Slack confirms it has raised $427M at a post-money valuation of over $7B • Hacker News Board

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#151

Post by conradfr » Tue, Aug 21, 2018, 4:57 PM UTC

fastball wrote: post #100

joelhaasnoot wrote: post #31

Earlier quoted context omitted.

And honestly, how hard can it be? Put a 5 man team on it and in a few months it'll be done and workable. Few million down the drain but your software is insanely more useable. I guess that doesn't sell the service...

You can think a 5-person team can build highly performant native apps for a number of different platforms in a matter of months?

Do they have to do a DSM everyday and retrospective, backlog grooming, sprint planning and whatnot every two weeks? Then no.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#152

Post by pluto9 » Tue, Aug 21, 2018, 4:59 PM UTC

mercer wrote: post #128

hvidgaard wrote: post #72

Earlier quoted context omitted.

Lets assume well paid developers of $150.000 yearly, 5 man for 3 months is less than $187.500 is wages. Lets be generous and say we double that to account for other expenses. It's $375.000 for a feature that will be a reasonable sales argument.

Much as I usually try to understand the 'business end' of things, I have to say that I'm baffled that Slack hasn't done this yet. I rather like Slack, and have good reasons to use it (it's pretty central to Elixir's community, for one), but even on my relatively beefy MBP (2015) I actively avoid having the app open because it's a heavy Electron piece of shit. While of course I might be a bit of an outlier as a develo…

I think it's typical. The business-minded management folks at tech companies tend to measure success and failure purely in dollars. If the company's financial indicators are good, they assume their trajectory is correct and change nothing. They won't fix or improve existing systems unless an issue is measurably costing them revenue.

In the case of the enterprise shop I work at, our revenue increases year over year, and so technical debt doesn't get addressed unless it causes such trouble that clients threaten to leave. Development gets slower and costlier over time as cruft builds up in the codebase, but that effect can't be measured, so it doesn't exist as far as management is concerned.

In Slack's case, their indicator of success is the giant valuation they just got. Their desktop app is an annoying resource hog, but hey, they have tremendous market share, so it must not really be a problem for users. And if it ain't broke, don't fix it.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#153

Post by jwalton » Tue, Aug 21, 2018, 4:59 PM UTC

tootie wrote: post #36

It seems to me that Slack is very vulnerable. Their core product isn't all that innovative and already has credible competitors who could probably beat their price. In fact, I don't understand how they beat HipChat so soundly. I wonder if their next tack will be to start digging a moat of proprietary tooling now that they have a critical mass of adoption.

> digging a moat of proprietary tooling

You mean, like disabling XMPP and IRC integrations? https://www.theregister.co.uk/2018/03/09/slack_cuts_ties_to_...

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#154

Post by acconrad » Tue, Aug 21, 2018, 5:02 PM UTC

gkanai wrote: post #130

acconrad wrote: post #127

I'm new to venture deals (just read the book of the same name) and I have a question: Slack seems to be in peacetime: aggressive growth, buying things like HipChat. If they're dominating the market, why would they need to raise money?

> why would they need to raise money? The thinking is that the more a hot company can raise, the longer they can stay public. In the current cycle, IPOs are more rare than in previous cycles (partly because FAANG are acquiring more companies and partly because companies are waiting longer to IPO) so having more cash on hand gives the company that much more runway.

Did you mean private?

So even if they are a market leader, give them more cash? I get why Uber does it because they have serious commoditized competition with Lyft, but Slack does not seem to have even a close 2nd place.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#155

Post by jerf » Tue, Aug 21, 2018, 5:04 PM UTC

grandmczeb wrote: post #141

jerf wrote: post #95

Earlier quoted context omitted.

"Integrations serve as a moat." The depth of those integrations serve as the depth of the moat. If your integration is basically "I send and receive textual messages", which from what I see the vast majority are, you've got an integration which could be ported to a competitor in less than a week. A lot of the integration work is in the thing being integrated rather than chat-system specific things. As you use more Sl…

> Be sure to read that first sentence of mine a couple of times before replying. It does not say "integrations are always trivial to port and are thus irrelevant", for instance. If I wanted to say that, I would have. Off topic, but when you write something like this the message you’re sending is “I’d rather insult the reader than take the time to communicate in a way that can be properly understood.” Hopefully that’s…

What it actually communicates is "I've been communicating over text on the internet for 25+ years and I have a pretty decent idea exactly how someone is going to aggressively misinterpret me."

