The hosts argue that Microsoft Teams' much larger active-user count did not represent equivalent engagement or adoption. Teams could launch automatically through Microsoft's distribution and was frequently used as an approved video tool, while Slack required deliberate organizational setup and participation.

Teams benefited from automatic distribution with Microsoft products.
Some counted Teams users may not have consciously adopted it.
Remote-work video usage inflated Teams' apparent comparison with Slack.
Slack required organization-wide setup, integrations, and active participation.

“Microsoft Teams has about 10 times the number of users as as Slack does.”
Packy McCormick · 14:00

“it is a total red herring to continue uh comparing Slack's users to Teams users because it's complete apples and oranges”
Ben Gilbert · 20:30

#microsoft teams#slack#metrics#distribution

Hot Take· 5

Hot Take10:00

Why Slack's 55% Premium Still Disappointed Its Biggest Bull

Packy McCormick welcomes the immediate gain for readers who bought after his bullish article but argues that the acquisition caps a much larger independent opportunity. He believed Slack could become a three-to-four-times investment as its customer base and revenue compounded over time.

The deal rewarded recent Slack buyers with a large premium.
Packy's thesis extended well beyond the acquisition price.
Undervalued SaaS companies growing near 50% were already rare.
The sale forced him to search for another mispriced compounder.

“I think it's a little bit of both.”
Packy McCormick · 10:00

“I was really hoping that this was kind of a three to four X stock.”
Packy McCormick · 10:30

#slack#investing#saas#acquisition

Hot Take21:30

Salesforce Could Anchor a Best-of-Breed Alternative to Microsoft

The acquisition is framed as consolidation among specialized enterprise applications rather than a simple Slack purchase. By owning the central communication layer, Salesforce could make a collection of purpose-built products more coherent and strategically credible against Microsoft's integrated suite.

Microsoft wins through integration, procurement simplicity, and distribution.
Best-of-breed buyers assemble specialized products from multiple vendors.
Slack can serve as an entry point connecting those applications.
The deal may improve strategic value for companies such as Box or Dropbox.

“what we're really seeing is like the the anti Microsoft um I don't think it's like an alliance it's really like the anti-Microsoft consolidation”
Ben Gilbert · 21:30

“Microsoft is the full integrated system that's best at nothing.”
Ben Gilbert · 22:00

#salesforce#microsoft#enterprise software#best of breed

Hot Take49:00

Slack's Worst Nightmare Is Chat Becoming Good Inside Every App

Tools such as Figma increasingly embed communication directly where specialized work occurs. If collaboration remains inside those applications, Slack risks becoming a backup channel for emergencies, announcements, and casual conversation rather than the place where substantive work happens.

Specialized workflow tools increasingly include native collaboration.
Workers may prefer discussing an artifact directly beside the artifact.
Slack could be relegated to announcements and exceptional coordination.
Embedding Slack's communication infrastructure inside other apps could provide a defense.

“the worst nightmare for Slack is that chat gets good in apps.”
Ben Gilbert · 52:00

“to the extent that work gets federated and happens in apps rather than in the central you know communication nexus, they're in big trouble.”
Ben Gilbert · 52:30

#collaboration#figma#product strategy#slack

Hot Take1:06:00

Why Google May Have Been Slack's Most Natural Buyer

Google's productivity applications already matched the technology stack used by many Slack-centric companies, and Google had completed custom product work for Slack integrations. Combining G Suite, Slack, and Looker could have produced a coherent modern office bundle backed by Google's enormous distribution and financial resources.

Slack and G Suite were already paired inside many growing companies.
Google's applications integrated deeply with Slack.
Looker could complement the bundle as an analytics layer.
Google had ample cash to outbid Salesforce.
No evidence of Google participating in the bidding was available during the recording.

“Google plus a Slack with Google's distribution really is a powerful combinator combination.”
Packy McCormick · 1:06:30

“That that's the acquisition that should have been.”
Ben Gilbert · 1:08:30

#google#slack#acquisitions#g suite

Hot Take1:11:00

Zoom's Bigger Opportunity Was Becoming Video Infrastructure

Rather than buying Slack and expanding into general workplace productivity, Zoom could remain focused on becoming the video layer for the entire economy. The hosts argue that startups should build vertical products on top of Zoom and that Zoom's strategic priority should be platform development.

Zoom's opportunity extended beyond enterprise meetings.
Its product could serve as video infrastructure for many industries.
A Slack acquisition might distract from the broader platform ambition.
Zoom's small corporate-development team made a major deal less likely.

“the huge opportunity is they are the video platform for the entire economy.”
David Rosenthal · 1:12:30

“their focus should be on becoming a platform.”
Packy McCormick · 1:13:00

#zoom#platforms#video#startups

Explainer· 4

Explainer16:30

Why Slack Threatened Microsoft More Than Zoom Did

Slack could become the hub connecting best-in-class workplace applications and potentially displace internal email. That platform trajectory threatened Outlook and the wider Microsoft suite, whereas Zoom's video product still sent users back to Microsoft's established productivity applications.

