Slack is the fastest growing workplace software ever. The company’s CEO Stewart Butterfield co-founded the company in August of 2013, as a cloud-based team collaboration tool.
As fast as the organization has grown, interestingly enough, Butterfield underestimated the true opportunity for the idea that he and his co-founders developed. Originally, when he first pitched Slack, he believed the market for this software was $100 million, which they recently exceeded in revenue in roughly three years.
As the organization has grown at such an impressive clip, Butterfield has been forced to grow the team substantially in parallel. He has done so with a laser focus on certain cultural attributes, aligning recruiting practices to his established mission in order to ensure the continued addition of high quality employees. As Butterfield notes below, the mission is: “to make people’s working lives simpler, more pleasant, and more productive.”
(To listen to an unabridged audio version of this interview, please click this link. This is the 20th interview in the IT Influencers series. To listen to past interviews with the likes of former Mexican President Vicente Fox, Sal Khan, Sebastian Thrun, Steve Case, Craig Newmark and Meg Whitman, please visit this link).
Peter High: I thought we would begin with the beginning of Slack itself. It was the result of a pivot when you were running a company called Tiny Speck, and it was a component to a game called Glitch, as I understand it. Can you talk a little bit about the genesis of that, the original intent of it, and how this became the idea itself?
Stewart Butterfield: Sure. It was not part of the game, but a tool that we used internally to communicate. The company was started by myself and three other members of the original team. At the time we started it, we had one person in New York, one person in San Francisco, and two in Vancouver, British Columbia, so the natural thing for us to use was IRC. As you know, IRC is now twenty-seven years old and predates the web by a couple of years. By modern standards, it is a clunky and ancient technology. For example, if you and I are using IRC to communicate and you are not connected to the server at a given moment, I cannot send you a message. We built a system to log messages so people could catch up when they got back online. Once we had those messages in a database, we wanted to be able to search, so we added search. I could keep going for a long time with the features we added.
I think one of the critical things was that we were doing this in a subconscious or pre-conscious way, which is not the normal method of software development. There was no ego and no speculation. Whenever a problem got so irritating that we couldn’t stand it or whenever an opportunity for improvement was so obvious that we could not help but take advantage of it, we would do it, and then go back to what we were supposed to be working on. The result of that after three and a half years was this system for internal communications that all of us agreed we would never work without again. We decided to see what else was out there in the market, and there wasn’t anything good, so we made a product at the moment we decided to shut down the game.
High: In those early days, what were the ambitions for it? Clearly, as you say, there was a need that wasn’t being met, even after seeking out something that might be more readily available. How big was the ambition in those early days? There are so many different areas now that Slack covers and so many different products and product categories that it now competes with. Did you see a broader enterprise use in those early days? Did you see this as something that would be taking on the likes of e-mail as well as the Skypes of the world? How did that all occur to you and how quickly did the broader implications of it grow?
Butterfield: It was a little bit of a slow boil in terms of how big it could be. We had taken a bunch of venture capital funding, and when we decided to sit down again, we had five million dollars left. Investors didn’t want their money back, they wanted us to try something else, so when we were putting together the pitch deck for Slack and explaining what we were going to do, we had sized the market at $100 million in revenue.