The business communications company has gotten acquisition offers in the past from Microsoft and others.
Slack, the popular business communications company, is in the midst of raising $500 million at a $5 billion post-money valuation, an effort that has attracted several potential buyers interested in taking out the company ahead of the funding.
That’s obviously an enormous amount of money, even though Slack CEO and founder Stewart Butterfield has long said publicly — and privately — that he wanted to keep the San Francisco startup independent.
Often when a hot company in Silicon Valley is seeking funding, larger players like to make an approach before it is done, since it gives the startup more options.
The company currently has projected a $1 billion in revenue next year, sources said, with its existing customers, although it is not yet expected to be profitable. Butterfield said earlier this year that Slack was at $200 million annual recurring revenue at the time.
But Slack faces enormous challenges including from a range of bigger rivals like Microsoft, who are developing similar products and have more access to markets. Slack also lacks the management depth that such competition will require.
Still, it is a compelling and fast-growing business for many companies and fits in well with their businesses, such as Microsoft’s Azure, Google’s business offerings and Amazon Web Services. And it’s a compelling idea that one company could own the protocol that powers a large amount of business communications — replacing a high volume of email — and other future functions.
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