Slack’s direct listing is a hit
As with Slack’s approach to enterprise software, its stock market debut was unconventional, unexpected, and delightful for those in the knowRead full story
interesting data point to show the trend around chat and video apps.
“More than two-thirds of Office 365 customers, for example, had duplicative apps in chat and video, according to Okta. About 28% were using Slack, and 24% were using Zoom for video conferencing. Okta expects this percentage to grow as teams demand the best software rather than bundled offerings.”
Slacks’s successful direct listing is terrible for investment banking stocks that miss out on the fat 6% fees on IPOs. Goldman Sachs generates the same income today as it did in 2007 because so many of its business lines are shrinking.
What I like most about their direct listing is it is absolutely authentic to Slack’s mission around democratizing the enterprise.
Yes, Slack has a great product, but a core part of their innovation is that they allow individual team members to choose their own communication platform and purchase with their own credit card, instead of using what their IT department insists upon.
The direct listing is an extension of that - bypassing the traditional gatekeepers (investment banks) going straight to individual investors.
If slack is worth $20B, then Gmail would be what? $100B? Or maybe call it 1/2 of Facebook and say $250B?
Okta's statements are self-serving and misguided. In enterprise environments it is entirely possible that the company has an Office365 subscription but individuals sign up for slack or zoom given the freemium/trial models they employ. It doesn't necessarily mean these are pervasive throughout the company.
Ultimately users want seamless integration and the cost of selling into corporate customers is about to take a big chunk out of Slacks cash... Just ask Marc Benioff...
Congratulation to the team at slack as it begins
While I'm definitely bullish on Slack in general, I feel like they'll come down hard from $40 as existing shareholders offload. Even at $26 that valuation was around 25 times revenue. At $40 they're trading like Zoom (which is profitable)
That's a great start. Stepping outside the normal routine worked.
While Slack has definitely beat the trading "death knell" of the Street on doing the direct listing, it still needs to demonstrate that it can execute itself out of its plateauing revenue trend that is hard pressed against a worsening trend of operating losses. Slack reported $139 million in losses in 2018 and $38.4 million during just the first quarter of 2019. Not only are expenses increasing, its net loss of the first quarter was 28% of revenue. Slack also stated unequivocally “We have a history
While Slack has definitely beat the trading "death knell" of the Street on doing the direct listing, it still needs to demonstrate that it can execute itself out of its plateauing revenue trend that is hard pressed against a worsening trend of operating losses. Slack reported $139 million in losses in 2018 and $38.4 million during just the first quarter of 2019. Not only are expenses increasing, its net loss of the first quarter was 28% of revenue. Slack also stated unequivocally “We have a history of net losses, we anticipate increasing operating expenses in the future, and we may not be able to achieve and, if achieved, maintain profitability.”
Yes, Slack stock is on Fire 🔥 so let’s monitor the volatility...
Good start for Slack.
Finally an unqualified business success
A community of leaders, subject matter experts, and curious minds bringing nuance back to how we talk about the news.
No content overload: our editors will curate the most notable and discussion-worthy pieces for you every day.
Don’t just read the story, tell it: contribute your ideas and experience to the dialogue.