Vonage to Acquire Twilio Arch Nemesis Nexmo for $230M

Vonage today announced that it is acquiring communications Platform-as-a-service provider Nexmo in a cash and stock deal valued at $230 million.

Nexmo provides a suite of communication APIs that enable its customers to integrate SMS, voice, phone verification and chat into their applications without having to deal with hundreds of carriers. The company counts over 100,000 registered developers, and says that it is processing 5 billion API calls every year. Its 350-plus customers include prominent tech companies like Uber, Alibaba and Snapchat, as well as established businesses like Daimler and KLM Airlines.

In interviews with ProgrammableWeb's Debra Donston-Miller, Nexmo revealed that it doubled its volume of business, as well as the number of API calls it handled, in 2015 and predicted that it would double its API call volume in 2016 as well. The company, which grew to more than $75 million in revenue in just four years of operations, pointed out that it that it came to market and competes exclusively as an API provider.

Nexmo's growth was clearly attractive to publicly-traded internet telephony service provider Vonage. Vonage says that its acquisition of Nexmo will accelerate its own growth, bolster its position as a leader in the cloud communications market and expand the size of its addressable market. According to IDC, the communications platform-as-a-service market alone will be worth $8 billion by 2018.

Nexmo's competitors include another prominent API-centric company, Twilio, which is expected to go public this year and could command a valuation exceeding $1 billion.

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