View Filing Data

Print Document

Document and Entity Information - USD ($) $ in Millions	12 Months Ended
Document and Entity Information - USD ($) $ in Millions	Dec. 31, 2017	Jan. 31, 2018	Jun. 30, 2017
Entity Registrant Name	TWILIO INC
Entity Central Index Key	0001447669
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float			$ 1,678
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Common Class A
Entity Common Stock, Shares Outstanding		70,176,391
Common Class B
Entity Common Stock, Shares Outstanding		24,054,845

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Current assets:
Cash and cash equivalents	$ 115,286	$ 305,665
Short-term marketable securities	175,587	0
Accounts receivable, net	43,113	26,203
Prepaid expenses and other current assets	19,279	21,512
Total current assets	353,265	353,380
Restricted cash	5,502	7,445
Property and equipment, net	50,541	37,552
Intangible assets, net	20,064	10,268
Goodwill	17,851	3,565
Other long-term assets	2,559	484
Total assets	449,782	412,694
Current liabilities:
Accounts payable	11,116	4,174
Accrued expenses and other current liabilities	53,614	59,308
Deferred revenue	13,797	10,222
Total current liabilities	78,527	73,704
Long-term liabilities	11,409	9,543
Total liabilities	89,936	83,247
Commitments and contingencies (Note 10)
Stockholders' equity:
Preferred stock, $0.001 par value, 100,000,000 shares authorized, none issued
Common stock, $0.001 par value per share: Authorized shares 1,100,000,000 as of December 31, 2017 and 2016; Issued and outstanding shares 93,969,796 and 87,248,548 as of December 31, 2017 and 2016	94	87
Additional paid-in capital	608,165	516,090
Accumulated other comprehensive income	2,025
Accumulated deficit	(250,438)	(186,730)
Total stockholders' equity	359,846	329,447
Total liabilities and stockholders' equity	$ 449,782	$ 412,694

Consolidated Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2017	Dec. 31, 2016
Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, authorized (in shares)	100,000,000	100,000,000
Preferred stock, issued (in shares)	0	0
Common Stock
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, authorized (in shares)	1,100,000,000	1,100,000,000
Common stock, issued (in shares)	93,969,796	87,248,548
Common stock, outstanding (in shares)	93,969,796	87,248,548

Consolidated Statements of Operations - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Consolidated Statements of Operations
Revenue	$ 399,020	$ 277,335	$ 166,919
Cost of revenue	182,895	120,520	74,454
Gross profit	216,125	156,815	92,465
Operating expenses:
Research and development	120,739	77,926	42,559
Sales and marketing	100,669	65,267	49,308
General and administrative	59,619	51,077	35,991
Charitable contribution	1,172	3,860
Total operating expenses	282,199	198,130	127,858
Loss from operations	(66,074)	(41,315)	(35,393)
Other income (expenses), net	3,071	317	11
Loss before provision for income taxes	(63,003)	(40,998)	(35,382)
Provision for income taxes	(705)	(326)	(122)
Net loss	(63,708)	(41,324)	(35,504)
Deemed dividend to investors in relation to tender offer			(3,392)
Net loss attributable to common stockholders	$ (63,708)	$ (41,324)	$ (38,896)
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.70)	$ (0.78)	$ (2.19)
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted (in shares)	91,224,607	53,116,675	17,746,526

Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Consolidated Statements of Comprehensive Loss
Net loss	$ (63,708)	$ (41,324)	$ (38,896)
Other comprehensive income:
Unrealized loss on marketable securities	(598)
Foreign currency translation	2,623
Total other comprehensive income	2,025
Comprehensive loss attributable to common stockholders	$ (61,683)	$ (41,324)	$ (38,896)

Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	IPO Common Stock Common Class A	IPO Additional Paid-in Capital	IPO	Follow-on Public Offering Common Stock Common Class A	Follow-on Public Offering Additional Paid-in Capital	Follow-on Public Offering	Preferred Stock Convertible preferred stock	Common Stock Common Class A	Common Stock Common Class B	Additional Paid-in Capital	Accumulated Other Comprehensive Income	Accumulated Deficit	Total
Beginning balance at Dec. 31, 2014							$ 111,691		$ 17	$ 8,920		$ (89,434)	$ 31,194
Beginning balance (in shares) at Dec. 31, 2014							42,482,490		17,446,051
Increase (Decrease) in Stockholders' Equity
Net loss												(35,504)	(35,504)
Issuance of stock							$ 125,448						125,448
Issuance of stock (in shares)							11,494,249
Exercise of vested stock options									$ 2	3,126			3,128
Exercise of vested stock options (in shares)									1,696,318
Vesting of early exercised stock options										201			201
Exercises of unvested stock options (in shares)									70,874
Repurchase of shares in tender offer							$ (315)		$ (2)			(17,076)	(17,393)
Repurchase of shares in tender offer (in shares)							(365,916)		(1,869,156)
Deemed dividend in relation to tender offer												(3,392)	(3,392)
Repurchase of unvested stock options (in shares)									(20,084)
Issuance of Series T convertible preferred Stock in acquisition							$ 3,087						3,087
Issuance of Series T convertible preferred Stock in acquisition (in shares)							897,618
Stock-based compensation										9,856			9,856
Ending balance at Dec. 31, 2015							$ 239,911		$ 17	22,103		(145,406)	116,625
Ending balance (in shares) at Dec. 31, 2015							54,508,441		17,324,003
Increase (Decrease) in Stockholders' Equity
Net loss												(41,324)	(41,324)
Issuance of stock	$ 12	$ 160,414	$ 160,426	$ 2	$ 65,279	$ 65,281
Issuance of stock (in shares)	11,500,000			1,691,222
Costs related to public offerings			$ (4,900)			$ (800)				(5,730)			(5,730)
Conversion of convertible preferred stock to common stock in connection with initial public offering							$ (239,911)		$ 54	239,857
Conversion of convertible preferred stock to common stock in connection with initial public offering (in shares)							(54,508,441)		54,508,441
Exercise of vested stock options									$ 2	8,390			8,392
Exercise of vested stock options (in shares)									2,168,287
Vesting of early exercised stock options										636			636
Vesting of restricted stock units (in shares)								19,178	68,345
Value of equity awards withheld for tax liability										(1,037)			(1,037)
Value of equity awards withheld for tax liability (in shares)								(1,578)	(27,036)
Exercises of unvested stock options (in shares)									126,365
Conversion of shares of Class B common stock into shares of Class A common stock								$ 37	$ (37)
Conversion of shares of Class B common stock into shares of Class A common stock (in shares)								36,787,588	(36,787,588)
Repurchase of unvested stock options (in shares)									(1,625)
Stock-based compensation										26,178			26,178
Escrow shares returned to the issuer (in shares)									(127,054)
Ending balance at Dec. 31, 2016								$ 51	$ 36	516,090		(186,730)	329,447
Ending balance (in shares) at Dec. 31, 2016								49,996,410	37,252,138
Increase (Decrease) in Stockholders' Equity
Net loss												(63,708)	(63,708)
Exercise of vested stock options									$ 6	25,591			25,597
Exercise of vested stock options (in shares)									5,186,539
Vesting of early exercised stock options										378			378
Vesting of restricted stock units (in shares)								360,116	351,255
Value of equity awards withheld for tax liability										(678)			(678)
Value of equity awards withheld for tax liability (in shares)									(22,538)
Exercises of unvested stock options (in shares)									22,510
Conversion of shares of Class B common stock into shares of Class A common stock								$ 18	$ (18)
Conversion of shares of Class B common stock into shares of Class A common stock (in shares)								18,710,499	(18,710,499)
Shares issued under ESPP								$ 1		11,917			11,918
Shares issued under ESPP (in shares)								794,142
Donated common stock										1,172			1,172
Donated common stock (in shares)								45,383
Repurchase of unvested stock options										(100)			(100)
Repurchase of unvested stock options (in shares)									(16,159)
Unrealized loss on marketable securities											$ (598)		(598)
Foreign currency translation											2,623		2,623
Stock-based compensation										53,795			53,795
Ending balance at Dec. 31, 2017								$ 70	$ 24	$ 608,165	$ 2,025	$ (250,438)	$ 359,846
Ending balance (in shares) at Dec. 31, 2017								69,906,550	24,063,246

Consolidated Statements of Stockholders' Equity (Parenthetical) $ in Millions	12 Months Ended
	Dec. 31, 2015 USD ($)
Preferred Stock \| Series E Preferred Stock
Consolidated Statements of Stockholders' Equity
Costs related to issuance of stock	$ 4.6

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss	$ (63,708)	$ (41,324)	$ (35,504)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	18,764	8,315	4,226
Amortization of bond premium	262
Stock-based compensation	49,619	24,225	8,877
Value of donated common stock	1,172
Provision for doubtful accounts	580	1,145	705
Tax benefit related to acquisition			(108)
Write-off of internal-use software	561	711	113
(Gain) loss on lease termination	(295)	94
Changes in operating assets and liabilities:
Accounts receivable	(15,280)	(8,254)	(10,506)
Prepaid expenses and other current assets	2,214	(13,755)	(2,128)
Other long-term assets	(1,989)	(135)	(162)
Accounts payable	5,433	1,714	658
Accrued expenses and other current liabilities	(3,312)	24,182	13,202
Deferred revenue	3,560	4,076	1,974
Long-term liabilities	(841)	9,097	(109)
Net cash provided by (used in) operating activities	(3,260)	10,091	(18,762)
CASH FLOWS FROM INVESTING ACTIVITIES:
(Increase) decrease in restricted cash	3,118	(7,439)
Purchases of marketable securities	(293,186)
Maturities of marketable securities	115,877
Capitalized software development costs	(17,280)	(11,527)	(8,409)
Purchases of property and equipment	(9,248)	(14,174)	(1,715)
Purchases of intangible assets	(290)	(785)	(494)
Acquisition, net of cash acquired	(22,621)	(8,500)	(1,761)
Net cash used in investing activities	(223,630)	(42,425)	(12,379)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from Initial Public Offering, net of underwriting discounts		160,426
Proceeds from Follow-On Public Offering, net of underwriting discounts		65,281
Payments of costs related to public offerings	(430)	(4,606)	(694)
Net proceeds from issuance of convertible preferred stock			125,448
Proceeds from exercises of vested options	25,597	8,392	3,128
Proceeds from exercises of nonvested options	130	710	277
Proceeds from shares issued in ESPP	11,918
Value of equity awards withheld for tax liabilities	(678)	(1,037)
Repurchases of common and preferred stock	(100)	(2)	(20,810)
Net cash provided by financing activities	36,437	229,164	107,349
Effect of exchange rate changes on cash and cash equivalents	74
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(190,379)	196,830	76,208
CASH AND CASH EQUIVALENTS-Beginning of year	305,665	108,835	32,627
CASH AND CASH EQUIVALENTS-End of year	115,286	305,665	108,835
Cash paid for income taxes	605	225	46
NON-CASH INVESTING AND FINANCING ACTIVITIES:
Purchases of property, equipment and intangible assets, accrued but not paid	235	4,201	97
Stock-based compensation capitalized in software development costs	4,176	1,953	979
Vesting of early exercised options	378	636	201
Business combination measurement period adjustments	$ (149)
Series T convertible preferred stock issued as part of purchase price in the Authy acquisition			3,087
Costs related to public offerings, accrued but not paid		$ 430	$ 1,265

Organization and Description of Business	12 Months Ended
Organization and Description of Business	Dec. 31, 2017
Organization and Description of Business
Organization and Description of Business	1. Organization and Description of Business Twilio Inc. (the "Company") was incorporated in the state of Delaware on March 13, 2008. The Company is the leader in the Cloud Communications Platform category and enables developers to build, scale and operate real-time communications within their software applications via simple-to-use Application Programming Interfaces, or API. The power, flexibility, and reliability offered by the Company's software building blocks empower entities of virtually every shape and size to build world-class engagement into their customer experience. The Company's headquarters are located in San Francisco, California and the Company has subsidiaries in the United Kingdom, Estonia, Ireland, Colombia, Germany, Hong Kong, Singapore, Bermuda, Spain, Sweden and Australia. Initial Public Offering In June 2016, the Company completed an initial public offering ("IPO") in which the Company sold 11,500,000 shares of its newly authorized Class A common stock, which included 1,500,000 shares sold pursuant to the exercise by the underwriters of an option to purchase additional shares, at the public offering price of $15.00 per share. The Company received net proceeds of $155.5 million, after deducting underwriting discounts and offering expenses paid by the Company, from the sale of its shares in the IPO. Immediately prior to the completion of the IPO, all shares of common stock then outstanding were reclassified as shares of Class B common stock and all shares of convertible preferred stock then outstanding were converted into 54,508,441 shares of common stock on a one-to-one basis, and then reclassified as shares of Class B common stock. See Note 11 for further discussion of Class A and B common stock. Follow-on Public Offering In October 2016, the Company completed a follow-on public offering ("FPO") in which the Company sold 1,691,222 shares of its Class A common stock, which included 1,050,000 shares sold pursuant to the exercise by the underwriters of an option to purchase additional shares, at a public offering price of $40.00 per share. In addition, another 6,358,778 shares of the Company's Class A common stock were sold by the selling stockholders of the Company, which included 906,364 shares sold pursuant to the exercise of employee stock options by certain selling stockholders. The Company received aggregate proceeds of $64.4 million, after deducting underwriting discounts and offering expenses paid and payable by the Company. The Company did not receive any of the net proceeds from the sales of shares by the selling stockholders.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2017

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

2. Summary of Significant Accounting Policies


	(a)	Basis of Presentation

The Company's consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP").


	(b)	Principles of Consolidation

The consolidated financial statements include the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated.


	(c)	Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are used for, but not limited to, revenue allowances and returns; valuation of the Company's stock and stock-based awards; recoverability of long-lived and intangible assets; capitalization and useful life of the Company's capitalized internal-use software development costs; fair value of acquired intangible assets and goodwill; accruals and contingencies. Estimates are based on historical experience and on various assumptions that the Company believes are reasonable under current circumstances. However, future events are subject to change and best estimates and judgments may require further adjustments; therefore, actual results could differ materially from those estimates. Management periodically evaluates such estimates and they are adjusted prospectively based upon such periodic evaluation.


	(d)	Concentration of Credit Risk

Financial instruments that potentially expose the Company to a concentration of credit risk consist primarily of cash, cash equivalents, marketable securities, restricted cash and accounts receivable. The Company maintains cash, cash equivalents, restricted cash and marketable securities with financial institutions that management believes are financially sound and have minimal credit risk exposure although the balances will exceed insured limits.

The Company sells its services to a wide variety of customers. If the financial condition or results of operations of any significant customers deteriorate substantially, operating results could be adversely affected. To reduce credit risk, management performs ongoing credit evaluations of the financial condition of significant customers. The Company does not require collateral from its credit customers and maintains reserves for estimated credit losses on customer accounts when considered necessary. Actual credit losses may differ from the Company's estimates. During the year ended December 31, 2017, there was no customer organization that accounted for more than 10% of the Company's total revenue. During the year ended December 31, 2016, one customer organization represented approximately 14% of the Company's total revenue. During the year ended December 31, 2015, a different customer organization represented approximately 17% of the Company's total revenue.

As of December 31, 2017, no customer organizations represented more than 10% of the Company's gross accounts receivable. As of December 31, 2016, one customer organization represented approximately 16% of the Company's gross accounts receivable.


	(e)	Revenue Recognition

The Company derives its revenue primarily from usage-based fees earned from customers accessing the Company's enterprise cloud computing services invoiced or paid monthly. The Company provides services to its customers under pay-as-you-go contracts and term-based contracts ranging in duration from one month to 48 months. Customers that pay via credit card are either billed in advance or as they use service. Larger customers are billed in arrears via invoices for services used. Certain customers have contracts that provide for a minimum monthly commitment and some customers have contracts that provide for a commitment that may be of a quarterly, annual or other specific durations.

The Company recognizes revenue from these transactions when all of the following criteria are satisfied:


	•	there is persuasive evidence of an arrangement;
	•	the service has been or is being provided to the customer;
	•	the amount of the fees to be paid by the customer is fixed or determinable; and
	•	collectability of the fees is reasonably assured.

Term-based contracts revenue is recognized on a straight-line basis over the contractual term of the arrangement beginning on the date that the service is made available to the customer, provided that all other revenue recognition criteria have been met. Usage-based fees are recognized as delivered.

The Company's arrangements do not contain general rights of return. However, credits may be issued to customers on a case-by-case basis. The contracts do not provide customers with the right to take possession of the software supporting the applications. Amounts that have been invoiced are recorded in accounts receivable and in revenue or deferred revenue, depending on whether the revenue recognition criteria have been met.

The reserve for sales credits was $1.8 million and $0.5 million as of December 31, 2017 and 2016, respectively, and is included in accounts receivable, net in the accompanying consolidated balance sheets. The reserve for sales credits is calculated based on historical trends and any specific risks identified in processing transactions. Changes in the reserve are recorded against revenue.

The Company collects various taxes and fees as an agent in connection with the sale of its services and remits these amounts to the respective taxing authorities. These taxes and fees have been presented on a net basis in the consolidated statements of operations and are recorded as a component of accrued liabilities in the accompanying consolidated balance sheets until remitted to the respective taxing authority.


	(f)	Cost of Revenue

Cost of revenue consists primarily of costs of communications services purchased from network service providers. Cost of revenue also includes fees to support the Company's cloud infrastructure, personnel costs, such as salaries and stock-based compensation for the customer care and support services employees, and non-personnel costs, such as amortization of capitalized internal-use software development costs.


	(g)	Research and Development Expenses

Research and development expenses consist primarily of personnel costs, cloud infrastructure fees for staging and development, outsourced engineering services, amortization of capitalized internal-use software development costs and an allocation of general overhead expenses. The Company capitalizes the portion of its software development costs that meets the criteria for capitalization.


	(h)	Internal-Use Software Development Costs

Certain costs of platform and other software applications developed for internal use are capitalized. The Company capitalizes qualifying internal-use software development costs that are incurred during the application development stage. Capitalization of costs begins when two criteria are met: (i) the preliminary project stage is completed and (ii) it is probable that the software will be completed and used for its intended function. Capitalization ceases when the software is substantially complete and ready for its intended use, including the completion of all significant testing. The Company also capitalizes costs related to specific upgrades and enhancements when it is probable the expenditures will result in additional functionality and expenses costs incurred for maintenance and minor upgrades and enhancements. Costs related to preliminary project activities and post-implementation operating activities are also expensed as incurred.

Capitalized costs of platform and other software applications are included in property and equipment. These costs are amortized over the estimated useful life of the software on a straight-line basis over three years. Management evaluates the useful life of these assets on an annual basis and tests for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. The amortization of costs related to the platform applications is included in cost of revenue, while the amortization of costs related to other software applications developed for internal use is included in research and development expenses.


	(i)	Advertising Costs

Advertising costs are expensed as incurred and were $4.9 million, $3.5 million and $2.9 million in the years ended December 31, 2017, 2016 and 2015, respectively. Advertising costs are included in sales and marketing expenses in the accompanying consolidated statements of operations.


	(j)	Stock-Based Compensation

All stock-based compensation to employees, including the purchase rights issued under the Company's 2016 Employee Stock Purchase Plan (the "ESPP"), is measured on the grant date based on the fair value of the awards on the date of grant. This cost is recognized as an expense following the ratable attribution method, over the requisite service period, for stock options, and the straight-line attribution method, over the offering period, for the purchase rights issued under the ESPP. The Company uses the Black-Scholes option pricing model to measure the fair value of its stock options and the purchase rights issued under the ESPP. The fair value of the restricted stock units is determined using the fair value of the Company's Class A common stock on the date of grant. Prior to adoption of ASU 2016-09, the stock-based compensation was recorded net of estimated forfeitures.

In March 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-09, "Compensation—Stock Compensation (Topic 718): Improvements to Employee Share -Based Payment Accounting." This new guidance was intended to simplify several areas of accounting for stock-based compensation arrangements, including the income tax impact, classification on the statement of cash flows and forfeitures. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2016, and early adoption is permitted. The Company early adopted this guidance in the quarter ended December 31, 2016. The new guidance allows entities to account for forfeitures as they occur. The Company elected to account for forfeitures as they occur and adopted this provision on a modified retrospective basis. The $0.1 million of cumulative prior years' impact as well as the impact on the first three quarters of 2016 of $75,000 was recognized as an increase to stock-based compensation during the quarter ended December 31, 2016, as the impact on prior periods was insignificant. Adoption of all other changes in the new guidance did not have a significant impact on the Company's consolidated financial statements.

Prior to the IPO, the fair value of the Company's common stock was determined by the estimated fair value of the Company's common stock at the time of grant. After the IPO, the Company uses the market closing price of its Class A common stock as reported on the New York Stock Exchange for the fair value.

Compensation expense for stock options granted to nonemployees is calculated using the Black-Scholes option pricing model and is recognized in expense over the service period. Compensation expense for nonemployee stock options subject to vesting is revalued at each reporting date until the stock options are vested.

The Black-Scholes option pricing model requires the use of complex assumptions, which determine the fair value of stock-based awards. These assumptions include:


	•	Fair value of the common stock. Prior to the Company's IPO, the board of directors considered numerous objective and subjective factors to determine the fair value of the Company's common stock at each meeting at which awards are approved. The factors included, but were not limited to: (i) contemporaneous valuations of the Company's common stock by an unrelated third party; (ii) the prices at which the Company sold shares of its convertible preferred stock to outside investors in arms-length transactions; (iii) the rights, preferences and privileges of the Company's convertible preferred stock relative to those of its common stock; (iv) the Company's results of operations, financial position and capital resources; (v) current business conditions and projections; (vi) the lack of marketability of the Company's common stock; (vii) the hiring of key personnel and the experience of management; (viii) the introduction of new products; (ix) the risk inherent in the development and expansion of the Company's products; (x) the Company's stage of development and material risks related to its business; (xi) the fact that the option grants involve illiquid securities in a private company; and (xii) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, in light of prevailing market conditions;
	•	Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The Company uses the simplified calculation of expected term, as the Company does not have sufficient historical data to use any other method to estimate expected term;
	•	Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of several entities with characteristics similar to those of the Company, such as the size and operational and economic similarities to the Company's principal business operations;
	•	Risk -free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal the expected term of the stock-based awards; and
	•	Expected dividend. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.

