Remember way back in June 2019, when we posed the question: “What if Salesforce acquired Slack?”
Well, now we could be about to get an answer.
Slack stood out as one of the most valuable competitors in the collaboration landscape in 2019, battling with competitors like Microsoft Teams and Cisco Webex for their share of the market.
When I started visualising the Salesforce/Slack partnership in 2019, Salesforce was making massive changes to its ecosystem, investing in a lot of important strategic acquisitions. At the same time, Salesforce and Slack also had a strong partnership going at that point – something that has continued to grow throughout 2020.
Now, the integration of Slack and Salesforce seems more likely than ever, after reports revealed that talks were already underway on the 25th of November.
Why Would Salesforce Buy Slack?
As of 2020, the overall value of Slack is estimated at around $17 billion – a drop from their $23 billion value in 2019. Though Slack, like many collaboration tools right now, has become a valuable tool for many work-from-home companies in 2020, it hasn’t had the same astronomical growth as companies like Zoom and Microsoft.
This could have something to do with the fact that both Microsoft and Zoom offer full UCaaS solutions for companies, featuring video, voice, and messaging. On the other hand, Slack is more about messaging than anything else. Unless Slack plans on expanding its functionality become more of a UCaaS competitor, an acquisition is a likely step forward.
So, what makes Salesforce the perfect buyer? Well, I originally predicted that Salesforce would purchase Slack in 2019 because Slack changed its ticker on the stock exchange to WORK. As you may already know, Salesforce owns the Work.com domain. Plus, Salesforce is rapidly expanding its footprint in the cloud environment. The purchase of Slack would make the company a serious contender among the likes of Microsoft Teams and Cisco Webex.
Thoughts on the Slack Acquisition
If Salesforce does go ahead with the purchase of Slack, it will mark one of the biggest software deals in history, on par with the $27 billion dollar purchase of LinkedIn by Microsoft in 2016. Already, Slack’s share prices are skyrocketing as a result of the rumours. Prices increased by up to 32% after the Wall Street Journal reported on the possible sale.
Principal Analyst of workplace transformation for CCS Insight, Angela Ashenden, told us that that the acquisition would be an exciting move for both companies if it goes through. Salesforce has been investing in initiatives that help it to expand its footprint with enterprise organisations, but its current application portfolio doesn’t reach far beyond sales and marketing.
Despite this, Salesforce has actually been looking at collaboration as an opportunity for some time now – ever since it launched Chatter in 2010. The acquisition of Quip in 2016 was another step in the right direction, but the purchase of Slack would be a true gamechanger.
Since Slack’s growth has been trending downwards over the last 18 months or so, now is the perfect time for the company to consider a sale. There’s more competition out there than ever from Microsoft and emerging companies, and Slack may not be able to win the market on its own. The combination of Slack and Salesforce could be just what the market needs to create another true Microsoft Teams competitor for the years ahead.
Of course, there’s no guarantee that the two companies will come to an agreement. Plus, we don’t know what that acquisition might mean in the long-term. For now, however, we’ll be keeping a closer eye on both Slack and Salesforce.
