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Salesforce Deal to Buy Slack Expected to Be Announced Tuesday After Market Close

164 points| awb | 5 years ago |nbcnewyork.com | reply

139 comments

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[+] adwww|5 years ago|reply
That letter Slack wrote to Microsoft after they rejected a $$$ takeover a few years ago has not aged that well.

https://slack.com/intl/en-gb/blog/news/dear-microsoft

[+] omh|5 years ago|reply
I agree that there's a lot in that letter that hasn't aged well.

But it looks like Microsoft considered paying about $8 billion back in 2016[1].

Slack held out, Microsoft built their competitor and Slack are still around. And now Slack are going to sell for $24 billion or more.

I'm not sure that puts Slack in too bad a light.

[1] https://techcrunch.com/2016/03/04/source-microsoft-mulled-an...

[+] ciarannolan|5 years ago|reply
> So welcome, Microsoft, to the revolution. We’re glad you’re going to be helping us define this new product category. We admire many of your achievements and know you’ll be a worthy competitor. We’re sure you’re going to come up with a couple of new ideas on your own too. And we’ll be right there, ready.

This whole thing is dripping with condescension and ego. It reads like a nasty letter written to an ex-girlfriend about how you're super successful now and gee I'm glad you're doing well too. Yuck.

[+] paxys|5 years ago|reply
Growing your acquisition value from $8B to ~$25B+ in that period would count as a win in my book.
[+] seibelj|5 years ago|reply
> Third, you’ve got to do this with love. You’ll need to take a radically different approach to supporting and partnering with customers to help them adjust to new and better ways of working.

This is so cringe-inducing, I can't believe they paid to have this in the NYT. Microsoft stock up to all-time highs as Teams eats Slack's lunch (for better or worse), while Slack bought for scrap by a company way worse than MSFT. Maybe don't publicly shame potential acquirers in passive-aggressive paid advertisements?

[+] elevenoh|5 years ago|reply
What'd you say aged least well about this?
[+] jbjbjbjb|5 years ago|reply
We tried Slack in the early days. No way we could run that across the entire business. It was clear back with Slack being then a cloud based, Electron based, lacking of MS Office integration, lacking Active directory integration a Microsoft me too offering would take all the market share. I’m surprised they didn’t do more to address this. Obviously Covid has massively accelerated Teams adoption too but it was a no brainer for businesses running Office 365.
[+] antbrain|5 years ago|reply
Now imagine how fucked up Slack would be and look on their faces if Microsoft buys Salesforce now? I can't stop laughing imagining this! Seriously.
[+] tims33|5 years ago|reply
What is the evidence that Slack rejected an acquisition offer from MSFT?
[+] hajile|5 years ago|reply
So long Slack. It was great while it lasted.

I have yet to see anything that got better because it involved Salesforce.

[+] JamesSwift|5 years ago|reply
I forget that Salesforce owns Heroku all the time. Seems like a pretty successful acquisition to me.
[+] burnthrow|5 years ago|reply
I have to push back on this. Salesforce backpacks seem to be a huge hit with the homeless. I've seen them in multiple major cities now and they are almost de rigueur in SF.
[+] ct0|5 years ago|reply
tableau is still pretty good, but their prices are out of touch
[+] dkdk8283|5 years ago|reply
I detest Slack and their push for chat ops. Good riddance. Nothing wrong with IRC.
[+] estomagordo|5 years ago|reply
According to this site, Slack operated at a $138.9 MUSD loss last year.

https://www.investopedia.com/articles/investing/012616/how-d....

And Slack themselves are expecting something similar for 2020.

https://slack.com/intl/en-nl/blog/news/slack-announces-recor....

People who actually know how to reason about business finances will elaborate, I'm sure.

What I'm wondering is, what are some realistic scenarios for how a new owner will pursue more aggressive revenue generation for Slack?

[+] toomuchtodo|5 years ago|reply
Salesforce will have their sales teams push it alongside their other offerings, raise prices for those who want to use it, kill the free plan, and trim any fat (or strongly encourage cost savings measures, depending on how much autonomy Slack will continue to have post-acquisition) not needed to operate the product. I have no doubt they'll be able to make it profitable, even at the loss of market share (free users and price sensitive paying orgs).
[+] ponker|5 years ago|reply
The cost of sales for Slack will be very low for Salesforce, because they’re already selling a ton of stuff to large customers. Their guys are already flying out to the customer, taking them out to dinner, getting their commission checks, etc. they’ll just ask “you want any Slack with that?” Imagine the economics of trying to sell lip balm door to door vs. just putting it in a pharmacy for people to buy when they’re buying other stuff.