If any of the assumptions used in the Black-Scholes model changes, stock-based compensation for future options may differ materially compared to that associated with previous grants.


	(k)	Income Taxes

The Company accounts for income taxes in accordance with authoritative guidance which requires the use of the asset and liability approach. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carry-forwards. Deferred tax amounts are determined by using the enacted tax rates expected to be in effect when the temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized.

The Company recognizes the effect of uncertain income tax positions only if those positions are more likely than not of being sustained. Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized. Changes in recognition or measurement are reflected in the period in which the change in judgment occurs.

The Company records interest and penalties related to uncertain tax positions in the provision for income taxes in the consolidated statements of operations.


	(l)	Foreign Currency Translation

The functional currency of the Company's foreign subsidiaries is generally the U.S. dollar. Accordingly, the subsidiaries remeasure monetary assets and liabilities at period-end exchange rates, while non-monetary items are remeasured at historical rates. Revenue and expense accounts are remeasured at the average exchange rate in effect during the year. Remeasurement adjustments are recognized in the consolidated statements of operations as other income or expense in the year of occurrence. Foreign currency transaction gains and losses were insignificant for all periods presented.

For those entities where the functional currency is a foreign currency, adjustments resulting from translating the financial statements into U.S. dollars are recorded as a component of accumulated other comprehensive income (loss) in stockholders' equity. Monetary assets and liabilities denominated in a foreign currency are translated into US dollars at the exchange rate on the balance sheet date. Revenue and expenses are translated at the weighted average exchange rates during the period. Equity transactions are translated using historical exchange rates. Foreign currency transaction gains and losses are included in other income (expense), net in the consolidated statements of operations.


	(m)	Comprehensive Income (Loss)

Comprehensive income (loss) refers to net income (loss) and other revenue, expenses, gains and losses that, under generally accepted accounting principles, are recorded as an element of stockholders' equity but are excluded from the calculation of net income (loss).

For the years ended December 31, 2016 and 2015, the Company's operations did not give rise to any material items includable in comprehensive income (loss), which were not already in net income (loss). Accordingly, for those periods, the Company's comprehensive income (loss) is the same as its net income (loss).


	(n)	Net Loss Per Share Attributable to Common Stockholders

The Company calculates its basic and diluted net loss per share attributable to common stockholders in conformity with the two-class method required for companies with participating securities. All series of convertible preferred stock are considered to be participating securities as the holders of the preferred stock are entitled to receive a non-cumulative dividend on a pro rata pari passu basis in the event that a dividend is declared or paid on common stock. Shares of common stock issued upon early exercise of stock options that are subject to repurchase are also considered to be participating securities, because holders of such shares have non-forfeitable dividend rights in the event a dividend is declared or paid on common stock. Under the two-class method, in periods when the Company has net income, net income attributable to common stockholders is determined by allocating undistributed earnings, calculated as net income less current period convertible preferred stock non-cumulative dividends, between common stock and the convertible preferred stock. In computing diluted net income attributable to common stockholders, undistributed earnings are re-allocated to reflect the potential impact of dilutive securities. The Company's basic net loss per share attributable to common stockholders is calculated by dividing the net loss attributable to common stockholders by the weighted-average number of shares of common stock outstanding for the period. The diluted net loss per share attributable to common stockholders is computed by giving effect to all potential dilutive common stock equivalents outstanding for the period. The dilutive effect of these potential common shares is reflected in diluted earnings per share by application of the treasury stock method. For purposes of this calculation, convertible preferred stock, options to purchase common stock, unvested restricted stock units, common stock issued subject to future vesting, any shares of stock committed under the ESPP, any shares of stock held in escrow and any shares of stock reserved for future donations are considered common stock equivalents but have been excluded from the calculation of diluted net loss per share attributable to common stockholders as their effect is antidilutive.

Since the Company's IPO in 2016, Class A and Class B common stock are the only outstanding equity of the Company. The rights of the holders of Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common stock is entitled to 10 votes per share. Shares of Class B common stock may be converted into Class A common stock at any time at the option of the stockholder on a one-for-one basis, and are automatically converted into Class A common stock upon sale or transfer, subject to certain limited exceptions. Shares of Class A common stock are not convertible.


	(o)	Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. Cash equivalents consist of funds deposited into money market funds. All credit and debit card transactions that process as of the last day of each month and settle within the first few days of the subsequent month are also classified as cash and cash equivalents as of the end of the month in which they were processed.


	(p)	Restricted Cash

Restricted cash consists of cash deposited into a savings account with a financial institution as collateral for the Company's obligations under its facility leases of premises located in San Francisco, California. The facility lease for the Company's old office space expired in January 2017 and the facility lease for the Company's new office space expires in October 2024. The restricted cash balances as of December 31, 2017 and December 31, 2016 were $5.5 million and $8.6 million, respectively.


	(q)	Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are recorded net of the allowance for doubtful accounts and the reserve for sales credits. The allowance for doubtful accounts is estimated based on the Company's assessment of its ability to collect on customer accounts receivable. The Company regularly reviews the allowance by considering certain factors such as historical experience, credit quality, age of accounts receivable balances and other known conditions that may affect a customer's ability to pay. In cases where the Company is aware of circumstances that may impair a specific customer's ability to meet their financial obligations, a specific allowance is recorded against amounts due from the customer which reduces the net recognized receivable to the amount the Company reasonably believe will be collected. The Company writes-off accounts receivable against the allowance when a determination is made that the balance is uncollectible and collection of the receivable is no longer being actively pursued. The allowance for doubtful accounts was $1.0 million and $1.1 million as of December 31, 2017 and 2016, respectively.


	(r)	Costs Related to the Public Offerings

Costs related to the public offerings, which consist of direct incremental legal, printing and accounting fees, are deferred until the offering is completed. Upon completion of the offering, these costs are offset against the offering proceeds within the consolidated statements of stockholders' equity. As of December 31, 2016, the Company recorded in its consolidated statement of stockholders' equity $5.7 million in total offering costs, of which $4.9 million and $0.8 million related to the IPO and the FPO, respectively.


	(s)	Property and Equipment

Property and equipment is stated at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful life of the related asset. Maintenance and repairs are charged to expenses as incurred.

The useful lives of property and equipment are as follows:

Capitalized software development costs		3 years
Office equipment		3 years
Furniture and fixtures		5 years
Software		3 years
Leasehold improvements		5 years or remaining lease term


	(t)	Intangible Assets

Intangible assets recorded by the Company are costs directly associated with securing legal registration of patents and trademarks, acquiring domain names and the fair value of identifiable intangible assets acquired in business combinations.

Intangible assets with determinable economic lives are carried at cost, less accumulated amortization. Amortization is computed over the estimated useful life of each asset on a straight-line basis. The Company determines the useful lives of identifiable intangible assets after considering the specific facts and circumstances related to each intangible asset. Factors the Company considers when determining useful lives include the contractual term of any agreement related to the asset, the historical performance of the asset, the Company's long-term strategy for using the asset, any laws or other local regulations which could impact the useful life of the asset and other economic factors, including competition and specific market conditions. Intangible assets without determinable economic lives are carried at cost, not amortized and reviewed for impairment at least annually.

The useful lives of the intangible assets are as follows:

Developed technology		3 - 4 years
Customer relationships		5 - 8 years
Supplier relationships		5 years
Trade names		2 years
Patents		20 years
Trademarks		Indefinite
Domain names		Indefinite


	(u)	Goodwill

Goodwill represents excess of the aggregate purchase price over the fair value of net identifiable assets acquired in a business combination. Goodwill is not amortized and is tested for impairment at least annually or whenever events or changes in circumstances indicate that the carrying value may not be recoverable. The Company has determined that it operates as one reporting unit and has selected November 30 as the date to perform its annual impairment test. In the valuation of goodwill, management must make assumptions regarding estimated future cash flows to be derived from the Company's business. If these estimates or their related assumptions change in the future, the Company may be required to record impairment for these assets. Management may first evaluate qualitative factors to assess if it is more likely than not that the fair value of a reporting unit is less than its carrying amount and to determine if a two-step impairment test is necessary. Management may choose to proceed directly to the two-step evaluation, bypassing the initial qualitative assessment. The first step of the impairment test involves comparing the fair value of the reporting unit to its net book value, including goodwill. If the net book value exceeds its fair value, then the Company would perform the second step of the goodwill impairment test to determine the amount of the impairment loss. The impairment loss would be calculated by comparing the implied fair value of the goodwill to its net book value. In calculating the implied fair value of goodwill, the fair value of the entity would be allocated to all of the other assets and liabilities based on their fair values. The excess of the fair value of the entity over the amount assigned to other assets and liabilities is the implied fair value of goodwill. An impairment loss would be recognized when the carrying amount of goodwill exceeds its implied fair value. No goodwill impairment charges have been recorded for any period presented.


	(v)	Impairment of Long-Lived Assets

The Company evaluates long-lived assets, including property and equipment and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets held and used is measured by a comparison of the carrying amount of an asset or an asset group to estimated undiscounted future net cash flows expected to be generated by the asset or asset group. If such evaluation indicates that the carrying amount of the asset or the asset group is not recoverable, any impairment loss would be equal to the amount the carrying value exceeds the fair value. There was no impairment during the years ended December 31, 2017, 2016 and 2015. The value of the internally-developed software written-off due to abandonment was $0.6 million, $0.7 million and $0.1 million in the years ended December 31, 2017, 2016 and 2015, respectively.


	(w)	Deferred Revenue

Deferred revenue consists of cash deposits from customers to be applied against future usage and customer billings in advance of revenues being recognized from the Company's contracts. Deferred revenue is generally expected to be recognized during the succeeding 12-month period and is thus recorded as a current liability. Deferred revenue is refunded in cash upon termination of customer accounts.


	(x)	Business Combinations

The Company recognizes identifiable assets acquired and liabilities assumed at their acquisition date fair values. Goodwill is measured as the excess of the consideration transferred over the fair value of assets acquired and liabilities assumed on the acquisition date. While the Company uses its best estimates and assumptions as part of the purchase price allocation process to accurately value assets acquired and liabilities assumed, these estimates are inherently uncertain and subject to refinement. The authoritative guidance allows a measurement period of up to one year from the date of acquisition to make adjustments to the preliminary allocation of the purchase price. As a result, during the measurement period the Company may record adjustments to the fair values of assets acquired and liabilities assumed, with the corresponding offset to goodwill to the extent that it identifies adjustments to the preliminary purchase price allocation. Upon conclusion of the measurement period or final determination of the values of the assets acquired and liabilities assumed, whichever comes first, any subsequent adjustments will be recorded to the consolidated statement of operations.


	(y)	Segment Information

The Company's Chief Executive Officer is the chief operating decision maker, who reviews the Company's financial information presented on a consolidated basis for purposes of allocating resources and evaluating the Company's financial performance. Accordingly, the Company has determined that it operates in a single reporting segment.


	(z)	Fair Value of Financial Instruments

The Company applies fair value accounting for all financial instruments on a recurring basis. The Company's financial instruments, which include cash, cash equivalents, accounts receivable and accounts payable are recorded at their carrying amounts, which approximate their fair values due to their short-term nature. Restricted cash is long-term in nature and consists of cash in a savings account, hence its carrying amount approximates its fair value. Marketable securities consist of U.S. treasury securities and high credit quality corporate debt securities. All marketable securities are considered to be available-for-sale and recorded at their estimated fair values. Unrealized gains and losses for available-for-sale securities are recorded in other comprehensive income (loss). In valuing these items, the Company uses inputs and assumptions that market participants would use to determine their fair value, utilizing valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs.

Impairments are considered to be other than temporary if they are related to deterioration in credit risk or if it is likely that the security will be sold before the recovery of its cost basis. Realized gains and losses and declines in value deemed to be other than temporary are determined based on the specific identification method and are reported in other income (expense), net.

The accounting guidance for fair value provides a framework for measuring fair value, clarifies the definition of fair value, and expands disclosures regarding fair value measurements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants at the reporting date. The accounting guidance establishes a three-tiered hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as follows:


	•	Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.
	•	Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.
	•	Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date.

A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.


	(aa)	Recent Accounting Pronouncements Not Yet Adopted

In May 2017, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Updates ("ASU") 2017-09, "Compensation-Stock Compensation (Topic 718), Scope of Modification Accounting", which clarifies when changes to the terms or conditions of a share-based payment award must be accounted for as modifications. The guidance is effective prospectively for interim and annual periods beginning after December 15, 2017 and early adoption is permitted. The Company will adopt this guidance upon its effective date. The Company does not expect the adoption of this guidance to have a material impact on the Company's financial position, results of operations or cash flows.

In January 2017, the FASB issued ASU 2017-04, "Simplifying the Test for Goodwill Impairment", which removes the second step of the goodwill impairment test that requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This guidance is effective prospectively for interim and annual reporting periods beginning after December 15, 2019. The Company will adopt this guidance upon its effective date. The Company does not expect the adoption of this guidance to have a material impact on the Company's financial position, results of operations or cash flows.

In January 2017, the FASB issued ASU 2017-01, "Business Combinations (Topic 805) Clarifying the Definition of a Business", which amends the guidance of FASB Accounting Standards Codification Topic 805, "Business Combinations", adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions or disposals of assets or businesses. The definition of a business affects many areas of accounting including acquisitions, disposals, goodwill, and consolidation. This guidance is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted under certain circumstances. The Company will adopt this guidance upon its effective date and implement it next time there is a potential business combination.

In November 2016, the FASB issued ASU 2016-18, "Restricted Cash", which requires a statement of cash flows to explain the change during the period in the total of cash, cash equivalents and amounts generally described as restricted cash and restricted cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This guidance is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted. The Company will adopt this guidance upon its effective date and its impact will be a function of the amounts of restricted cash the Company has at that time and the movements therein.

In October 2016, the FASB issued ASU 2016-16, "Intra-Entity Transfers Other Than Inventory", which requires entities to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This guidance is effective for annual and interim periods beginning after December 15, 2017, and early adoption is permitted. The Company will adopt this guidance upon its effective date. The Company does not expect the adoption of this guidance to have any material impact on the Company's financial position, results of operations or cash flows.

In June 2016, the FASB issued ASU No. 2016-13, "Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments", which changes the impairment model for most financial assets. The new model uses a forward-looking expected loss method, which will generally result in earlier recognition of allowances for losses. ASU 2016-13 is effective for annual and interim periods beginning after December 15, 2019 and early adoption is permitted for annual and interim periods beginning after December 15, 2018. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.

In February 2016, the FASB issued ASU No. 2016-02, "Leases." The standard will affect all entities that lease assets and will require lessees to recognize a lease liability and a right-of-use asset for all leases (except for short-term leases that have a duration of less than one year) as of the date on which the lessor makes the underlying asset available to the lessee. For lessors, accounting for leases is substantially the same as in prior periods. For public companies, the new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. For leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, lessees and lessors must apply a modified retrospective transition approach. While the Company expects the adoption of this standard to result in an increase to the reported assets and liabilities, the Company has not yet determined the full impact that the adoption of this standard will have on its consolidated financial statements and related disclosures.

In May 2014, the FASB issued ASU 2014-09, "Revenue from Contracts with Customers". This new guidance will replace most existing U.S. GAAP guidance on this topic. The new revenue recognition standard provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. In August 2015, the FASB issued ASU 2015-14 which deferred, by one year, the effective date for the new revenue reporting standard for entities reporting under U.S. GAAP. In accordance with the deferral, this guidance will be effective for the Company beginning January 1, 2018 and can be applied either retrospectively to each period presented or as a cumulative-effect adjustment as of the date of adoption. Early adoption is permitted beginning January 1, 2017. In March 2016, the FASB issued ASU 2016-08, "Revenue from Contracts with Customers, Principal versus Agent Considerations (Reporting Revenue Gross versus Net)" clarifying the implementation guidance on principal versus agent considerations. Specifically, an entity is required to determine whether the nature of a promise is to provide the specified good or service itself (that is, the entity is a principal) or to arrange for the good or service to be provided to the customer by the other party (that is, the entity is an agent). The determination influences the timing and amount of revenue recognition. In April 2016, the FASB issued ASU 2016-10, "Revenue from Contracts with Customers, Identifying Performance Obligations and Licensing", clarifying the implementation guidance on identifying performance obligations and licensing. Specifically, the amendments reduce the cost and complexity of identifying promised goods or services and improve the guidance for determining whether promises are separately identifiable. The amendments also provide implementation guidance on determining whether an entity's promise to grant a license provides a customer with either a right to use the entity's intellectual property (which is satisfied at a point in time) or a right to access the entity's intellectual property (which is satisfied over time). In May 2016, the FASB issued ASU 2016-12 "Revenue from Contracts with Customers (Topic 606), Narrow-Scope Improvements and Practical Expedients", which amends the guidance on transition, collectability, noncash consideration and the presentation of sales and other similar taxes. ASU 2016-12 clarifies that, for a contract to be considered completed at transition, all (or substantially all) of the revenue must have been recognized under legacy GAAP. In addition, ASU 2016-12 clarifies how an entity should evaluate the collectability threshold and when an entity can recognize nonrefundable consideration received as revenue if an arrangement does not meet the standard's contract criteria. In September 2017, the FASB issued ASU 2017-13, "Revenue Recognition (Topic 605), Revenue from Contracts with Customers (Topic 606), Leases (Topic 840), and Leases (Topic 842)". These amendments provide additional clarification and implementation guidance on the previously issued ASUs. These amendments do not change the core principles of the guidance stated in ASU 2014-09, instead they are intended to clarify and improve operability of certain topics included within the revenue standard. In November 2017, the FASB issued ASU 2017-14, which includes amendments to certain SEC paragraphs within the FASB Accounting Standards Codification (Codification). ASU 2017-14 amends the Codification to incorporate SEC Staff Accounting Bulletin (SAB) No. 116 and SEC Interpretive Release on Vaccines for Federal Government Stockpiles (SEC Release No. 33-10403) that bring existing SEC staff guidance into conformity with the FASB's adoption of and amendments to ASC Topic 606, Revenue from Contracts with Customers. The effective date and transition requirements for ASU 2016-08, ASU 2016-10, ASU 2016-12, ASU 2017-13 and ASU 2017-14 are the same as the effective date and transition requirements for ASU 2014-09. The Company has evaluated the potential changes from the adoption of the new standard on its financial statements and disclosures, and is in the process of implementing appropriate changes to its business processes, systems and controls to support revenue recognition and disclosures under the new standard. Based on this evaluation, the Company will adopt the requirements of the new standard in the first quarter of 2018, using the modified retrospective transition method with a cumulative catch adjustment to retained earnings as of January 1, 2018. Under the new standard, based on the Company's preliminary assessment, the Company does not believe there will be material changes to its revenue recognition and the expectation is that the majority of the Company's revenue will continue to be recognized according to the usage by its customers, in the period in which that usage occurs.

The Company is also assessing the impact of adoption of the new standard on its accounting for sales commissions. The Company's current accounting policy requires capitalization and amortization of the deferred commissions. Under the new standard, the amounts capitalized will be recognized as amortization over the expected customer life. The Company's preliminary assessment of its analyses of the amortizable life of the deferred commissions under the new guidance at three years. Further review of certain commission plans is yet to be completed to finalize the impact on the consolidated statements of financial position, results of operations and cash flows.

There will not be any significant tax impact to the Company's consolidated statements of operations and consolidated balance sheet relating to the adoption of the new standard as there will be a full valuation allowance due to the Company's history of continued losses.

Fair Value Measurements

12 Months Ended

Dec. 31, 2017

Fair Value Measurements

Fair Value Measurements

3. Fair Value Measurements

The following tables provide the assets measured at fair value on a recurring basis as of December 31, 2017 and 2016 (in thousands):

						Fair Value Hierarchy as of December 31, 2017
	Amortized Cost or Carrying Value
			Net Unrealized Losses									Aggregate Fair Value
			Net Unrealized Losses			Level 1		Level 2		Level 3		Aggregate Fair Value
Financial Assets:
Cash and cash equivalents:
Money market funds	$	95,432	$	—		$	95,432	$	—	$	—	$	95,432

Total included in cash and cash equivalents		95,432		—			95,432		—		—		95,432

Marketable securities:
U.S. Treasury securities		59,962		(216	)		59,746		—		—		59,746
Corporate debt securities		116,223		(382	)		—		115,841		—		115,841

Total marketable securities		176,185		(598	)		59,746		115,841		—		175,587

Total financial assets	$	271,617	$	(598	)	$	155,178	$	115,841	$	—	$	271,019

There were no marketable securities as of December 31, 2016.

			As of December 31, 2016
	Total Carrying Value		As of December 31, 2016
	Total Carrying Value		Level I		Level 2		Level 3		Total
Financial Assets:
Money market funds (included in cash and cash equivalents)	$	274,135	$	274,135	$	—	$	—	$	274,135

Total financial assets	$	274,135	$	274,135	$	—	$	—	$	274,135

As the Company views these securities as available to support current operations, it has classified all available-for-sale securities as short term. The following table summarizes the contractual maturities of marketable securities as of December 31, 2017 (in thousands):

	Amortized Cost		Aggregate Fair Value
Financial Assets:
Less than one year	$	108,584	$	108,360
One to two years		67,601		67,227

Total	$	176,185	$	175,587

For fixed income securities that had unrealized losses as of December 31, 2017, the Company has determined that no other-than-temporary impairment existed. As of December 31, 2017, all securities in an unrealized loss position have been in an unrealized loss position for less than one year. Interest earned on marketable securities in the year ended December 31, 2017 was $2.6 million and is recorded as other income (expense), net, in the accompanying consolidated statement of operations.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Property and Equipment

12 Months Ended

Dec. 31, 2017

Property and Equipment

Property and Equipment

4. Property and Equipment

Property and equipment consisted of the following (in thousands):

	As of December 31,
	2017			2016
Capitalized internal-use software development costs	$	49,177		$	28,661
Leasehold improvements		14,246			14,063
Office equipment		9,652			5,729
Furniture and fixtures		1,976			1,576
Software		1,675			968

Total property and equipment		76,726			50,997
Less: accumulated depreciation and amortization		(26,185	)		(13,445	)

Total property and equipment, net	$	50,541		$	37,552

Depreciation and amortization expense was $13.1 million, $7.4 million and $3.7 million for the years ended December 31, 2017, 2016 and 2015, respectively.

