A cloud-based software company, Salesforce, has finally completed Slack’s acquisition in a deal valued at approximately $27.7 billion.
The acquisition of the American proprietary business communication platform was announced by Salesforce on Tuesday, December 1.
Recall that rumours of the potential acquisition made rounds on the internet about a week, causing a spike in Slack’s stocks.
Techuncode published an article that highlighted the reasons for Salesforce’s interest in Slack.
Well, the eventual acquisition of Slack by Salesforce has further confirmed the reports.
On the acquirer side, Salesforce co-founder and CEO Marc Benioff didn’t hold back as he expressed great delight about the deal.
Speaking on the acquisition, Marc delightfully said that “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.”
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The gesture also extended to the newly acquired company’s side, as Slack CEO Stewart Butterfield lauded what he addressed as “the most strategic combination in the history of software.”
Salesforce venture into enterprise social network
Salesforce’s acquisition of Slack allows the company to dive deeper into enterprise social networking.
Hence, this latest development positions Salesforce to compete with top players in the industry.
The likes of Microsoft’s Meet, Google Workspace, among others, are in for a major competition moving forward.
More so, being a cloud-based company gives Salesforce an edge even as it makes a big entrance into the enterprise social networking space.
Another thing that makes the acquisition worth it is the timing. The world is beginning to adapt to a closed-door lifestyle.
More corporate companies are adopting the remote working approach and, as such, require corporate communication tools like Slack.
About Slack and why it is worth that much
Founded in 2009, the American software company operates a corporate channel-based messaging platform.
Here, people can collaborate or perhaps execute a project or task collectively and simultaneously.
Additionally, users can integrate all their software tools and services and find the right information required to execute their tasks efficiently.
The Slack app has been downloaded more than 12.6 million times in 2020 alone. That’s about a 50% boost from the same period in 2019.
The boost in Slack’s adoption isn’t surprising, giving that most corporate organizations have resulted in remote working.
Also, despite the massive boost, many people have left the platform for other alternatives. The reason for this is because of the economic fallout as a result of the pandemic.
Not many could easily afford the $8 monthly subscription; others prefer other alternatives that charge less.
Some companies switched to Teams to save operational costs, which offers many of Microsoft’s office software packages.
“I think Microsoft Teams has been able to capitalize on the opportunity better than Slack, partly because they give it away for free as a bundle,” Rishi Jaluria, an analyst who works at a research firm, said.
“Now Slack realizes that they might be able to get greater penetration as part of a larger company,” Jaluria added.
While this claim is not false, it is evident in Slack’s billing growth, which slowed in the initial half of the year ending July 31, 2020. The company reportedly lost about $147.6 million within Q1 and Q2 2020.
Despite the initial loss in H1, the company has been able to turn a profit afterward.
Slack was valued at $25 billion by both Yahoo and Google Finance ahead of the acquisition.
What Techuncode thinks
Acquisitions such as this are what keeps the industry exciting and competitive-oriented.
However, far from the immediate future, we are optimistic about what the long-term future holds for both unified companies.