Silicon Valley messaging and enterprise collaboration software leader Slack has raised a whopping $500 million in fresh capital from investors including Accel and SoftBank, according to Axios.
The startup was created in 2014 by serial entrepreneur Stewart Butterfield, who is still the company’s Chief Executive Officer. What began as a program to streamline workflow processes at Butterfield’s failed gaming company named Glitch, has mushroomed into a cloud-based set of team collaboration tools and services used by some of the world’s largest organizations and thousands of startups.
In June, Recode reported that the corporate collaboration giant, which allows employees to share and track documents, and send each other messages, emojis and funny gifs, was raising half-a-billion at a $4.5 billion pre-money valuation. While Accel is an existing investor, the amount being thrown on the table is exceptionally large. Other insiders are expected to participate, although the deal is not yet finalized.
Sources suggested that the business software company garnered interest from several potential buyers ahead of the mega-funding round, including Amazon, Microsoft, Google and Salesforce, although Butterfield has expressed no interest in a deal.
Moving forward, Slack is hoping to attract bigger customers who are currently more skeptical of its products due to security and privacy concerns. As part of a larger initiative to build out its offerings, the company has invested in artificial intelligence in order to help automate functions. Earlier this year, Butterfield said Slack was at $200 million annual recurring revenue, targeting $1 billion in 2018 with its existing customers.
The firm, which is not yet profitable, has already raised over $500 million from investors including Accel, Andreessen Horowitz, Alphabet’s GV, Kleiner Perkins and Thrive Capital.