Slack, the work-chat platform that transformed conversation at your office into a series of GIFs, raised a $427m Series H at a valuation of $7.1B. Since raising $250m just months ago, Slack’s value increased $2B.
Offbeat Slack founder Stewart Butterfield built a fan-favorite workplace chat platform by prioritizing fun features — and now he’s using them to crush the competition.
Slack — an acronym for “Searchable Log of All Conversation and Knowledge” — began as a feature in Butterfield’s lifelong passion project of building a never-ending video game (he founded Flickr the same way).
When users gave the game’s new communications feature two emoji-thumbs up, Butterfield dropped his old project to focus on improving Slack with even more new features.
Butterfield’s focus on features became Slack’s primary strategy, guiding the development of easy-to-use integrations that have made Slack so important that major news outlets now report when their service is down.
Unlike products designed not to work with other brands (cough *Apple* cough), Slack’s platform features integrations with other software (Google, Microsoft, Salesforce, etc.) to make its product fun and easy to use.
This strategy paid off last month: Slack bought one of its largest competitors, Hipchat, winning a years-long fight of the features.
Now, Slack has one main competitor: Microsoft. The ’Soft considered buying Slack in 2016, but then built its own collaboration tool, Microsoft Teams, instead.
After Microsoft unveiled its Teams product in 2016, Slack took out a full page ad in The Wall Street Journal saying they were “excited to have some competition” (riffing on a 1981 Apple ad that welcomed IBM to the personal computer competition).
But since then, Slack has built up a massive war chest to continue expanding its software offerings to rival Microsoft’s. With $1.2B in the bank and a paying user base of 3m users across 70k teams, now all Slack has to do is keep being the “fun” messaging platform.