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Story of Slack

Picture Credits : Slack.com

Slack is a proprietary business communication platform developed by American software company Slack Technologies. Slack offers many IRC-style features, including persistent chat rooms (channels) organized by topic, private groups, and direct messaging.

Slack’s tagline is “Be Less Busy,” but for the first two years of Slack’s development, the company was very busy. What began as an internal tool hacked together out of necessity soon became the most popular chat and productivity tool in the world used by 77% of the Fortune 100. By testing Slack on its development team over a prolonged period, the company knew exactly how people were using its product long before unveiling Slack to the world—a crucial competitive advantage that propelled Slack to unprecedented heights of success.

Picture Credits: The Australian

The geniuses behind this billion-dollar company

Stewart Butterfield is the CEO and co-founder of Slack. For more than 20 years, he has been an entrepreneur, designer and technology leader, usually all at once.

In 2013, Stewart and his team launched Slack, which has transformed business communication. Today, Slack is the leading channel-based messaging platform, used by millions to align their teams, unify their systems and drive their businesses forward.

In 2003, Stewart co-founded Flickr, one of the pioneers of image sharing and the social web. As CEO, he built Flickr into one of the largest web services in the world.

Stewart has been regularly recognised for the foresight and innovation that has helped him build two companies that have reimagined the way we use technology to communicate, collaborate, share and store information. He was named one of the 100 Most Influential People in the World by Time Magazine, and one of the Top 50 Leaders by BusinessWeek; he has been included on Vanity Fair’s New Establishment List, the Recode 100, Advertising Age’s Creativity 50, and the Technology Innovator of the Year by the Wall Street Journal.

Stewart has a Bachelor of Arts in Philosophy from the University of Victoria and a Master of Philosophy from the University of Cambridge.

Cal Henderson is the co-founder and CTO of Slack. He oversees Slack’s world-class engineering team and sets the technical vision for the company.

In 2019, he was named a Fortune 40 Under 40 honoree and recognised by the World Economic Forum as a Young Global Leader.

Previously, Cal built and led the engineering teams at Flickr, until its acquisition by Yahoo. An experienced technology leader and a popular speaker on engineering scalability, he authored the best-selling O’Reilly Media book Building Scalable Websites. Cal was also a pioneer in the use of web APIs and created the basis for OAuth and oEmbed, now used by YouTube, Twitter and many others.

Cal was involved in London’s early online network through his work with digital creative communities and the blogosphere. He has a Bachelor of Computer Science and has received an Honorary Doctorate from Birmingham City University.

Picture Credits: Slack.com

The story of Slack.

Slack was made for internal use and suddenly as the founders realized that it has more potential in the public forum and that’s how Slack came into existence. 

Slack turned into a 1 billion project without even spending a penny in eight months. How did they do that?

Slack founder Stewart Butterfield and his team set out to create something new and original for the massively multiplayer online role-playing game (MMORPG) market. As it turns out, they revolutionized how we communicate at work instead.

Being the fastest-growing startup in history isn’t the only thing that makes Slack unique. Its product development process was unorthodox. Slack was actually born out of a gaming company called Tiny Speck. Butterfield and his team didn’t intentionally set out to create a SaaS product for the workplace. They built a tool for themselves. They only realized their tool’s commercial potential later on

“The pattern was to share Slack with progressively larger groups. We would say, ‘Oh, that great idea isn’t so great after all.’ We amplified the feedback we got at each stage by adding more teams,” Butterfield says.

“That was essentially our beta release, but we didn’t want to call it a beta because then people would think that the service would be flaky or unreliable,” Butterfield says. Instead, with help from an impressive press blitz (based largely on the team’s prior experience — i.e. use whatever you’ve got going for you), they welcomed people to request an invitation to try Slack. On the first day, 8,000 people did just that; and two weeks later, that number had grown to 15,000.

The big lesson here:Don’t underestimate the power of traditional media when you launch. It must be your primary concern, starting months beforehand and continuing for weeks afterward. Pull the strings you have. Work closely with your PR firm to find your hook. It can be personalities on your team, impressive customers you already have in the bag, prestigious investors, etc. But don’t leave it to two weeks beforehand and throw something together.

