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Selling Slack seems like a mistake. It's so ubiquitous. I'd be interested in buying stock in Slack if they IPO. Snapchat was in a similar situation, and four o

Selling Slack seems like a mistake. It's so ubiquitous. I'd be interested in buying stock in Slack if they IPO. Snapchat was in a similar situation, and four or so years ago when they turned down Zuck's ~$5B offer everyone was saying what a silly mistake it was not to sell. How could Snapchat possibly make money? And think of all the disheartened employees whose shares would've been worth something. Turns out there's a market for ubiquitous software. Slack seems similar. Another datapoint: Look how well the acquisition of Oculus turned out. Palmer now has money, which would've come eventually. He no longer controls Oculus, and hence can't impact the world. And in a twist of fate, Palmer has attracted public annoyance due to some political decisions, so he went from favorite underdog to just another wealthy person. For ambitious people, this can sometimes be a worse fate than not being rich. Ideas require opportunity and timing, and opportunities like Oculus, Snapchat, and Slack are rare. $9B is nice. But are you sure you wouldn't rather affect the world?

ido 9y ago
$9B is nice. But are you sure you wouldn't rather affect the world? Absolutely. Get real, they're not curing cancer they're providing a (great) chat service for businesses and organizations.
- sillysaurus3 9y ago
  So is Snapchat.
  - freyir 9y ago
    If only we could all aspire to affect the world like Snapchat.
IanCal 9y ago
> $9B is nice. But are you sure you wouldn't rather affect the world? That's a false dichotomy isn't it? You could have a large impact on the world with that sort of money.
- sillysaurus3 9y ago
  You could be right. But there are only so many ways to convert $B into impact. The most straightforward way is to become an investor, but investing isn't so easy. And while it's true investors are one of the most important engines driving our economy, investors aren't makers. The CEO is the one with the power to get the whole company working toward a shared goal, set by the CEO. And when your company is as ubiquitous as Slack, you have the best people fighting to work for you. That's a degree of influence you might not get back, even with billions. From another angle, consider Steve Jobs. He had the money; he could've done anything. But being CEO of Apple was worth more.
  - Fomite 9y ago
    I mean, $9 billion could fund 4800 research labs at R01 levels for 5 years, even with a fairly generous 50% indirect cost rate. Pretty sure that could have some impact.
blazespin 9y ago
The problem with selling isn't the money, the problem is what do you do with the rest of your life. If you sell, that is most likely your peak. This is what zuck and the Snapchat guy was thinking. If they sell, that's it, they are done. Life is over as they know it.
- simonrobb 9y ago
  I'm sure most entrepreneur types run off the "thrill of the chase", and a big exit would momentarily dilute the initial mission. But you are waayyy overstating that effect. You've suddenly got a massive amount of capital to execute on the things you've been dreaming up along the way but have never been able to do before. Zuck sure had a company of thousands of employees to look after. And even if your mission was always just to exit... get a new vision. Do I really need to invoke Elon and his first acquisitions here?
  - blazespin 9y ago
    Bill Gates had to go, he was dragging MSFT down after the court case. Besides, he'd being doing it a looong time. He probably already hit Peak Bill and he knew it. Elon is an outlier of grand proportions.
- nathan_f77 9y ago
  Your comment makes very little sense to me. One obvious counter-example is Bill Gates, who left Microsoft and went on to do much more important work with the Bill & Melinda Gates foundation. I'm also sure that Mark Zuckerberg has plenty of things to do with the Chan Zuckerberg Initiative. I don't know anything about Evan Spiegel, but I just read about the Snap Foundation - https://www.engadget.com/2017/02/02/snap-inc-snap-foundation-ipo/ https://www.engadget.com/2017/02/02/snap-inc-snap-foundation... I just saw simonrobb's comment, and of course the best example is Elon Musk. That's how you sell a company and do something with the rest of your life.
InclinedPlane 9y ago
Yeah, so, you think you can affect the world more through slack or through $9 billion on your own? If you have even a few hundred million dollars to your name, even a few million really, you can work on whatever project you want on your own. If you have more money you can even work on things for years without having to worry about making a profit. And that's hugely powerful. As much as I hate the trend of companies gobbling up other companies, slack is a bad example here. Almost certainly everyone involved would be better off if a sale happened.
kayoone 9y ago
I don't know, to me $9B seems like a lot of money for a glorified IRC client built on web tech. Sure, you don't pay for the tech, but in the end you can do a lot with that kind of money. Elon Musk sold his first two businesses to get the funds to start what he really wanted to do. We don't know where Oculus would be without FB, i would argue they are better off because they are creating a new market and are in a capital intensive business. The VR market is still slow overall. Without FB, they could have already run out of breath or cut corners on the product.
- simonrobb 9y ago
  A glorified IRC client built on web tech... that everybody uses. Tech is only one small part of a business. Slack provides real value to millions of people, $9B certainly doesn't seem an unreasonable valuation to me.
  - hueving 9y ago
    >that everybody uses You're spending too much time in the tech industry. Even if you double the daily active users from a year ago, that doesn't even reach 5% of the US population.
    - derimagia 9y ago
      5% of the US population seems very large to me if that's right... They make a lot more money than something like facebook per user - even though we don't know how many organizations are paid vs free.
    - simonrobb 9y ago
      That's still a lot of users. By that logic most B2C companies (e.g.: Atlassian) shouldn't have a big valuation either. My point is that Slack has taken technology which has been around a long time, made it fun and usable so people use it, and most importantly they've got people to pay for it. GP's comment was dismissing Slack purely because of the tech.
Grue3 9y ago
Except Slack doesn't have any new ideas behind it. It's just another chat app. And just like other popular chat apps of yesteryear, it's a fad that will pass.
- noway421 9y ago
  IRC was just a chat app, yet even though it didn't age nicely, was still seeing massive usage for professional communication up until lately. Is it only because of legacy? Hardly, new blood was pouring in constantly, the only hit it took was skype. Slack is simply disrupting this area by offering product which is up to date and doesn't need bouncer running (+ hundreds of other useful nice to have features).
- paulcole 9y ago
  > Slack doesn't have any new ideas behind it. It's just another chat app. Billions of dollars can be made on old ideas positioned properly.
solatic 9y ago
It makes sense to sell if Slack will have more value as part of a larger company, compared to being by itself. Acquisition typically makes it easier to integrate into that company's offerings, at the expense of making it harder to maintain all of the independent integrations that were in Slack's interest when it was independent. It makes a lot of sense for Amazon to offer some kind of managed corporate communications platform to customers who are already heavily invested in AWS, but in the long term, it would probably hurt Slack's core integration strengths. What would probably be best for Slack is to build out an on-premises enterprise version, which could then be deployed on your cloud of choice. It gets Slack most of the benefits of acquisition by a cloud provider, without the downsides.
jpalomaki 9y ago
I love Slack, but there's always the question that is it worth the monthly fees and related overhead. So far the answer is yes, but for example Microsoft is already trying to push competing offering via Office 365. If Google and Amazon follow the same path with their groupware offerings, this may hurt Slack sales. And it's not just about the price and quality of product, but also about the convenience. Do you deal with one vendor or do you have 10 different SaaS subscriptions you need to deal with. One interesting option would be for Slack and Dropbox to merge. Don't know if this kind of deal could ever work out financially, but I think the combination would be quite interesting.
jk563 9y ago
I mean, I'd definitely take the money.
adventured 9y ago
> He no longer controls Oculus, and hence can't impact the world That makes absolutely no sense. Palmer Luckey has a vast fortune thanks to selling, he can easily impact the world depending on what he chooses to do with it.
nsommer 9y ago
Concerning Snap, you are right in terms of market cap that generated evan spiegel billions. But don't mix that with profits. How could Snapchat possibly make money? They never did, and they probably never will (they even acknowledge this in their IPO filing).
giancarlostoro 9y ago
Unlike Snapchat though people pay for Slack. Not sure how people pay Snapchat directly in comparison. A fun plot twist would be if Snap bought out Slack and became a communications company of sorts. Would be nice to see something different. Also waiting on Apple to buy out other companies to join their fold and become a little more cross-platform.

