Age of Remote Working Sees Slack Sold for $27.7 Billion

Age of Remote Working Sees Slack Sold for $27.7 Billion

Business messaging platform Slack has been sold for $27.7 billion to Salesforce after a remarkable year in the new age of remote working, which has seen the value of companies like Slack and Zoom skyrocket. 

The sale of Slack, a messaging platform that has been tailored for professional use, for $27.7 billion to Salesforce was “a match made in heaven,” according to Salesforce CEO Marc Benioff. “We see in Slack a once-in-a-generation company and platform. It’s a central nervous system for so many companies,” he added. 

Slack has been a pivotal tool for organisations that moved their operations online amid the pandemic, with the age of remote working a primary driver of the $27.7 billion sale.

“Stewart and his team have built one of the most beloved platforms in enterprise software history, with an incredible ecosystem around it,” he added. “Together, Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world.” 

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Slack was created as a product specifically for video gamers to communicate, before its executive team decided to pivot to a more corporate context, where it has challenged even the biggest of competitors like Microsoft with 12 million daily users. 

It’s often touted as a more direct, and informal alternative to email communication, and has been widely adopted around the globe in a relatively short amount of time. The adoption rate exploded in 2020, whereby the COVID-19 pandemic forced a huge number of organisations to operate online.

Analysts believe that the company has a market value of $25 billion, which is closely tied to the fact that the age of remote working no doubt played a key role in Slack being sold for the $27.7 Billion figure. 

Stewart Butterfield, Slack’s co-founder has said that “Salesforce started the cloud revolution, and two decades later, we are still tapping into all the possibilities it offers to transform the way we work. The opportunity we see together is massive,” Butterfield said. 

According to a report from the BBC, “the company, which had about 12.5 million users as of late March, has had difficulty making inroads against Microsoft Teams, a similar product that the tech giant unveiled in 2016 and now has more than 100 million users.” 

Age of Remote Working Sees Slack Sold for $27.7 Billion

Slack and Microsoft have been locked in a fierce competition for the hearts and minds of businesses around the globe with their communication platforms. Slack has previously launched legal action against Microsoft for reportedly “bundling Teams into Office 365 in a way that blocks its removal by customers who may prefer Slack,” according to ABC News.

The competition has caused Slack’s share price to stagnate, which, in the lead up to the acquisition stood around $26; the same price it was listed at nearly two-years previously.

“This is a stellar exit strategy for Slack,” says Kate Leggett, a technology analyst. “Microsoft Teams is eating Slack’s lunch,” she said. 

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The BBC’s report quotes technology analyst Dan Ives and Wedbush Securities, who described it as a “now or never” acquisition on the part of Salesforce. 

“For Benioff [Salesforce CEO], this is all about Microsoft… It’s just clear Microsoft is moving further and further away from Salesforce when it comes to the cloud wars.” 

“If Salesforce wants to expand beyond its core gold mine of sales and marketing departments… this was the moment and thus represents a major shot across the bow against Microsoft.” 

Mr Ives added that “I think the pandemic’s played a massive role… The Zooms, Slacks and Microsoft Teams, that’s going to be a new part of the workforce,” he said. 

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