The Company capitalized $21.5 million, $13.5 million and $9.4 million in internal-use software development costs in the years ended December 31, 2017, 2016 and 2015, respectively, of which $4.2 million, $2.0 million and $1.0 million, respectively, was stock-based compensation expense. Amortization of capitalized software development costs was $8.4 million, $5.5 million and $2.8 million in the years ended December 31, 2017, 2016 and 2015, respectively. The amortization expense was allocated as follows (in thousands):

	Year Ended December 31,
	2017		2016		2015
Cost of revenue	$	4,788	$	3,304	$	1,793
Research and development		3,619		2,182		1,045

Total	$	8,407	$	5,486	$	2,838

Business Combinations

12 Months Ended

Dec. 31, 2017

Business Combinations

Business Combinations

5. Business Combinations

Beepsend, AB

In February 2017, the Company completed its acquisition of Beepsend AB, a messaging provider based in Sweden, specializing in messaging and SMS solutions, for a total purchase price of $23.0 million, paid in cash, of which $5.0 million was held in escrow. The escrow will continue for 18 months after the transaction closing date and may be extended under certain circumstances.

Additionally, the Company deposited $2.0 million into a separate escrow account that will be released to certain employees on the first and second anniversaries of the closing date, provided the underlying service conditions are met. This amount is recorded as prepaid compensation in the accompanying consolidated balance sheet and is amortized into expense as the services are rendered.

The acquisition was accounted for as a business combination and, accordingly, the total purchase price was allocated to the preliminary net tangible and intangible assets and liabilities based on their preliminary fair values on the acquisition date. The prepaid compensation subject to service conditions is accounted for as a post-acquisition compensation expense and recorded as research and development expense in the accompanying consolidated statement of operations. During the measurement period in 2017, the Company recorded a net adjustments of $0.1 million to the preliminary purchase price allocation. As of December 31, 2017 the purchase price allocation is final.

The acquired entity's results of operations have been included in the consolidated financial statements of the Company from the date of acquisition.

The following table presents the purchase price allocation, as adjusted, recorded in the Company's consolidated balance sheet (in thousands):

	Total
Net tangible liabilities	$	(3,575	)
Goodwill(1)		12,837
Intangible assets(2)		13,700

Total purchase price	$	22,962


(1)	Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer and supplier relationships as well as operational synergies. Goodwill is deductible for tax purposes.
(2)	Identifiable finite-lived intangible assets were comprised of the following:

	Total		Estimated life (in years)
Developed technology	$	5,000	4
Customer relationships		6,100	7 - 8
Supplier relationships		2,600	5

Total intangible assets acquired	$	13,700

The Company acquired a net deferred tax liability of $2.6 million in this business combination that is included in the long-term liabilities in the accompanying consolidated balance sheet.

The estimated fair value of the intangible assets acquired was determined by the Company, and the Company considered or relied in part upon a valuation report of a third-party expert. The Company used income approaches to estimate the fair values of the identifiable intangible assets. Specifically, the developed technology asset class was valued using the-relief-from royalty method, while the customer relationships asset class was valued using a multi-period excess earnings method and the supplier relationships asset class was valued using an incremental cash flow method.

The Company incurred costs related to this acquisition of $0.7 million, of which $0.3 million and $0.4 million were incurred during fiscal years 2017 and 2016, respectively. All acquisition related costs were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statements of operations.

Pro forma results of operations for this acquisition are not presented as the financial impact to the Company's consolidated financial statements is immaterial.

Kurento Open Source Project

In November 2016, the Company acquired certain assets from Tikal Technologies S.L., a Spanish corporation, behind the Kurento Open Source Project. The acquired assets consisted of (a) proprietary WebRTC media processing technologies, (b) certain licenses, patents and trademarks and (c) certain employee relationships behind the WebRTC technology. The purchase price consisted of $8.5 million in cash, of which $1.5 million was placed into escrow to indemnify the Company against breaches of general representations, warranties, claims and tax compliance matters. The escrow is effective for 24 months and 10 days from the acquisition date and may be extended under certain circumstances.

The acquisition was accounted for as a business combination and, accordingly, the total purchase price was allocated to the identifiable intangibles assets acquired based on their respective fair values on the acquisition date. The excess of the purchase price over the fair values of the identifiable assets acquired was recorded as goodwill. The Company considered or relied in part upon a valuation report of a third-party expert.

The following table presents the final purchase price allocation recorded in the Company's consolidated balance sheet (in thousands):

	Total
Intangible assets(1)	$	8,100
Goodwill(2)		400

Total purchase price	$	8,500


(1)	The intangible assets consist of developed technology with the estimated useful life of 3 years on the date of acquisition.
(2)	The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology and the future development initiatives of the acquired workforce. The goodwill is deductible for tax purposes.

The Company incurred cost related to this acquisition of $0.1 million that were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statement of operations.

Authy, Inc.

In February 2015, the Company completed its acquisition of Authy, Inc. ("Authy"), a Delaware corporation with operations in Bogota, Colombia and San Francisco, California. Authy had developed a two-factor authentication online security solution. The Company's purchase price of $6.1 million for all of the outstanding shares of capital stock of Authy consisted of $3.0 million in cash and $3.1 million representing the fair value of 389,733 shares of the Company's Series T convertible preferred stock, of which 180,000 shares were placed in escrow. The escrow was effective until the first anniversary of the closing date, and has continued beyond that date as a result of certain circumstances. As of December 31, 2017, the Company has not released any shares out of the escrow. Additionally, the Company issued 507,885 shares of its Series T convertible preferred stock, which converted into shares of Class B common stock immediately prior to the closing of the IPO, to a former shareholder of Authy that had a fair value of $4.0 million and were subject to a service condition over a period of three years, as amended. In August 2016, the unvested shares were reduced by 127,054 shares due to the non-fulfillment of certain conditions of the merger agreement. In December 2016, all remaining unvested shares vested.

The acquisition was accounted for as a business combination and, accordingly, the total purchase price was allocated to the identifiable tangible and intangible assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. The cost of shares subject to vesting and performance conditions was accounted for as a post-acquisition compensation expense and recorded as research and development expense in the accompanying consolidated statements of operations. The Company recorded $2.4 million and $0.6 million of stock-based compensation expense related to these shares in the years ended December 31, 2016 and 2015, respectively.

Authy's results of operations have been included in the consolidated financial statements of the Company from the date of acquisition.

This transaction was intended to qualify as a tax-free reorganization under Section 368(a) of the IRS Code.

The fair value of the Series T convertible preferred stock was determined by the board of directors of the Company with input from a third-party valuation consultant.

The following table presents the final purchase price allocation recorded in the Company's consolidated balance sheet (in thousands):

	Total
Net tangible assets	$	1,165
Goodwill(1)		3,165
Intangible assets(2)		1,760

Total purchase price	$	6,090


The Company acquired a net deferred tax liability of $0.1 million in this business combination.


(1)	Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer base and the future development initiatives of the assembled workforce. Goodwill is not deductible for tax purposes.
(2)	Identifiable finite-lived intangible assets were comprised of the following:

	Total		Estimated life (in years)
Developed technology	$	1,300	3
Customer relationships		400	5
Trade name		60	2

Total intangible assets acquired	$	1,760

The estimated fair value of the intangible assets acquired was determined by the Company, and the Company considered or relied in part upon a valuation report of a third-party expert. The Company used an income approach to measure the fair values of the developed technology and trade names based on the relief-from-royalty method. The Company used an income approach to measure the fair value of the customer relationships based on the multi-period excess earnings method, whereby the fair value is estimated based upon the present value of cash flows that the applicable asset is expected to generate.

The Company incurred costs related to this acquisition of $1.5 million, of which $1.2 million and $0.3 million were incurred during the years ended December 31, 2015 and 2014, respectively. All acquisition related costs were expensed as incurred and have been recorded in general and administrative expenses in the accompanying consolidated statements of operations.

Pro forma results of operations for this acquisition are not presented as the financial impact to the Company's consolidated financial statements is immaterial.

Goodwill and Intangible Assets

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets

Goodwill and Intangible Assets

6. Goodwill and Intangible Assets

Goodwill

Goodwill balance as of December 31, 2017 and 2016 was as follows (in thousands):

	Total
Balance as of December 31, 2015	$	3,165
Goodwill recorded in connection with 2016 acquisition		400

Balance as of December 31, 2016		3,565
Goodwill recorded in connection with 2017 acquisition		12,688
Measurement period adjustment		149
Effect of exchange rate		1,449

Balance as of December 31, 2017	$	17,851

Intangible assets

Intangible assets consisted of the following (in thousands):

	As of December 31, 2017
	Gross		Accumulated Amortization			Net
Amortizable intangible assets:
Developed technology	$	14,941	$	(5,476	)	$	9,465
Customer relationships		7,159		(1,006	)		6,153
Supplier relationships		2,881		(500	)		2,381
Trade name		60		(60	)		—
Patent		1,878		(108	)		1,770

Total amortizable intangible assets		26,919		(7,150	)		19,769

Non-amortizable intangible assets:
Domain names		32		—			32
Trademarks		263		—			263

Total	$	27,214	$	(7,150	)	$	20,064

	As of December 31, 2016
	Gross		Accumulated Amortization			Net
Amortizable intangible assets:
Developed technology	$	9,400	$	(1,140	)	$	8,260
Customer relationships		400		(148	)		252
Trade name		60		(56	)		4
Patent		1,512		(55	)		1,457

Total amortizable intangible assets		11,372		(1,399	)		9,973

Non-amortizable intangible assets:
Domain names		32		—			32
Trademarks		263		—			263

Total	$	11,667	$	(1,399	)	$	10,268

Amortization expense was $5.7 million, $0.9 million and $0.5 million for the years ended December 31, 2017, 2016 and 2015, respectively.

Total estimated future amortization expense was as follows (in thousands):

	As of December 31, 2017
2018	$	6,793
2019		5,083
2020		2,653
2021		1,520
2022		924
Thereafter		2,796

Total	$	19,769

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Accrued Expenses and Other Liabilities

12 Months Ended

Dec. 31, 2017

Accrued Expenses and Other Liabilities

Accrued Expenses and Other Liabilities

7. Accrued Expenses and Other Liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

	As of December 31,
	2017		2016
Accrued payroll and related	$	4,898	$	3,132
Accrued bonus and commission		4,777		2,251
Accrued cost of revenue		10,876		8,741
Sales and other taxes payable		20,877		28,795
ESPP contributions		1,338		4,365
Deferred rent		1,048		1,250
Accrued other expense		9,800		10,774

Total accrued expenses and other current liabilities	$	53,614	$	59,308

Long-term liabilities consisted of the following (in thousands):

	As of December 31,
	2017		2016
Deferred rent	$	8,480	$	9,387
Deferred tax liability		2,452		(2)
Accrued other expense		477		158

Total long-term liabilities	$	11,409	$	9,543

Supplemental Balance Sheet Information

12 Months Ended

Dec. 31, 2017

Supplemental Balance Sheet Information

Supplemental Balance Sheet Information

8. Supplemental Balance Sheet Information

A roll-forward of the Company's reserves for the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands):


	(a)	Allowance for doubtful accounts:

	Year Ended December 31,
	2017			2016			2015
Balance, beginning of period	$	1,076		$	486		$	210
Additions		580			1,145			705
Write-offs		(623	)		(555	)		(429	)

Balance, end of period	$	1,033		$	1,076		$	486


	(b)	Sales credit reserve:

	Year Ended December 31,
	2017			2016			2015
Balance, beginning of period	$	544		$	714		$	312
Additions		2,531			1,348			1,210
Deductions against reserve		(1,314	)		(1,518	)		(808	)

Balance, end of period	$	1,761		$	544		$	714

Revenue by Geographic Area

12 Months Ended

Dec. 31, 2017

Revenue by Geographic Area

Revenue by Geographic Area

9. Revenue by Geographic Area

Revenue by geographic area is based on the IP address at the time of registration. The following table sets forth revenue by geographic area (in thousands):

	Year Ended December 31,
	2017			2016			2015
Revenue by geographic area:
United States	$	308,612		$	233,922		$	143,145
International		90,408			43,413			23,774

Total	$	399,020		$	277,335		$	166,919


Percentage of revenue by geographic area:
United States		77	%		84	%		86	%
International		23	%		16	%		14	%

Long-lived assets outside the United States were not significant.

Commitments and Contingencies

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies

Commitments and Contingencies

10. Commitments and Contingencies


	(a)	Lease Commitments

The Company entered into various non-cancelable operating lease agreements for its facilities that expire over the next six years. Certain operating leases contain provisions under which monthly rent escalates over time. When lease agreements contain escalating rent clauses or free rent periods, the Company recognizes rent expense on a straight-line basis over the term of the lease.

In January 2016, the Company entered into a lease agreement ("Lease"), as subsequently amended, for approximately 90,000 square feet of new office space at 375 Beale Street in San Francisco, California, that houses its principal executive office. The term of the Lease is approximately 96 months following the commencement in October 2016, and the lease payments range from $0.4 million per month in the first 60 months to $0.5 million per month thereafter. The Lease included a tenant improvement allowance to cover construction of certain leasehold improvements for up to $8.3 million. All applicable amounts were collected from the landlord as of December 31, 2017. Based on the terms of the landlord incentive and involvement of the Company in the construction process, the leasehold improvements were determined to be property of the Company. The Company secured its lease obligation with a $7.4 million letter of credit, which was designated as restricted cash on its balance sheet as of December 31, 2016. As of December 31, 2017, the letter of credit and the restricted cash were reduced to $5.5 million, as stipulated in the lease agreement.

Rent expense was $8.1 million, $7.3 million and $4.1 million for the years ended December 31, 2017, 2016 and 2015, respectively.

Future minimum lease payments under non-cancelable operating leases were as follows (in thousands):

Year Ending December 31:	As of December 31, 2017
2018	$	7,884
2019		7,676
2020		7,101
2021		7,033
2022		5,864
Thereafter		10,189

Total minimum lease payments	$	45,747

Additionally, the Company has noncancellable contractual commitments with its cloud infrastructure provider, network service providers and other vendors that are non-cancellable and expire within one to four years. Future minimum payments under these noncancellable purchase commitments were as follows (in thousands). Unrecognized tax benefits are not included in these amounts because any amounts expected to be settled in cash are not material:

Year Ending December 31:	As of December 31, 2017
2018	$	22,414
2019		25,526
2020		147
2021		23

Total payments	$	48,110


	(b)	Legal Matters

On April 30, 2015, Telesign Corporation, or Telesign, filed a lawsuit against the Company in the United States District Court, Central District of California ("Telesign I"). Telesign alleges that the Company is infringing three U.S. patents that it holds: U.S. Patent No. 8,462,920 ("'920"), U.S. Patent No. 8,687,038 ("'038") and U.S. Patent No. 7,945,034 ("'034"). The patent infringement allegations in the lawsuit relate to the Company's Account Security products, its two-factor authentication use case and an API tool to find information about a phone number. The Company petitioned the U.S. Patent and Trademark Office ("U.S. PTO") for inter partes review of the patents at issue. On July 8, 2016, PTO denied the Company's petition for inter partes review of the '920 and '038 patents, and on June 26, 2017, it upheld the patentability of the '034 patent, adopting Telesign's narrow construction of its patent.

On March 28, 2016, Telesign filed a second lawsuit against the Company in the United States District Court, Central District of California ("Telesign II"), alleging infringement of U.S. Patent No. 9,300,792 ("'792") held by Telesign. The '792 patent is in the same patent family as the '920 and '038 patents asserted in Telesign I. On March 8, 2017, in response to a petition by the Company, the PTO issued an order instituting the inter partes review for the '792 patent. A final written decision is expected by March 2018. On March 15, 2017, Twilio filed a motion to consolidate and stay related cases pending the conclusion of the '792 patent inter partes review, which the court granted. With respect to each of the patents asserted in Telesign I and Telesign II, the complaints seek, among other things, to enjoin the Company from allegedly infringing the patents, along with damages for lost profits.

On December 1, 2016, the Company filed a patent infringement lawsuit against Telesign in the United States District Court, Northern District of California, alleging indirect infringement of United States Patent No. 8,306,021, United States Patent No. 8,837,465, United States Patent No. 8,755,376, United States Patent No. 8,736,051, United States Patent No. 8,737,962, United States Patent No. 9,270,833, and United States Patent No. 9,226,217. Telesign filed a motion to dismiss the complaint on January 25, 2017. In two orders, issued on March 31, 2017 and April 17, 2017, the Court granted Telesign's motion to dismiss with respect to the '962, '833, '051 and '217 patents, but denied Telesign's motion to dismiss as to the '021, '465 and '376 patents. This litigation is currently ongoing.

On February 18, 2016, a putative class action complaint was filed in the Alameda County Superior Court in California, entitled Angela Flowers v. Twilio Inc. The complaint alleges that the Company's products permit the interception, recording and disclosure of communications at a customer's request and are in violation of the California Invasion of Privacy Act. The complaint seeks injunctive relief as well as monetary damages. On May 27, 2016, the Company filed a demurrer to the complaint. On August 2, 2016, the court issued an order denying the demurrer in part and granted it in part, with leave to amend by August 18, 2016 to address any claims under California's Unfair Competition Law. The plaintiff opted not to amend the complaint. Following a period of discovery, the plaintiff filed a motion for class certification on September 20, 2017. On January 2, 2018, the court issued an order granting in part and denying in part the plaintiff's class certification motion. The court certified two classes of individuals who, during specified time periods, allegedly sent or received certain communications involving the accounts of three of the Company's customers that were recorded. The court has not yet set a schedule for notice to potential class members, additional discovery, summary judgment motions, or trial.

The Company intends to vigorously defend itself against these lawsuits and believes it has meritorious defenses to each matter in which it is a defendant. It is too early in these matters to reasonably predict the probability of the outcomes or to estimate ranges of possible losses.

In addition to the litigation matters discussed above, from time to time, the Company is a party to legal action and subject to claims that arise in the ordinary course of business. The claims are investigated as they arise and loss estimates are accrued, when probable and reasonably estimable. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company believes that these legal proceedings will not have a material adverse effect on its financial position or results of operations.

Legal fees and other costs related to litigation and other legal proceedings are expensed as incurred and are included in general and administrative expenses in the accompanying consolidated statements of operations.


	(c)	Indemnification Agreements

The Company has signed indemnification agreements with all of its board members and executive officers. The agreements indemnify the board members and executive officers from claims and expenses on actions brought against the individuals separately or jointly with the Company for certain indemnifiable events. Indemnifiable Events generally mean any event or occurrence related to the fact that the board member or the executive officer was or is acting in his or her capacity as a board member or an executive officer for the Company or was or is acting or representing the interests of the Company.

In the ordinary course of business, the Company enters into contractual arrangements under which it agrees to provide indemnification of varying scope and terms to business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, intellectual property infringement claims made by third parties and other liabilities relating to or arising from the Company's various products, or its acts or omissions. In these circumstances, payment may be conditional on the other party making a claim pursuant to the procedures specified in the particular contract. Further, the Company's obligations under these agreements may be limited in terms of time and/or amount, and in some instances, the Company may have recourse against third parties for certain payments. The terms of such obligations may vary.

As of December 31, 2017 and 2016, no amounts were accrued.


	(d)	Other Taxes

The Company conducts operations in many tax jurisdictions throughout the United States. In many of these jurisdictions, non-income-based taxes, such as sales and use and telecommunications taxes are assessed on the Company's operations. Prior to March 2017, the Company had not billed nor collected these taxes from its customers and, in accordance with U.S. GAAP, recorded a provision for its tax exposure in these jurisdictions when it was both probable that a liability had been incurred and the amount of the exposure could be reasonably estimated. These estimates included several key assumptions including, but not limited to, the taxability of the Company's services, the jurisdictions in which its management believes it has nexus, and the sourcing of revenues to those jurisdictions. Starting in March 2017, the Company began collecting these taxes from customers in certain jurisdictions, and since then, has expanded the number of jurisdictions where these taxes are being collected. The Company expects to continue to expand the number of jurisdictions where these taxes will be collected in the future. Simultaneously, the Company was and continues to be in discussions with certain states regarding its prior state sales and other taxes, if any, that the Company may owe.

During 2017, the Company revised its estimates of its tax exposure based on settlements reached with various states indicating that certain revisions to the key assumptions including, but not limited to, the sourcing of revenue and the taxability of the Company's services were appropriate in the current period. In the year ended December 31, 2017, the total impact of these changes on the net loss attributable to common stockholders was a reduction of $13.4 million. As of December 31, 2017 and 2016, the liability recorded for these taxes was $20.9 million and $28.8 million, respectively.

In the event other jurisdictions challenge management's assumptions and analysis, the actual exposure could differ materially from the current estimates.

Stockholders' Equity

12 Months Ended

Dec. 31, 2017

Stockholders' Equity

Stockholders' Equity

11. Stockholders' Equity


	(a)	Convertible Preferred Stock

As of December 31, 2015, the Company had outstanding Series A, B, C, D, E and T convertible preferred stock (individually referred to as "Series A, B, C, D, E or T" or collectively "Preferred Stock") as follows (in thousands, except share data).

Immediately prior to the completion of the IPO, all shares of convertible preferred stock then outstanding were automatically converted into 54,508,441 shares of common stock on a one-to-one basis, and then reclassified as shares of Class B common stock.

