CEO on the spot: nine questions with Twilio’s Khozema Shipchandler

I guess I always did. I didn’t necessarily think it would transpire at Twilio, because we already had a CEO and he was also one of the founders. Credit to him for giving me a lot of different opportunities.

When I was CFO, I would say, ‘I realise I have certain responsibilities, but I think there are a lot of other things that I can do.’

Every three months or so, I would take on new responsibilities. I took on cybersecurity, I took on IT, I took on corporate development, I took on legal. I’m sure I’m missing a few, but there was this consistent addition of responsibilities until one day the then-CEO said, ‘Hey, you’re kind of running the company at this point, so we should change your title to chief operating officer and have you take over a lot of the day-to-day running of Twilio.’

The final step before becoming CEO was when I took over as president of our communications business. Communications is about 97% of the company’s total revenue and overseeing that division gave me a lot of exposure to customers and to the inner workings of R&D.

While you’re never 100% ready for these things, I wasn’t caught off guard either. It felt like a natural progression in that way. It’s been exhilarating so far.

The reality is that not a lot of CFOs, especially in tech, ascend to the executive seat – it requires some intellectual curiosity. I was probably the right candidate at the right time.

I spent a lot of my career working at General Electric. Growing up in that system, where CFOs tend to be very operational and are effectively COOs, was good preparation. After that experience, I was naturally inclined to look at the business not just through the numbers, but actually through the inner workings of what our customers were asking for.

Initially, the most important thing was to instil financial discipline, operational rigour and a focus on innovation. Those three things were my priorities, particularly last year when it became really important to rebuild the foundation of the company.

Our co-founders left us with a lot of great qualities. One was great product-market fit, another was great culture. But in the day-to-day running of the company, we’d lost our way in the three areas I mentioned.

At some point in an organisation’s life, you’ve got to become profitable, you’ve got to start generating a lot of cash, you’ve got to reinvigorate growth and you’ve got to do all of that without isolating one variable.

Our employees are resilient, humble and self-aware people, but they’re also very hungry. I’m very proud of that. One thing I’ve seen over the past year and a half is that, when called upon to do some really difficult things, they will give it their all. They will dedicate themselves to the mission. They will execute like crazy. As a result, we’ve seen incredibly high employee engagement. In return, it’s our responsibility to create the conditions in which they’re able to do their best work. We want it to be economically rewarding, but we also want it to be rewarding in terms of the kinds of things they’re building. We want them to feel pride.

There’s a handful of components that really matter. When employees are fearful, or when customers are uncertain, it’s the job of a leader to absorb the fear and uncertainty and project pragmatic confidence. As an executive, you can’t be irrational. You’ve got to show people there’s a way forward and give them something realistic to feel good about.

To do that, you create toll gates of what progress looks like. That’s ascertained by looking at objective metrics that allow you to say, ‘OK, we are making progress. And here’s why I can say that and look at you with a straight face.’

You’ve also got to be humble and self-aware. You don’t know everything. You’re constantly collecting signals from other companies, including your competitors. But the most important signals come from your customers and employees. If you stop listening, you’ll be vulnerable and exposed.

A really smart person told me this a long time ago: you’re never as good as people say you are on your best days, and you’re never as bad as people say you are on your worst days. It’s important to internalise that. This job can be all-consuming. I spend a lot of time thinking about work even when I’m not at work, but there are moments when you have to shut down and shut off; when you’re with your family or friends. Business leaders may have fewer of those moments as a matter of necessity, but you have to find ways to make them impactful.

The best advice I’ve ever been given was from my mum, who passed away several years ago. She taught me to work hard but play hard. When you’re working, be all in, but when you’re playing, play. You don’t get time back with your kids or with your friends. This is not an eight-to-five job. But when I’m playing, I’m playing. I’m not thinking about work and I don’t constantly look at my phone.

On this particular business trip, my daughter is travelling with me and I went to dinner with her last night at Dishoom. My phone was put away the whole time. I wasn’t looking at it. It’s not fair to her if I’m not in the moment with her. The work-hard-play-hard lesson I take from my parents and I think it’s the best way anyone can live their lives.

I had the lamb chops and the ruby masala. And then we had a side order of the chaat and the fried okra fingers.

I read The Power of Full Engagement by Jim Loehr and Tony Schwartz 20 years ago and it is just as good now as it was then. It was written for high-performance athletes and then adapted for high-performance leaders in any environment. It really nicely addresses the notion of managing your energy and your work/life balance.

Another business classic, which I happen to have re-read recently, is Only The Paranoid Survive, the book Andy Grove wrote after leaving Intel. The last couple of chapters are actually pretty dated, because they’re about the emergence of the internet. But the book is very good.

I don’t really view it that way. Every challenge is really an opportunity in our space. Clearly, we’re in this AI moment where everybody’s trying to figure out what’s next. For our company, it’s the perfect moment. We’ve always positioned ourselves as a company that’s great at communications. But over the past three to five years, we’ve become great at combining that with contextual data. AI has to feed on data to produce meaningful answers. Generic data is one thing but, when it comes to legitimately solving a customer’s problem, the only data that matters is rich, contextual data.

For us, we have to ask how we’re going to capitalise on this moment. We are ‘all systems go’, trying to ensure we nail our moment at this particular opportunity.

The next three years are pretty set. We’ve got a financial framework and a product strategy. But every CEO has to think about what happens after that. If you want to create a business that’s sustainable, what are you investing in beyond that? That means constantly experimenting in new product areas, creating a future and constantly investing in our people so we have the right organic development at the very front line of the company.

I get tremendous energy from interacting with customers and employees – they’re the most insightful, most delightful people. We have a diverse customer base – more than 335,000 businesses of all shapes and sizes, growing constantly all over the world – and I learn a lot from them every day. I also learn from our 5,500 employees. They’re the smartest, humblest, most self-aware group of folks I’ve ever interacted with in my career. They’re constantly energising me.

There’s never been a more exciting time for the company. I genuinely believe that the company has never been in stronger shape and our best days are truly ahead of us. All of that credit goes to the 5,500 people that work here.