Slack has been on a growth spurt, adding more than 1 million DAUs practically every six months for the past year
It’s the latest tech darling of Silicon Valley. Slack, the workplace messaging app for teams is not just popular among businesses trying to improve communication and enhance productivity, it has also become the hot favourite when it comes to acquisitions.
Slack chief executive officer Stewart Butterfield admitted this at a conference in May, saying that he had fielded acquisition offers from 8-10 companies, but was not interested in cashing out.
Slack’s growth has been meteoric ever since it was launched in August 2013. From 16,000 daily active users (DAUs) in February 2014 to 500,000 DAUs in just a year (February 2015), Slack has been on a growth spurt, adding more than 1 million DAUs practically every six months for the past year. In June 2015, the company had 1.1 million DAUs, they doubled it in December 2015 before hitting the 3 million mark in May.
In May this year, Slack announced that its team communication app is seeing continued growth, with more than 3 million (weekday) DAUs. What’s more, the company also reported 930,000 paid seats (users whose companies are at the paid level of service) as compared to April when it reported 800,000 paid seats.
According to a report in Techcrunch, the average user spends 10 hours per weekday plugged into Slack. The tool saw 320 million minutes of active usage per weekday as of February, which comes to 140 minutes per user per weekday.
The start-up app is already a unicorn with a valuation of $3.8 billion and tech insiders believe the company will soon become a decacorn ($10 billion valuation) given its viral growth as an email replacement and top tier funding from VC firms such as Kleiner Perkins and Google Ventures. The company has also been innovating at breakneck speed recently: releasing the Slack platform and taking a lead in the bot space, while working on audio and video chat. At the same time, the company has been building an experienced executive team bringing on April Underwood (formerly at Twitter) and Keith Adams (formerly at Facebook) to steer operations. Enterprises that are hooked to Slack include Nasa, LinkedIn and Spotify.
Latest analysis by SurveyMonkey Intelligence, which provides usage and revenue estimates for thousands of apps, also corroborated that Slack is becoming the hub for enterprise software.
Slack much larger than competitors despite newest offering
According to SurveyMonkey data, Slack dominates all other competitors, such as Hipchat, Skype for Business and Yammer, which offer a similar service in the US. All of these trail Slack in terms of raw users despite launching earlier and spending considerably more on sales and user acquisition.
Closer to a daily habit like Facebook than any other work app
Not only is Slack larger in terms of the total number of users, it has found a much better product/market fit, with its users using the app more frequently—similar to social networking or messaging apps (in terms of days per month, sessions per day, and time per day).
Potential expansion opportunities
A comparison of the other apps that Slack users have offers some guide to the other parts of the value chain that Slack might disintermediate. For example, document authoring. With many links of documents being pasted into Slack, players like Google Docs (about 50% of Slack users use Google Docs), and Office365 risk being replaceable containers integrated into Slack.
Companies like Dropbox (about 30% of Slack users use Dropbox) which have been working on productivity tools for teams also face risk as Slack swallows storage and directly stores documents from document authoring companies.
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