	As of December 31, 2015
	Shares Authorized		Shares Issued and Outstanding			Aggregate Liquidation preference		Proceeds, Net of Issuance Costs
Series A		13,173,240		13,076,491		$	4,590	$	4,592
Series B		11,416,062		11,146,895			11,717		11,658
Series C		8,452,864		8,452,864			25,250		25,196
Series D		9,440,324		9,440,324			70,000		69,930
Series E		11,494,249		11,494,249			130,000		125,448
Series T		5,000,000		897,618	(1)		9		—	(2)

Total		58,976,739		54,508,441		$	241,566	$	236,824


(1)	The outstanding shares include 687,885 shares held in escrow as of December 31, 2015 related to the Authy acquisition. Of these shares, 507,885 shares were subject to graded vesting over a period of three years, as amended, and had a fair value of $4.0 million. A total of 127,054 shares were subject to certain performance conditions and were returned to the issuer in the third quarter 2016 due to the non-fulfillment of certain conditions of the merger agreement. All remaining unvested shares vested in the fourth quarter of 2016.
(2)	389,733 shares were issued as part of the purchase price for Authy acquisition and had a fair value of $3.1 million on the acquisition closing date.

The holders of the Company's Preferred Stock had the following rights, preferences and privileges:

Conversion

At any time following the date of issuance, each share of Preferred Stock is convertible, at the option of its holder, into the number of shares of common stock which results from dividing the applicable original issue price per share for each series by the applicable conversion price per share for such series, on the date of conversion. As of December 31, 2015, the initial conversion prices per share of all series of preferred stock were equal to the original issue prices of each series and therefore the conversion ratio was 1:1.

Each share of preferred stock shall be automatically converted into shares of common stock immediately upon the earlier of (i) the consummation of a firmly underwritten public offering pursuant to the Securities Act of 1933, as amended, the public offering price of which is not less than $50.0 million in aggregate; or (ii) the date specified by the written consent of holders of a majority of the outstanding shares of preferred stock, voting together as a class of shares on an as-converted basis. In addition, the conversion of each of the Series B, Series C, Series D and Series E preferred stock in connection with a Liquidation Event defined below requires the written consent of a majority of such series, if the proceeds payable to each of these series is less than the respective original issuance price.

A Liquidation Event includes (i) a sale, lease or other disposition of all or substantially all of the Company's assets, (ii) a merger or consolidation of the Company into another entity (except where the merger results in the holders of the Company's stock prior to merger continuing to hold at least 50% of the voting power of the capital stock of the Company or the surviving or acquiring entity), (iii) the transfer of the Company's securities to a person, or a group of affiliated persons, if, after such a transfer, such person or group of persons holds 50% or more of the outstanding voting stock of the Company, (iv) the grant of an exclusive, irrecoverable license to all or substantially all of the Company's intellectual property or (v) a liquidation, dissolution or winding up of the Company.

In the event the Company issues any additional stock, as defined in the Company's Certificate of Incorporation, after the preferred stock original issue date, without consideration or for a consideration per share less than the conversion price applicable to a series of preferred stock in effect immediately prior to such issuance, the conversion price for such series in effect immediately prior to each such issuance shall be adjusted according to a formula set forth in the Company's Certificate of Incorporation.

Voting

The holders of Preferred Stock and the holders of common stock vote together and not as separate classes, except in cases specifically provided for in the Certificate of Incorporation or as provided by law.

The holders of each share of Preferred Stock has the right to one vote for each share of common stock into which such Preferred Stock could be converted, and, with respect to such vote, holders of Preferred Stock have full voting rights and powers equal to the voting rights and powers of the holders of common stock, with the exception of voting for the election of directors referred to below.

As long as a majority of the shares of Series A preferred stock originally issued remain outstanding, the holders of such shares, voting as a separate class, shall be entitled to elect one director. As long as a majority of the shares of Series B preferred stock originally issued remain outstanding, the holders of such shares, voting as a separate class, shall be entitled to elect one director. As long as at least 2,000,000 shares of Series D preferred stock are outstanding, the holders of such shares, voting as a separate class, shall be entitled to elect one director. The holders of common stock, voting as a separate class, shall be entitled to elect two directors. The holders of shares of Preferred Stock and common stock, voting together as a single class on an as-converted basis, shall be entitled to elect the remaining directors of the Company.

Dividends

The holders of convertible preferred stock are entitled to receive, when and if declared by the board of directors, out of any assets legally available therefor, any dividends as may be declared from time to time by the board of directors. No dividend may be declared or paid on the common stock unless any and all such dividends are distributed among all holders of common stock and preferred stock on a pro rata pari passu basis in proportion to the number of shares of common stock that would be held by each such holder if all shares of preferred stock were converted to common stock at the effective conversion rate. The right to receive dividends on shares of preferred stock is non-cumulative. No dividends had been declared or paid by the Company as of December 31, 2015 and through the Company's IPO.

Liquidation Preference

In the event of any Liquidation Event of the Company, the holders of Series A, Series B, Series C, Series D and Series E preferred stock ("senior preferred stock") shall be entitled to receive, in preference to any distribution of the proceeds to the holders of Series T preferred stock or common stock, an amount per share equal to the sum of the applicable original issue price for each series of preferred stock (as adjusted for stock splits and combinations as described in the Certificate of Incorporation), plus declared but unpaid dividends on such share. Upon completion of this distribution, the holders of Series T preferred stock shall be entitled to receive in preference to any distribution of the proceeds to the holders of common stock an amount per share equal to the sum of the applicable original issue price for Series T preferred stock, plus declared but unpaid dividends on such share. If the proceeds thus distributed among the holders of the preferred stock are insufficient to permit payment to such holders of the full preferential amounts, then the entire proceeds available for distribution shall be distributed ratably first among the holders of the senior preferred stock in proportion to the full preferential amount that each holder is otherwise entitled to. The original issue price per share of Series A, Series B, Series C, Series D, Series E and Series T convertible preferred stock is equal to $0.35, $1.05, $2.99, $7.42, $11.31 and $0.01, respectively.

Upon completion of the distribution referred to above, all the remaining proceeds available for distribution shall be distributed to the holders of the Company's common stock pro rata based on the number of common stock held by each.

The Company classified the Preferred Stock within shareholders' equity since the shares are not redeemable, and the holders of the Preferred Stock cannot effect a deemed liquidation of the Company outside of the Company control.


	(b)	Preferred Stock

As of December 31, 2017 and 2016, the Company had authorized 100,000,000 shares of preferred stock, par value $0.001, of which no shares were issued and outstanding.


	(c)	Common Stock

As of December 31, 2017 and 2016, the Company had authorized 1,000,000,000 shares of Class A common stock and 100,000,000 shares of Class B common stock, each par value $0.001 per share. As of December 31, 2017, 69,906,550 shares of Class A common stock and 24,063,246 shares of Class B common stock were issued and outstanding. As of December 31, 2016, 49,996,410 shares of Class A common stock and 37,252,138 shares of Class B common stock were issued and outstanding. Holders of Class A and Class B common stock are entitled to one vote per share and 10 votes per share, respectively, and the shares of Class A common stock and Class B common stock are identical, except for voting and conversion rights. The outstanding Class B common stock in both periods included 180,000 shares related to the Authy acquisition that were held in escrow.

The Company had reserved shares of common stock for issuance as follows:

	As of December 31,
	2017		2016
Stock options issued and outstanding		10,710,427		14,649,276
Nonvested restricted stock units issued and outstanding		5,665,459		2,034,217
Class A common stock reserved for Twilio.org		635,014		680,397
Stock-based awards available for grant under 2016 Plan		10,200,189		10,143,743
Class A common stock reserved for issuance under 2016 ESPP		235,372		597,038

Total		27,446,461		28,104,671


	(d)	Stock Repurchases

Following the closing of the Series E convertible preferred stock financing, on August 21, 2015, the Company repurchased an aggregate of 365,916 shares of Series A preferred stock and Series B preferred stock from certain preferred stockholders, and repurchased an aggregate of 1,869,156 shares of common stock from certain current and former employees for $22.8 million in cash, which transaction is referred to as the 2015 Repurchase. The 2015 Repurchase was conducted at a price in excess of the fair value of the Company's common stock at the date of repurchase. No special rights or privileges were conveyed to the employees and former employees. However, not all employees were invited to participate in the 2015 Repurchase. The Company recorded a compensation expense in the amount of $2.0 million for the year ended December 31, 2015, which was the excess of the common stock repurchase price above the fair value of the common stock on the date of repurchase. Of this expense, $0.8 million, $0.1 million and $1.1 million were classified as research and development, sales and marketing and general and administrative expenses, respectively, in the accompanying consolidated statement of operations. The excess of the preferred stock repurchase price above the carrying value of the preferred stock was recorded as a deemed dividend in the year ended December 31, 2015. The Company retired the shares repurchased in the 2015 Repurchase as of August 21, 2015.


	(e)	Twilio.org

On September 2, 2015, the Company's board of directors approved the establishment of Twilio.org with 888,022 shares of the Company's common stock, which at the time represented 1% of the Company's outstanding capital stock on as-converted basis, reserved to fund Twilio.org's activities. Through Twilio.org, which is a part of the Company and not a separate legal entity, the Company donates and discounts its products to nonprofits, who use the Company's products to engage their audience, expand their reach and focus on making a meaningful change in the world. On May 13, 2016, the Company's board of directors authorized a reduction of 107,625 shares reserved to offset equity grants to Twilio.org employees. On October 20, 2016, the Company completed its follow-on public offering. Of the net proceeds the Company received in the offering, $3.9 million was reserved to fund and support the operations of Twilio.org and the number of shares of Class A common stock reserved for Twilio.org was reduced by 100,000. In December 2016, Twilio.org donated the full $3.9 million proceeds into an independent Donor Advised Fund to further the philanthropic goals of the Company. In November 2017, Twilio.org donated 45,383 shares of Class A common stock with a fair value of $1.2 million into the same Donor Advised Fund. Both donations were recorded as charitable contributions in the accompanying consolidated statements of operations. As of December 31, 2017, the total remaining shares reserved for Twilio.org was 635,014.

Stock-Based Compensation

12 Months Ended

Dec. 31, 2017

Stock-Based Compensation

Stock-Based Compensation

12. Stock-Based Compensation

2008 Stock Option Plan

The Company maintained a stock plan, the 2008 Stock Option Plan, as amended and restated (the "2008 Plan"), which allowed the Company to grant incentive ("ISO"), non-statutory ("NSO") stock options and restricted stock units ("RSU") to its employees, directors and consultants to participate in the Company's future performance through stock-based awards at the discretion of the board of directors. Under the 2008 Plan, options to purchase the Company's common stock could not be granted at a price less than fair value in the case of ISOs and NSOs. Fair value was determined by the board of directors, in good faith, with input from valuation consultants. On June 22, 2016, the plan was terminated in connection with the Company's IPO. Accordingly, no shares are available for future issuance under the 2008 Plan. The 2008 Plan continues to govern outstanding equity awards granted thereunder. The Company's right of first refusal for outstanding equity awards granted under the 2008 Plan terminated upon completion of the IPO. Options granted include provisions for early exercisability.

2016 Stock Option Plan

The Company's 2016 Stock Option and Incentive Plan (the "2016 Plan") became effective on June 21, 2016. The 2016 Plan provides for the grant of ISOs, NSOs, restricted stock, RSUs, stock appreciation rights, unrestricted stock awards, performance share awards, dividend equivalent rights and cash-based awards to employees, directors and consultants of the Company. A total of 11,500,000 shares of the Company's Class A common stock were initially reserved for issuance under the 2016 Plan. These available shares automatically increase each January 1, beginning on January 1, 2017, by 5% of the number of shares of the Company's Class A and Class B common stock outstanding on the immediately preceding December 31, or such lesser number of shares as determined by the Company's compensation committee. On January 1, 2017, the shares available for grant under the 2016 Plan were automatically increased by 4,362,427 shares.

Under the 2016 Plan, the stock options are granted at a price per share not less than 100% of the fair market value per share of the underlying common stock on the date of grant. Under both plans, stock options generally expire 10 years from the date of grant and vest over periods determined by the board of directors. The vesting period for new-hire options and restricted stock units is generally a four-year term from the date of grant, at a rate of 25% after one year, then monthly or quarterly, respectively, on a straight-line basis thereafter. In July 2017, the Company began granting restricted stock units to existing employees that vest in equal quarterly installments over a four year service period.

2016 Employee Stock Purchase Plan

The Company's Employee Stock Purchase Plan ("2016 ESPP") became effective on June 21, 2016. A total of 2,400,000 shares of the Company's Class A common stock were initially reserved for issuance under the 2016 ESPP. These available shares will automatically increase each January 1, beginning on January 1, 2017, by the lesser of 1,800,000 shares of the common stock, 1% of the number of shares of the Company's Class A and Class B common stock outstanding on the immediately preceding December 31 or such lesser number of shares as determined by the Company's compensation committee. On January 1, 2017, the shares available for grant under the 2016 Plan were automatically increased by 872,485 shares.

The 2016 ESPP allows eligible employees to purchase shares of the Company's Class A common stock at a discount of up to 15% through payroll deductions of their eligible compensation, subject to any plan limitations. Except for the initial offering period, the 2016 ESPP provides for separate six-month offering periods beginning in May and November of each fiscal year, starting in May 2017.

On each purchase date, eligible employees will purchase the Company's stock at a price per share equal to 85% of the lesser of (i) the fair market value of the Company's Class A common stock on the offering date or (ii) the fair market value of the Company's Class A common stock on the purchase date.

In the year ended December 31, 2017, 794,142 shares of Class A common stock were purchased under the 2016 ESPP and 235,372 shares are expected to be purchased in the second quarter of 2018. As of December 31, 2017, total unrecognized compensation cost related to the 2016 ESPP was $1.1 million, which will be amortized over a weighted-average period of 0.4 years. No ESPP shares were purchased in the year ended December 31, 2016.

Stock options activity under the 2008 Plan and 2016 Plan was as follows:

Stock Options

	Number of options outstanding			Weighted- average exercise price (per share)		Weighted- average remaining contractual term (in years)		Aggregate intrinsic value (in thousands)
Outstanding options as of December 31, 2016		14,649,276		$	6.14		7.52	$	332,716
Granted		1,526,450			30.66
Exercised		(5,194,905	)		4.93
Forfeited and cancelled		(825,394	)		7.76

Outstanding options as of December 31, 2017		10,155,427		$	10.31		7.12	$	145,763


Options vested and exercisable as of December 31, 2017		5,278,003		$	5.53		6.28	$	95,354

Aggregate intrinsic value represents the difference between the Company's estimated fair value of its common stock and the exercise price of outstanding "in-the-money" options. Prior to the IPO, the fair value of the Company's common stock was estimated by the Company's board of directors. After the IPO, the fair value of the Company's common stock is the Company's Class A common stock price as reported on the New York Stock Exchange. The aggregate intrinsic value of stock options exercised was $132.0 million, $54.4 million and $10.1 million, during the years ended December 31, 2017, 2016 and 2015, respectively.

The total estimated grant date fair value of options vested was $15.8 million, $15.3 million and $8.2 million during the years ended December 31, 2017, 2016 and 2015, respectively. The weighted-average grant-date fair value of options granted was $13.33, $5.52 and $4.30 during the years ended December 31, 2017, 2016 and 2015, respectively.

On February 28, 2017, the Company granted a total of 555,000 shares of performance-based stock options in three distinct awards to an employee with grant date fair values of $13.48, $10.26 and $8.41 per share for a total grant value of $5.9 million. The first half of each award vests upon satisfaction of a performance condition and the remainder vests thereafter in equal monthly installments over a 24-month period. The achievement window expires after 4.3 years from the date of grant and the stock options expire seven years after the date of grant. The stock options are amortized over a derived service period, as adjusted, of 3.4 years, 4.6 years and 5.3 years, respectively. The stock options value and the derived service period were estimated using the Monte-Carlo simulation model. The following table summarizes the details of the performance options:

	Number of options outstanding		Weighted- average exercise price (per share)		Weighted- average remaining contractual term (in years)		Aggregate intrinsic value (in thousands)
Outstanding options as of December 31, 2016		—	$	—		—	$	—
Granted		555,000		31.72
Exercised		—		—
Forfeited and cancelled		—		—

Outstanding options as of December 31, 2017		555,000	$	31.72		6.0	$	—


Options vested and exercisable as of December 30, 2017		—	$	—		—	$	—

As of December 31, 2017, total unrecognized compensation cost related to nonvested stock options was $34.8 million, which will be amortized on a ratable basis over a weighted-average period of 2.12 years.

Restricted Stock Units

	Number of options outstanding			Weighted- average grant date fair value (per share)		Aggregate intrinsic value (in thousands)
Nonvested RSUs as of December 31, 2016		2,034,217		$	32.66	$	58,687
Granted		4,826,508			28.05
Vested		(711,371	)		30.29
Forfeited and cancelled		(483,895	)		29.53

Nonvested RSUs as of December 31, 2017		5,665,459		$	29.29	$	133,648

Prior to the completion of the Company's IPO, the Company granted RSUs ("Pre-IPO RSUs") under its 2008 Plan to its employees that vested upon the satisfaction of both a time-based service condition and a liquidity condition. The time-based service condition for the majority of these awards will be satisfied over a period of four years. The liquidity condition was satisfied upon occurrence of the Company's IPO in June 2016. RSUs granted on or after the completion of the Company's IPO ("Post-IPO RSUs") are granted under the 2016 Plan and are subject to a time-based vesting condition only. The compensation expense related to these grants is based on the grant date fair value of the RSUs and is recognized on a ratable basis over the applicable service period. The majority of Post-IPO RSUs are earned over a service period of two to four years.

As of December 31, 2017, total unrecognized compensation cost related to nonvested RSUs was $148.0 million, which will be amortized over a weighted-average period of 3.3 years.

Equity Awards Granted to Nonemployees

As of December 30, 2017, there were no nonemployee awards outstanding.

In September 2016, the Company granted 30,255 restricted stock units to a nonemployee. The award fully vested in August 2017. Total stock-based compensation expense recorded for this award during the years ended December 31, 2017 and 2016, was $0.4 million and $0.6 million, respectively.

In December 2015, the Company granted 30,000 stock options to another nonemployee. On January 1, 2017 due to the employee status change, the grant was converted into a standard award and the fair value accounting stopped. Total stock-based compensation expense recorded for this award in the year ended December 31, 2016, was $0.3 million.

Early Exercise of Nonvested Options

Under the 2008 Plan, employees have an option to exercise their stock options prior to vesting. The Company has the right to repurchase, at the original issuance price, any unvested (but issued) common shares upon termination of service of an employee, either voluntarily or involuntarily. The consideration received for an early exercise of a stock option is considered to be a deposit of the exercise price and the related amount is recorded as a liability. The liability is reclassified into stockholders' equity as the stock options vest. As of December 31, 2017 and 2016, the Company recorded a liability of $0.03 million and $0.3 million for 5,214 and 49,580 unvested shares, respectively, that were early exercised by employees and were subject to repurchase at the respective period end. These amounts are reflected in current and non-current liabilities on the Company's consolidated balance sheets.

Valuation Assumptions

The fair value of employee stock options was estimated on the date of grant using the following assumptions in the Black-Scholes option pricing model:

	Year Ended December 31,
	2017	2016	2015
Employee Stock Options
Fair value of common stock	$23.60 - $31.96	$10.09 - $15.00	$7.07 - $10.09
Expected term (in years)	6.08	6.08	6.08
Expected volatility	44.3% - 47.6%	51.4% - 53.0%	47.8% - 54.9%
Risk-free interest rate	1.9% - 2.3%	1.3% - 1.5%	1.4% - 2.0%
Dividend rate	0%	0%	0%
Employee Stock Purchase Plan
Expected term (in years)	0.5	0.90	—
Expected volatility	33.2% - 33.9%	52%	—
Risk-free interest rate	1.1% - 1.4%	0.6%	—
Dividend rate	0%	0%	—

The following assumptions were used in the Monte Carlo simulation model to estimate the fair value and the derived service period of the performance options:

Asset volatility		40	%
Equity volatility		45	%
Discount rate		14	%
Stock price at grant date	$	31.72

Stock-Based Compensation Expense

The Company recorded the total stock-based compensation expense as follows (in thousands):

	Year Ended December 31,
	2017		2016		2015
Cost of revenue	$	650	$	291	$	65
Research and development		22,808		12,946		4,046
Sales and marketing		9,822		4,972		2,389
General and administrative		16,339		6,016		2,377

Total	$	49,619	$	24,225	$	8,877

Net Loss Per Share Attributable to Common Stockholders

12 Months Ended

Dec. 31, 2017

Net Loss Per Share Attributable to Common Stockholders

Net Loss Per Share Attributable to Common Stockholders

13. Net Loss Per Share Attributable to Common Stockholders

The following table sets forth the calculation of basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data):

	Year Ended December 31,
	2017			2016			2015
Net loss attributable to common stockholders	$	(63,708	)	$	(41,324	)	$	(38,896	)


Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted		91,224,607			53,116,675			17,746,526


Net loss per share attributable to common stockholders, basic and diluted	$	(0.70	)	$	(0.78	)	$	(2.19	)

The following outstanding shares of common stock equivalents were excluded from the calculation of the diluted net loss per share attributable to common stockholders because their effect would have been anti-dilutive:

	Year Ended December 31,
	2017		2016		2015
Convertible preferred stock outstanding		—		—		54,508,441	(1)
Stock options issued and outstanding		10,710,427		14,649,276		16,883,837
Nonvested restricted stock units issued and outstanding		5,665,459		2,034,217		71,000
Class A common stock reserved for Twilio.org		635,014		680,397		888,022
Class A common stock committed under 2016 ESPP		235,372		597,038		—
Unvested shares subject to repurchase		5,214		49,580		52,407

Total		17,251,486		18,010,508		72,403,707


(1)	Includes 687,885 shares as of December 31, 2015 of Series T convertible preferred stock related to the Authy acquisition held in escrow.

