Slack actively preparing for early 2019 IPO
Messaging company, recently valued at roughly $7 billion, aims to debut in the first half
Slack Technologies Inc. is actively preparing for an initial public offering in the first half of 2019, with an eye toward going public as soon as the first quarter, according to people familiar with the company’s plans.
Slack expects it could achieve a valuation well in excess of roughly $7 billion—the level at which a recent round of financing valued the company, these people said. Still, valuations can change until a company prices its IPO.
Slack would be one of the largest tech IPOs since Snap Inc.’s debut in 2017 that valued the company at nearly $24 billion.
Slack operates a popular workplace instant-messaging app that as of earlier this year had more than 8 million daily active users and 3 million paid users.
The IPO preparations come not long after the Slack’s most recent private round of funding. It raised $427 million earlier this year in a round led by Dragoneer Investment Group and General
Atlantic. That followed a round led by SoftBank Group Corp. in 2017 that valued the company at $5.1 billion. In all, Slack has raised more than $1 billion since it launched in 2013 at increasingly higher valuations.
Slack has been working on its IPO readiness since at least 2017, but has more recently opted to take specific steps to be prepared to launch in early 2019, people familiar with the company’s plans said.
The company hasn’t yet hired underwriters but could do so soon, these people said.
Slack Co-Founder and Chief Executive Stewart Butterfield in a May interview with The Wall Street Journal ruled out a 2018 IPO and said the company was in a multiyear process of preparing to go public.
After years of opting to remain private, pushing out IPO timelines and reaping large sums of money from private investors, technology companies are now increasingly being drawn toward the IPO market, which is seen by bankers and advisers as one of the best in years.
That is especially the case for fast-growing tech companies, as yield-hungry investors have been scrambling to buy shares of those companies tapping the market.
On average, shares of newly U.S.-listed tech companies have risen an average of roughly 50% this year, according to Dealogic, far outpacing the year-to-date gains in broader stock indexes. As of Thursday, 43 technology companies had made their debut on U.S. exchanges this year, raising $16.9 billion, according to Dealogic. That is more than technology companies had raised for the full years in 2015, 2016 and 2017, but down from 2014’s pace.
But even as the pace of IPOs has ramped up, some of the most notable companies remain sidelined in the private markets, including Uber Technologies Inc. and Airbnb Inc.