outcome we’d hoped for. As a result, we’re simply spending too much. So we’ve made the hard decision to eliminate some of our Segment GTM roles - right sizing the investment for the results we’re seeing.
I, and the OG, believe Segment is a great product with amazing potential – I see and hear it every time I talk to Segment customers. It’s critical that we have a GTM model to achieve the growth this product deserves. Meanwhile, our CustomerAI vision is resonating in the market – customers are hungry to get their hands on the products we’ve already introduced, and those we’re still working on. And Segment is core to CustomerAI and those products.
We’re also making changes to how we sell Flex, where we’ve seen an overlap between our Flex sales motion and many of our Communications products. Given the similar buyer personas and product synergies between voice, IVR, and Flex, we want to simplify the experience for our customers. So, we’re consolidating Flex GTM into Communications and eliminating many Flex GTM roles. Account Executives in Communications can now sell Flex alongside our other contact center products – aligned with how customers want to buy. Flex R&D will also move intact to Communications to keep product development close to our customer-facing teams.
The decision to eliminate these roles was a hard one, but we’re confident it’s in the best interest of our customers and the long-term health of our business. At the same time, we’re opening up more AE roles inside of Communications and I encourage all sellers impacted by these changes to apply.
Reducing our Segment and Flex GTM teams will also mean impacts to some supporting functions, primarily Marketing and Finance.
Lastly, we’ve decided to end-of-life (EOL) Twilio Programmable Video as a standalone product. Given it’s such a niche area and a relatively small part of our portfolio, we believe partnering with video industry leaders is the best way to ensure long-term product innovation for our customers. Removing Programmable Video from our portfolio will also allow Communications to more effectively focus on our pillar products - Messaging, Voice, and Email.
Those Twilions impacted by our Video EOL are aware of this decision, and we’ll continue working closely with them on transition plans.
For those departing Twilio
To each and every one of you – thank you. You’ve been instrumental in building Segment, Flex, and Programmable Video to where they are today, and your contributions will be felt for a long time to come.
To all remaining Twilions
I know these changes come in a year of many changes already. When we adopted our BU structure, we knew part of that would mean learning and adapting along the way, particularly when an area of our business isn’t performing as well as we’d like. While I know it’s hard to undergo so much change, it’s all part of the necessary transition to profitable growth. Despite, and because of, these changes – I believe we are increasingly set up to balance the needs of profit and growth, and enabled to execute on the CustomerAI opportunity ahead of us.
You’ll hear from your leaders tomorrow morning, and then at 8 a.m. Pacific Time, we’ll hold a Company All Hands dedicated to answering your questions, followed by BU-specific all hands meetings later that day.
Thank you for continuing to build this company and serve our customers as we retool Twilio for the future.
–jeffiel
FEBRUARY 14, 2023 — 1,500 EMPLOYEES TARGETED IN THE NAME OF PROFITABILITY.
In a second round of layoffs, the company announced plans to cut about 1,500 employees, or around 17% of its workforce
From CEO Jeff Lawson…
“A company optimizes for its environment. For the last 15 years, we ran Twilio for growth, building a tremendous customer base, product set, and revenue base. But environments change – and so must we. Now we have to prioritize profit far more than before. We’re exiting the last phase with a great market position and very strong cash reserves, but unfortunately, that's not enough to get us through the next phase. We have to spend less, streamline, and become more efficient. To do that, we’re forming two business units: Twilio Communications and Twilio Data & Applications. And today, I'm unfortunately bearing the news that we’re parting ways with approximately 17% of our team.
I'm sure you're wondering why we're making additional cuts to the team after the September layoffs. At that time, we sought to streamline the company as it was then structured. Today's news, however, is more driven by the need to organize ourselves differently for success – and the changes needed to enact this new structure. Both the reorganization and the reductions increase our ability to drive profit and growth, both of which are required in this new environment.
At Twilio, we care about each other, our customers, and the world around us – and in this situation, it means we generously care for our departing colleagues. Here's what to expect for those who are departing:
We’re winding down some of the perks we’ve historically offered, including our book and wellness allowances. We’ve also decided to sunset Twilio Recharge, which I believe in, but which (in retrospect) was ill-timed given our profitability goals. Those who are already eligible or will become eligible for Recharge by the end of 2023 will still be able to take it. (Other perk changes will vary by country, so we will share that with each of you individually via email this week.)
SEPTEMBER 29, 2022 — Original post…
San Francisco, California-based Twilio, an operator of a cloud-based messaging platform, has announced a major reduction in force estimated at 11% of the workforce. Approximately 700+ employees will be impacted.
In an announcement to employees, Twilio founder and CEO Jeff Lawson noted, "Over the years, we’ve made lots of changes to the way Twilio operates and is organized, but none harder than what I’m sharing today."