Income Taxes

12 Months Ended

Dec. 31, 2017

Income Taxes

Income Taxes

14. Income Taxes

The following table presents domestic and foreign components of loss before income taxes for the periods presented (in thousands):

	Year Ended December 31,
	2017			2016			2015
United States	$	(46,737	)	$	(14,002	)	$	(23,962	)
International		(16,266	)		(26,996	)		(11,420	)

Loss before provision for income taxes	$	(63,003	)	$	(40,998	)	$	(35,382	)

Provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2017			2016		2015
Current:
Federal	$	99		$	—	$	—
State		78			83		45
Foreign		823			214		213

Total		1,000			297		258
Deferred:
Federal		28			2		(109	)
State		10			—		—
Foreign		(333	)		27		(27	)

Total		(295	)		29		(136	)

Provision for income taxes	$	705		$	326	$	122

The following table presents a reconciliation of the statutory federal tax rate and the Company's effective tax rate for the years ended December 31, 2017, 2016 and 2015:

	Year Ended December 31,
	2017			2016			2015
Tax benefit at federal statutory rate		34	%		34	%		34	%
State tax, net of federal benefit		10			11			(3	)
Stock-based compensation		47			23			(8	)
Credits		8			2			4
Foreign rate differential		(8	)		(23	)		(11	)
Reserve for uncertain tax positions		—			(12	)		—
Change in valuation allowance		(46	)		(34	)		(14	)
Change in federal statutory rate		(45	)		—			—
Other		(1	)		(2	)		(2	)

Effective tax rate		(1	)%		(1	)%		—	%

Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The following table presents the significant components of the Company's deferred tax assets and liabilities (in thousands):

	As of December 31,
	2017			2016			2015
Deferred tax assets:
Net operating loss carryforwards	$	56,138		$	31,090		$	27,401
Accrued and prepaid expenses		9,140			16,698			7,603
Stock-based compensation		7,131			5,368			1,433
Research and development credits		16,212			7,807			6,022
Charitable contributions		1,233			1,458			—
Other		472			—			—

Gross deferred tax assets		90,326			62,421			42,459
Valuation allowance		(78,900	)		(49,601	)		(35,613	)

Net deferred tax assets		11,426			12,820			6,846
Deferred tax liabilities:
Capitalized software		(7,664	)		(7,086	)		(4,084	)
Prepaid expenses		(1,015	)		(452	)		(2,035	)
Acquired intangibles		(2,101	)		(152	)		(460	)
Property and equipment		(2,380	)		(4,931	)		(240	)
Deferred commissions		(718	)		(201	)		—

Net deferred tax asset (liability)	$	(2,452	)	$	(2	)	$	27

As of December 31, 2017, the Company had approximately $229.3 million in federal net operating loss carryforwards and $12.6 million in federal tax credits. If not utilized, the federal net operating loss and tax credit carryforwards will expire at various dates beginning in 2029.

As of December 31, 2017, the Company had approximately $159.6 million in state net operating loss carryforwards and $11.0 million in state tax credits. If not utilized, the state net operating loss carryforwards will expire at various dates beginning in 2026. The California state tax credits can be carried forward indefinitely.

A limitation may apply to the use of the net operating loss and credit carryforwards, under provisions of the Internal Revenue Code of 1986, as amended, and similar state tax provisions that are applicable if the Company experiences an "ownership change." An ownership change may occur, for example, as a result of issuance of new equity. Should these limitations apply, the carryforwards would be subject to an annual limitation, resulting in a potential reduction in the gross deferred tax assets before considering the valuation allowance.

The Company's accounting for deferred taxes involves the evaluation of a number of factors concerning the realizability of its net deferred tax assets. The Company primarily considered such factors as its history of operating losses, the nature of the Company's deferred tax assets, and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary differences and carryforwards become deductible. At present, the Company does not believe that it is more likely than not that the net deferred tax assets will be realized, accordingly, a full valuation allowance has been established. The valuation allowance increased by approximately $29.3 million and $14.0 million during the years ended December 31, 2017 and 2016, respectively.

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

	Year Ended December 31,
	2017			2016		2015
Unrecognized tax benefit, beginning of year	$	12,275		$	1,679	$	1,024
Gross increases for tax positions of prior years		493			1,996		—
Gross decrease for tax positions of prior years		(6,331	)		—		—
Gross increases for tax positions of current years		3,008			8,600		655

Unrecognized tax benefit, end of year	$	9,445		$	12,275	$	1,679

As of December 31, 2017, the Company had approximately $9.4 million of unrecognized tax benefits. If the $9.4 million is recognized, $0.4 million would affect the effective tax rate. The remaining amount would be offset by the reversal of related deferred tax assets which are subject to a full valuation allowance.

The Company recognizes interest and penalties, if any, related to uncertain tax positions in its income tax provision. As of December 31, 2017, the Company has accumulated $35,000 in both interest and penalties related to uncertain tax positions.

The Company does not anticipate any significant changes within 12 months of December 31, 2017, in its uncertain tax positions that would be material to the consolidated financial statements taken as a whole because nearly all of the unrecognized tax benefit has been offset by a deferred tax asset, which has been reduced by a valuation allowance.

The Company files U.S. federal income tax returns as well as income tax returns in many U.S. states and foreign jurisdictions. As of December 31, 2017, the tax years 2008 through the current period remain open to examination by the major jurisdictions in which the Company is subject to tax. Fiscal years outside the normal statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years, which have been carried forward and may be audited in subsequent years when utilized. The Company is not currently subject to U.S. federal, state and local, or non-U.S. income tax examinations by any tax authorities.

On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act ("Tax Act"). The Tax Act makes broad and complex changes to the U.S. tax code including, but not limited to, (1) reducing the U.S. federal corporate tax rate from 35% to 21%; (2) requiring companies to pay a one-time transition tax on certain unrepatriated earnings of foreign subsidiaries; (3) generally eliminating U.S. federal income taxes on dividends from foreign subsidiaries; (4) requiring current inclusion in U.S. federal taxable income of certain earnings of controlled foreign corporations; (5) eliminating the corporate alternative minimum tax (AMT) and changing how existing AMT credits can be realized; (6) creating the base erosion anti-abuse tax (BEAT), a new minimum tax; (7) creating a new limitation on deductible interest expense; and (8) changing rules related to uses and limitations of net operating loss carryforwards created in tax years beginning after December 31, 2017.

We remeasured certain deferred tax assets and liabilities based on rates at which they are expected to reverse in the future, which is generally 21%. The rate reduction would generally take effect on January 1, 2018. Consequently, any changes in the US corporate income tax rate will impact the carrying value of our deferred tax assets. Under the new corporate income tax rate of 21%, U.S. federal and state deferred tax assets will decrease by approximately $28.0 million and the valuation allowance will decrease by approximately $28.0 million. Due to the valuation allowance on the deferred tax assets, the provisional amount recorded related to the remeasurement was zero.

The SEC staff issued SAB 118, which provides guidance on accounting for the tax effects of the Tax Act. SAB 118 provides a measurement period that should not extend beyond one year from the Tax Act enactment date for companies to complete the accounting under ASC 740. In accordance with SAB 118, a company must reflect the income tax effects of those aspects of the Act for which the accounting under ASC 740 is complete. To the extent that a company's accounting for certain income tax effects of the Tax Act is incomplete but it is able to determine a reasonable estimate, it must record a provisional estimate in the financial statements. If a company cannot determine a provisional estimate to be included in the financial statements, it should continue to apply ASC 740 on the basis of the provisions of the tax laws that were in effect immediately before the enactment of the Tax Act.

Our accounting for the following element of the Tax Act is complete.

Reduction of U.S. federal corporate tax rate: The Act reduces the corporate tax rate to 21%, effective January 1, 2018. Consequently, we have recorded a decrease to our federal and state deferred tax assets of $28.0 million, with a corresponding net adjustment to valuation allowance of $28.0 million for the year ended December 31, 2017.

Our accounting for the following elements of the Tax Act is incomplete, and we were not yet able to make reasonable estimates of the effects. Therefore, no provisional adjustments were recorded.

Indefinite reinvestment assertion: Although the mandatory deemed repatriation tax has removed U.S. federal taxes on distributions to the U.S., the Company continues to evaluate the expected manner of recovery to determine whether or not to continue to assert indefinite reinvestment on a part or all the foreign undistributed earnings. This requires the Company to re-evaluate its reinvestment policies in light of the 2017 Act and calculate the tax cost that is incremental to the deemed repatriation tax, (e.g. foreign withholding, state income taxes of repatriating cash to the U.S. While the provisional tax expense for the year ended December 31, 2017 is based upon an assumption that foreign undistributed earnings are indefinitely reinvested, the Company's plan may change upon the completion of the analysis of the impact of the 2017 Act and completion of the calculation of the incremental tax effects on the repatriation of foreign undistributed earnings. In the event the Company determines not to continue to assert the permanent reinvestment of part or all of foreign undistributed earnings, such a determination could result in the accrual and payment of additional foreign, state and local taxes.

Global intangible low taxed income (GILTI): The Tax Act creates a new requirement that certain income (i.e., GILTI) earned by controlled foreign corporations (CFCs) must be included currently in the gross income of the CFCs' U.S. shareholder. GILTI is the excess of the shareholder's "net CFC tested income" over the net deemed tangible income return, which is currently defined as the excess of (1) 10% of the aggregate of the U.S. shareholder's pro rata share of the qualified business asset investment of each CFC with respect to which it is a U.S. shareholder over (2) the amount of certain interest expense taken into account in the determination of net CFC-tested income.

Because of the complexity of the new GILTI tax rules, we are continuing to evaluate this provision of the Tax Act and the application of ASC 740. Under U.S. GAAP, we are allowed to make an accounting policy choice of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the "period cost method") or (2) factoring such amounts into a company's measurement of its deferred taxes (the "deferred method"). Our selection of an accounting policy with respect to the new GILTI tax rules will depend, in part, on analyzing our global income to determine whether we expect to have future U.S. inclusions in taxable income related to GILTI and, if so, what the impact is expected to be. Because whether we expect to have future U.S. inclusions in taxable income related to GILTI depends on not only our current structure and estimated future results of global operations but also our intent and ability to modify our structure and/or our business, we are not yet able to reasonably estimate the effect of this provision of the Tax Act. Therefore, we have not made any adjustments related to potential GILTI tax in our financial statements and have not made a policy decision regarding whether to record deferred taxes on GILTI.

Employee Benefit Plan	12 Months Ended
Employee Benefit Plan	Dec. 31, 2017
Employee Benefit Plan
Employee Benefit Plan	15. Employee Benefit Plan The Company sponsors a 401(k) defined contribution plan covering all employees. There were no employer contributions to the plan in the years ended December 31, 2015. The employer contribution to the plan in the year ended December 31, 2017 and 2016 was $1.8 million and $1.1 million, respectively.

Transactions with Investors	12 Months Ended
Transactions with Investors	Dec. 31, 2017
Transactions with Investors
Transactions with Investors	16. Transactions With Investors In 2015, two of the Company's vendors participated in the Company's Series E convertible preferred stock financing and owned approximately 1.9% and 1.0% , respectively, of the Company's capital stock, on an as-if converted basis, as of December 31, 2017; 2.0% and 1.0%, respectively, of the Company's capital stock, on as-if converted basis, as of December 31, 2016; and 2.5% and 1.2%, respectively, of the Company's outstanding capital stock as of December 31, 2015. During the years ended December 31, 2017, 2016 and 2015, the amounts of software services the Company purchased from the first vendor were $20.4 million, $14.5 million and $11.1 million, respectively. The amounts due to this vendor as of December 31, 2017 and 2016 were $0.2 million and none, respectively. The amount due from this vendor as of December 31, 2017 and 2016 were $1.2 million and $0.3 million, respectively. In October 2016, the Company entered into a three-year agreement with this vendor to purchase services for an aggregate purchase commitment amount of $57.7 million over the course of the three-year contractual period. The amount of services the Company purchased from the second vendor was $0.8 million in the year ended December 31, 2017, and $0.5 million for each of the years ended December 31, 2016 and 2015. The amounts due to this vendor as of December 31, 2017 and 2016 were insignificant. The amounts due from this vendor as of December 31, 2017 and 2016 were none and $1.0 million, respectively.

Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2017

Summary of Significant Accounting Policies

Basis of Presentation

(a) Basis of Presentation

The Company's consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("U.S. GAAP").

Principles of Consolidation

(b) Principles of Consolidation

The consolidated financial statements include the Company and its wholly owned subsidiaries. All significant intercompany balances and transactions have been eliminated.

Use of Estimates

Concentration of Credit Risk

(d) Concentration of Credit Risk

Revenue Recognition

(e) Revenue Recognition

The Company recognizes revenue from these transactions when all of the following criteria are satisfied:


	•	there is persuasive evidence of an arrangement;
	•	the service has been or is being provided to the customer;
	•	the amount of the fees to be paid by the customer is fixed or determinable; and
	•	collectability of the fees is reasonably assured.

Cost of Revenue

(f) Cost of Revenue

Research and Development Expenses

(g) Research and Development Expenses

Internal-Use Software Development Costs

(h) Internal-Use Software Development Costs

Advertising Costs

(i) Advertising Costs

Stock-Based Compensation

(j) Stock-Based Compensation

The Black-Scholes option pricing model requires the use of complex assumptions, which determine the fair value of stock-based awards. These assumptions include:


	•	Fair value of the common stock. Prior to the Company's IPO, the board of directors considered numerous objective and subjective factors to determine the fair value of the Company's common stock at each meeting at which awards are approved. The factors included, but were not limited to: (i) contemporaneous valuations of the Company's common stock by an unrelated third party; (ii) the prices at which the Company sold shares of its convertible preferred stock to outside investors in arms-length transactions; (iii) the rights, preferences and privileges of the Company's convertible preferred stock relative to those of its common stock; (iv) the Company's results of operations, financial position and capital resources; (v) current business conditions and projections; (vi) the lack of marketability of the Company's common stock; (vii) the hiring of key personnel and the experience of management; (viii) the introduction of new products; (ix) the risk inherent in the development and expansion of the Company's products; (x) the Company's stage of development and material risks related to its business; (xi) the fact that the option grants involve illiquid securities in a private company; and (xii) the likelihood of achieving a liquidity event, such as an initial public offering or sale of the Company, in light of prevailing market conditions;
	•	Expected term. The expected term represents the period that the stock-based awards are expected to be outstanding. The Company uses the simplified calculation of expected term, as the Company does not have sufficient historical data to use any other method to estimate expected term;
	•	Expected volatility. The expected volatility is derived from an average of the historical volatilities of the common stock of several entities with characteristics similar to those of the Company, such as the size and operational and economic similarities to the Company's principal business operations;
	•	Risk -free interest rate. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant for zero coupon U.S. Treasury notes with maturities approximately equal the expected term of the stock-based awards; and
	•	Expected dividend. The expected dividend is assumed to be zero as the Company has never paid dividends and has no current plans to pay any dividends on its common stock.

If any of the assumptions used in the Black-Scholes model changes, stock-based compensation for future options may differ materially compared to that associated with previous grants.

Income Taxes

(k) Income Taxes

The Company records interest and penalties related to uncertain tax positions in the provision for income taxes in the consolidated statements of operations.

Foreign Currency Translation

(l) Foreign Currency Translation

Comprehensive Income (Loss)

(m) Comprehensive Income (Loss)

Net Loss Per Share Attributable to Common Stockholders

(n) Net Loss Per Share Attributable to Common Stockholders

Cash and Cash Equivalents

(o) Cash and Cash Equivalents

Restricted Cash

(p) Restricted Cash

Accounts Receivable and Allowance for Doubtful Accounts

(q) Accounts Receivable and Allowance for Doubtful Accounts

Costs Related to the Public Offerings

(r) Costs Related to the Public Offerings

Property and Equipment

(s) Property and Equipment

The useful lives of property and equipment are as follows:

Capitalized software development costs		3 years
Office equipment		3 years
Furniture and fixtures		5 years
Software		3 years
Leasehold improvements		5 years or remaining lease term

Intangible Assets

(t) Intangible Assets

The useful lives of the intangible assets are as follows:

Developed technology				3 - 4 years
Customer relationships				5 - 8 years
Supplier relationships				5 years
Trade names				2 years
Patents				20 years
Trademarks				Indefinite
Domain names				Indefinite

Goodwill

(u) Goodwill

Impairment of Long-Lived Assets

(v) Impairment of Long-Lived Assets

Deferred Revenue

(w) Deferred Revenue

Business Combinations

(x) Business Combinations

Segment Information

(y) Segment Information

Fair Value of Financial Instruments

(z) Fair Value of Financial Instruments


	•	Level 1 Inputs: Unadjusted quoted prices in active markets for identical assets or liabilities accessible to the reporting entity at the measurement date.
	•	Level 2 Inputs: Other than quoted prices included in Level 1 inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the asset or liability.
	•	Level 3 Inputs: Unobservable inputs for the asset or liability used to measure fair value to the extent that observable inputs are not available, thereby allowing for situations in which there is little, if any, market activity for the asset or liability at measurement date.

A financial instrument's categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.

Recent Accounting Pronouncements Not Yet Adopted

(aa) Recent Accounting Pronouncements Not Yet Adopted

Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2017

Summary of Significant Accounting Policies

Summary of Useful Lives of Property and Equipment

Capitalized software development costs		3 years
Office equipment		3 years
Furniture and fixtures		5 years
Software		3 years
Leasehold improvements		5 years or remaining lease term

Useful Lives of Intangible Assets

Developed technology		3 - 4 years
Customer relationships		5 - 8 years
Supplier relationships		5 years
Trade names		2 years
Patents		20 years
Trademarks		Indefinite
Domain names		Indefinite

Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2017

Fair Value Measurements

Schedule of assets measured at fair value on a recurring basis

The following tables provide the assets measured at fair value on a recurring basis as of December 31, 2017 and 2016 (in thousands):

						Fair Value Hierarchy as of December 31, 2017
	Amortized Cost or Carrying Value
			Net Unrealized Losses									Aggregate Fair Value
			Net Unrealized Losses			Level 1		Level 2		Level 3		Aggregate Fair Value
Financial Assets:
Cash and cash equivalents:
Money market funds	$	95,432	$	—		$	95,432	$	—	$	—	$	95,432

Total included in cash and cash equivalents		95,432		—			95,432		—		—		95,432

Marketable securities:
U.S. Treasury securities		59,962		(216	)		59,746		—		—		59,746
Corporate debt securities		116,223		(382	)		—		115,841		—		115,841

Total marketable securities		176,185		(598	)		59,746		115,841		—		175,587

Total financial assets	$	271,617	$	(598	)	$	155,178	$	115,841	$	—	$	271,019

			As of December 31, 2016
	Total Carrying Value		As of December 31, 2016
	Total Carrying Value		Level I		Level 2		Level 3		Total
Financial Assets:
Money market funds (included in cash and cash equivalents)	$	274,135	$	274,135	$	—	$	—	$	274,135

Total financial assets	$	274,135	$	274,135	$	—	$	—	$	274,135

Schedule of contractual maturities of marketable securities

The following table summarizes the contractual maturities of marketable securities as of December 31, 2017 (in thousands):

	Amortized Cost		Aggregate Fair Value
Financial Assets:
Less than one year	$	108,584	$	108,360
One to two years		67,601		67,227

Total	$	176,185	$	175,587

Property and Equipment (Tables)

12 Months Ended

Dec. 31, 2017

Property and Equipment

Schedule of property and equipment

Property and equipment consisted of the following (in thousands):

	As of December 31,
	2017			2016
Capitalized internal-use software development costs	$	49,177		$	28,661
Leasehold improvements		14,246			14,063
Office equipment		9,652			5,729
Furniture and fixtures		1,976			1,576
Software		1,675			968

Total property and equipment		76,726			50,997
Less: accumulated depreciation and amortization		(26,185	)		(13,445	)

Total property and equipment, net	$	50,541		$	37,552

Schedule of amortization expense

The amortization expense was allocated as follows (in thousands):

	Year Ended December 31,
	2017		2016		2015
Cost of revenue	$	4,788	$	3,304	$	1,793
Research and development		3,619		2,182		1,045

Total	$	8,407	$	5,486	$	2,838

Business Combinations (Tables)

12 Months Ended

Dec. 31, 2017

Beepsend AB, a messaging provider based in Sweden

Business Combinations

Schedule of final purchase price allocation

The following table presents the purchase price allocation, as adjusted, recorded in the Company's consolidated balance sheet (in thousands):

	Total
Net tangible liabilities	$	(3,575	)
Goodwill(1)		12,837
Intangible assets(2)		13,700

Total purchase price	$	22,962


(1)	Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer and supplier relationships as well as operational synergies. Goodwill is deductible for tax purposes.
(2)	Identifiable finite-lived intangible assets were comprised of the following:

	Total		Estimated life (in years)
Developed technology	$	5,000	4
Customer relationships		6,100	7 - 8
Supplier relationships		2,600	5

Total intangible assets acquired	$	13,700

Schedule of identifiable finite-lived intangible assets

	Total		Estimated life (in years)
Developed technology	$	5,000	4
Customer relationships		6,100	7 - 8
Supplier relationships		2,600	5

Total intangible assets acquired	$	13,700

Kurento Open Source Project

Business Combinations

Schedule of final purchase price allocation

The following table presents the final purchase price allocation recorded in the Company's consolidated balance sheet (in thousands):

	Total
Intangible assets(1)	$	8,100
Goodwill(2)		400

Total purchase price	$	8,500


(1)	The intangible assets consist of developed technology with the estimated useful life of 3 years on the date of acquisition.
(2)	The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology and the future development initiatives of the acquired workforce. The goodwill is deductible for tax purposes.

Authy, Inc.

Business Combinations

Schedule of final purchase price allocation

The following table presents the final purchase price allocation recorded in the Company's consolidated balance sheet (in thousands):

	Total
Net tangible assets	$	1,165
Goodwill(1)		3,165
Intangible assets(2)		1,760

Total purchase price	$	6,090


The Company acquired a net deferred tax liability of $0.1 million in this business combination.