Slack integrated G Suite, Figma, and thousands of other applications.
Replacing email could weaken Outlook's strategic position.
Slack aspired to become a broad workplace platform.
Zoom complemented rather than displaced Microsoft's core suite.

“Zoom is not a platform and doesn't have line of sight to being a platform”
Packy McCormick · 16:30

“it doesn't, it's not a threat to Microsoft's Cash Cow in the way that Slack would have been.”
Packy McCormick · 17:00

#platforms#microsoft#slack#zoom

Explainer29:30

Slack Connect Turns Internal Chat Into an External Work Network

Slack Connect lets companies communicate with customers, vendors, and partners through shared channels. Packy argues that influential companies can pull counterparties into Slack, giving those organizations a low-friction way to experience the product and potentially adopt it internally.

Shared channels allow cross-company communication.
Partners can introduce organizations to Slack through real work.
The mechanism creates a try-before-you-buy distribution path.
Salesforce could connect CRM records directly with client channels.
Connect endpoints grew rapidly before the acquisition.

“it's a way for people to kind of try before you try before you buy the Slack product”
Packy McCormick · 31:00

“what Slack Connect is is a bunch of share channels between organizations.”
Packy McCormick · 32:00

#slack connect#network effects#crm#collaboration

Explainer39:30

The Numbers That May Explain Why Slack Sold Now

Slack was approaching a billion-dollar revenue run rate with high gross margins and newly positive free cash flow, but its year-over-year revenue growth had slowed from 49% to 39%. Combined with a 55% acquisition premium and continuing pressure from Microsoft, that deceleration may have made the offer more attractive.

Quarterly revenue reached roughly $235 million.
Gross margins were about 86%.
Free cash flow had recently turned positive and improved sharply.
Year-over-year revenue growth slowed by ten percentage points.
A 55% premium was unusually difficult for a public board to reject.

“you're essentially paying 27, 28 times next 12 months revenue for this business”
Packy McCormick · 40:30

“last quarter it was 49% year over year. This quarter it was 39% year over year.”
Packy McCormick · 41:30

#valuation#revenue growth#free cash flow#slack

Explainer54:30

Discord Won Communities by Charging Differently, Not Just Designing Differently

Discord and Slack share a visible chat surface but diverge in target customer, extensibility, enterprise features, and monetization. Discord supports large communities by charging superusers for upgrades, while Slack's per-seat enterprise model makes a thousands-member public community prohibitively expensive and administratively awkward.

Discord targets gaming and influencer communities rather than enterprises.
Slack provides enterprise integrations and cross-organization features Discord did not prioritize.
Discord monetizes optional upgraded capabilities for individual users.
Slack's per-seat model penalizes large communities.
Most of the difficult product differences sit below the visible chat interface.

“it's the first piece of software that's really made me feel old using it.”
Ben Gilbert · 54:30

“Discord handles those use cases a heck of a lot better.”
Packy McCormick · 56:30

#discord#slack#business models#communities

Takeaway· 2

Takeaway26:30

The Simplest Slack Deal Thesis: Salesforce Supplies Distribution

Despite expansive language about Customer 360, the hosts see the acquisition primarily as a distribution transaction. Slack had strong penetration among startups and innovative teams but lacked a similarly credible path into very large organizations; Salesforce could supply that enterprise sales reach.

Slack already grew with startups and innovative internal teams.
Salesforce offers a large professional enterprise-sales organization.
Enterprise distribution could unlock large deployments Slack struggled to win.
Deep product integration was considered less certain than sales-channel leverage.

“that translates to me as Slack just uh upped their sales, their their own sales uh force uh by like a hundred X in terms…”
Ben Gilbert · 26:30

“this is a distribution deal, right?”
Ben Gilbert · 27:00

#salesforce#distribution#enterprise sales#slack

Takeaway33:30

Slack's Hardest Communication Problem Was Explaining Slack

The discussion criticizes Slack's repeated shifts between positioning itself as where work happens, a virtual office, and an email killer. A simple enemy or problem can mobilize customers more effectively than philosophically precise language that fails to communicate what the product changes.

Slack repeatedly changed its primary marketing message.
Where work happens was broad but difficult to interpret.
Killing email provided a clearer problem for customers to rally around.
Salesforce's no-software campaign showed the power of naming the hated problem.

“something as simple as we kill email is something that people can really rally behind versus we're where work happens.”
Packy McCormick · 34:30

“this communications company's biggest problem was communications”
Packy McCormick · 1:18:30

#positioning#messaging#slack#marketing

Frameworks in this episode

A-Plus, C, and F Scenario Test

Compounding SaaS Quality Scorecard

Product Partnership Acquisition Dance

Insights & moments

⚡Myth Buster· 1

Why Teams and Slack User Counts Were an Apples-to-Oranges Comparison

◆Hot Take· 5