Is Twilio Inc (NYSE:TWLO) the Next GoPro Inc (NASDAQ:GPRO) or Facebook Inc (NASDAQ:FB)?
Tech companies are choosing to stay private now longer than ever. The abundance of available private funding on the market has made it possible for these companies to avoid the blunders of its peers. In 2014, eleven unicorns went public, in 2015 only 5, and until last month the count for 2016 was holding strong at zero. Last month Twilio marked the first unicorn and tech company to file an IPO. Early indications suggest that Twilio won’t fall into the same rut as GoPro, Box or Fitbit.
Twilio is a cloud communications platform used to build voice and message applications. The company provides software developers to programmatically make and receive messages using its web service API.
Twilio began trading Thursday June 23 and has remained relatively unscathed despite market angst from Brexit .The cloud communications platform priced its IPO at $15, but ended up opening at nearly $24 per share. Since then the stock has remained resilient reaching a peak of $42 per share. It wasn’t until after the initial Brexit turmoil that Twilio hit its first roadblock. Late last week the company saw shares tumble to the mid $30 range as the optimism began to subside.
Tech startups like Twilio have achieved lofty valuations in recent years only to struggle after making their public debut. GoPro is a prime example of said misfortunes. In its early trading days, shares of the action camera maker soared as high as $87. But after a few disastrous quarters of continually decelerating growth, the stock began to tank. Shares now trade just over $10 and 66% below its IPO price.
Twilio isn’t quite there yet and hopefully will never reach that point. The company continues to leverage strategic partnerships to prevent falling down the same path of its peers. Earlier today Twilio announced they would be extending their relationship with Amazon Web Services to deliver SMS messages through Amazon’s notification service. Together the two companies are working to provide developers and users tools to manage communication channels.
It’s still too early to tell where Twilio goes from here and what the future holds for the IPO market. By any estimation, this won’t open up the floodgates for IPOs this year, especially given that Brexit and the US presidential election come with immense uncertainty.
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Photo Credit: Ken Yeung