ido 9y ago

$9B is nice. But are you sure you wouldn't rather affect the world? Absolutely. Get real, they're not curing cancer they're providing a (great) chat service for businesses and organizations.

sillysaurus3 9y ago
So is Snapchat.
- freyir 9y ago
  If only we could all aspire to affect the world like Snapchat.

IanCal 9y ago

> $9B is nice. But are you sure you wouldn't rather affect the world? That's a false dichotomy isn't it? You could have a large impact on the world with that sort of money.

sillysaurus3 9y ago
You could be right. But there are only so many ways to convert $B into impact. The most straightforward way is to become an investor, but investing isn't so easy. And while it's true investors are one of the most important engines driving our economy, investors aren't makers. The CEO is the one with the power to get the whole company working toward a shared goal, set by the CEO. And when your company is as ubiquitous as Slack, you have the best people fighting to work for you. That's a degree of influence you might not get back, even with billions. From another angle, consider Steve Jobs. He had the money; he could've done anything. But being CEO of Apple was worth more.
- Fomite 9y ago
  I mean, $9 billion could fund 4800 research labs at R01 levels for 5 years, even with a fairly generous 50% indirect cost rate. Pretty sure that could have some impact.

blazespin 9y ago

The problem with selling isn't the money, the problem is what do you do with the rest of your life. If you sell, that is most likely your peak. This is what zuck and the Snapchat guy was thinking. If they sell, that's it, they are done. Life is over as they know it.

simonrobb 9y ago
I'm sure most entrepreneur types run off the "thrill of the chase", and a big exit would momentarily dilute the initial mission. But you are waayyy overstating that effect. You've suddenly got a massive amount of capital to execute on the things you've been dreaming up along the way but have never been able to do before. Zuck sure had a company of thousands of employees to look after. And even if your mission was always just to exit... get a new vision. Do I really need to invoke Elon and his first acquisitions here?
- blazespin 9y ago
  Bill Gates had to go, he was dragging MSFT down after the court case. Besides, he'd being doing it a looong time. He probably already hit Peak Bill and he knew it. Elon is an outlier of grand proportions.
nathan_f77 9y ago
Your comment makes very little sense to me. One obvious counter-example is Bill Gates, who left Microsoft and went on to do much more important work with the Bill & Melinda Gates foundation. I'm also sure that Mark Zuckerberg has plenty of things to do with the Chan Zuckerberg Initiative. I don't know anything about Evan Spiegel, but I just read about the Snap Foundation - https://www.engadget.com/2017/02/02/snap-inc-snap-foundation-ipo/ https://www.engadget.com/2017/02/02/snap-inc-snap-foundation... I just saw simonrobb's comment, and of course the best example is Elon Musk. That's how you sell a company and do something with the rest of your life.

