Slack is Now Worth More Than $20 Billion (cnn.com) 104
Five years ago, Slack officially launched out of the ashes of a failed gaming project. Now the company is worth more than $20 billion. From a report: Slack, the workplace communication tool popular in tech and media circles, began trading on the New York Stock Exchange on Thursday, making it the latest tech unicorn to race to Wall Street this year. But Slack took a more unconventional approach to going public. The company chose to list its existing shares directly on the stock exchange rather than raising money by issuing new shares to be sold to public investors. Slack opened at $38.50 a share on Thursday, a more than 50% increase from its $26 reference price -- not to be confused with an IPO price -- set on the eve of its market debut. At that price, Slack has a market value of roughly $23 billion.
Watch the excitement at WORK (Score:3, Interesting)
I think the stock is overvalued personally, but the summary should have at least included the stock ticker for Slack for informative reasons for those curious how it fares aver the next few days and weeks - WORK [google.com].
Re:Watch the excitement at WORK (Score:5, Interesting)
It's way overvalued. They pulled in $400 million last FY in revenue and posted $138 million in losses. I'm confident they are renting capacity from someone like AWS and not rolling their own datacenters so they have little in assets beyond the codebase and office supplies. I assume they also rent the office space they are in.
Valuation should be a realistic sum of assets and revenue, that includes intangible assets of course. Slack could be worth 2 or maybe 3 billion in a sane world. But there is no way its worth 20.
Re: Didn't you misspell "thousand"? (Score:2)
Open-source IRC servers and clients already exist.
Re:Watch the excitement at WORK (Score:5, Informative)
I'm confident they are renting capacity from someone like AWS and not rolling their own datacenters
That is the smart thing to do. It gives them the ability to scale quickly (in either direction), and frees them to focus on their core competencies.
I assume they also rent the office space they are in.
That is also the smart thing to do.
Valuation should be a realistic sum of assets and revenue
That is a silly way to value a growing tech company. Their value is in their future growth potential, not their office furniture.
Slack could be worth 2 or maybe 3 billion in a sane world. But there is no way its worth 20.
Since you are so much smarter than the market, you can make a fortune by shorting their stock. Be sure to come back here and post a picture of your yacht.
Re: (Score:3)
"The market can stay irrational longer than you can stay solvent." - Those closing out short positions they cannot afford to carry in 2007.
Re: Watch the excitement at WORK (Score:2)
IP, brand and market share are also assets.
There's a word for the type of company (Score:2)
It's the opposite of Top heavy. There's no end to the profits when one of these companies starts making money. You can lose a ton of money on a ton of them and if one of 'em makes good you're in the clear. All the while you write off the losses on the failed ones, sometime
Re: (Score:2)
What I mean by this is that the stock market has nothing to do with investing in a company or its technology. As such, the value of the share doesn't have anything to do with the value of the company. The share however, based on supply and demand is exciting to gamblers. It goes up more than it goes down and the volatility of the share is interesting enough to keep short traders, day traders, and other gamblers playing the game. There's money to be made
What? (Score:2)
16 billion earlier [slashdot.org], 20 billion now...
wtf?
Re: (Score:1)
Tends to imply that not many of the stakeholders are selling compared to the number of people wanting to buy.
Re: (Score:3)
The only real question when valuing Slack is how much their revenue will grow.
Re:What? (Score:4)
Still with a deficit though.
256.49M cash on hand with a net loss of 33M in April...
That revenue better grow quickly.
Re: (Score:2)
Re: (Score:2)
That revenue better grow quickly.
80% year-over-year growth.
Re: What? (Score:2)
Revenue isn't the issue. They are growing revenue fast. But they haven't laid out a path to profitability. They're already super lean, so their costs are infrastructure which scales up with users/revenue.
Re: (Score:2)
They're already super lean, so their costs are infrastructure which scales up with users/revenue.