There is no other way to communicate nuance that I've found. If you claim that "some types of X are Y", you'll get angry replies about how some X aren't Y, angry replies about how terrible it is to claim that all X are Y, and on more than one occasion, angry replies about how some types of X are Y.

If you're insulted, well, then, it's not targeted at you. But abundant experience says it does have non-zero targets. And it's getting worse, not better, as more and more people are convinced(/programmed) to believe that reading people as harshly as possible and then being as angry and offended as possible is a virtue rather than a vice. As these people get more power, it's becoming simply self-defense to make sure you underline your point.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#156

Post by joelhaasnoot » Tue, Aug 21, 2018, 5:09 PM UTC

fizx wrote: post #142

joelhaasnoot wrote: post #31

Earlier quoted context omitted.

And honestly, how hard can it be? Put a 5 man team on it and in a few months it'll be done and workable. Few million down the drain but your software is insanely more useable. I guess that doesn't sell the service...

Video performance is a LOT harder than you think. At another company, I watched an five person team, half of whom had related PhDs, the other half over a dozen years of video engineering experience, make incremental improvements to the WebRTC stack. After a year, was it better? The metrics said it was somewhat better, but the customers still complained all the time.

Ship a Mac client without video. Add video next year once you've proven that people actually use a native Mac client. Some companies call this 'agile' - it's a strange concept.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#157

Post by [deleted] » Tue, Aug 21, 2018, 5:10 PM UTC

Cthulhu_ wrote: post #60

mechazawa wrote: post #6

How come Slack is worth $7.1B? I can't imagine they produce that much value or have a high enough revenue to warrant this valuation.

Their base product is bringing in $5/month/user, and they'll often get dozens to hundreds to thousands of users for each company that joins, whose employees are usually already using the free version of slack, as a sort of grassroots movement within companies. It's been the primary means of asynchronous communication for the last ~5 customers I've worked at, and I've been in slack channels of 30 to 300 users - in tot…

[deleted]

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#158

Post by joelhaasnoot » Tue, Aug 21, 2018, 5:11 PM UTC

fastball wrote: post #100

joelhaasnoot wrote: post #31

Earlier quoted context omitted.

And honestly, how hard can it be? Put a 5 man team on it and in a few months it'll be done and workable. Few million down the drain but your software is insanely more useable. I guess that doesn't sell the service...

You can think a 5-person team can build highly performant native apps for a number of different platforms in a matter of months?

Start with Mac, find some good metrics that indicate that a lot of your users are on Mac and go from there. (parse your user agents for instance) Once it's proven itself, you can try Windows and some other options as needed (probably mobile).

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#159

Post by russdpale » Tue, Aug 21, 2018, 5:11 PM UTC

maxehmookau wrote: post #17

Still waiting for a native MacOS app that doesn't slow my machine down to a crawl and runs the fans whenever I made a video call. $7.1B folks. $7.1 billion.

Same for windows, and linux. I refuse to install it and instead use the web app as if it were email. Fortunately, I don't have to use it for work.

IMO, the only thing slack does really well, is the threading. But I've ever only been a part of one group that actually used that feature. Every other group uses it like a chat room.

Re: Slack confirms it has raised $427M at a post-money valuation of over $7B

#160

Post by russdpale » Tue, Aug 21, 2018, 5:17 PM UTC

peterwwillis wrote: post #132

iambateman wrote: post #129

Earlier quoted context omitted.

But once you get to that organizational size, there are 3 project managers and a VP with an agenda and designers and design managers and a QA department which is backed up “for a bit” and a PR team who wants to make sure we get a good Q2’19 “win with the developer crowd”. So it takes a year, and $2.5M, to do what should take 3 months and $300k. * not saying this is the case at Slack, it’s just often the case at Every…

Exactly. A completely rewritten from scratch product would probably take 1 year to finish. 90% complete can be ready in a few months, but the last 10% takes much more effort. Then there's the QA division you need to build out to test it on the platforms and OSes you need to support your enterprise customers. Then there's the management structure to track the project. Then there's keeping it up to date with the existi…

Electron apps are for amateurs and small start up teams. Once you are into the 7b valuation range, you need to put on big boy pants, and make big boy software that runs as advertised. No video functionality even needs to exist for it to run terribly. I have never used the video feature, and it causes my entire 4-5 year old system to chug. I can't even consider using it on an old linux machine.

People shouldn't have to put up with the system crawl that ensues after firing up slack. It is absurd for the money they charge.