Slack acquired by Salesforce for £20.7B: How British co-founder’s work-chat service cashed in the biggest software deal ever
Salesforce, a global cloud computing company in a mega-deal, acquired Slack, a business communication platform, for a whopping $27.7 billion (approx £20.7 billion). According to the press release, Slack shareholders will receive $26.79 (approx £20.04) in cash and 0.0776 shares of Salesforce common stock for each Slack share, representing an enterprise value of approximately $27.7 billion (approx £20.7 billion) based on the closing price of Salesforce’s common stock on November 30, 2020.
“Stewart and his team have built one of the most beloved platforms in enterprise software history, with an incredible ecosystem around it,” said Marc Benioff, Chair and CEO, Salesforce. “This is a match made in heaven. Together, Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world. I’m thrilled to welcome Slack to the Salesforce Ohana once the transaction closes.”
“Salesforce started the cloud revolution, and two decades later, we are still tapping into all the possibilities it offers to transform the way we work. The opportunity we see together is massive,” said Stewart Butterfield, Slack CEO and Co-Founder. “As software plays a more and more critical role in the performance of every organization, we share a vision of reduced complexity, increased power and flexibility, and ultimately a greater degree of alignment and organizational agility. Personally, I believe this is the most strategic combination in the history of software, and I can’t wait to get going.”
The COVID-19 pandemic has accelerated the move by companies and governments to an all-digital world. With this acquisition, Salesforce and Slack together will give companies a unified platform for connecting employees, customers, and partners with each other and the apps they use every day, all within their existing workflows.
As the new interface for Salesforce Customer 360, the Microsoft rival will transform how people communicate, collaborate, and take action on customer information across Salesforce as well as information from all of their other business apps and systems to be more productive, make smarter, faster decisions, and create connected customer experiences.
The transaction is anticipated to close in the second quarter of Salesforce’s fiscal year 2022, subject to approval by the Slack stockholders, the receipt of required regulatory approvals, and other customary closing conditions.
Founded by Stewart Butterfield and Cal Henderson in 2009, Slack transformed a business communication platform. The platform was used by millions to align their teams, unify their systems, and drive their businesses forward.
While everyone knows Stewart Butterfield as the face of Slack, British entrepreneur Cal Henderson, who co-founded two successful startups looks after the technology behind the growing platform. With a Computer Science degree from the University of Central England, Cal was a pioneer in the use of web APIs and created the basis for oAuth and oEmbed, which is now used by YouTube, Twitter, and many others.
Slack, which started as a messaging platform for employees has become an online command centre for work, with the integration of other services like word processing and cloud storage.
What British co-founder has to say
In an interview with CNBC, Cal Henderson said had his doubts about whether companies could work from home before the coronavirus pandemic.
“I was as surprised as anyone that we were able to be so productive during that shift,” he said. “We were already distributed because we have offices around the world, but we weren’t fully distributed. Teams in general are co-located. They are in the same office and they can have in-person meetings and white-boarding sessions and all that kind of interaction.”
For Slack, this deal comes at a time where it struggles to capitalise on the switch to remote work during the pandemic.
“It felt like it was just a short-term thing … we weren’t going to be in this for months,” he said. “In many ways, it felt like it was a snow day. Now, it turned out to not be true.”
Cal Henderson also said that if he had been asked a month ago about shutting its office and going remote overnight, he would have said no.
“Organisations can’t be productive like that at scale,” he said. “It would just be an impossible undertaking.”
At the same time commenting on the news Karandeep Anand, Head of Workplace from Facebook also shared his official statement on the same.
“Today’s Salesforce/Slack deal makes sense for large companies with high numbers of desk-bound employees. These knowledge workers are used to complex tools and their IT teams regularly spend money on expensive software. This deal will help Slack sell into those companies.
At Facebook we’re focused on bringing simplicity and accessibility to the world of work. Our goal is to make sure everyone is connected, informed and empowered at work – wherever they are and whatever tech they have available.”