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

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Doug Zanger

Doug Zanger is the Americas editor for The Drum. He leads the Americas editorial team’s content activity in the growing region. Based in Portland, Oregon, he is committed to sharing the most meaningful stories that benefit the global industry and its people. A Minnesota native, Zanger has covered a wide range of brands, issues and personalities, including Aloe Blacc, Seu Jorge, Wendy Clark, Susan Credle, Dan Wieden, Jeff Goodby and more. Fiercely dedicated to diversity, equality and talent, he has interviewed several women in leadership roles through his Exceptional Women of the World podcast.

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