Most importantly, getting the story out doesn’t end when an article is published. In fact, by Butterfield’s estimation, that’s only about 20% of the recipe for media success. “The other 80% is people posting about that article. I almost never go to news sites — it’s overwhelming how much content is out there. But I will pay attention to what my friends are picking up and sharing.”

Social media has leveled the playing field, so whatever coverage you earn, run with it — give it new life by sharing it with your immediate and extended networks again and again. Engage with interested parties in your networks (prioritizing those with lots of followers and known influence) to broaden your reach. Don’t worry about repetition. It will only help you stay top of mind for prospective users.

We get to learn quite a lot from the success of Slack, the co- founders always mentions few simple strategies to grow ones business and among everything one important aspect they zoom on is the advantage of traditional media and traditional marketing strategies and that explains the growth of the company.

Picture Credits: Statista

Initial and further Funding

After the closure of Glitch, the company launched the Slack real-time collaboration app and platform, raising $17 million in funding from Andreessen Horowitz, Accel and Social Capital. After the launch of Slack, the company renamed itself to Slack Technologies in August 2014 The name is an acronym for “Searchable Log of All Conversation and Knowledge”. Slack had been an internal tool used for the development of Glitch.

The company raised $42.75 million in April 2014.In October 2014, the company raised $120 million in venture capital with a $1.2 billion valuation led by Kleiner Perkins. Earlier investors Andreessen Horowitz, Accel Partners and The Social+Capital Partnership also participated in this round.

In January 2015, Slack announced the acquisition of Screenhero, a specialist in voice, video, and screen sharing.In March 2015, Slack signed a deal with investors to raise up to $160 million in a funding round that valued the company at $2.76 billion. New investors include Institutional Venture Partners, Horizons Ventures, Index Ventures and DST Global.

In April 2015, the company raised another $160 million.In May 2015, Social Capital was a leading investor in a funding round for Slack Technologies.

In April 2016, Slack raised another $200 million, led by Thrive Capital, with participation by GGV, Comcast Ventures and existing investors, including Accel, Index Ventures and Social Capital. In 2016, Slack was ranked #1 on the Forbes Cloud 100 list.In September 2017, Slack raised $250 million, the majority of which came from Softbank’s Vision Fund, with about 45% of that, or $112.5 million, originally from the Public Investment Fund of Saudi Arabia.This round put Slack’s total fundraising at $841 million and its valuation at $5.1 billion (including cash raised).In early 2018, Slack announced the company’s first CFO, Allen Shim.

On July 26, 2018, Atlassian announced the shutdown of its competing HipChat and Stride effective February 11, 2019, and the sale of their intellectual property to Slack. Slack was to pay an undisclosed amount over three years to assume the user bases of the services, and Atlassian was to take a minority investment in Slack. The companies also announced a commitment to work on integration of Slack with Atlassian services.

In September 2018, it was announced the firm was preparing for an initial public offering in the first half of 2019.In November 2018, Slack was recognized in Credit Suisse AG’s inaugural Disruptive Technology Recognition (DTR) Program, an annual recognition of five top companies who are disrupting traditional enterprise information technology.On January 16, 2019, Slack announced the launch of the company’s new logo.

On December 11, 2018, it was reported that Slack was considering a direct public listing.In the lead-up to its DPO, Slack reported that, for the fiscal year ending January 31, 2019, it had generated $400.6 million in revenue, up from $220.5 million in the previous year and up from $105.2 million in 2017. Slack also reported losses of $138.9 million for the fiscal year ending in January 2019. On February 4, 2019, several media news outlets reported that Slack had filed for taking the company public. According to The Wall Street Journal, sources indicated the company would pursue a Direct Listing Process (DLP) instead of the traditional IPO.On April 26, 2019, Slack filed its S-1 to go public through a direct listing on the New York Stock Exchange, similar to Spotify in 2018. Its stock, ticker WORK, started trading on June 20, 2019. The NYSE set a reference price of $26 to start off trading and the stock rose to more than $41 in the initial hours of trading.

On November 13, 2019, Slack announced the formation of its partner channel as part of its focus on enterprise clients

In July 2020, Slack filed a lawsuit with the European Commission accusing Microsoft of anticompetitive behavior. Slack alleges that Microsoft illegally bundled their competing Microsoft Teams collaboration product with the Microsoft office suite.

 

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