On Wednesday, the Cloud Communications platform, Twilio (NYSE:TWLO) announced the launch of Twilio Ventures and its new $50 million fund designed to champion the customers that are building the future of customer engagement.

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Senior vice president Bryan Vaniman of corporate development, who is in charge of the new investment arm, is on a mission to build a fund and start investing.

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It is a natural extension of the company, he says.  Twilio Ventures will invest in startups and developers and have already invested in Hyro, Algolia, Calixa, and Terrazzo.

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CEO Bernadette Nixon at Algolia said: “Twilio and Algolia share a vision of utilizing API building blocks to empower developers to improve the customer experience and engagement. As a truly developer-first company pushing the boundaries of customer engagement, we are thrilled to have the support of Twilio as we embark on our next phase of growth.”

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Vaniman says that Twilio are secondary strategic investors even though they can’t share exact investment amounts with these companies.  

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It plans to act as valuable partners and offer these companies access to internal resources and assist with sales and marketing, but in most cases, without a board seat.

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The Twilio Ventures program is an addition to Twilio’s existing Twilio.org Impact Fund that supports nonprofits and social enterprises that accelerate social impact through innovative communications and engagement technologies.

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FUND IMPLICATIONS

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According to TipRanks, the fund will mainly invest in early-stage companies. However, one cannot ignore attractive opportunities in late-stage companies.

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Companies that fit within the Twilio ecosystem and companies involved in creating a better customer experience and engagement will be the twin areas of investments for the fund.

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PRICE TARGET

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Analyst Rishi Jaluria at RBC Capital recently reiterated a Buy rating on the stock with a price target of $450, implying an upside potential of 63.8% from its current levels.  

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The consensus among analysts is a Strong Buy based on 16 Buys and 2 Holds. Twilio shares have fallen 12.1% over the past year.

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