6 ms·

How come Slack is worth $7.1B? I can't imagine they produce that much value or have a high enough revenue to warrant this valuation.

everyone 8y ago
Have you been living in a cave for the last decade? This is modern business, whatever is hot and gets a lot of users, gets a ridiculously unrealistically high valuation. Also, you never need to be profitable, as long us ure hot you can just keep doing more rounds of funding.
- amelius 8y ago
  Sounds an awful lot like a Ponzi scheme to me. From Wikipedia: > A Ponzi scheme is a form of fraud in which a purported businessman lures investors and pays profits to earlier investors using funds obtained from newer investors. Investors may be led to believe that the profits are coming from product sales, or other means, and remain unaware that other investors are the source of apparent profits. A Ponzi scheme is able to maintain the illusion of a sustainable business as long as most of the investors do not demand full repayment and are willing to believe in the non-existent assets that they are purported to own, and there continues to be new investors willing to contribute new funds. https://en.wikipedia.org/wiki/Ponzi_scheme https://en.wikipedia.org/wiki/Ponzi_scheme
  - phailhaus 8y ago
    No. Businesses whose success depend on network effects are not automatically Ponzi schemes.
    - amelius 8y ago
      Who said anything about network effects?
      - phailhaus 8y ago
        The comment you replied to is (snarkily) saying that as long as a company is "hot" (i.e., it has a lot of users) then investors will keep coming. That's totally reasonable; a product doing well that grows as a function of the number of users using it is a promising investment (especially when those users are paying!). That's not a Ponzi scheme.
brazzledazzle 8y ago
Tool integration and automation with Slack are things that people have come to depend on. There’s not much unique to Slack in that regard but they have the momentum and many products will either be Slack-first or be integrated exclusively with Slack. There’s a lot more out there in terms of APIs these days so people can, and do, develop their own integrations for other chat platforms but that’s not quite the same. I don’t know about 7 billion but based on how technical and non-technical teams alike use and depend on Slack I can easily see 1 Billion or more. But 1 and 7 billion are really far apart. If I were a Slack employee I’d be thinking about my stock. If it sold for 2 billion would I be shit out of luck? Legitimately asking, I don’t know how stock preference works when the VC investment comes after stock has been issued to an employee.
IshKebab 8y ago
Because lots of companies pay for it.
Cthulhu_ 8y ago
Their base product is bringing in $5/month/user, and they'll often get dozens to hundreds to thousands of users for each company that joins, whose employees are usually already using the free version of slack, as a sort of grassroots movement within companies. It's been the primary means of asynchronous communication for the last ~5 customers I've worked at, and I've been in slack channels of 30 to 300 users - in total, an easy 500 paid accounts, and that's just from my network. Anyway yeah it's a risky investment and a precarious valuation, there is plenty of competition out there right now, yet somehow nothing seems to be able to come out as better than Slack. Maybe if a party actually spent those millions in investment funds to create good non-Electron apps.
- swozey 8y ago
  One of my Slack channels (not servers, no idea how many are on this workspace) has, no exaggeration, ~45k users. It's a hosted FOSS project so they're not making money on those users, though. I'm curious what the largest Slack instance is if it's not k8s.
- deleted 8y ago
  [deleted]
wott 8y ago
They have a deal with Corsair and Micron.
CaptSpify 8y ago
Because their value isn't from the product itself. It's from being able to dig into the data being transferred with the product.

everyone 8y ago

Have you been living in a cave for the last decade? This is modern business, whatever is hot and gets a lot of users, gets a ridiculously unrealistically high valuation. Also, you never need to be profitable, as long us ure hot you can just keep doing more rounds of funding.

amelius 8y ago
Sounds an awful lot like a Ponzi scheme to me. From Wikipedia: > A Ponzi scheme is a form of fraud in which a purported businessman lures investors and pays profits to earlier investors using funds obtained from newer investors. Investors may be led to believe that the profits are coming from product sales, or other means, and remain unaware that other investors are the source of apparent profits. A Ponzi scheme is able to maintain the illusion of a sustainable business as long as most of the investors do not demand full repayment and are willing to believe in the non-existent assets that they are purported to own, and there continues to be new investors willing to contribute new funds. https://en.wikipedia.org/wiki/Ponzi_scheme https://en.wikipedia.org/wiki/Ponzi_scheme
- phailhaus 8y ago
  No. Businesses whose success depend on network effects are not automatically Ponzi schemes.
  - amelius 8y ago
    Who said anything about network effects?
    - phailhaus 8y ago
      The comment you replied to is (snarkily) saying that as long as a company is "hot" (i.e., it has a lot of users) then investors will keep coming. That's totally reasonable; a product doing well that grows as a function of the number of users using it is a promising investment (especially when those users are paying!). That's not a Ponzi scheme.

brazzledazzle 8y ago

Tool integration and automation with Slack are things that people have come to depend on. There’s not much unique to Slack in that regard but they have the momentum and many products will either be Slack-first or be integrated exclusively with Slack. There’s a lot more out there in terms of APIs these days so people can, and do, develop their own integrations for other chat platforms but that’s not quite the same. I don’t know about 7 billion but based on how technical and non-technical teams alike use and depend on Slack I can easily see 1 Billion or more. But 1 and 7 billion are really far apart. If I were a Slack employee I’d be thinking about my stock. If it sold for 2 billion would I be shit out of luck? Legitimately asking, I don’t know how stock preference works when the VC investment comes after stock has been issued to an employee.

IshKebab 8y ago

Because lots of companies pay for it.

Cthulhu_ 8y ago

Their base product is bringing in $5/month/user, and they'll often get dozens to hundreds to thousands of users for each company that joins, whose employees are usually already using the free version of slack, as a sort of grassroots movement within companies. It's been the primary means of asynchronous communication for the last ~5 customers I've worked at, and I've been in slack channels of 30 to 300 users - in total, an easy 500 paid accounts, and that's just from my network. Anyway yeah it's a risky investment and a precarious valuation, there is plenty of competition out there right now, yet somehow nothing seems to be able to come out as better than Slack. Maybe if a party actually spent those millions in investment funds to create good non-Electron apps.

swozey 8y ago
One of my Slack channels (not servers, no idea how many are on this workspace) has, no exaggeration, ~45k users. It's a hosted FOSS project so they're not making money on those users, though. I'm curious what the largest Slack instance is if it's not k8s.
deleted 8y ago
[deleted]

wott 8y ago

They have a deal with Corsair and Micron.

CaptSpify 8y ago

Because their value isn't from the product itself. It's from being able to dig into the data being transferred with the product.