Microsoft Reportedly Abandoned $8 Billion Slack Bid To Double Down On Skype
Since its launch in 2013, Slack has risen to superstardom. In a recent blog post, the company highlighted some of its recent milestones, which includes hitting 2.3 million daily active users by its second anniversary, over 675,000 paid seats, and over $64 million in annual revenue. Not bad for a software solution that came out of nowhere just a couple of years ago.
Given its meteoric success, it's only a matter of time before this cloud-based collaboration tool gets snapped up by a bigger company, but that company apparently isn't going to be Microsoft. According to TechCrunch, Microsoft apparently mulled the idea of acquiring Slack but instead decided to double-down on its Skype focus. Microsoft's not the only interested party; it's noted that Slack received 8 to 10 acquisition offers last year - hardly a surprise given that the service is still growing at a rapid rate.
Slack has grown a lot in just a few years
While it could make sense for Slack to hold off for as long as possible at this point to keep growing its value, Microsoft had apparently been willing to shell out as much as $8 billion for the company, despite its annual revenue being a mere sliver of that. But again, it's growing at such a quick rate, that $8 billion could very well be considered a deal a few years down the road.
When the idea of acquiring Slack passed through the halls of Microsoft, co-founder Bill Gates and CEO Satya Nadella were both unconvinced by it, and ultimately, the focus remains on improving Skype, and perhaps even integrating some popular Slack-like features into the client. And given some recent instabilities Skype has been encountering, it might be a great thing that a bulk of Microsoft's focus continues to be on Skype.
It's worth noting that despite Microsoft acquiring Skype 8 years after its launch, it paid $8.5 billion at a time when the service had 8.8 million paying customers (and 170 million regular ones), and here, we have Slack, with a small amount of paying users (675K) in comparison being valued at about $8 billion. The creators of Slack have certainly gone about their business the right way. Now it's just a matter of waiting it out and seeing which company ends up acquiring it, because it seems almost certain that it's going to happen.