Their infrastructure is cheap. Looking at their IPO filing, the biggest expense is sales and marketing, which really, should come as no surprise. They probably have sales teams taking expensive corporate vacations with buyers at Fortune 500 companies. Hookers don't come cheap.
Re: (Score:2)
$400 million in annual revenue with 80% year-over-year growth. This isn't the .bomb era when companies weren't making money.
The only real question when valuing Slack is how much their revenue will grow.
When it comes to talking about Slack, it is. They're not posting a profit. In a sane market (and I fully understand that we're not living in a sane market right now when it comes to tech companies), value isn't based on revenue, it's based on profit.
Re: (Score:2)
In a sane market value isn't based on revenue, it's based on profit.
No, you are wrong. Not only are you wrong, you are unwilling to reconsider your opinion, you are so stubborn in your wrongness.
Valuation is based on predicted dividends and predicted stock growth, not current profit.
Re: (Score:2)
It depends on your preferred investment theory.
Predicted dividends are predicted based on what a statistical/mathematical model shows predicted profits to be - paying dividends while posting net losses isn't a sustainable business model. It's difficult at best to predict future profits on a company that has yet to show one.
Basing value on predicted stock growth is speculation, not valuation.
Lastly, don't make assumptions or accusations about me. What I've stated is my opinion, and I'm always willing to list
Re: (Score:2)
Lastly, don't make assumptions or accusations about me.
I didn't. I made a valuation based on data available.
Re: (Score:2)
Lastly, don't make assumptions or accusations about me.
I didn't. I made a valuation based on data available.
Seems to me that you made a judgment about me being stubborn and unwilling to consider other opinions before giving me the opportunity to do so.
Re: (Score:2)
Seems to me that you made a judgment about me being stubborn and unwilling to consider other opinions
Yes.
Re: (Score:2)
16 billion earlier [slashdot.org], 20 billion now...>
Oh, just wait until another five stories are posted to Slashdot . . . then a new story will be posted that it is worth 25 billion.
20 billion for javascript powered irc (Score:5, Insightful)
Re: 20 billion for javascript powered irc (Score:1)
Of course. Software developers tend to focus on the problems they find interesting. What they find interesting is generally what they find complicated.
Generally speaking, no GOOD software developer is going to feel like reinventing IRC.
An idiot one though? Yep.
Re:20 billion for javascript powered irc (Score:5, Informative)
At least half the people with decent programming experience reading here could've done better. But why did nobody actually do it?
They did.
Beginning with the client/server team chat applications, we've got RocketChat, MatterMost, HipChat, Riot.IM, Campfire, Zulip, Matrix, Let's Chat, Flock, and ZeroChat for starters. They have varying levels of free (beer), support, self-hosting, and how open their source is.
Then we can go commercial and get Microsoft's Teams (and Skype), Google's Hangouts, Cisco's Jabber, the business version of Facebook Messenger, and the rebirth of Trillian. At a lower level of popularity, we have eXo, Dialog, SamePage, Flock, Nextcloud Talk, Ora, and Grape.
Finally, we have the mobile-first IM clients of Whatsapp, Viber, Kik, Line, Threema, Telegram, Signal, Wire, Briar, Wickr, WeChat, ICQ (still a thing, apparently), GroupMe, and Tango.
All of this ignores XMPP-compliant software (since there's about a million of those) and IRC client/server models (since there's a million of those).
So, while I can't speak for exactly how many of the people who wrote the thirty-six Slack alternatives I cited are Slashdotters, it's abundantly clear that Slack has competitors who have, in fact, done as good or better from a technical standpoint. Slack isn't popular due to the pristine efficiency of its code base.
Re:20 billion for javascript powered irc (Score:4, Interesting)
Re: (Score:1)
I think that has more to do with the business-side aspects (read: schmoozing, wheeling/dealing, playing golf, etc.) than the ones most of us here are familiar with.
