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Twilio CEO Lawson Resigns After Fierce Activist Battles

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Twilio CEO Lawson Resigns After Fierce Activist Battles

(CTN News) – Jeff Lawson, co-founder of Twilio, has announced that he will step down as company CEO on Monday. Two activist investors have been pushing for significant changes at Twilio, prompting the move.

Twilio also said it expects revenue and income to exceed its prior guidance in its regulatory filing announcing the change.

On the news, Twilio’s shares rose around 7%.

Twilio needs a new CEO to lead it through its next chapter, Lawson said in a blog post announcing the change.

Khozema Shipchandler, a executive for many years, will assume the top position on Monday. Additionally, Shipchandler will join the board.

Also, Lawson will step down as chairman of board. A current board member and Bessemer Venture Partners operating partner, Jeff Epstein, will take the lead role.

A release said Shipchandler was honored to take over as CEO. In line with activist demands, he suggested the company would take a closer look at “underperforming” businesses.

Even so, the move is unlikely to discourage activists at Anson Funds and Legion Partners. The two want the company to sell itself or completely divest its data and applications business.

Reported in December that was working with bankers at Catalyst Partners to fend off activists.

We believe Jeff Lawson’s departure from Twilio would be a step in the right direction, and are pleased with the leadership change announced today,” Anson Funds portfolio manager Sagar Gupta said.

Legion Partners’ stake in was built by Gupta in 2023, according to people familiar with the matter, and he acquired a fresh stake in Anson Funds when he joined in that fall.

“Having said that, we believe more actions are needed to maximize shareholder value. The Twilio Board and management team continue to be of interest to us, and we look forward to working together going forward.” he said.

After multiple rounds of restructuring, Shipchandler’s appointment comes after the company cut employees. A recent restructuring focused on the company’s data and applications division resulted in 5% of employees being laid off. A person familiar with Legion Partner’s thinking told me at the time that more fundamental changes were needed.

In a corporate restructuring, Shipchandler took over Twilio’s crucial communications division after serving as the company’s chief financial officer and chief operating officer. In 2018, he joined Twilio.

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