(1)	Goodwill represents the excess of purchase price over the fair value of identifiable tangible and intangible assets acquired and liabilities assumed. The goodwill in this transaction is primarily attributable to the future cash flows to be realized from the acquired technology platform, existing customer base and the future development initiatives of the assembled workforce. Goodwill is not deductible for tax purposes.
(2)	Identifiable finite-lived intangible assets were comprised of the following:

	Total		Estimated life (in years)
Developed technology	$	1,300	3
Customer relationships		400	5
Trade name		60	2

Total intangible assets acquired	$	1,760

Schedule of identifiable finite-lived intangible assets

	Total		Estimated life (in years)
Developed technology	$	1,300	3
Customer relationships		400	5
Trade name		60	2

Total intangible assets acquired	$	1,760

Goodwill and Intangible Assets (Tables)

12 Months Ended

Dec. 31, 2017

Goodwill and Intangible Assets

Schedule of goodwill balance

Goodwill balance as of December 31, 2017 and 2016 was as follows (in thousands):

	Total
Balance as of December 31, 2015	$	3,165
Goodwill recorded in connection with 2016 acquisition		400

Balance as of December 31, 2016		3,565
Goodwill recorded in connection with 2017 acquisition		12,688
Measurement period adjustment		149
Effect of exchange rate		1,449

Balance as of December 31, 2017	$	17,851

Schedule of intangible assets

Intangible assets consisted of the following (in thousands):

	As of December 31, 2017
	Gross		Accumulated Amortization			Net
Amortizable intangible assets:
Developed technology	$	14,941	$	(5,476	)	$	9,465
Customer relationships		7,159		(1,006	)		6,153
Supplier relationships		2,881		(500	)		2,381
Trade name		60		(60	)		—
Patent		1,878		(108	)		1,770

Total amortizable intangible assets		26,919		(7,150	)		19,769

Non-amortizable intangible assets:
Domain names		32		—			32
Trademarks		263		—			263

Total	$	27,214	$	(7,150	)	$	20,064

	As of December 31, 2016
	Gross		Accumulated Amortization			Net
Amortizable intangible assets:
Developed technology	$	9,400	$	(1,140	)	$	8,260
Customer relationships		400		(148	)		252
Trade name		60		(56	)		4
Patent		1,512		(55	)		1,457

Total amortizable intangible assets		11,372		(1,399	)		9,973

Non-amortizable intangible assets:
Domain names		32		—			32
Trademarks		263		—			263

Total	$	11,667	$	(1,399	)	$	10,268

Schedule of total estimated future amortization expense

Total estimated future amortization expense was as follows (in thousands):

	As of December 31, 2017
2018	$	6,793
2019		5,083
2020		2,653
2021		1,520
2022		924
Thereafter		2,796

Total	$	19,769

Accrued Expenses and Other Liabilities (Tables)

12 Months Ended

Dec. 31, 2017

Accrued Expenses and Other Liabilities

Schedule of accrued expenses and other current liabilities

Accrued expenses and other current liabilities consisted of the following (in thousands):

	As of December 31,
	2017		2016
Accrued payroll and related	$	4,898	$	3,132
Accrued bonus and commission		4,777		2,251
Accrued cost of revenue		10,876		8,741
Sales and other taxes payable		20,877		28,795
ESPP contributions		1,338		4,365
Deferred rent		1,048		1,250
Accrued other expense		9,800		10,774

Total accrued expenses and other current liabilities	$	53,614	$	59,308

Schedule of long-term liabilities

Long-term liabilities consisted of the following (in thousands):

	As of December 31,
	2017		2016
Deferred rent	$	8,480	$	9,387
Deferred tax liability		2,452		(2)
Accrued other expense		477		158

Total long-term liabilities	$	11,409	$	9,543

Supplemental Balance Sheet Information (Tables)

12 Months Ended

Dec. 31, 2017

Supplemental Balance Sheet Information

Schedule of the allowance for doubtful accounts

A roll-forward of the Company's reserves for the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands):


	(a)	Allowance for doubtful accounts:

	Year Ended December 31,
	2017			2016			2015
Balance, beginning of period	$	1,076		$	486		$	210
Additions		580			1,145			705
Write-offs		(623	)		(555	)		(429	)

Balance, end of period	$	1,033		$	1,076		$	486

Schedule of the sales credit reserve

A roll-forward of the Company's reserves for the years ended December 31, 2017, 2016 and 2015 is as follows (in thousands):


	(b)	Sales credit reserve:

	Year Ended December 31,
	2017			2016			2015
Balance, beginning of period	$	544		$	714		$	312
Additions		2,531			1,348			1,210
Deductions against reserve		(1,314	)		(1,518	)		(808	)

Balance, end of period	$	1,761		$	544		$	714

Revenue by Geographic Area (Tables)

12 Months Ended

Dec. 31, 2017

Revenue by Geographic Area

Schedule of revenue by geographic area

The following table sets forth revenue by geographic area (in thousands):

	Year Ended December 31,
	2017			2016			2015
Revenue by geographic area:
United States	$	308,612		$	233,922		$	143,145
International		90,408			43,413			23,774

Total	$	399,020		$	277,335		$	166,919


Percentage of revenue by geographic area:
United States		77	%		84	%		86	%
International		23	%		16	%		14	%

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2017

Commitments and Contingencies

Schedule of future minimum lease payments under non-cancelable operating leases

Future minimum lease payments under non-cancelable operating leases were as follows (in thousands):

Year Ending December 31:	As of December 31, 2017
2018	$	7,884
2019		7,676
2020		7,101
2021		7,033
2022		5,864
Thereafter		10,189

Total minimum lease payments	$	45,747

Schedule of Future minimum payments under other existing non-cancelable purchase commitments

Future minimum payments under these noncancellable purchase commitments were as follows (in thousands).

Year Ending December 31:	As of December 31, 2017
2018	$	22,414
2019		25,526
2020		147
2021		23

Total payments	$	48,110

Stockholders' Equity (Tables)

12 Months Ended

Dec. 31, 2017

Stockholders' Equity

Convertible Preferred Stock

	As of December 31, 2015
	Shares Authorized		Shares Issued and Outstanding			Aggregate Liquidation preference		Proceeds, Net of Issuance Costs
Series A		13,173,240		13,076,491		$	4,590	$	4,592
Series B		11,416,062		11,146,895			11,717		11,658
Series C		8,452,864		8,452,864			25,250		25,196
Series D		9,440,324		9,440,324			70,000		69,930
Series E		11,494,249		11,494,249			130,000		125,448
Series T		5,000,000		897,618	(1)		9		—	(2)

Total		58,976,739		54,508,441		$	241,566	$	236,824


(1)	The outstanding shares include 687,885 shares held in escrow as of December 31, 2015 related to the Authy acquisition. Of these shares, 507,885 shares were subject to graded vesting over a period of three years, as amended, and had a fair value of $4.0 million. A total of 127,054 shares were subject to certain performance conditions and were returned to the issuer in the third quarter 2016 due to the non-fulfillment of certain conditions of the merger agreement. All remaining unvested shares vested in the fourth quarter of 2016.
(2)	389,733 shares were issued as part of the purchase price for Authy acquisition and had a fair value of $3.1 million on the acquisition closing date.

Schedule of reserved shares of common stock for issuance

	As of December 31,
	2017		2016
Stock options issued and outstanding		10,710,427		14,649,276
Nonvested restricted stock units issued and outstanding		5,665,459		2,034,217
Class A common stock reserved for Twilio.org		635,014		680,397
Stock-based awards available for grant under 2016 Plan		10,200,189		10,143,743
Class A common stock reserved for issuance under 2016 ESPP		235,372		597,038

Total		27,446,461		28,104,671

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21506-112644

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 480
-SubTopic 10
-Section S99
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=65877616&loc=d3e177068-122764

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(d))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21553-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=65888546&loc=d3e21300-112643

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27))
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21484-112644

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21538-112644

Reference 14: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21488-112644

+ Details

Stock-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2017

Stock-Based Compensation

Schedule of stock option activity

	Number of options outstanding			Weighted- average exercise price (per share)		Weighted- average remaining contractual term (in years)		Aggregate intrinsic value (in thousands)
Outstanding options as of December 31, 2016		14,649,276		$	6.14		7.52	$	332,716
Granted		1,526,450			30.66
Exercised		(5,194,905	)		4.93
Forfeited and cancelled		(825,394	)		7.76

Outstanding options as of December 31, 2017		10,155,427		$	10.31		7.12	$	145,763


Options vested and exercisable as of December 31, 2017		5,278,003		$	5.53		6.28	$	95,354

Schedule of restricted stock unit activity

	Number of options outstanding			Weighted- average grant date fair value (per share)		Aggregate intrinsic value (in thousands)
Nonvested RSUs as of December 31, 2016		2,034,217		$	32.66	$	58,687
Granted		4,826,508			28.05
Vested		(711,371	)		30.29
Forfeited and cancelled		(483,895	)		29.53

Nonvested RSUs as of December 31, 2017		5,665,459		$	29.29	$	133,648

Schedule of valuation assumptions for ESPP

	Year Ended December 31,
	2017	2016	2015
Employee Stock Purchase Plan
Expected term (in years)	0.5	0.90	—
Expected volatility	33.2% - 33.9%	52%	—
Risk-free interest rate	1.1% - 1.4%	0.6%	—
Dividend rate	0%	0%	—

Schedule of stock based compensation expense

The Company recorded the total stock-based compensation expense as follows (in thousands):

	Year Ended December 31,
	2017		2016		2015
Cost of revenue	$	650	$	291	$	65
Research and development		22,808		12,946		4,046
Sales and marketing		9,822		4,972		2,389
General and administrative		16,339		6,016		2,377

Total	$	49,619	$	24,225	$	8,877

Employee Stock Option

Stock-Based Compensation

Schedule of valuation assumptions

	Year Ended December 31,
	2017	2016	2015
Employee Stock Options
Fair value of common stock	$23.60 - $31.96	$10.09 - $15.00	$7.07 - $10.09
Expected term (in years)	6.08	6.08	6.08
Expected volatility	44.3% - 47.6%	51.4% - 53.0%	47.8% - 54.9%
Risk-free interest rate	1.9% - 2.3%	1.3% - 1.5%	1.4% - 2.0%
Dividend rate	0%	0%	0%

Performance-based stock options

Stock-Based Compensation

Schedule of stock option activity

	Number of options outstanding		Weighted- average exercise price (per share)		Weighted- average remaining contractual term (in years)		Aggregate intrinsic value (in thousands)
Outstanding options as of December 31, 2016		—	$	—		—	$	—
Granted		555,000		31.72
Exercised		—		—
Forfeited and cancelled		—		—

Outstanding options as of December 31, 2017		555,000	$	31.72		6.0	$	—


Options vested and exercisable as of December 30, 2017		—	$	—		—	$	—

Schedule of valuation assumptions

Asset volatility		40	%
Equity volatility		45	%
Discount rate		14	%
Stock price at grant date	$	31.72

Net Loss Per Share Attributable to Common Stockholders (Tables)

12 Months Ended

Dec. 31, 2017

Net Loss Per Share Attributable to Common Stockholders

Schedule of the calculation of basic and diluted net loss per share attributable to common stockholders

The following table sets forth the calculation of basic and diluted net loss per share attributable to common stockholders during the periods presented (in thousands, except per share data):

	Year Ended December 31,
	2017			2016			2015
Net loss attributable to common stockholders	$	(63,708	)	$	(41,324	)	$	(38,896	)


Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted		91,224,607			53,116,675			17,746,526


Net loss per share attributable to common stockholders, basic and diluted	$	(0.70	)	$	(0.78	)	$	(2.19	)

Schedule of common stock equivalents excluded from the computation of the diluted net loss per share attributable to common stockholders

	Year Ended December 31,
	2017		2016		2015
Convertible preferred stock outstanding		—		—		54,508,441	(1)
Stock options issued and outstanding		10,710,427		14,649,276		16,883,837
Nonvested restricted stock units issued and outstanding		5,665,459		2,034,217		71,000
Class A common stock reserved for Twilio.org		635,014		680,397		888,022
Class A common stock committed under 2016 ESPP		235,372		597,038		—
Unvested shares subject to repurchase		5,214		49,580		52,407

Total		17,251,486		18,010,508		72,403,707


(1)	Includes 687,885 shares as of December 31, 2015 of Series T convertible preferred stock related to the Authy acquisition held in escrow.

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Income Taxes

Domestic and Foreign Components of Loss before Income Taxes

The following table presents domestic and foreign components of loss before income taxes for the periods presented (in thousands):

	Year Ended December 31,
	2017			2016			2015
United States	$	(46,737	)	$	(14,002	)	$	(23,962	)
International		(16,266	)		(26,996	)		(11,420	)

Loss before provision for income taxes	$	(63,003	)	$	(40,998	)	$	(35,382	)

Provision for Income Taxes

Provision for income taxes consists of the following (in thousands):

	Year Ended December 31,
	2017			2016		2015
Current:
Federal	$	99		$	—	$	—
State		78			83		45
Foreign		823			214		213

Total		1,000			297		258
Deferred:
Federal		28			2		(109	)
State		10			—		—
Foreign		(333	)		27		(27	)

Total		(295	)		29		(136	)

Provision for income taxes	$	705		$	326	$	122

Reconciliation of the Statutory Federal Tax Rate and the Company's Effective Tax Rate

	Year Ended December 31,
	2017			2016			2015
Tax benefit at federal statutory rate		34	%		34	%		34	%
State tax, net of federal benefit		10			11			(3	)
Stock-based compensation		47			23			(8	)
Credits		8			2			4
Foreign rate differential		(8	)		(23	)		(11	)
Reserve for uncertain tax positions		—			(12	)		—
Change in valuation allowance		(46	)		(34	)		(14	)
Change in federal statutory rate		(45	)		—			—
Other		(1	)		(2	)		(2	)

Effective tax rate		(1	)%		(1	)%		—	%

Significant Components of Deferred Tax Assets and Liabilities

The following table presents the significant components of the Company's deferred tax assets and liabilities (in thousands):

	As of December 31,
	2017			2016			2015
Deferred tax assets:
Net operating loss carryforwards	$	56,138		$	31,090		$	27,401
Accrued and prepaid expenses		9,140			16,698			7,603
Stock-based compensation		7,131			5,368			1,433
Research and development credits		16,212			7,807			6,022
Charitable contributions		1,233			1,458			—
Other		472			—			—

Gross deferred tax assets		90,326			62,421			42,459
Valuation allowance		(78,900	)		(49,601	)		(35,613	)

Net deferred tax assets		11,426			12,820			6,846
Deferred tax liabilities:
Capitalized software		(7,664	)		(7,086	)		(4,084	)
Prepaid expenses		(1,015	)		(452	)		(2,035	)
Acquired intangibles		(2,101	)		(152	)		(460	)
Property and equipment		(2,380	)		(4,931	)		(240	)
Deferred commissions		(718	)		(201	)		—

Net deferred tax asset (liability)	$	(2,452	)	$	(2	)	$	27

Reconciliation Beginning and Ending Amount of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows (in thousands):

	Year Ended December 31,
	2017			2016		2015
Unrecognized tax benefit, beginning of year	$	12,275		$	1,679	$	1,024
Gross increases for tax positions of prior years		493			1,996		—
Gross decrease for tax positions of prior years		(6,331	)		—		—
Gross increases for tax positions of current years		3,008			8,600		655

Unrecognized tax benefit, end of year	$	9,445		$	12,275	$	1,679

Organization and Description of Business - Initial Public Offering (Details) $ / shares in Units, $ in Millions	1 Months Ended
	Jun. 30, 2016 USD ($) $ / shares shares
Common Class B
Initial Public Offering
Shares issued upon automatic conversion (in shares)	54,508,441
Conversion ratio	1
IPO \| Common Class A
Initial Public Offering
Shares sold (in shares)	11,500,000
Stock price at grant date (in dollars per share) \| $ / shares	$ 15.00
Proceeds received, after deducting underwriting discounts and offering expenses \| $	$ 155.5
Over-Allotment Option, IPO \| Common Class A
Initial Public Offering
Shares sold (in shares)	1,500,000

Organization and Description of Business - Follow-on Public Offering (Details) - Common Class A $ / shares in Units, $ in Millions	1 Months Ended
	Oct. 31, 2016 USD ($) $ / shares shares
Follow-on Public Offering
Follow-on Public Offering
Shares sold (in shares)	1,691,222
Stock price at grant date (in dollars per share) \| $ / shares	$ 40.00
Proceeds received, after deducting underwriting discounts and offering expenses \| $	$ 64.4
Over-Allotment Option, FPO
Follow-on Public Offering
Shares sold (in shares)	1,050,000
Stock Sold by Certain Selling Stockholders
Follow-on Public Offering
Shares sold (in shares)	6,358,778
Stock option exercises (in shares)	906,364

Summary of Significant Accounting Policies - Concentration of Credit Risk (Details) - customer	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue \| Customer Concentration Risk
Concentration of Credit Risk
Number of customers	0	1	1
Revenue \| Customer Concentration Risk \| Customer One
Concentration of Credit Risk
Concentration risk (as a percent)		14.00%
Revenue \| Customer Concentration Risk \| Customer Two
Concentration of Credit Risk
Concentration risk (as a percent)			17.00%
Accounts Receivable \| Credit Concentration Risk
Concentration of Credit Risk
Number of customers	0	1
Accounts Receivable \| Credit Concentration Risk \| Customer One
Concentration of Credit Risk
Concentration risk (as a percent)		16.00%

Summary of Significant Accounting Policies - Revenue Recognition (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Minimum
Revenue Recognition
Duration of contracts	1 month
Maximum
Revenue Recognition
Duration of contracts	48 months
Sales credit reserve
Revenue Recognition
Reserve for sales credits	$ 1,761	$ 544	$ 714	$ 312

Summary of Significant Accounting Policies - Internal-Use Software Development Costs (Details)	12 Months Ended
	Dec. 31, 2017
Capitalized internal-use software development costs
Internal-Use Software Development Costs
Estimated useful life (in years)	3 years

Summary of Significant Accounting Policies - Advertising Costs (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Summary of Significant Accounting Policies
Advertising expense	$ 4.9	$ 3.5	$ 2.9

Summary of Significant Accounting Policies - Stock-Based Compensation (Details) - USD ($)	3 Months Ended	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2017
Stock-Based Compensation
Expected dividend rate for Black-Scholes model (as a percent)		0.00%
Accounting Standards Update 2016-09 \| Early Adoption Impact
Stock-Based Compensation
Increase in stock-based compensation expense for cumulative prior year impact	$ 100,000
Increase in stock-based compensation expense for 2016 quarterly impact	$ 75,000

Summary of Significant Accounting Policies - Net Loss Per Share Attributable to Common Stockholders (Details)	12 Months Ended
	Dec. 31, 2017 Vote
Common Class A
Net Loss Per Share Attributable to Common Stockholders
Votes per share	1
Common Class B
Net Loss Per Share Attributable to Common Stockholders
Votes per share	10
Ratio for option to convert to Class A	1

Summary of Significant Accounting Policies - Restricted Cash (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016
Summary of Significant Accounting Policies
Restricted cash balances	$ 5.5	$ 8.6

Summary of Significant Accounting Policies - Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Summary of Significant Accounting Policies
Allowance for doubtful accounts	$ 1,033	$ 1,076	$ 486	$ 210

Summary of Significant Accounting Policies - Costs Related to the Public Offerings (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)
Summary of Significant Accounting Policies
Costs related to the public offerings	$ 5,730
IPO
Summary of Significant Accounting Policies
Costs related to the public offerings	4,900
Follow-on Public Offering
Summary of Significant Accounting Policies
Costs related to the public offerings	$ 800

Summary of Significant Accounting Policies - Property and Equipment (Details)	12 Months Ended
	Dec. 31, 2017
Capitalized internal-use software development costs
Property and Equipment
Estimated useful life (in years)	3 years
Office equipment
Property and Equipment
Estimated useful life (in years)	3 years
Furniture and fixtures
Property and Equipment
Estimated useful life (in years)	5 years
Software
Property and Equipment
Estimated useful life (in years)	3 years
Leasehold improvements
Property and Equipment
Estimated useful life (in years)	5 years

Summary of Significant Accounting Policies - Intangible Assets (Details)	12 Months Ended
	Dec. 31, 2017
Developed technology \| Minimum
Intangible Assets
Useful life (in years)	3 years
Developed technology \| Maximum
Intangible Assets
Useful life (in years)	4 years
Customer relationships \| Minimum
Intangible Assets
Useful life (in years)	5 years
Customer relationships \| Maximum
Intangible Assets
Useful life (in years)	8 years
Supplier relationships
Intangible Assets
Useful life (in years)	5 years
Trade name
Intangible Assets
Useful life (in years)	2 years
Patent
Intangible Assets
Useful life (in years)	20 years

Summary of Significant Accounting Policies - Goodwill (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($) item	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Summary of Significant Accounting Policies
Number of reporting units \| item	1
Goodwill impairment charges \| $	$ 0	$ 0	$ 0

Summary of Significant Accounting Policies - Impairment of Long Lived Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Summary of Significant Accounting Policies
Long-lived assets, including property and equipment and intangible assets, impairment loss	$ 0	$ 0	$ 0
Value of internally-developed software written-off due to abandonment	$ 561	$ 711	$ 113

Summary of Significant Accounting Policies - Segment Information (Details)	12 Months Ended
	Dec. 31, 2017 segment
Summary of Significant Accounting Policies
Number of reportable segments	1

