Slack, Flickr Co-Founder Butterfield’s Business Collaboration App, Exits Beta & Goes Freemium

Stewart Butterfield, the co-founder of Flickr who eventually left its acquirer Yahoo and started TinySpeck (and an ill-fated multiplayer game called Glitch), last year decided to take a different turn, porting his expertise in consumer services to tackle the enterprise market. The result was Slack, a collaboration platform that lets users port in conversations and links to other work from dozens of other apps (including Dropbox, Google Docs, GitHub and Asana) so that they can track progress on different projects in one common platform; more generally converse about work in a less fragmented way, and crucially reduce email overload. Or, in Butterfield’s words, help the working world emerge from “email bankruptcy.” Today, after a successful, limited beta run that kicked off in August 2013, Slack is launching to the rest of the world — a step, Butterfield tells me, that it’s making as it prepares to introduce pricing tiers around additional services. Since that August launch, Butterfield says that “things have been going crazy”, with the teams that have been trialling it seeing usage from “every single team member every day.” Those teams — he asked me to keep the names out of the article — range in numbers of between 250 people down to around 10 (which is closer to the typical number, he says), and interestingly they are starting to see some pick-up from non-tech corners of the world, including a U.S. church, a building materials company, and a group in the UK government. Although Slack, in a way, owes a lot to how business people have been “taught” to use apps via mobile devices, these days mobile only forms a small part of the traffic on Slack. The service has native Android and iOS clients, with about 10 percent of messages sent and 20 percent of messages received coming from non-desktop devices. So where will the pricing fit in? Right now one tier looks like it will be around how archival information can be accessed — specifically, usage will be free for the most recent 10,000 messages, but charged for anything past that. (So far, Slack is seeing a big enough volume of usage, and a big enough interest in accessing archival material, that it thinks this could prove to be a viable model.) The archive will be the most important, but another area will be adding more storage and adding in apps — the number of integrations you can have into Slack, essentially. Butterfield says that users will be able to turn on the archive whenever they choose — “We won’t delete any messages,” he says. “It’s a constraint on which we will make available.” TinySpeck’s move into business services is, in a way, not as much of a trailblazer as Flickr was in its time (just think of how central photo sharing is to so many social services today). In the case of Slack, it comes amidst a rush of other “consumerized” enterprise startups, the point being to make once-boring and difficult-to-use business services into apps that engage employees that have now become used to smartphones and recording their every thought and sight with their networks of friends. Others include older players like Yammer, Hipchat and Cotap. In fact, one of the other hopefuls in this group, Tomfoolery — coincidentally co-founded by Butterfield’s former colleague both at Yahoo and TinySpeck, Kakul Srivastava — was just sold to Yahoo. But that’s not a sign, Butterfield tells me, of where he plans to take Slack. “We’re happy for them,” he says of Tomfoolery’s exit, “but we’re not a Yahoo type of company.” On the subject of the proliferation of enterprise “consumerised” apps, Butterfield agrees that there are a lot of them out there, but he’s also philosophical. “There are a lot of products on a continuum. But I feel like a lot of software aimed at business the feature set is speculative. There are so many products, and they have a highly speculative design but they sound good enough to try,” he says. “With Slack, we’ve built this around what works for us. We find it genuinely useful when you get all your tweets flowing to one place, when a conversation is consolidated.” Butterfield says he and his co-founders are not currently raising any money, with the company still with plenty of cash left after we the Glitch shut down. Based on the users Slack already has, it’s very likely it will be profitable shortly after launch, Butterfield predicts.
Ingrid Lunden

Ingrid Lunden is a Writer at Gigabuzz, focused on covering early-stage startups, especially those with a technology focus and great perks.

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