"We’ve made the extremely difficult decision to restructure and reduce Twilio’s workforce by approximately 11% – teammates and friends who helped build Twilio."
"I’m not going to sugarcoat things. A layoff is the last thing we want to do, but I believe it’s wise and necessary. Twilio has grown at an astonishing rate over the past couple years. It was too fast, and without enough focus on our most important company priorities. I take responsibility for those decisions, as well as the difficult decision to do this layoff."
It appears that the CEO has attracted significant media attention by suggesting the company will include race in its decision-making process regarding layoffs.
"Why we’re taking this step...
Twilio has always been a growth company. And as you know, we’re committed to being a profitable growth company. At our scale, being profitable will make us stronger. It requires us to ask more rigorously which activities and investments are working. It forces us to ask where we have good alignment internally to amplify each of our efforts. This discipline requires us to ask if our investments are getting us where we need to go.
As we’ve discussed frequently, we have four priorities for reaching profitability and leading in customer engagement: Investing in our platform reliability and trust, increasing the profitability of messaging, accelerating Segment adoption, and scaling the Flex customer base. Today’s layoffs are about aligning our investments more squarely with our priorities, as well as running our company more efficiently overall.
Full stop, these are our priorities. As they have been for a while now. But we must sharpen our focus more than ever. I am asking Twilio’s leaders to further examine their priorities, and any Twilion has full permission to question every other activity that doesn’t help us achieve our company priorities in a measurable way. I am not asking you all to “do more with less.” I’m asking the company to actually do fewer things better. I take responsibility for choosing to grow our team faster and to pursue many priorities beyond these four priorities over the recent years. And now, I also own the decision to become more focused – resulting in this layoff.
I know that we can succeed in becoming the leading Customer Engagement Platform we envision. I just came back from APJ where I met with over two dozen customers. There’s a hunger for where we’re going – and key to that success in the coming years is accelerating Segment and Flex. That won’t happen without the concerted focus and investment I’m emphasizing today.
How did we decide which roles would be impacted
This was tremendously difficult. For those impacted today, we applied a rigorous selection process to examine which roles were most tightly aligned to our four priorities. Similarly, we looked at the size of the investments we’ve made and whether they are working for our company. We ultimately found that some investments no longer make sense and identified areas where we can be more efficient. By no fault of the Twilions impacted today, we’ve curtailed our investment in areas of Go To Market where customers can succeed without as much human intervention, as well as making targeted changes to be more efficient in areas of R&D and G&A.
As you all know, we are committed to becoming an Anti-Racist/Anti-Oppression company. Layoffs like this can have a more pronounced impact on marginalized communities, so we were particularly focused on ensuring our layoffs – while a business necessity today – were carried out through an Anti-Racist/Anti-Oppression lens.
To all the Twilions who will be leaving:
I want to do our best to take care of you in this transition and set you up for success in what comes next. All impacted Twilions globally will receive at least 12 weeks of pay, plus one week for every year of service at Twilio. You’ll also receive the full value of Twilio’s next stock vest because the Twilions who are leaving us are shareholders too – which is important to us.
In the US and in most regions, you will be able to remain on company payroll while searching for your next role, whether it be inside or outside Twilio. Our Talent Acquisition team will give high-touch service to impacted Twilions if there’s an open internal role in one of our investment areas. We will create a list that impacted employees can opt into, which we’ll share with other companies who may be hiring, as well as investors who know many such companies.
I know this is especially hard news for those Twilions who depend on Twilio-sponsored visas. We’ll be giving those team members even more support to hopefully minimize the disruption to them and their families as they work through their immigration status.
I am deeply sorry to see you all leave Twilio. You have all been part of building our company. You’ve been our teammates, partners, and friends. I’m grateful for your contributions to our customers and our business. And we owe it to you to help as much as we can.
To those Twilions who are remaining:
We are builders. This is all part of the complicated, difficult and at times emotional journey as builders. No doubt, it will be a hard few months as we change the shape of our company for the opportunity ahead. We’ll have an All Hands meeting tomorrow to talk more about that.
Today, it’s okay to be a bit shocked and feel sad. And to support your colleagues. I am confident that we’ll look back at this as a difficult time – but one that set up Twilio well for the future. Please see Switchboard for more details about today’s news."
Change is coming. There will always be a tomorrow, no matter how much you may try to ignore it. There are no guarantees in life or promises for a bright future. We see good people being laid off through no fault of their own. Just because something bad hasn't happened yet, doesn't mean it won't. It can happen to anyone, anytime, anywhere. No one is guaranteed to wake up tomorrow and still have a job by evening. Are you now wondering, Am I Next?