Fair Value Measurements - Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Fair Value Measurements
Marketable securities, Amortized Cost	$ 176,185
Total marketable securities, Aggregate Fair Value	175,587	$ 0
Recurring
Fair Value Measurements
Marketable securities, Amortized Cost	176,185
Marketable securities, Net Unrealized Losses	(598)
Total financial assets, Amortized Cost or Carrying Value	271,617
Recurring \| U.S. Treasury securities
Fair Value Measurements
Marketable securities, Amortized Cost	59,962
Marketable securities, Net Unrealized Losses	(216)
Recurring \| Corporate debt securities
Fair Value Measurements
Marketable securities, Amortized Cost	116,223
Marketable securities, Net Unrealized Losses	(382)
Recurring \| Carrying Value
Fair Value Measurements
Cash and cash equivalents	95,432
Total financial assets		274,135
Recurring \| Carrying Value \| Money market funds
Fair Value Measurements
Cash and cash equivalents	95,432	274,135
Recurring \| Aggregate Fair Value
Fair Value Measurements
Cash and cash equivalents	95,432
Total marketable securities, Aggregate Fair Value	175,587
Total financial assets	271,019	274,135
Recurring \| Aggregate Fair Value \| U.S. Treasury securities
Fair Value Measurements
Total marketable securities, Aggregate Fair Value	59,746
Recurring \| Aggregate Fair Value \| Corporate debt securities
Fair Value Measurements
Total marketable securities, Aggregate Fair Value	115,841
Recurring \| Aggregate Fair Value \| Money market funds
Fair Value Measurements
Cash and cash equivalents	95,432	274,135
Recurring \| Aggregate Fair Value \| Level 1
Fair Value Measurements
Cash and cash equivalents	95,432
Total marketable securities, Aggregate Fair Value	59,746
Total financial assets	155,178	274,135
Recurring \| Aggregate Fair Value \| Level 1 \| U.S. Treasury securities
Fair Value Measurements
Total marketable securities, Aggregate Fair Value	59,746
Recurring \| Aggregate Fair Value \| Level 1 \| Money market funds
Fair Value Measurements
Cash and cash equivalents	95,432	$ 274,135
Recurring \| Aggregate Fair Value \| Level 2
Fair Value Measurements
Total marketable securities, Aggregate Fair Value	115,841
Total financial assets	115,841
Recurring \| Aggregate Fair Value \| Level 2 \| Corporate debt securities
Fair Value Measurements
Total marketable securities, Aggregate Fair Value	$ 115,841

Fair Value Measurements - Contractual Maturities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Fair Value Measurements
Less than one year, Amortized Cost	$ 108,584
One to two years, Amortized Cost	67,601
Total amortized cost	176,185
Less than one year, Aggregate Fair Value	108,360
One to two years, Aggregate Fair Value	67,227
Total marketable securities, Aggregate Fair Value	$ 175,587	$ 0

Fair Value Measurements - Additional Disclosures (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($)
Fair Value Measurements
Other-than-temporary impairments	$ 0
Interest earned on marketable securities	$ 2,600

Property and Equipment - Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Property and Equipment
Total property and equipment	$ 76,726	$ 50,997
Less: accumulated depreciation and amortization	(26,185)	(13,445)
Total property and equipment, net	50,541	37,552
Capitalized internal-use software development costs
Property and Equipment
Total property and equipment	49,177	28,661
Leasehold improvements
Property and Equipment
Total property and equipment	14,246	14,063
Office equipment
Property and Equipment
Total property and equipment	9,652	5,729
Furniture and fixtures
Property and Equipment
Total property and equipment	1,976	1,576
Software
Property and Equipment
Total property and equipment	$ 1,675	$ 968

Property and Equipment - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property and Equipment
Depreciation and amortization	$ 13.1	$ 7.4	$ 3.7

Property and Equipment - Capitalized Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property and Equipment
Capitalized software development costs	$ 21,500	$ 13,500	$ 9,400
Stock-based compensation capitalized in software development costs	$ 4,176	$ 1,953	$ 979

Property and Equipment - Amortization of Capitalized Software Development Costs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Property and Equipment
Capitalized software amortization expense	$ 8,407	$ 5,486	$ 2,838
Cost of revenue
Property and Equipment
Capitalized software amortization expense	4,788	3,304	1,793
Research and development
Property and Equipment
Capitalized software amortization expense	$ 3,619	$ 2,182	$ 1,045

Business Combinations - Consideration (Details) - USD ($) $ in Millions	1 Months Ended			10 Months Ended	12 Months Ended
	Feb. 28, 2017	Nov. 30, 2016	Feb. 28, 2015	Dec. 31, 2017	Dec. 31, 2015
Beepsend AB, a messaging provider based in Sweden
Acquisition
Total purchase price	$ 23.0
Purchase price paid in cash	23.0
Amount of purchase price placed into an escrow account	$ 5.0
Escrow effective period	18 months
Amount deposited into an employee escrow account	$ 2.0
Adjustment to preliminary purchase price allocation				$ 0.1
Kurento Open Source Project
Acquisition
Total purchase price		$ 8.5
Purchase price paid in cash		8.5
Amount of purchase price placed into an escrow account		$ 1.5
Escrow effective period		24 months 10 days
Authy, Inc.
Acquisition
Total purchase price			$ 6.1
Purchase price paid in cash			3.0
Purchase price, fair value of shares of Series T convertible preferred stock			$ 3.1		$ 3.1

Business Combinations - Purchase Price Allocation (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Feb. 28, 2017	Dec. 31, 2016	Nov. 30, 2016	Dec. 31, 2015	Feb. 28, 2015
Acquisition
Goodwill	$ 17,851		$ 3,565		$ 3,165
Beepsend AB, a messaging provider based in Sweden
Acquisition
Net tangible liabilities		$ (3,575)
Goodwill		12,837
Intangible assets		13,700
Total purchase price		22,962
Net deferred tax liability		$ 2,600
Authy, Inc.
Acquisition
Net tangible assets						$ 1,165
Goodwill						3,165
Intangible assets						1,760
Total purchase price						6,090
Net deferred tax liability						$ 100
Kurento Open Source Project
Acquisition
Goodwill				$ 400
Intangible assets				8,100
Total purchase price				$ 8,500

Business Combinations - Identifiable Finite-lived Intangible Assets (Details) - USD ($) $ in Thousands	1 Months Ended			12 Months Ended
	Feb. 28, 2017	Nov. 30, 2016	Feb. 28, 2015	Dec. 31, 2017
Developed technology \| Minimum
Acquisition
Estimated life (in years)				3 years
Developed technology \| Maximum
Acquisition
Estimated life (in years)				4 years
Customer relationships \| Minimum
Acquisition
Estimated life (in years)				5 years
Customer relationships \| Maximum
Acquisition
Estimated life (in years)				8 years
Supplier relationships
Acquisition
Estimated life (in years)				5 years
Trade name
Acquisition
Estimated life (in years)				2 years
Beepsend AB, a messaging provider based in Sweden
Acquisition
Total intangible assets acquired	$ 13,700
Beepsend AB, a messaging provider based in Sweden \| Developed technology
Acquisition
Total intangible assets acquired	$ 5,000
Estimated life (in years)	4 years
Beepsend AB, a messaging provider based in Sweden \| Customer relationships
Acquisition
Total intangible assets acquired	$ 6,100
Beepsend AB, a messaging provider based in Sweden \| Customer relationships \| Minimum
Acquisition
Estimated life (in years)	7 years
Beepsend AB, a messaging provider based in Sweden \| Customer relationships \| Maximum
Acquisition
Estimated life (in years)	8 years
Beepsend AB, a messaging provider based in Sweden \| Supplier relationships
Acquisition
Total intangible assets acquired	$ 2,600
Estimated life (in years)	5 years
Authy, Inc.
Acquisition
Total intangible assets acquired			$ 1,760
Authy, Inc. \| Developed technology
Acquisition
Total intangible assets acquired			$ 1,300
Estimated life (in years)			3 years
Authy, Inc. \| Customer relationships
Acquisition
Total intangible assets acquired			$ 400
Estimated life (in years)			5 years
Authy, Inc. \| Trade name
Acquisition
Total intangible assets acquired			$ 60
Estimated life (in years)			2 years
Kurento Open Source Project
Acquisition
Total intangible assets acquired		$ 8,100
Kurento Open Source Project \| Developed technology
Acquisition
Estimated life (in years)		3 years

Business Combinations - Acquisition Costs (Details) - General and administrative - USD ($) $ in Millions	12 Months Ended				24 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2017	Dec. 31, 2015
Beepsend AB, a messaging provider based in Sweden
Business Combinations
Acquisition related costs	$ 0.3	$ 0.4			$ 0.7
Authy, Inc.
Business Combinations
Acquisition related costs			$ 1.2	$ 0.3		$ 1.5
Kurento Open Source Project
Business Combinations
Acquisition related costs		$ 0.1

Business Combinations - Consideration - Shares of Stock (Details) - Authy, Inc. - Preferred Stock - Series T Preferred Stock - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Feb. 28, 2015	Dec. 31, 2015	Aug. 31, 2016
Acquisition
Shares issued (in shares)	389,733	389,733
Shares held in escrow (in shares)	180,000	687,885
Former Shareholder of Acquiree
Acquisition
Shares issued to former shareholder (in shares)	507,885	507,885
Fair value	$ 4.0	$ 4.0
Graded vesting period (in years)	3 years	3 years
Reduction in unvested shares due to non-fulfillment of certain conditions of the merger agreement (in shares)			127,054

Business Combinations - Cost of Shares Subject to Vesting and Performance Conditions (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Business Combinations
Stock-based compensation expense	$ 49,619	$ 24,225	$ 8,877
Research and development
Business Combinations
Stock-based compensation expense	$ 22,808	12,946	4,046
Research and development \| Authy, Inc.
Business Combinations
Stock-based compensation expense		$ 2,400	$ 600

Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Goodwill
Balance at the beginning of the period	$ 3,565	$ 3,165
Goodwill recorded in connection with acquisitions	12,688	400
Measurement period adjustment	149
Effect of exchange rate	1,449
Balance at the end of the period	$ 17,851	$ 3,565

Goodwill and Intangible Assets - Amortizable Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Intangible Assets
Gross	$ 26,919	$ 11,372
Accumulated Amortization	(7,150)	(1,399)
Net	19,769	9,973
Developed technology
Intangible Assets
Gross	14,941	9,400
Accumulated Amortization	(5,476)	(1,140)
Net	9,465	8,260
Customer relationships
Intangible Assets
Gross	7,159	400
Accumulated Amortization	(1,006)	(148)
Net	6,153	252
Supplier relationships
Intangible Assets
Gross	2,881
Accumulated Amortization	(500)
Net	2,381
Trade name
Intangible Assets
Gross	60	60
Accumulated Amortization	(60)	(56)
Net		4
Patent
Intangible Assets
Gross	1,878	1,512
Accumulated Amortization	(108)	(55)
Net	$ 1,770	$ 1,457

Goodwill and Intangible Assets - Non-amortizable Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Domain names
Intangible Assets
Non-amortizable intangible assets	$ 32	$ 32
Trademarks
Intangible Assets
Non-amortizable intangible assets	$ 263	$ 263

Goodwill and Intangible Assets - Total Intangible Assets, Gross (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Intangible Assets
Amortizable intangible assets, gross	$ 26,919	$ 11,372
Total	27,214	11,667
Domain names
Intangible Assets
Non-amortizable intangible assets	32	32
Trademarks
Intangible Assets
Non-amortizable intangible assets	$ 263	$ 263

Goodwill and Intangible Assets - Total Intangible Assets, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Intangible Assets
Amortizable intangible assets, net	$ 19,769	$ 9,973
Total	20,064	10,268
Domain names
Intangible Assets
Non-amortizable intangible assets	32	32
Trademarks
Intangible Assets
Non-amortizable intangible assets	$ 263	$ 263

Goodwill and Intangible Assets - Total Intangible Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Goodwill and Intangible Assets
Gross	$ 27,214	$ 11,667
Accumulated Amortization	(7,150)	(1,399)
Net	$ 20,064	$ 10,268

Goodwill and Intangible Assets - Amortization Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Goodwill and Intangible Assets
Amortization expense	$ 5.7	$ 0.9	$ 0.5

Goodwill and Intangible Assets - Total Estimated Future Amortization Expense (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Intangible Assets
2018	$ 6,793
2019	5,083
2020	2,653
2021	1,520
2022	924
Thereafter	2,796
Net	$ 19,769	$ 9,973

Accrued Expenses and Other Liabilities - Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Accrued Expenses and Other Liabilities
Accrued payroll and related	$ 4,898	$ 3,132
Accrued bonus and commission	4,777	2,251
Accrued cost of revenue	10,876	8,741
Sales and other taxes payable	20,877	28,795
ESPP contributions	1,338	4,365
Deferred rent	1,048	1,250
Accrued other expense	9,800	10,774
Total accrued expenses and other current liabilities	$ 53,614	$ 59,308

Accrued Expenses and Other Liabilities - Long-term Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Accrued Expenses and Other Liabilities
Deferred rent	$ 8,480	$ 9,387
Deferred tax liability	2,452
Deferred tax benefit		(2)
Accrued other expense	477	158
Total long-term liabilities	$ 11,409	$ 9,543

Supplemental Balance Sheet Information - Allowance for Doubtful Accounts (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Allowance for doubtful accounts
Balance, beginning of period	$ 1,076	$ 486	$ 210
Additions	580	1,145	705
Write-offs	(623)	(555)	(429)
Balance, end of period	$ 1,033	$ 1,076	$ 486

Supplemental Balance Sheet Information - Sales Credit Reserve (Details) - Sales credit reserve - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Sales credit reserve
Balance, beginning of period	$ 544	$ 714	$ 312
Additions	2,531	1,348	1,210
Deductions against reserve	(1,314)	(1,518)	(808)
Balance, end of period	$ 1,761	$ 544	$ 714

Revenue by Geographic Area - Revenue by Geographic Area (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Revenue by geographic area
Revenue	$ 399,020	$ 277,335	$ 166,919
United States
Revenue by geographic area
Revenue	308,612	233,922	143,145
International
Revenue by geographic area
Revenue	$ 90,408	$ 43,413	$ 23,774

Revenue by Geographic Area - Percentage of Revenue by Geographic Area (Details) - Revenue - Geographic Concentration Risk	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
United States
Percentage of revenue by geographic area
Percentage of revenue (as a percent)	77.00%	84.00%	86.00%
International
Percentage of revenue by geographic area
Percentage of revenue (as a percent)	23.00%	16.00%	14.00%

Commitments and Contingencies - Lease Commitments (Details) $ in Millions	1 Months Ended	12 Months Ended	23 Months Ended
	Oct. 31, 2016 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Jan. 31, 2016 USD ($) ft²
Various Facilities Leases \| Maximum
Lease Commitments
Non-cancelable operating lease agreements, facilities, remaining term (in years)		6 years
Office Space, 375 Beale Street, San Francisco, California
Lease Commitments
Area of office space (in square feet) \| ft²					90,000
Lease agreements term	96 months
Monthly payment, first 60 months	$ 0.4
Monthly payment, after 60 months	$ 0.5
Tenant improvements allowance					$ 8.3
Tenant improvement allowance collected			$ 8.3
Office Space, 375 Beale Street, San Francisco, California \| Letter of Credit
Lease Commitments
Letter of credit		$ 5.5	$ 5.5	$ 7.4

Commitments and Contingencies - Rent Expense (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Commitments and Contingencies
Rent expense	$ 8.1	$ 7.3	$ 4.1

Commitments and Contingencies - Future Minimum Lease Payments (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Future minimum lease payments
2018	$ 7,884
2019	7,676
2020	7,101
2021	7,033
2022	5,864
Thereafter	10,189
Total minimum lease payments	$ 45,747

Commitments and Contingencies - Other Commitments (Details)	12 Months Ended
	Dec. 31, 2017
Minimum
Non-cancelable contractual commitments
Expiration period (in years)	1 year
Maximum
Non-cancelable contractual commitments
Expiration period (in years)	4 years

Commitments and Contingencies - Future Minimum Payments under Other Existing Noncancellable Purchase Commitments (Details) $ in Thousands	Dec. 31, 2017 USD ($)
Future minimum payments under other existing noncancelable purchase commitments
2018	$ 22,414
2019	25,526
2020	147
2021	23
Total payments	$ 48,110

Commitments and Contingencies - Legal Matters (Details) - Pending Litigation - Putative class action complaint, Angela Flowers v. Twilio Inc.	Jan. 02, 2018 item
Legal Matters
Number of classes of individuals who allegedly sent or received certain communications	2
Number of customers' accounts involved in the complaint	3

Commitments and Contingencies - Indemnification Agreements (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Indemnification Agreement
Indemnification Agreements
Amount accrued	$ 0	$ 0

Commitments and Contingencies - Other taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Other taxes
Liability for uncertain tax positions	$ 20,900	$ 28,800
Net loss attributable to common stockholders	(63,708)	$ (41,324)	$ (38,896)
Change in estimate for non-income-based tax exposure - revisions in key assumptions
Other taxes
Net loss attributable to common stockholders	$ 13,400

Stockholders' Equity - Convertible Preferred Stock - IPO (Details) - Common Class B	1 Months Ended
	Jun. 30, 2016 shares
Convertible Preferred Stock
Shares issued upon automatic conversion (in shares)	54,508,441
Conversion ratio	1

Stockholders' Equity - Convertible Preferred Stock - Tabular Disclosure (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2017	Dec. 31, 2016
Preferred Stock
Shares Authorized (in shares)		100,000,000	100,000,000
Shares Issued (in shares)		0	0
Shares Outstanding (in shares)		0	0
Convertible preferred stock
Preferred Stock
Shares Authorized (in shares)	58,976,739
Shares Issued (in shares)	54,508,441
Shares Outstanding (in shares)	54,508,441
Aggregate Liquidation preference	$ 241,566
Proceeds, Net of Issuance Costs	$ 236,824
Series A Preferred Stock
Preferred Stock
Shares Authorized (in shares)	13,173,240
Shares Issued (in shares)	13,076,491
Shares Outstanding (in shares)	13,076,491
Aggregate Liquidation preference	$ 4,590
Proceeds, Net of Issuance Costs	$ 4,592
Series B Preferred Stock
Preferred Stock
Shares Authorized (in shares)	11,416,062
Shares Issued (in shares)	11,146,895
Shares Outstanding (in shares)	11,146,895
Aggregate Liquidation preference	$ 11,717
Proceeds, Net of Issuance Costs	$ 11,658
Series C Preferred Stock
Preferred Stock
Shares Authorized (in shares)	8,452,864
Shares Issued (in shares)	8,452,864
Shares Outstanding (in shares)	8,452,864
Aggregate Liquidation preference	$ 25,250
Proceeds, Net of Issuance Costs	$ 25,196
Series D Preferred Stock
Preferred Stock
Shares Authorized (in shares)	9,440,324
Shares Issued (in shares)	9,440,324
Shares Outstanding (in shares)	9,440,324
Aggregate Liquidation preference	$ 70,000
Proceeds, Net of Issuance Costs	$ 69,930
Series E Preferred Stock
Preferred Stock
Shares Authorized (in shares)	11,494,249
Shares Issued (in shares)	11,494,249
Shares Outstanding (in shares)	11,494,249
Aggregate Liquidation preference	$ 130,000
Proceeds, Net of Issuance Costs	$ 125,448
Series T Preferred Stock
Preferred Stock
Shares Authorized (in shares)	5,000,000
Shares Issued (in shares)	897,618
Shares Outstanding (in shares)	897,618
Aggregate Liquidation preference	$ 9

Stockholders' Equity - Convertible Preferred Stock - Authy Acquisition (Details) - Authy, Inc. - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Feb. 28, 2015	Dec. 31, 2015
Acquisition
Purchase price, fair value of shares of Series T convertible preferred stock	$ 3.1	$ 3.1
Preferred Stock \| Series T Preferred Stock
Acquisition
Shares held in escrow (in shares)	180,000	687,885
Shares issued as part of purchase price (in shares)	389,733	389,733
Shares subject to performance conditions (in shares)		127,054
Preferred Stock \| Series T Preferred Stock \| Former Shareholder of Acquiree
Acquisition
Shares subject to graded vesting (in shares)	507,885	507,885
Graded vesting period (in years)	3 years	3 years
Fair value	$ 4.0	$ 4.0

Stockholders' Equity - Convertible Preferred Stock - Conversion (Details) - Convertible preferred stock $ in Millions	12 Months Ended
	Dec. 31, 2015 USD ($)
Conversion
Ratio for option to convert into common stock	1
Minimum IPO price for conversion	$ 50.0
Voting power (as a percent)	50.00%

Stockholders' Equity - Convertible Preferred Stock - Voting (Details)	Dec. 31, 2015 Vote director shares
Stockholders' Equity
Votes per share \| Vote	1
Common stock, number of directors	2
Series A Preferred Stock
Stockholders' Equity
Preferred stock, number of directors	1
Series B Preferred Stock
Stockholders' Equity
Preferred stock, number of directors	1
Series D Preferred Stock
Stockholders' Equity
Preferred stock, number of directors	1
Minimum number of shares required for voting (in shares) \| shares	2,000,000

Stockholders' Equity - Convertible Preferred Stock - Dividends (Details) - USD ($) $ in Millions	6 Months Ended	12 Months Ended
	Jun. 30, 2016	Dec. 31, 2015
Convertible preferred stock
Convertible Preferred Stock
Dividends declared and paid	$ 0	$ 0

Stockholders' Equity - Convertible Preferred Stock - Liquidation Preference (Details)	Dec. 31, 2015 $ / shares
Series A Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	$ 0.35
Series B Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	1.05
Series C Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	2.99
Series D Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	7.42
Series E Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	11.31
Series T Preferred Stock
Convertible Preferred Stock
Original issue price per share (in dollars per share)	$ 0.01

Stockholders' Equity - Preferred Stock (Details) - $ / shares	Dec. 31, 2017	Dec. 31, 2016
Preferred Stock
Preferred stock, authorized (in shares)	100,000,000	100,000,000
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0

