Slack, the US-based startup behind the enterprise messaging app Slack, is getting ready to go public when the time is right. "About three to four months ago we started an internal campaign for IPO readiness because we want to have the option in the future and there’s quite a bit of work that goes into it," CEO Steward Butterfield told the Australian Business Review . "We’ve done our first external audit and we’ve put in place a lot of controls and security practices," he said.
Slack has rocketed up the popularity and growth ladder since its launch in 2013 in San Francisco. By the spring of 2015 it had notched up an impressive 500,000 daily active users, including 135,000 paying users. And all with no sales force. Back then, that translated into annual revenues estimated at around 12 million US dollars, and by now the figure is likely much higher.
Currently valued at 3.9 billion US dollars, Slack has already attracted its fair share of big-name investors, having raised 340 million US dollars in private funding from companies like Andreessen Horowitz, Kleiner Perkins and Google. Butterfield says most of that money is still sitting in the bank, so the startup won’t be needing to look for more funding anytime soon. He sees the USD 340 million partly as a hedge against possible changes in market conditions. "Things won’t always be rosy and if market conditions shift and we have a giant pile of cash we’ll be in a great position because suddenly the competition for engineering talent is less, the lease rate on office space comes down, advertising becomes cheaper and especially companies that we might want to acquire become cheaper," he said.
Despite the company’s preparations, Butterfield notes that any IPO is still some time off. "The absolute earliest that we could IPO, if everything came together right, would be 18 months from now," he said, citing the importance of being ready for the move when the time came. "One of the things public investors look for is predictability and when you’re growing as fast as we are it’s impossible to predict where we’re going to be six months from now," he added.