How can one irksome idea for an enterprise company turn into a buzzing hive of a startup in Silicon Valley? Ask Stewart Butterfield, co-founder of Flicker and instant classic cult Glitch, and now chief executive of Slack, a communication startup valued at more than $1.2 billion.

Reaching such massive numbers in valuation in less than 8 months is something quite unheard of. Let’s talk about Slack and how it has taken the enterprise world by storm.

The Origin

Slack is basically a chat room like internal communication tool for business with advanced search and file-sharing functionalities. The enterprise company aims to make selling products to businesses, opposed to individual consumers.

In October 2012, it nabbed another $120 million in a financing round, where several venture capitalists believed that Butterfield is building an enterprise company that will reign the world of online collaboration for the next 100 years.

Doesn’t Slack sound like the dozen other applications that we probably know of? Probably Not. The idea behind Slack goes a little something like this: Corporate teams are empowered with better efficiency when able to easily collaborate from their laptops and computers, whether they’re in the same office premises, or on entirely different continents. It stems from one of the earliest and most basic web applications such as Internet Relay Chat.


This isn’t the first time Butterfield has embraced IRC, earlier it was seen in another start-up, a massively multiplayer online role playing game (MMORPG) which eventually fizzed out. The team spread across the U.S. and Canada used it for chatting online and file sharing much crucial to any business in its developmental stages. When Butterfield realized that the gaming startup wouldn’t work out, the team decided to utilize the remaining funds in creating an even better and successful version of the collaboration system, known as Slack.

Similar to competing services such as Hipchat and Campfire, Slack offers chat solutions for small and individual teams inside huge companies. It’s slick design and easy to use interface makes it an anomaly in the world of an enterprise software computing.

Today, Slack had nabbed more than 250,000 individuals using the product on a daily basis, 70,000 of them are paid users. There are more than 30,000 teams using the collaboration tool, sending more than 200 million messages in a month. It is expected to eclipse $10 million in annual recurring revenue in 2014 – a figure much difficult to reach for most early-stage enterprise software companies.

However, this isn’t what makes Slack so special. It can work with a dozen other online services that are essential in today’s competitive business world. It integrated with many other software services like Dropbox, Github, ZenDesk, Google Drive, Hersoku, MailChimp and many others. Everything is archived and made easily searchable by employees – including chats, Twitter messages, and customer service tickets.

So instead of letting the I.T. department administrator decide what specific set of tools the entire company will utilize, workers can choose what programs work best for them and integrate them with Slack.

Today’s enterprise model of software purchasing is constantly evolving. In the past, several years businesses have become much more open to such lucrative options. Managers want to identify what works best for their workers and try to support their decision. There has been a substantial shift from I.T. purchase decisions being made by chief information officers and I.T. staff to heads of different departments and marketing directors. Businesses today are more fascinated towards the very idea of empowering their teams.