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Slack Technologies

(Redirected fromTiny Speck)

Slack Technologies, LLCis an American software company founded in 2009 inVancouver,British Columbia,known for its proprietary communication platformSlack.Outside its headquarters inSan Francisco,California, Slack also operates offices inNew York City,Denver,Toronto,London,Paris,Tokyo,Dublin,Vancouver,Pune,andMelbourne.[6][5]: 66 

Slack Technologies, LLC
FormerlyTiny Speck (2009–2014)
Company typeSubsidiary
IndustryInternet(formerlyvideo games)[1]
Founded2009;15 years ago(2009)inVancouver, British Columbia,Canada[2]
Founders
HeadquartersSalesforce Tower
San Francisco, California,U.S.
Area served
Worldwide
Key people
Denise Dresser (CEO)[4]
ProductsSlack
RevenueIncreaseUS$903 million(2020)[5]
IncreaseUS$−300 million(2020)[5]
Number of employees
2,545 (January 2021)[5]
ParentSalesforce
Websiteslack.com

On June 20, 2019, Slack Technologies went public on theNew York Stock Exchangevia adirect stock listing.[7]On December 1, 2020,Salesforceannounced its acquisition of Slack for $27.7 billion.[8]On July 21, 2021, the acquisition was closed.[9]

History

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Slack logo used between August 2013 and January 2019

Initial funding andGlitch

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The company goes back to the San Francisco based startup Tiny Speck, which was headed byStewart Butterfield,the co-founder of the photo sharing siteFlickr.[10]Tiny Speck receivedangel fundingof $1.5 million in 2009,[11]followed bySeries Afunding of $5 million in 2010 fromAccelandAndreessen Horowitz.[12]ASeries Bround of $10.7 million was raised in 2011.[13]

Tiny Speck's first product was acomputer gamecalledGlitch—a socialMMORPGwith highly stylized2Dgraphics. Thegameplaywas described as follows: "players must learn how to find and grow resources, identify and build community and, at the higher levels of the game, proselytize to those around them".[14]Glitchlaunched on September 27, 2011,[15][16]but subsequently "unlaunched" on 30 November to improve gameplay.[17][18]

In November 2012, it was announced thatGlitchwould be closed, effective December 9, 2012.[1]

Slackand further funding

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TheNew York Stock Exchange Buildingafter Slack's direct offering on theNYSE– June 20, 2019

After the closure ofGlitch,the company launched theSlackreal-time collaboration app and platform, raising $17 million in funding fromAndreessen Horowitz,Accel,andSocial Capital.[19]After the launch of Slack, the company renamed itself to Slack Technologies in August 2014.[20]The name is an acronym for "Searchable Log of All Conversation and Knowledge".[21]Slack had been an internal tool used for the development ofGlitch.

The company raised $42.75 million in April 2014.[22]In October 2014, the company raised $120 million inventure capitalwith a $1.2 billion valuation led byKleiner PerkinsandGV.[23]Earlier investorsAndreessen Horowitz,Accel, and Social Capital also participated in this round.[23]

In January 2015, Slack announced the acquisition of Screenhero, a specialist in voice, video, and screen sharing.[24][25]In March 2015, Slack signed a deal with investors to raise up to $160 million in a funding round that valued the company at $2.76 billion. New investors includeInstitutional Venture Partners,Horizons Ventures,Index Ventures,andDST Global.[26]

In April 2015, the company raised another $160 million.[27]In May 2015, Social Capital was a leading investor in a funding round for Slack Technologies.[28]

In April 2016, Slack raised another $200 million, led byThrive Capital,with participation byGGV,Comcast Venturesand existing investors, including Accel, Index Ventures, and Social Capital.[29][30]In September 2017, Slack raised $250 million, the majority of which came fromSoftbank Vision Fund,with about 45% of that, or $112.5 million, originally from thePublic Investment Fund of Saudi Arabia.[31][32]This round put Slack's total fundraising at $841 million and its valuation at $5.1 billion (including cash raised).[33]In early 2018, Slack announced the company's first CFO, Allen Shim.[34]

On July 26, 2018,Atlassianannounced the shutdown of its competingHipChatandStrideeffective February 11, 2019, and the sale of their intellectual property to Slack.[35]Slack was to pay an undisclosed amount over three years to assume the user bases of the services, and Atlassian was to take a minority investment in Slack. The companies also announced a commitment to work on integration of Slack with Atlassian services.[36][37]

In September 2018, it was announced the firm was preparing for aninitial public offeringin the first half of 2019.[38]In November 2018, Slack was recognized inCredit Suisse AG's inaugural Disruptive Technology Recognition (DTR) Program, an annual recognition of five top companies who are disrupting traditional enterprise information technology.[39]On January 16, 2019, Slack announced the launch of the company's new logo.[40]

