Slack, the US-based communications platform developer backed by telecommunications firm SoftBank, internet technology group Alphabet and mass media group Comcast, listed its shares on the New York Stock Exchange yesterday.
The company went public through a direct listing that involved it issuing no new shares and employing no underwriters, making about 118 million shares available for trading.
NYSE set a guidance price of $26.00 for Slack’s shares, but they opened at $38.50 and closed at $38.62 yesterday, lifting its market capitalisation from $13.1bn to $19.5bn.
Founded in 2009 as game developer Tiny Speck, Slack operates an enterprise messaging platform utilised by more than 10 million monthly active users across some 600,000 organisations.
The company increased its revenue approximately 67% year on year to almost $135m for the three months ending April 2019 while its net loss rose from $24.9m to $31.4m.
SoftBank’s Vision Fund owned 7.3% of Shack’s shares pre-listing and registered 2.2 million shares for trading. The company’s largest shareholders were Accel (23.8%), Andreessen Horowitz (13.2%) and Social Capital (10.1%) according to its prospectus. It had raised $1.27bn in funding.
Slack secured $427m in an August 2018 series H round co-led by Dragoneer and General Atlantic that included SoftBank Vision Fund, Baillie Gifford, Sands Capital, funds advised by Wellington Management, funds and accounts advised by T. Rowe Price, and unnamed existing investors that valued it at more than $7.1bn.
Vision Fund had provided $150m in funding for the company in December 2017 and added $12.7m in January 2018. It had already led Slack’s $250m series G round in September 2017 at a $5.1bn valuation, investing together with backers including Accel and Social Capital.
The company had received $200m in series F funding from Comcast Ventures and GV, respective subsidiaries of Comcast and Alphabet, as well as Accel, Social Capital and Index Ventures, in 2016 at a $3.8bn valuation.
GV had joined Accel, Social Capital, Index Ventures, Andreessen Horowitz, Horizons Ventures, DST Global, Spark Capital Growth, Kleiner Perkins Caufield & Byers (KPCB) and IVP in Slack’s $160m series E round in 2015 that valued it at $2.8bn post-money.
GV had already co-led the company’s $120m series D round in 2014 with KCPB. The round valued it at $1.12bn and included existing investors Andreessen Horowitz, Accel and Social Capital.
Music streaming platform Spotify had been responsible for the last notable direct listing by a tech company, listing on NYSE in April 2018 at a $29.5bn valuation, up from $8.5bn when it raised its last venture capital funding in 2015.
