Slack is headquartered in Silicon Valley but was born in Vancouver, where it boasts a beautiful multi-floor downtown office.
Like any good startup, Slack has an fascinating history. And as is so often the case, something came before it. In this case, a few things.
Our tale begins in 2002—over a decade before Slack would come to be. For this entrepreneur took the scenic route.
2002 – 2007: First Flickr of Success
Stewart Butterfield’s first company, Ludicorp, was created in 2002 to build a game.
Called Game Neverending, the game had failed to gain meaningful traction by 2004. But the game’s embedded photo-uploading tool was popular among players.
As the game itself crumbled around Butterfield, another project by the name of Flickr rose from its ashes. Just one year later, that popular image hosting platform was sold to Yahoo for well over $20 million.
2008 – 2010: Butterfield Launches Tiny Speck
Butterfield left Yahoo in 2008. He penned a quirky resignation letter that described tin as “the most useful of metals” and Yahoo as a firm involved in “grain processing, lighting, and salty snacks.” Many searched for a deeper meaning, but Butterfield’s explanation was simpler and truer to his nature: he was an avid reader of satirical news site The Onion.
In 2009, Butterfield tried again to make a game. His new venture, Tiny Speck, starting developing a new game. This game was called Glitch. Not much information was given about the game at the time, but it was clear the entrepreneur had higher ambitions than ever before.
Tiny Speck raised $5 Million in Series A funding from Accel Partners and Andreessen Horowitz in 2010. Glitch at the time was not yet available to play. It was vaguely described as a web-based, massively-multiplayer game. Glitch was expected to launch by the end of the year. It did not.
2011 – 2013: Glitching Out
The Vancouver-based Tiny Speck raised another $11 million in the spring of 2011, again from Accel and Andreessen Horowitz. The startup also launched an invite-based beta test of Glitch.
Finally, toward the end of the year, Glitch launched. The side-scrolling “cooperative exercise in world building” was expected to break even as a business model at 100,000 players.
And yet just two months after launching, Butterfield pulled the game, returning it to beta. Tiny Speck wanted “to make the early game reveal itself more easily to new players” while also adding more robust creative tools that could be used “to change the world in more tangible ways.”
However, three years into Tiny Speck, it became evident that Glitch was hopeless. “Glitch has not attracted an audience large enough to sustain itself,” an announcement in the fall of 2012 revealed. Some suspected the game’s reliance on Flash—a dying technology even back then—was a driving force behind its downfall. Others criticzed the game mechanics.
Butterfield went to Twitter to inform the world that while Glitch was dead, Tiny Speck was not.
2014 – 2017: Fastest of All Time
An internal communications tool developed to connect Speck’s Canadian and US offices had proved invaluable, which sparked the birth of Slack. Once again something amazing rose of the ashes of a failed game.
In 2014, Slack was announced: “Imagine all your team communication in one place, instantly searchable, available wherever you go,” the startup said. “That’s Slack.”
According to Butterfield, “Slack” is an acronym standing for “Searchable Log of All Conversation and Knowledge.”
The collaboration platform targeted at enterprises quickly raised more than $42 million from The Social + Capital Partnership, Accel Partners, and Andreessen Horowitz after gaining several thousand new users monthly. By the end of the year, the company had raised a clossoal $120 million round, valuing the startup at more than a billion dollars—making it the fastest-growing startup ever, anywhere at the time.
“Never before have we witnessed so much user love for an enterprise software platform,” said John Doerr, general partner of KPCB.
“The world is in the very early stages of a 100-year shift in how people communicate, and we’re determined to push the boundaries,” said Butterfield.
By 2015, Slack was adding over $1 million in annual recurring revenue each month at current rates. It was a company whose growth “had no parallel.” As of February, Slack boasted 500,000 daily active users across 60,000 teams (including 135,000 paid accounts).
Tthat summer, Slack was worth nearly $3 billion. Slack had reached a valuation of $1 billion 1.25 years after launching, ahead of Groupon (1.46 years) and Akamai Technologies (1.58 years). Slack had then reached a valuation of $2 billion just 1.71 years after launching, ahead of companies like Xiaomi Technology (2.24 years) and Instacart (2.58 years).
In 2016, Slack raised a quarter-million dollars. Valued at almost $4 billion, the company revamped its Vancouver offices.
By 2017, Slack was considered more of a Silicon Valley darling than Vancouver tech anchor. Another funding round—bringing total capital raises to nearly $1 billion—bumped its valuation north of $5 billion.
2018 – 2022: The Sale’s Force
Slack’s momentum was maintained through 2018 so much so that in early 2019 the company announced its intention to go public. The company revealed sizeable revenue but a lack of profitability.
That very year, Slack entered the market as a direct listing, and its shares surged, soaring its valuation.
In 2020, Slack acquired corporate directory startup Rimeto.
In late 2021, San Francisco neighbour Salesforce announced a commitment to enterprise social by acquiring Slack in a $28 billion mega-deal.
“This is a match made in heaven,” Salesforce CEO Marc Benioff gushed at the time. “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.”
“Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going,” Butterfield stated following the transaction.
From the doe-eyed days of a Flash-based Glitch to the Silicon Valley ways of “reduced complexity, increased power and flexibility, and ultimately a greater degree of alignment and organizational agility,” Butterfield has evolved from quirky entrepreneur to seasoned executive.
Let’s see where he and Benioff take Slack next.
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