This is how Microsoft makes so much money.

[+] minutillo|5 years ago|reply
Looking forward to Stewart's next attempt at making a game. Third time's the charm!
[+] disgruntledphd2|5 years ago|reply
Or at least we'll get another piece of usable business software ;)
[+] chrismeller|5 years ago|reply
I’m not going to say that Salesforce has ruined every product they’ve acquired, but...
[+] toast0|5 years ago|reply
Isn't that the role of a big company?

Everyonce in a while, an acquisition goes well, but usually it's like a private equity buyout; you know it's not going to end well, you just don't know when. Except if it's Oracle, then you know you need to start migrating immediately, cause you can maybe get one more contract renewal in before the terms change.

[+] symlinkk|5 years ago|reply
Quip and Heroku are solid
[+] theandrewbailey|5 years ago|reply
2021: Salesforce introduces Chat Cloud.
[+] mrweasel|5 years ago|reply
Populated by bots and that one guy who accidentally clicked on the “chat with our sales team”
[+] tbenst|5 years ago|reply
Slack fosters vibrant (free) communities in open source and academia. I fear these are not long for this world.
[+] tootie|5 years ago|reply
Slack has no moat. It won the market by dint of excellent marketing and a good enough product with a little design panache. Admittedly, this has been really hard for it's competitors to match 100% but really no chat platform has had any major innovation in like 20 years. They have mostly all failed due to a combination of network effects and poorly-conceived monetization strategies. Slack is hot, but it's not going to last 10 years.
[+] foepys|5 years ago|reply
Aren't people already preferring Discord? I saw a lot of Discord links in the past few months and nobody even talked about Slack.
[+] srgpqt|5 years ago|reply
They can easily migrate to Discord or Matrix.
[+] corytheboyd|5 years ago|reply
They signed up for this by using Slack in the first place. I don’t mean to be anti-corporation, just saying the wise move for keeping communities around for the long haul does not involve tying yourself to the life of a SV company.

I hate to beat the dead horse but IRC sounds great for such free communities. If it’s just about connecting people without the need for historical data or discovery, IRC is great and won’t die when [tech company] folds

[+] mrweasel|5 years ago|reply
So did IRC and mailinglists for many years, people will move on to the next platform du jour.
[+] remarkEon|5 years ago|reply
Is everyone else dreading the inevitable forced quip integration as much as I am?
[+] JohnTHaller|5 years ago|reply
As Salesforce is basically Oracle, Jr, who wants to take bets on when they kill off the free option (or greatly water down the features), raise the prices to fit better with with Salesforce's pricing, and force-integrate it with the rest of their product stack?
[+] MangoCoffee|5 years ago|reply
we don't use Slack at my job. we do use MuleSoft which got bought by Salesforce. not sure about every touched by Salesforce die but Salesforce is giving out the Oracle vibe. they just keep buying other companies...
[+] xtracto|5 years ago|reply
> MuleSoft

Ooh my, that brings me back terrible nightmares. I remember having to use Mule Eclipse based platform to create "service buses". That was crazy.

[+] foolmeonce|5 years ago|reply
Hmm, I would have gone from slack to keybase, if keybase weren't bought out.

It seems to me like running a matrix server without open registration would be about all I need and is startup resistant.

But intros understandably don't seem geared to details for migration of simple automated systems. JSON/HTTP is great, but what does sending messages in via API look like given e2e? Is one installing a whole robot framework to replace a simple webhook (similar to how one would be using a whole keybase install for its CLI)?

[+] karaterobot|5 years ago|reply
Am I paranoid to assume that Salesforce is probably very (mostly?) interested in the business intelligence that comes from analyzing team communications?
[+] CharlesW|5 years ago|reply
This aged well: https://www.theinformation.com/articles/why-slack-will-be-ac...

(You have to give them your email address to read.)

[+] MikeKusold|5 years ago|reply
There is no email verification. The article appears after you submit any valid email address.
[+] troughway|5 years ago|reply
I remember that, was on the front page. The writing was on the wall the moment they took out that full page ad in NYT which is a bizarre PR move that signalled fear.

Can someone pastebin the article for us?

[+] xwdv|5 years ago|reply
Now I'm just waiting to see who is going to buy Zoom.
[+] cutenewt|5 years ago|reply
Slack has a $135B market cap.

At that price, it'll be a merger, not an acquisition.

[+] remote_phone|5 years ago|reply
Zoom missed a good opportunity to buy slack. They could have used their inflated stock price to purchase it snd consolidate into a WFH platform. The only weakness is probably the Zoom CEO who probably wouldn’t know how to run both businesses. But I think that would have been a better match than salesforce