11 ms·

Umm. What endgame? They get away with charging $6.66 / month / user for the most popular organizational chat application in existence.

scientistem 9y ago
After email, of course.
greenyoda 9y ago
They can only charge $6.66/month until a competitor comes along that creates a better and/or cheaper product. Unlike Facebook, which has a lot of inertia because all your friends may be on it and you can't get them to switch, a company can easily switch all its employees to a different corporate chat app: the CEO orders it, and it's done. Also, that $5B valuation is based on significant expectations of future growth. Their customers up to now are probably the low-hanging fruit of the market - tech companies whose culture embraces tools like Slack. To grow beyond that (e.g., to Fortune 500 companies), they may need to offer a significantly different product that's sold in a very different way. Or, those companies may not want such a product at all.
- simonh 9y ago
  Corporate chat apps are much stickier than that. After a while you integrate them into other services, build workflows on them and they become part of how your business functions. The specifics of what they integrate with and how determine what workflows you can build and how they work, which means these services are not fungible. Changing over can be very painful and costly.
- mason55 9y ago
  Slack has raised insane amounts of money at really good terms just because they can. The funding world is insane right now and they are taking advantage. They can easily do what Facebook or Oracle did and just buy up any competitions with their huge warchest.
  - deleted 9y ago
    [deleted]
  - greenyoda 9y ago
    You can't always buy out your competitors. Facebook itself is an example of this, having turned down numerous acquisition offers (including one from its competitor MySpace, and then one from the company that bought MySpace): http://www.businessinsider.com/all-the-companies-that-ever-tried-to-buy-facebook-2010-5 http://www.businessinsider.com/all-the-companies-that-ever-t...

scientistem 9y ago

After email, of course.

greenyoda 9y ago

They can only charge $6.66/month until a competitor comes along that creates a better and/or cheaper product. Unlike Facebook, which has a lot of inertia because all your friends may be on it and you can't get them to switch, a company can easily switch all its employees to a different corporate chat app: the CEO orders it, and it's done. Also, that $5B valuation is based on significant expectations of future growth. Their customers up to now are probably the low-hanging fruit of the market - tech companies whose culture embraces tools like Slack. To grow beyond that (e.g., to Fortune 500 companies), they may need to offer a significantly different product that's sold in a very different way. Or, those companies may not want such a product at all.

simonh 9y ago
Corporate chat apps are much stickier than that. After a while you integrate them into other services, build workflows on them and they become part of how your business functions. The specifics of what they integrate with and how determine what workflows you can build and how they work, which means these services are not fungible. Changing over can be very painful and costly.
mason55 9y ago
Slack has raised insane amounts of money at really good terms just because they can. The funding world is insane right now and they are taking advantage. They can easily do what Facebook or Oracle did and just buy up any competitions with their huge warchest.
- deleted 9y ago
  [deleted]
- greenyoda 9y ago
  You can't always buy out your competitors. Facebook itself is an example of this, having turned down numerous acquisition offers (including one from its competitor MySpace, and then one from the company that bought MySpace): http://www.businessinsider.com/all-the-companies-that-ever-tried-to-buy-facebook-2010-5 http://www.businessinsider.com/all-the-companies-that-ever-t...