Slack has what it takes to succeed in the market
Following Zoom’s incredibly successful entry into the public trading market, Slack – the world’s best-known collaboration tool, has now completed its own IPO. Slack rose to fame as the first official collaboration app to change the way that we work and communicate. It’s no surprise that the company entered the market with such vigour.
Slack set their entry price at $26 per share, but the prices rose by 60% at the start of trading, before gradually easing back to around $36 per share by the end of the day during the company’s debut. The Slack team chose a direct listing on the stock market and refused the option to use traditional advisers and underwriters for the management of its pricing.
The decision to embrace a direct listing opened the door to substantial potential price swings for the organisation, which is sure to leave traders wondering where to get involved.
Slack’s sudden increase in share prices means that the business is now valued at around $25 billion.
It’s easy to see why there’s such a hefty price tag on one of the world’s most widely-adopted collaboration tools. After all, Slack is the go-to option for free instant messaging in most workplaces, and its premium option has been embraced by countless corporations, including Ford and HSBC. According to Slack Founder, Stewart Butterfield, the team collaboration tool was designed to revolutionise corporate communication – and that’s precisely what it’s doing.
Over the years, Slack has become increasingly popular, earning the attention of countless organisations. Although the business has never made a profit, its revenue rose by 80% in 2018, to $400 million. Despite a lack of profit so far, the name “Slack” has become synonymous with digital collaboration in the workforce. Businesses like the BBC have transformed their entire workforce using Slack’s strategies for instant messaging and communication, combined with integrated tools and bots.
The BBC found that by making Slack channels a part of their daily workflow, they could reduce the confusion and disruption in their teams and ensure true collaboration.
So, why is Slack such a popular app?
The most obvious reason is that it excels at user experience.
Since its launch in 2013, Slack exploded into the business market, emerging as one of the most popular and fastest-growing apps of all time. The software’s success wasn’t just because of its unique approach to business communications.
People discovered that Slack could genuinely improve productivity, transforming the internal communication landscape from a tangled mess of silos into a unified and easy-to-manage environment.
Rather than just providing companies with yet another set of tools to learn and implement, Slack built off the communication experiences that we already had in the consumer world. That meant it could bring us something fun and easy. As our publisher, Rob Scott said:
“If something is enjoyable, we learn it fast, adopt it, and it makes us smile. If technology is going to continue helping us be more productive, making us better team players and happier serving our customers, then it needs to start with the fun factor before anything else”
Slack has certainly remembered to focus on the “fun factor.” As Stewart Butterfield said himself, while it might have been challenging to bring something as new and unique as Slack into the market, once people started using it, “They rarely stopped.”
While some technology companies have floundered with their IPO entries, it seems unlikely that Slack will experience the same results. As the fastest growing business app in the world, Slack is hugely compelling. Its parabolic growth levels have always presented the business as something worth getting behind.
Slack didn’t just bring new tech to the market; it focused on creating a way for people’s working lives to be simpler and more productive. That commitment to user experience is what makes the app so successful today.
The CEO of Dialpad, Craig Walker, said: “Zoom’s IPO and Slack’s direct listing are realisations that workplaces are evolving, and workers are changing — from what they value to even where they do their jobs.”
“Work is becoming more remote, more dynamic, and the age of a fixed workplace is officially gone. So, the tools we use to do our jobs are getting smarter, too”
“In Slack’s case, it boils down to user experience: even in the age of consumerised IT, enterprise tools are so often complicated and hidden in a black box. Slack is nothing like this; it’s easy to use and, importantly, actually fun. They’ve worked pieces of how we communicate outside of work, like GIFs and humour, into the way we now operate as teams. And if Zoom’s IPO in April is any indication, team collaboration companies will be market movers in 2019. Slack’s direct listing is an important one to watch.”