Microsoft contemplated Slack bid, decides to focus on Skype

According to TechCrunch, Microsoft was rumored to have considered an $8bn acquisition of cloud-based team collaboration software company Slack. However, in the final analysis, the Redmond, Washington-based company appeared to opt for improvements to their Skype platform. They noted that it was a tough sell internally, with co-founder Bill Gates and CEO Satya Nadella pushing for the Skype option, to make it more competitive. Microsoft released a Skype integration with Slack in January 2016.

It was reported that the Microsoft push to acquire the company was led by Qi Lu, executive vice president of applications and services.

At present, Slack has 2.3m daily active users, with 675,000 as paying customers. According to Statista, Skype has 300m active users.

Last year, it was rumored that San Francisco-based Slack had several acquisition offers, all rebuffed by CEO Stewart Butterfield, the former founder of Flickr, that was acquired by Yahoo in 2005. Slack was valued at $2.8bn in April 2015 and is in the process of raising another round of funding between $150m to $300m. After that round, the company valuation is estimated somewhere between $3.5bn and $5bn.

Over the years, Microsoft has acquired other enterprise collaboration companies such as SharePoint, Yammer, Lync and Skype — and could conceivably create its own Slack competitor. TechCrunch noted that Slack has a level of cache that Microsoft hasn’t been able to approach which may have had some influence on the decision to pursue the acquisition.

Source: TechCrunch

Doug Zanger

I am the North America editor for The Drum. A geographic mutt, I was born in Minnesota (lived outside of Minneapolis until I was 12), lived in suburban Philadelphia, attended college in Denver and London — and have proudly called Portland, Oregon (and the Pacific Northwest) my home for 24 years.

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