Slack CEO Stewart Butterfield: “Slack or Don’t Do It”

As COVID-19 forces millions to take work home, remote working tools have seen a boom

Stewart Butterfield, Co-Founder and CEO of channel-based messaging app Slack, discussed remote working and business communications with Alex Zukin, Managing Director of Software Equity Research at RBC Capital Market, on an investor webcast that aired March 26, 2020.

Between March 12 (a day after the World Health Organization declared COVID-19 a global pandemic) and March 25 the rate at which new workspaces were created on Slack increased by hundreds of percent, a statement from the company said, highlighting the magnitude of the work-from-home corporate mandate.

The one-hour webcast explored remote working and how businesses can adapt to radical global issues.

The Remote Working Boom

Butterfield noted that the adoption curve for remote working has seen a steep upswing due to COVID-19. Where companies may take years to shift to a complete or partial remote working model, they are now required to do this within hours.

In fact, between 1 February 2020 and 25 March 2020, Slack saw an 80% increase above the quarterly total for the preceding six months, with 9000 new paying customers. To Butterfield, this is the most telling metric.

“By far the most important [metric] for us since we’ve penetrated a couple percent into this enormous market is more paid customers, because we historically have got them to expand,” he said.

He added that Slack was “super committed to [ensuring] that we take the best advantage of this moment.” However, he noted that external circumstances and uncertainty surrounding the long-term impact of the virus remain a factor in Slack’s decision-making.

“Some of our customers inevitably will go bankrupt. [We don’t have the technology] that can tell us how the world will look three months from now, and that’s where the uncertainty comes from,” he said, adding that Slack is adopting a cautious approach to the upswing in adoption.

Making Communications Efficient

Butterfield strongly emphasized agility and communication in the innovation space during the webcast.

“Technological changes drive changes in consumer behavior, and that [causes] changes in the macro environment. You have to be dynamic. It’s a fundamental requirement of every organization, especially in a world that has been increasingly globalized,” he said.

On that line of thought, Butterfield spoke at length about companies contemplating a shift to remote working models. He pinpointed agility and responsiveness as the key to a successful work from home policy, highlighting dynamic communication as a fundamental competitive strength.

“You need to have a space where every conversation can happen, and absent of that, I think it’s going to be very difficult for companies to recreate, through a patchwork of emails, instant messaging and other tools, the same environment [as a channel-based messaging platform],” he said.

Butterfield also discussed the amount of time office-goers spend communicating. “More than 50% of [office workers’] time is spent on really basic acts of communication and coordination. You have a whole class of people whose full-time job is to do that. If 50% of [business capital] is going to basic acts of communication, the question is, can we increase the efficacy of that effort?”

A Business For Businesses

Slack faces stiff competition from similar software such as Microsoft Teams, but Butterfield is confident about Slack’s unique position. He sees Slack as an enabler for businesses to continue providing their own services to their end-users; a software that makes other software more useful.

He added that Slack allows enterprise users to create up to 20,000 channels, where Microsoft Teams only allows 200 channels per team, and limits the number of team members to 5,000.

“Our largest customers have tens of thousands of workspaces,” he said. “If any [enterprise] customer is making a choice in this category, their choice is Slack or don’t do it.”

On COVID-19

As COVID-19 has increasingly crippled business finances, Slack has pushed a slew of initiatives to “help other companies make the transition in a way that’s going to be sustainable for them vis-a-vis the pressure that’s been put on their employees,” including free usage for companies who are closing their paid accounts.

He added that prevailing stress and resentment stemming from poor management culture–such as micromanaging remote employees–may “cause people to check out completely.”

“This is not regular working-from-home, this is a very different situation,” he concluded.

Header image courtesy of Slack.

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