Stockholders' Equity - Common Stock (Details)	Dec. 31, 2017 Vote $ / shares shares	Dec. 31, 2016 $ / shares shares
Common Stock
Common stock, authorized (in shares)	1,100,000,000	1,100,000,000
Common stock, par value (in dollars per share) \| $ / shares	$ 0.001	$ 0.001
Common stock, issued (in shares)	93,969,796	87,248,548
Common stock, outstanding (in shares)	93,969,796	87,248,548
Common Class A
Common Stock
Common stock, authorized (in shares)	1,000,000,000	1,000,000,000
Common stock, par value (in dollars per share) \| $ / shares	$ 0.001	$ 0.001
Common stock, issued (in shares)	69,906,550	49,996,410
Common stock, outstanding (in shares)	69,906,550	49,996,410
Votes per share \| Vote	1
Common Class B
Common Stock
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, par value (in dollars per share) \| $ / shares	$ 0.001	$ 0.001
Common stock, issued (in shares)	24,063,246	37,252,138
Common stock, outstanding (in shares)	24,063,246	37,252,138
Votes per share \| Vote	10

Stockholders' Equity - Shares Held in Escrow (Details) - shares	Dec. 31, 2017	Dec. 31, 2016
Common Class B \| Authy, Inc.
Shares held in escrow
Shares held in escrow (in shares)	180,000	180,000

Stockholders' Equity - Common Stock Shares Reserved (Details) - shares	Dec. 31, 2017	Dec. 31, 2016	Sep. 02, 2015
Stockholders' Equity
Common stock reserved for Twilio.org (in shares)			888,022
Reserved shares of common stock (in shares)	27,446,461	28,104,671
2016 Stock Option and Incentive Plan
Stockholders' Equity
Stock - based awards available for grant (in shares)	10,200,189	10,143,743
Common Class A
Stockholders' Equity
Common stock reserved for Twilio.org (in shares)	635,014	680,397
Stock Options
Stockholders' Equity
Stock options issued and outstanding (in shares)	10,710,427	14,649,276
Restricted Stock Units (RSUs)
Stockholders' Equity
Nonvested restricted stock units issued and outstanding (in shares)	5,665,459	2,034,217
Employee Stock \| Common Class A
Stockholders' Equity
Common stock reserved for issuance under an ESPP (in shares)	235,372	597,038

Stockholders' Equity - Stock Repurchases (Details) - USD ($) $ in Thousands		12 Months Ended
	Aug. 21, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Repurchases
Repurchases of stock		$ 100	$ 2	$ 20,810
Stock-based compensation expense		49,619	24,225	8,877
Research and development
Stock Repurchases
Stock-based compensation expense		22,808	12,946	4,046
Sales and marketing
Stock Repurchases
Stock-based compensation expense		9,822	4,972	2,389
General and administrative
Stock Repurchases
Stock-based compensation expense		$ 16,339	$ 6,016	2,377
2015 Repurchase
Stock Repurchases
Repurchases of stock	$ 22,800
Stock-based compensation expense				2,000
2015 Repurchase \| Research and development
Stock Repurchases
Stock-based compensation expense				800
2015 Repurchase \| Sales and marketing
Stock Repurchases
Stock-based compensation expense				100
2015 Repurchase \| General and administrative
Stock Repurchases
Stock-based compensation expense				$ 1,100
2015 Repurchase \| Common Stock
Stock Repurchases
Number of shares repurchased (in shares)	1,869,156
2015 Repurchase \| Series A And B Preferred Stock
Stock Repurchases
Number of shares repurchased (in shares)	365,916

Stockholders' Equity - Twilio.org (Details) - USD ($) $ in Thousands		1 Months Ended			12 Months Ended
	May 13, 2016	Nov. 30, 2017	Dec. 31, 2016	Oct. 31, 2016	Dec. 31, 2017	Sep. 02, 2015
Stockholders' Equity
Common stock reserved for Twilio.org (in shares)						888,022
Twilio.org, percentage of outstanding capital stock (as a percent)						1.00%
Twilio.org, authorized reduction in shares reserved (in shares)	107,625
Aggregate proceeds reserved for Twilio.org				$ 3,900
Donation of proceeds into Donor Advised Fund			$ 3,900
Twilio.org, reserved shares, issued fair value					$ 1,172
Common Class A
Stockholders' Equity
Common stock reserved for Twilio.org (in shares)			680,397		635,014
Twilio.org, authorized reduction in shares reserved (in shares)				100,000
Twilio.org, reserved shares, issued (in shares)		45,383
Twilio.org, reserved shares, issued fair value		$ 1,200

Stock-Based Compensation - 2008 Stock Option Plan (Details)	Dec. 31, 2017 shares
2008 Stock Option Plan
Stock Based Compensation
Shares available for future issuance (in shares)	0

Stock-Based Compensation - 2016 Stock Option Plan (Details) - shares		1 Months Ended	12 Months Ended
	Jan. 01, 2017	Jul. 31, 2017	Dec. 31, 2017	Jun. 21, 2016
Employee and Nonemployee Stock Options
Stock Based Compensation
Expiration term			10 years
Vesting period			4 years
Employee and Nonemployee Stock Options \| First vesting
Stock Based Compensation
Vesting period			1 year
Percentage of vesting rights			25.00%
Restricted Stock Units (RSUs)
Stock Based Compensation
Vesting period			4 years
Restricted Stock Units (RSUs) \| Granted in July 2017
Stock Based Compensation
Vesting period		4 years
Restricted Stock Units (RSUs) \| First vesting
Stock Based Compensation
Vesting period			1 year
Percentage of vesting rights			25.00%
2016 Stock Option and Incentive Plan
Stock Based Compensation
Maximum automatic annual increase as a percentage of outstanding common shares			5.00%
Automatic increase in shares available for grant (in shares)	4,362,427
2016 Stock Option and Incentive Plan \| Common Class A
Stock Based Compensation
Shares reserved for issuance (in shares)				11,500,000
2016 Stock Option and Incentive Plan \| Employee and Nonemployee Stock Options
Stock Based Compensation
Minimum grant price as a percentage of fair market value per share of the underlying common stock on the date of grant (as a percent)			100.00%

Stock-Based Compensation - 2016 Employee Stock Purchase Plan (Details) - Employee Stock - USD ($) $ in Millions		3 Months Ended	12 Months Ended
	Jan. 01, 2017	Jun. 30, 2018	Dec. 31, 2017	Jun. 21, 2016
Stock Based Compensation
Maximum automatic annual increase (in shares)			1,800,000
Maximum automatic annual increase as a percentage of outstanding common shares			1.00%
Automatic increase in shares available for grant (in shares)	872,485
Unrecognized compensation cost, other than options			$ 1.1
Weighted-average period (in years)			4 months 24 days
Common Class A
Stock Based Compensation
Shares reserved for issuance (in shares)				2,400,000
Discount from market price, offering date (as a percent)			15.00%
Discount from market price, purchase date (as a percent)			15.00%
Purchase price, percentage of fair market value (as a percent)			85.00%
Shares purchased (in shares)			794,142
Common Class A \| Forecast
Stock Based Compensation
Shares purchased (in shares)		235,372

Stock-Based Compensation - Stock Option Activity (Details) - Employee and Nonemployee Stock Options - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Number of options outstanding
Outstanding options as of the beginning of the period (in shares)	14,649,276
Granted (in shares)	1,526,450
Exercised (in shares)	(5,194,905)
Forfeited and cancelled (in shares)	(825,394)
Outstanding options as of the end of the period (in shares)	10,155,427	14,649,276
Weighted-average exercise price (per share)
Outstanding options as of the beginning of the period (in dollars per share)	$ 6.14
Granted (in dollars per share)	30.66
Exercised (in dollars per share)	4.93
Forfeited and cancelled (in dollars per share)	7.76
Outstanding options as of the end of the period (in dollars per share)	$ 10.31	$ 6.14
Weighted-average remaining contractual term and aggregate intrinsic value
Weighted-average remaining contractual term (in years)	7 years 1 month 13 days	7 years 6 months 7 days
Aggregate intrinsic value	$ 145,763	$ 332,716
Options vested and exercisable and options vested and expected to vest
Options vested and exercisable - number of options outstanding (in shares)	5,278,003
Options vested and exercisable - weighted-average exercise price (in dollars per share)	$ 5.53
Options vested and exercisable - weighted-average remaining contractual term (in years)	6 years 3 months 11 days
Options vested and exercisable - aggregate intrinsic value	$ 95,354

Stock-Based Compensation - Stock Options - Additional Information (Details) - Employee and Nonemployee Stock Options - USD ($) $ / shares in Units, $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Based Compensation
Aggregate intrinsic value of stock options exercised	$ 132.0	$ 54.4	$ 10.1
Grant date fair value of options vested	$ 15.8	$ 15.3	$ 8.2
Weighted-average grant date fair value of options granted (in dollars per share)	$ 13.33	$ 5.52	$ 4.30

Stock-Based Compensation - Performance-Based Stock Options (Details) $ / shares in Units, $ in Millions	1 Months Ended	12 Months Ended
	Feb. 28, 2017 USD ($) item $ / shares shares	Dec. 31, 2017 $ / shares shares
Performance-based stock options
Stock-Based Compensation
Number of distinct awards \| item	3
Total grant value \| $	$ 5.9
Vesting period upon satisfaction of performance condition	24 months
Performance condition achievement window	4 years 3 months 18 days
Expiration term	7 years
Number of options outstanding
Granted (in shares) \| shares	555,000	555,000
Outstanding options as of the end of the period (in shares) \| shares		555,000
Weighted-average exercise price (per share)
Granted (in dollars per share)		$ 31.72
Outstanding options as of the end of the period (in dollars per share)		$ 31.72
Weighted-average remaining contractual term
Weighted-average remaining contractual term (in years)		6 years
Performance-based stock options, $13.48 grant date fair value
Stock-Based Compensation
Grant date fair value (in dollars per share)	$ 13.48
Derived service period as adjusted	3 years 4 months 24 days
Performance-based stock options, $10.26 grant date fair value
Stock-Based Compensation
Grant date fair value (in dollars per share)	$ 10.26
Derived service period as adjusted	4 years 7 months 6 days
Performance-based stock options, $8.41 grant date fair value
Stock-Based Compensation
Grant date fair value (in dollars per share)	$ 8.41
Derived service period as adjusted	5 years 3 months 18 days

Stock-Based Compensation - Stock Options - Unrecognized Compensation Cost (Details) - Employee and Nonemployee Stock Options $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)
Stock Based Compensation
Unrecognized compensation cost, options	$ 34.8
Weighted-average period (in years)	2 years 1 month 13 days

Stock-Based Compensation - Restricted Stock Units Activity (Details) - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Number of units outstanding
Nonvested RSUs at the beginning of the period (in shares)	2,034,217
Granted (in shares)	4,826,508
Vested (in shares)	(711,371)
Forfeited and cancelled (in shares)	(483,895)
Nonvested RSUs at the end of the period (in shares)	5,665,459
Weighted-average grant date fair value (per share)
Nonvested RSUs at the beginning of the period (in dollars per share)	$ 32.66
Granted (in dollars per share)	28.05
Vested (in dollars per share)	30.29
Forfeited and cancelled (in dollars per share)	29.53
Nonvested RSUs at the end of the period (in dollars per share)	$ 29.29
Aggregate intrinsic value
Aggregate intrinsic value	$ 133,648	$ 58,687

Stock-Based Compensation - Restricted Stock Units - Additional Information (Details)	12 Months Ended
	Dec. 31, 2017
Restricted Stock Units (RSUs), Pre-IPO
Stock Based Compensation
Service condition period (in years)	4 years
Restricted Stock Units (RSUs), Post-IPO \| Minimum
Stock Based Compensation
Service condition period (in years)	2 years
Restricted Stock Units (RSUs), Post-IPO \| Maximum
Stock Based Compensation
Service condition period (in years)	4 years

Stock-Based Compensation - Restricted Stock Units - Unrecognized Compensation Cost (Details) - Restricted Stock Units (RSUs) $ in Millions	12 Months Ended
	Dec. 31, 2017 USD ($)
Stock Based Compensation
Unrecognized compensation cost, other than options	$ 148.0
Weighted-average period (in years)	3 years 3 months 18 days

Stock-Based Compensation - Equity Awards Granted to Nonemployees (Details) - USD ($) $ in Thousands	1 Months Ended		12 Months Ended
	Sep. 30, 2016	Dec. 31, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Based Compensation
Stock-based compensation expense			$ 49,619	$ 24,225	$ 8,877
Nonemployee Restricted Stock Units
Stock Based Compensation
Restricted stock unit awards outstanding (in shares)			0
Restricted stock units granted (in shares)	30,255
Stock-based compensation expense			$ 400	600
Nonemployee Stock Option
Stock Based Compensation
Stock option awards outstanding (in shares)			0
Stock options granted (in shares)		30,000
Stock-based compensation expense				$ 300

Stock-Based Compensation - Early Exercises of Nonvested Options (Details) - Employee Stock Option - 2008 Stock Option Plan - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Stock Based Compensation
Liability for unvested shares	$ 30	$ 300
Unvested shares that were early exercised (in shares)	5,214	49,580

Stock-Based Compensation - Valuation Assumptions (Details) - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Valuation Assumptions
Dividend rate (as a percent)	0.00%
Employee Stock Option
Valuation Assumptions
Expected term (in years)	6 years 29 days	6 years 29 days	6 years 29 days
Expected volatility, low end of range (as a percent)	44.30%	51.40%	47.80%
Expected volatility, high end of range (as a percent)	47.60%	53.00%	54.90%
Risk-free interest rate, low end of range (as a percent)	1.90%	1.30%	1.40%
Risk-free interest rate, high end of range (as a percent)	2.30%	1.50%	2.00%
Dividend rate (as a percent)	0.00%	0.00%	0.00%
Employee Stock
Valuation Assumptions
Expected term (in years)	6 months	10 months 24 days
Expected volatility (as a percent)		52.00%
Expected volatility, low end of range (as a percent)	33.20%
Expected volatility, high end of range (as a percent)	33.90%
Risk-free interest rate (as a percent)		0.60%
Risk-free interest rate, low end of range (as a percent)	1.10%
Risk-free interest rate, high end of range (as a percent)	1.40%
Dividend rate (as a percent)	0.00%	0.00%
Performance-based stock options
Valuation Assumptions
Asset volatility (as a percent)	40.00%
Equity volatility (as a percent)	45.00%
Discount rate (as a percent)	14.00%
Stock price at grant date (in dollars per share)	$ 31.72
Minimum \| Employee Stock Option
Valuation Assumptions
Fair value of common stock (in dollars per share)	23.60	$ 10.09	$ 7.07
Maximum \| Employee Stock Option
Valuation Assumptions
Fair value of common stock (in dollars per share)	$ 31.96	$ 15.00	$ 10.09

Stock-Based Compensation - Stock-Based Compensation Expense (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock-Based Compensation Expense
Stock-based compensation expense	$ 49,619	$ 24,225	$ 8,877
Cost of revenue
Stock-Based Compensation Expense
Stock-based compensation expense	650	291	65
Research and development
Stock-Based Compensation Expense
Stock-based compensation expense	22,808	12,946	4,046
Sales and marketing
Stock-Based Compensation Expense
Stock-based compensation expense	9,822	4,972	2,389
General and administrative
Stock-Based Compensation Expense
Stock-based compensation expense	$ 16,339	$ 6,016	$ 2,377

Net Loss Per Share Attributable to Common Stockholders - Basic and Diluted Net Loss per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net Loss Per Share Attributable to Common Stockholders
Net loss attributable to common stockholders	$ (63,708)	$ (41,324)	$ (38,896)
Weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted (in shares)	91,224,607	53,116,675	17,746,526
Net loss per share attributable to common stockholders, basic and diluted (in dollars per share)	$ (0.70)	$ (0.78)	$ (2.19)

Net Loss Per Share Attributable to Common Stockholders - Anti-Dilutive Securities (Details) - shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Anti-dilutive securities
Total	17,251,486	18,010,508	72,403,707
Convertible preferred stock
Anti-dilutive securities
Total			54,508,441
Employee and Nonemployee Stock Options
Anti-dilutive securities
Total	10,710,427	14,649,276	16,883,837
Restricted Stock Units (RSUs)
Anti-dilutive securities
Total	5,665,459	2,034,217	71,000
Class A common stock reserved for Twilio.org
Anti-dilutive securities
Total	635,014	680,397	888,022
Employee Stock
Anti-dilutive securities
Total	235,372	597,038
Unvested shares subject to repurchase
Anti-dilutive securities
Total	5,214	49,580	52,407

Net Loss Per Share Attributable to Common Stockholders - Shares Held in Escrow (Details) - shares	Dec. 31, 2015	Feb. 28, 2015
Authy, Inc. \| Preferred Stock \| Series T Preferred Stock
Shares held in escrow
Shares held in escrow (in shares)	687,885	180,000

Income Taxes - Domestic and Foreign Components of Loss Before Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Taxes
United States	$ (46,737)	$ (14,002)	$ (23,962)
International	(16,266)	(26,996)	(11,420)
Loss before provision for income taxes	$ (63,003)	$ (40,998)	$ (35,382)

Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Current:
Federal	$ 99
State	78	$ 83	$ 45
Foreign	823	214	213
Total	1,000	297	258
Deferred:
Federal	28	2	(109)
State	10
Foreign	(333)	27	(27)
Total	(295)	29	(136)
Provision for income taxes	$ 705	$ 326	$ 122

Income Taxes - Reconciliation of the Statutory Federal Tax Rate and the Effective Tax Rate (Details)		12 Months Ended
	Dec. 22, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Taxes
Tax benefit at federal statutory rate	35.00%	34.00%	34.00%	34.00%
State tax, net of federal benefit		10.00%	11.00%	(3.00%)
Stock-based compensation		47.00%	23.00%	(8.00%)
Credits		8.00%	2.00%	4.00%
Foreign rate differential		(8.00%)	(23.00%)	(11.00%)
Reserve for uncertain tax positions			(12.00%)
Change in valuation allowance		(46.00%)	(34.00%)	(14.00%)
Change in federal statutory rate		(45.00%)
Other		(1.00%)	(2.00%)	(2.00%)
Effective tax rate		(1.00%)	(1.00%)	0.00%

Income Taxes - Significant Components of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Deferred tax assets:
Net operating loss carryforwards	$ 56,138	$ 31,090	$ 27,401
Accrued and prepaid expenses	9,140	16,698	7,603
Stock-based compensation	7,131	5,368	1,433
Research and development credits	16,212	7,807	6,022
Charitable contributions	1,233	1,458
Other	472
Gross deferred tax assets	90,326	62,421	42,459
Valuation allowance	(78,900)	(49,601)	(35,613)
Net deferred tax assets	11,426	12,820	6,846
Deferred tax liabilities:
Capitalized software	(7,664)	(7,086)	(4,084)
Prepaid expenses	(1,015)	(452)	(2,035)
Acquired intangibles	(2,101)	(152)	(460)
Property and equipment	(2,380)	(4,931)	(240)
Deferred commissions	(718)	(201)
Net deferred tax asset			$ 27
Net deferred tax liability	$ (2,452)	$ (2)

Income Taxes - Net Operating Loss Carryforwards (Details) $ in Millions	Dec. 31, 2017 USD ($)
Federal
Income Taxes
Net operating loss carryforwards	$ 229.3
State
Income Taxes
Net operating loss carryforwards	$ 159.6

Income Taxes - Tax Credits (Details) $ in Millions	Dec. 31, 2017 USD ($)
Federal
Income Taxes
Tax credits	$ 12.6
State
Income Taxes
Tax credits	$ 11.0

Income Taxes - Additional Information (Details) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Income Taxes
Increase in valuation allowance	$ 29.3	$ 14.0

Income Taxes - Unrecognized Tax Benefits - Reconciliation (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Taxes
Unrecognized tax benefit, beginning of year	$ 12,275	$ 1,679	$ 1,024
Gross increases for tax positions of prior years	493	1,996
Gross decrease for tax positions of prior years	(6,331)
Gross increases for tax positions of current years	3,008	8,600	655
Unrecognized tax benefit, end of year	$ 9,445	$ 12,275	$ 1,679

Income Taxes - Unrecognized Tax Benefit - Additional Information (Details)	Dec. 31, 2017 USD ($)
Income Taxes
Unrecognized tax benefit that would impact the effective tax rate if recognized	$ 400,000
Accumulated interest and penalties related to uncertain tax positions	$ 35,000

Income Taxes - Tax Cuts and Jobs Act (Details) - USD ($) $ in Millions		12 Months Ended
	Dec. 22, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Tax Cuts and Jobs Act
U.S. corporate income tax rate (as a percent)	35.00%		34.00%	34.00%	34.00%
Decrease to federal and state deferred tax assets			$ 28.0
Decrease to deferred tax assets valuation allowance			28.0
Adjustment to income tax expense related to remeasurement of deferred tax assets			0.0
Provisional amount for incomplete accounting			$ 0.0
Percentage of pro rata share in CFC for determining GILTI requirements			10.00%
Forecast
Tax Cuts and Jobs Act
U.S. corporate income tax rate (as a percent)		21.00%

Employee Benefit Plan (Details) - USD ($) $ in Millions	12 Months Ended
Employee Benefit Plan (Details) - USD ($) $ in Millions	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Employee Benefit Plan
Employer contributions	$ 1.8	$ 1.1	$ 0.0

Transactions with Investors - Vendor Ownership Interest (Details) - Counterparty	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Vendor 1 \| Twilio Inc.
Transactions With Investors
Ownership percentage (as a percent)	1.90%	2.00%	2.50%
Vendor 2 \| Twilio Inc.
Transactions With Investors
Ownership percentage (as a percent)	1.00%	1.00%	1.20%
Investor
Transactions With Investors
Vendors, number	2	2	2

Transactions with Investors - Vendor Transactions (Details) - Investor - USD ($) $ in Millions	1 Months Ended	12 Months Ended
	Oct. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Vendor 1
Transactions With Investors
Purchases from vendor		$ 20.4	$ 14.5	$ 11.1
Amount due to vendor		0.2	0.0
Amount due from vendor		1.2	0.3
Purchase agreement period (in years)	3 years
Purchase commitment amount	$ 57.7
Vendor 2
Transactions With Investors
Purchases from vendor		0.8	0.5	$ 0.5
Amount due from vendor		$ 0.0	$ 1.0