InclinedPlane 9y ago

Yeah, so, you think you can affect the world more through slack or through $9 billion on your own? If you have even a few hundred million dollars to your name, even a few million really, you can work on whatever project you want on your own. If you have more money you can even work on things for years without having to worry about making a profit. And that's hugely powerful. As much as I hate the trend of companies gobbling up other companies, slack is a bad example here. Almost certainly everyone involved would be better off if a sale happened.

kayoone 9y ago

I don't know, to me $9B seems like a lot of money for a glorified IRC client built on web tech. Sure, you don't pay for the tech, but in the end you can do a lot with that kind of money. Elon Musk sold his first two businesses to get the funds to start what he really wanted to do. We don't know where Oculus would be without FB, i would argue they are better off because they are creating a new market and are in a capital intensive business. The VR market is still slow overall. Without FB, they could have already run out of breath or cut corners on the product.

simonrobb 9y ago
A glorified IRC client built on web tech... that everybody uses. Tech is only one small part of a business. Slack provides real value to millions of people, $9B certainly doesn't seem an unreasonable valuation to me.
- hueving 9y ago
  >that everybody uses You're spending too much time in the tech industry. Even if you double the daily active users from a year ago, that doesn't even reach 5% of the US population.
  - derimagia 9y ago
    5% of the US population seems very large to me if that's right... They make a lot more money than something like facebook per user - even though we don't know how many organizations are paid vs free.
  - simonrobb 9y ago
    That's still a lot of users. By that logic most B2C companies (e.g.: Atlassian) shouldn't have a big valuation either. My point is that Slack has taken technology which has been around a long time, made it fun and usable so people use it, and most importantly they've got people to pay for it. GP's comment was dismissing Slack purely because of the tech.

Grue3 9y ago

Except Slack doesn't have any new ideas behind it. It's just another chat app. And just like other popular chat apps of yesteryear, it's a fad that will pass.

noway421 9y ago
IRC was just a chat app, yet even though it didn't age nicely, was still seeing massive usage for professional communication up until lately. Is it only because of legacy? Hardly, new blood was pouring in constantly, the only hit it took was skype. Slack is simply disrupting this area by offering product which is up to date and doesn't need bouncer running (+ hundreds of other useful nice to have features).
paulcole 9y ago
> Slack doesn't have any new ideas behind it. It's just another chat app. Billions of dollars can be made on old ideas positioned properly.

solatic 9y ago

It makes sense to sell if Slack will have more value as part of a larger company, compared to being by itself. Acquisition typically makes it easier to integrate into that company's offerings, at the expense of making it harder to maintain all of the independent integrations that were in Slack's interest when it was independent. It makes a lot of sense for Amazon to offer some kind of managed corporate communications platform to customers who are already heavily invested in AWS, but in the long term, it would probably hurt Slack's core integration strengths. What would probably be best for Slack is to build out an on-premises enterprise version, which could then be deployed on your cloud of choice. It gets Slack most of the benefits of acquisition by a cloud provider, without the downsides.

jpalomaki 9y ago

I love Slack, but there's always the question that is it worth the monthly fees and related overhead. So far the answer is yes, but for example Microsoft is already trying to push competing offering via Office 365. If Google and Amazon follow the same path with their groupware offerings, this may hurt Slack sales. And it's not just about the price and quality of product, but also about the convenience. Do you deal with one vendor or do you have 10 different SaaS subscriptions you need to deal with. One interesting option would be for Slack and Dropbox to merge. Don't know if this kind of deal could ever work out financially, but I think the combination would be quite interesting.

jk563 9y ago

I mean, I'd definitely take the money.

adventured 9y ago

> He no longer controls Oculus, and hence can't impact the world That makes absolutely no sense. Palmer Luckey has a vast fortune thanks to selling, he can easily impact the world depending on what he chooses to do with it.

nsommer 9y ago

Concerning Snap, you are right in terms of market cap that generated evan spiegel billions. But don't mix that with profits. How could Snapchat possibly make money? They never did, and they probably never will (they even acknowledge this in their IPO filing).

giancarlostoro 9y ago

Unlike Snapchat though people pay for Slack. Not sure how people pay Snapchat directly in comparison. A fun plot twist would be if Snap bought out Slack and became a communications company of sorts. Would be nice to see something different. Also waiting on Apple to buy out other companies to join their fold and become a little more cross-platform.