AAA Slack begins laying IPO groundwork

Slack begins laying IPO groundwork

Slack, the US-based instant messaging app developer backed by internet technology group Alphabet, has begun preparations for an initial public offering, CEO Stewart Butterfield told The Australian yesterday.

The company is the creator of a communication and message storage app that is currently used mainly in workplaces, but which could theoretically be extended to a range of functions and areas.

Butterfield said: “About three to four months ago we started an internal campaign for IPO readiness because we want to have the option in the future and there’s quite a bit of work that goes into it.

“We have done our first external audit and we have put in place a lot of controls and security practices. There is a lot of predictability that needs to be evident in the business, so we are spending a lot on analysis and data infrastructure,”

Slack has so far raised $340m, closing a $160m series E round in April this year that was backed by Alphabet subsidiary Google Ventures, Horizons Ventures, DST Global, Index Ventures, Spark Capital Growth, Institutional Venture Partners, Accel Partners, Andreessen Horowitz, The Social+Capital Partnership, and Kleiner Perkins Caufield & Byers, and which valued it at $2.8bn.

The earliest Slack would look to go public is in around 18 months time, Butterfield stated, but it has no firm plans to do so. Much of the $340m remains unspent and serves as a hedge against a change in market conditions

Nevertheless, the company is putting things in place in case it changes its mind, and the proceeds from an IPO would likely be used to fuel growth. Slack currently has 1.7 million active users, 480,000 of which pay for the app, but Butterfield estimates the market could potentially be as large as 200 million people.

Leave a comment

Your email address will not be published. Required fields are marked *