On December 11, 2018, it was reported that Slack was considering adirect public listing.[41]In the lead-up to its DPO, Slack reported that it had generated $400.6 million in revenue for the fiscal year ending January 31, 2019, up from $220.5 million in the previous year[42]and up from $105.2 million in 2017.[43]Slack also reported losses of $138.9 million for the fiscal year ending in January 2019.[42][44]On February 4, 2019, several media news outlets reported that Slack had filed for taking the company public. According toThe Wall Street Journal,sources indicated the company would pursue a Direct Listing Process (DLP) instead of the traditional IPO.[45][46]On April 26, 2019, Slack filed itsForm S-1to go public through a direct listing on theNew York Stock Exchange,[47]similar toSpotifyin 2018.[48]Its stock, ticker WORK, started trading on June 20, 2019. TheNYSEset a reference price of $26 to start off trading and the stock rose to more than $41 in the initial hours of trading.[49]

On November 13, 2019, Slack announced the formation of its partner channel as part of its focus on enterprise clients.[50]

On February 10, 2020, it was reported thatIBMwill deploySlackto all of its 350,000 employees, making IBM Slack's largest client to date.[51]

On November 25, 2020, theWall Street Journalreported that Salesforce was in advanced talks to acquire Slack.[52]The deal closed in 2021 for $27.1 billion.[53]Slack was delisted from the NYSE in June 2021 after the acquisition was completed, and shareholders were given Salesforce stock.[54]

Slack announced it would move its headquarters fromFoundry SquaretoSalesforce Towerby the end of February 2023, as part of a consolidation plan by Salesforce.[55]

Litigation

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In July 2020, Slack filed a lawsuit with theEuropean CommissionaccusingMicrosoftof anticompetitive behavior. Slack alleges that Microsoft illegally bundled their competingMicrosoft Teamscollaboration product with the Microsoftoffice suite.[56]

State court class action

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In October 2020, investors plaintiffs filed aclass actionlawsuit against Slack in theCalifornia State Superior Court of San Mateo County,alleging securities violations.[57]Plaintiffs claimed, on behalf of individuals who alleged that they acquired Slack Class Acommon stockin Slack’s June 2019direct public offering,that Slack violatedSections 11, 12,and 15 of theSecurities Act of 1933because itsIPOdocumentation allegedly had untrue statements and material omissions.[57]

Federal court class action

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Earlier, in April 2020, JudgeSusan Illstonof theUnited States District Court for the Northern District of Californiahad issued an order partially granting Slack’smotion to dismissa similar federal class action complaint against Slack,Pirani v. Slack Technologies.[58]Typically, plaintiffs in Section 11 class actions must show they can trace theirsharesof stock in the issuer back to the relevantoffering.[59]If there have been multipleregistration statements,plaintiffs must prove that the shares they purchased were issued under the allegedly false or misleading registration statement.[59]Illiston held that adirect listingis different than the normal offering. This is in one respect true, in that unlike a traditional IPO consisting of "new" shares being offered to the public, a direct listing permits insiders and certain early investors to immediately sell their already outstanding shares, which are immediately tradeable on a stock exchange.[60]In Slack's direct listing, Slack offered 118 million registered shares for resale while at the same time another 164 million unregistered shares also became available without registration pursuant to exemptions to the Securities Act registration requirements.[60]Slack moved to dismiss, arguing that the plaintiff lacked standing because he could not trace his shares back to the registration statement that he claimed was misleading.[60]The judge opined—in an opinion that was later overturned—that that requires a broader reading of Section 11 of the '33 Act of the phrase “such security,” meaning: “acquiring a security of the same nature as that issued pursuant to the registration statement.”[58]As a result, she denied defendant’s motion to dismiss the case under Section 11.[58]At the same time, she granted the motion to dismiss partially (as to claims that Slack misled plaintiffs regarding Slack's scalable architecture), and she also found the statements in the “Key Benefits” portion of Slack's registration statement to be unactionable.[58]

On September 20, 2021, theNinth Circuitissued a split decision—ultimately overturned, affirming the district court.[60]The dissent, citing established precedent, said that Congress provided for strict liability for issuers in Sections 11 and 12(a)(2), but chose to temper that by "limiting the class of plaintiffs who can sue."[60]The dissent therefore was of the opinion that Sections 11 and 12(a)(2) confer standing only on plaintiffs who purchased securities issued pursuant to the registration statement containing the allegedly false or misleading disclosure.[60]

In December 2022, theU.S. Supreme CourtgrantedcertiorariinPirani v. Slack Technologies, Inc.[61][60][62]The U.S. Supreme Court ultimately noted in its unanimous June 2023 decision that lower federal courts had held since the 1960s that liability under Section 11 of the Securities Act of 1933 attaches "only when a buyer can trace the shares he has purchased to a false or misleading registration statement."[63]It held that "because we think the better reading of the particular provision before us requires a plaintiff to plead and prove that he purchased shares traceable to the allegedly defective registration statement, we vacate the Ninth Circuit’s judgment holding otherwise."[63]

References

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  62. ^https://www.supremecourt.gov/DocketPDF/22/22-200/242285/20221003121846238_2022-10-03%20%20No.%2022-200%20Slack%20-%20Chamber%20Cert%20Amici%20Brief.pdf[bare URL PDF]
  63. ^abSlack v. Prani,Supreme Court of the United States(2023).
edit
  • Official website
    • Historical business data for Slack Technologies:
    • SEC filings
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