Putting A Price On Chat: Slack Is Going Public At $16 Billion Value
Slack Technologies is going public Thursday. In the fiscal year that ended Jan. 31, the company nearly doubled its revenues, to about $400 million. But it had a net loss of nearly $139 million.
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In just five years, Slack has grown to have more than 10 million users and has become a verb in the process. “I’ll Slack you” is shorthand for sending a message via the workplace chat platform.
On Thursday, the company will take that popularity to the New York Stock Exchange, where its shares will be publicly listed for the first time.
At a starting price of $26 per share set Wednesday, Slack Technologies would be worth about $16 billion.
Instead of having a conventional initial public offering, Slack will enter into the market as a direct listing, which means the shares will simply be listed on the New York Stock Exchange. Most firms that pass on an IPO are widely known companies that are in good financial shape.
As Fortune explains:
“Unlike an ordinary IPO, a direct listing means the company doesn’t issue any new shares and doesn’t raise additional capital. It’s primarily a way for company insiders to sell some of their holdings to investors, while bypassing the formidable fees and requirements of using an underwriter.”
Spotify, the music-streaming company, went public as a direct listing last year.
In the fiscal year that ended Jan. 31, Slack nearly doubled its revenues, to about $400 million. But it had a net loss of nearly $139 million.
As it continues to grow, Slack’s biggest hurdle will be proving to its users that it’s more than just a chat application.
Forrester analyst Michael Facemire says it’s hard for people to understand why the platform is more useful than other chat applications without trying it for themselves. With Microsoft Teams as a major competitor, Slack is facing pressure to distinguish itself in the market.
“If the world were only composed of technologists and developers and Silicon Valley illuminati, then Slack would be far, far ahead,” Facemire says. “There is a large percentage of the population that isn’t that. This is where tools like Microsoft Teams do just as well.”
Slack’s decision to begin trading as a direct listing follows a wobbly start for Uber, which has had one of the most anticipated initial public offerings in the tech sector. Last month, the ride-hailing company reported a $1 billion loss in its first public financial report, just weeks after its IPO.
Slack, which was publicly released in 2014, stemmed from an internal chat platform created by CEO Stewart Butterfield during a failed video game development. The software was created to avoid the confusion of email and, per its acronym, provide a “Searchable Log of All Conversation and Knowledge” for the team, which had people working all over North America.
Butterfield co-founded Flickr, which he sold to Yahoo for around $25 million in 2005. But despite interest from Amazon, Google and Microsoft in 2017, he held on to Slack, which continued to compete with emerging chat platforms.
U.S. Women To Take On Their Biggest Opponent Yet With Game Against Sweden
The biggest test for the U.S. Women’s National Team at the Women’s World Cup comes Thursday when the U.S. takes on Sweden. It’s been a busy week with many notable performances.
MARY LOUISE KELLY, HOST:
The U.S. women’s soccer team is back in action tomorrow at the Women’s World Cup in France. The team is taking on its biggest opponent yet, Sweden – a key match for the U.S. And there’s plenty else going on at the tournament.
Here to catch us up is NPR’s Laurel Wamsley. She’s been following the U.S. team in France, and she joins us on the line from there now. Hey there.
LAUREL WAMSLEY, BYLINE: Hi there.
KELLY: Hi. So I want to get to the U.S. women in just a second, but I gather it’s a player from Brazil who’s got everybody buzzing today.
WAMSLEY: Absolutely. That’s Marta. She’s the Brazilian superstar. You probably heard about her. And she scored on a penalty last night in their game – in Brazil’s game against Italy. And with that goal, she set the all-time scoring record for most World Cup goals, men or women, with 17.
And in a press conference after the match, Marta talked about how she’s dedicating that goal to all the girls who believe in their dreams. And she said that the Brazilian team can be an example in their country and also to South America that women can do every kind of role. But she also pointed out that given the huge audience for this event, that in a way, each team is doing that in their own home country. And because of Marta’s goal, Brazil will now go through to the knockout round, which had been in question.
KELLY: OK, all right, so the U.S. team – we said they take on Sweden. That’s going to be tomorrow. What are the stakes here?
WAMSLEY: Well, this is a matchup with a lot of history. So the U.S. used to have a Swedish coach, Pia Sundhage, and she led them to Olympic gold in both 2008 and 2012. And then right after the 2012 Olympics, she left the U.S. squad and went to coach Sweden. And then in the 2016 Olympics, Sundhage was the coach of Sweden that knocked out the U.S. team in the quarterfinals. And no U.S. women’s soccer team had ever left a major tournament that early, so it was a huge blow.
And it’s been said that the coach who took over after Sundhage, Jill Ellis, who’s the coach now, has spent a lot of time watching the tape and spending time with that and figuring out, how does this U.S. team face off against teams like Sweden that just bunker down defensively and won’t let them through?
KELLY: Wow – so quite a rivalry and, it sounds like, quite a game potentially tomorrow. This is not going to be like the opening match, where we saw the U.S. just dominate against Thailand. It was 13-nil, I think.
WAMSLEY: Yes, it was. And, no, this will be nothing like that. So people are predicting maybe 2-0, 2-1 against Sweden. This is going to be the first real test for the U.S. at this tournament, especially for the defense and for goalkeeper – new goalkeeper Alyssa Naeher. They just haven’t had much come their way so far. Here’s what coach Jill Ellis said earlier today about this game.
JILL ELLIS: This is going to be great for us because we do need to sharpen that in terms of, you know, the first two games. We haven’t had a lot of balls to deal with in behind. And Alyssa hasn’t had a lot to deal with. But, you know, I’d also sort of remind the players that we’ve played one of the most competitive schedules and for that very purpose – to have as many of those moments before we came to this big stage.
WAMSLEY: And so the thing about this game is that both U.S. and Sweden are already through. And if the U.S. were to lose to Sweden tomorrow, they would actually maybe have an easier path in this tournament because they may have to play France if they win in the quarterfinals. But that’s just not how this team plays. This team plays to win, and that’s what they’re going to go out there to do tomorrow.
KELLY: Yeah. And before I let you go, just a quick sense of the scene, because you’ve been all over – you’ve been in Paris. You’ve been in Reims. Where are you exactly today?
WAMSLEY: Right now I’m in Le Havre a couple miles from where the team is going to play tomorrow. And…
KELLY: And is everybody just totally caught up in this?
WAMSLEY: Yes and no. In Paris, you almost wouldn’t know it’s happening. There’s almost no signage, no indication that it’s happening. You see – still see more signs for the men’s football games than the women’s. But here in these smaller towns where the U.S. has been playing in Reims and in Le Havre, you do see them a lot more, and there is a palpable excitement here. And of course wherever the U.S. plays, the U.S. fans go. So there’s a lot of excitement.
KELLY: All righty, thank you, Laurel.
WAMSLEY: Thank you.
KELLY: NPR’s Laurel Wamsley reporting.
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