Microsoft said to have considered $8B Slack acquisition
March 07, 2016
Late last week, reports surfaced that Microsoft (NASDAQ: MSFT) had mulled over a possible $8 billion acquisition of workplace productivity software provider Slack. The news comes at an interesting time, as Slack recently announced the launch of a video and voice calling feature, Slack Calls. While these new features are not groundbreaking technologies, they will only make Slack’s team collaboration and communication platform even stickier to enterprises.
It’s said that Microsoft CEO Satya Nadella and Bill Gates were part of the group unconvinced of the mega-acquisition, instead wanting to allocate more resources to Microsoft's own video and voice calling service Skype, which it acquired for $8.5 billion in 2011.
The Slack we know today was only launched in mid-2013 and has quickly risen to prominence in both the startup world and the workplace productivity market. The company recently reported annual recurring revenues of over $64 million and daily active user growth from 500,000 in early 2015 to around 2.3 million currently. Although some may say the $8 billion price tag was rather high—Slack was valued at $3.1 billion with its raise last May—it will be even costlier if Slack grows into a serious competitor of Microsoft's business products. Time will tell if the decision to not move forward with the purchase of Slack may come back to bite the tech giant.