Re: (Score:2)
Re: (Score:2)
Let The Fun Begin (Score:2)
Never underestimate derivitave works. (Score:5, Insightful)
Re: Never underestimate derivitave works. (Score:2, Interesting)
And a terrible one at that
Re: (Score:2)
Re: (Score:3, Insightful)
Not to mention it is a crappy IRC server, without all the benefits IRC had such as decentralization and free....
Re: (Score:2)
As a company that went from IRC to Slack - one big difference is the conversation state is actually server side.
On IRC if you close your notebook PC you get disconnected and you'll miss any conversations in any channels you were in - short of having a separate irc proxy server.
Slack has been way more useful for our field techs who need to chat with people via phones as an example - which used to be a bit of a pita with irc.
Re: (Score:1)
Worth $20,000,000,000? (Score:1)
Re: (Score:2)
It was worth $20B at some point in time, that's just how math works. What we are seeing here are lots of short term investors trying to anticipate the future. Will it swell to $25B? Then buy now, ride it up to the peak, and jump off. Is $20B the peak? Well congrats to those who got in at $16B.
I'll stick to buying lotto tickets, it's a much easier and cheaper game than playing at tech stocks.
Analysis (Score:4, Informative)
As of April 30, Slack had 645 paid customers with over $100,000 in annual recurring revenue.... $100K annual revenue
The global market for workplace collaboration is expected to hit $3.2 billion by 2021, according to research firm IDC... total
Conclusion: $20B?!?! bwahahahahahahaha
No, it isn’t worth 20 billion.
Re: (Score:2)
Re:Analysis (Score:4, Informative)
https://www.reuters.com/articl... [reuters.com]
Re: (Score:3, Informative)
645 major paying customers. 95,000 paying customers as of April 30.
Comment removed (Score:4, Interesting)
Re: 20 Billion to "them", but to me... (Score:2)
I have a feeling you are in the "Slack zone" - a very specific size of company for which Slack can function reasonably well. As your business grows, Slack's signal-to-noise ratio drops dramatically.
Re: (Score:2)
my employer uses slack so I have to. It's a little bit rough compared to what Discord can do, those retards at slack should have least have easy escaping. the solutions on stackexchange to escaping markdown on slack are hilarious (and inconvenient)
Tomorrow on Slashdot (Score:2)
Slack is worth 42 billion.
buy buy buy buy buy buy buy buy buy buy buy buy buy buy
Re: (Score:2)
As a former Slack user, I would have said the problem is it doesn't do anything useful and what it does it doesn't do in a useful way. The project I was using it with has gone from doing useful things by email to spending an hour every week trying to find a time everyone can be in Slack before adjourning.
It's 1999 again (well, sort of) (Score:2)
I'm surprised Google or Amazon didn't buy them before the IPO, or maybe IBM. Even if they don't profit directly, they can hold it up as a trophy and try grafting a bunch of AI/ML/Blockchain on top of it to generate buzz.
Either way, Slack now has only one job...generate massive profits every quarter or be punished. The only way I can think of doing that is to cash out the VCs and founders, fire most of the staff and outsource all the development to the lowest bidder. Or - start charging more people to use wh
Price Per User (Score:3)
Re: (Score:2)
So, that assumes 10 million users. Their total revenue was about 600 million, so each user brings is about $60 per user, per year, or about $5 per user per month. Considering the most expensive tier is $12 a month, I would say that $5 per user average is actually a pretty high subscription rate.
NO thank you (Score:2)
I'm saving my cash for the IPO from IRC!
/me slaps Slashdot with a wet trout
Worth? (Score:2)
Nope.
I've got a stop limit buy order at $0.02 a share.
Tiny Speck (Score:1)
You abandoned us, Stoot.
Not in my mind. (Score:2)
IRC is STILL by far the best. No graphics, no animations, no alerts unless I tell it to, and the ability to /ignore users or bots. Slack is hell.
That's funny, so am I! (Score:2)
(disclaimer: Neither of those assertions has any connection to reality)