The events of 2020 have affected all facets of our lives. It also includes the way we work. However, people in this new remote working have different requirements to get the job done effectively. The days are gone where we could hop in a conference room to collaborate or communicate with people across cubicles to get work done as easily and quickly as in antiquity.
Enter Slack
The cloud-based communication platform has now become an integral part of many team’s daily interactions and functions. It claims that it has more than 12 million daily active users, including 65 of the Fortune 100 (1).
If you are working in a large enough company or for an organization with any remote employees or freelancers, the chances are high that you will be asked to join Slack at some point.
It was sorted out as an integral chatting program for one company that has grown into the primary communication and workflow portal for companies, nonprofits, and other organizations globally.
You can think of Slack as a chatroom shared between all the given company members in simple terms. It is also known as a workspace, and it is divided into channels, which are separate group chats with different team members and topics. In these channels, you can send messages, internet links, images, videos, and more. The platform is designed to make communication between employees seamless and replace many of the functions that email once dominated.
It also offers direct messages which allow you to chat with one or multiple people privately without anyone else being able to join. You can also sync the platform with apps that your company uses every day, like Google calendar and drive.
Also allows your administrator to install apps on the platform, which enables you to use them without ever leaving the chat you are in (2).
The Birth of Slack App Directory
Slack is one of the fastest-growing startups ever, and users and developers equally adore it. There is no wonder why everyone is trying to crack the Slack code to success.
The company was valued at more than 7.1 billion USD after it raised new capital last year. Slack has succeeded in creating an elusive brand love that companies long with more than 8 million users and counting.
Self-proclaimed Slayer of email, it’s ‘wall of love’ on Twitter is filled with hundreds of thousands of enthusiastic about for fun at work, time saved, and better communication.
In 2015, the slack team collaborated with their buddies over at Index and a16z, to name a few, and scoop 80 million USD fund to support teams building products on top of Slack that enable more pleasant, simpler, and productive workplaces (3).
It received about seven investments each year in four years of its existence. A remote shift due to pandemic has the Slack Fund participating in over 15 investments in this year alone (4). In total, there are over 296.4 million USD to companies building on top of Slack.
Its App Dictionary was launched in 2015 and standing at more than 2,411 apps strong. It has observed a 34% increase in the last 12 months, which indicates a strong demand for applications that can address the pain points of teams transitioning from a physical office to a virtual workplace.
Stewart Butterfield, the CEO of Slack, has stated that companies have developed more than 500k apps internally to help with their workflows, pointing to massive white space between the availability of apps on the directory and apps that solve thousands of companies’ problems.
It is clear that the workforce’s shift has rocked the world, and it will turn the unified communications market into 167.1 billion USD by 2020 (5). Since 99% of remote workers wish to continue telecommunication at least part of the time in the future, the trend is not going to go away (6).
When we studied Slack’s case, it was clear that the success of this friendly, colorful, and fun messaging platform is based not only on the loyal and enthusiastic following of users but also because of a vibrant community of developers. Only a few companies like Slack showcase the value of building a strong ecosystem and creating an attractive and functional app Marketplace.
Why Developers Adores the Slack App Directory?
Slack first launched the Marketplace for apps in 2015, the App Directory. At the time of the launch, it contained about 150 different apps. Today, it has more than a thousand apps, with new ones being added daily.
You can add any app built on the Slack API to the App Directory. It allows developers to easily and conveniently placed their apps right at the fingertips of the millions of users who are active on the platform daily. It also has very substantial SEO value passed on to developers linking back to their website.
In three years, it has become one of Slack’s most crucial competitive advantage. Even a smaller competitor can copy its basic messaging platform, but they won’t have the muscle to develop and support every feature and use case supported by Slack.
When it launched the App Directory, the two-year-old firm also announced an 80 million USD VC fund with the sole purpose of investing in startups building apps on top of Slack (7). It built a huge hype around the platform and created a lot of excitement among developers.
With this strategic investment in new ideas and applications that add value to the universe, Slack has grown its ecosystem incredibly quickly. It has proved to be a successful way to boost bold ventures or, as Slack puts it, to ‘take a chance on founders who are taking a risk on us.’
Companies that have received funding from Slack include Polly; it is an app that lets users build enterprise servers and force on the Slack platform. Another is Loom, a tool for video collaboration, and Drafted, a referral hiring platform that enables users to run their entire employee referral program on Slack.
These apps add advanced and valuable functionality to Slack and relieve the Slack team of developing these functions themselves.
Slack treats all developers building on its API as their own since it recognizes a thriving developer community’s value. Slack is sparing no effort as it is constantly aiming to support developers in its work and offer them all kinds of training, assistance, and advice.
They are arranging meet-ups worldwide. In this period, the company has managed to grow the community of over 200,000 developers who are regularly contributing to the ecosystem.
It seems like Slack has realized early on what enormous potential an app marketplace brings and what a Win-Win situation it creates for all parties involved. We could say that the App Directory allows the platform to outsource the business of complexity and diversity to the community of enthusiastic developers across the globe so that Slack can concentrate on sharpening its core product and its API.
Another reason why Slack is so popular with developers is an unusually high level of transparency. The Slack team is doing a great job of keeping the public Slack platform road map up-to-date, announcing, and explaining every upcoming feature of the App Directory (8).
In other words, the Slack team wishes to do the whole shooting match to help the community of developers succeed.
From a technical perspective, Slack is enticing to developers because of its user-friendly API. With extensive documentation, an abundance of tutorials, and a comprehensive FAQ show its dedication to helping the community succeed. It also offers a specific blog and maintains a separate Slack platform Twitter handle, fully dedicated to the API (9).
Curating apps on the Slack API allows developers to fully leverage its existing infrastructure with everything from push notifications, gif support, and emojis, so developers can dedicate their energy to developing new features. The requirement to ‘reinvent the wheel’ disappears, and developers can concentrate on inventing something new.
Slack also offers an extremely straightforward process for development and also for app submission. At first, the steep number of options and complex ways to hook into and connect with Slack can be a bit intimidating, but it is outweighed by the extensive checklist guides and tutorials offered at every stage of the journey. It also publishes all kinds of material to help developers succeed in every part of the process, from the ideation stage to development, marketing, and monetization.
It offers an on-boarding guiding process with long and detailed checklists, and every step has to be completed and confirmed before an app can be submitted for approval.
It also lists ideas for a future app based on the customers’ requests as they believe it would be a good shot at becoming popular (10). There is also a disclaimer that some of these functions might be developed in-house or that someone might have already created an app for the function; however, they go on to stress that just because an app has been built, it doesn’t mean that a second app can’t do the same thing and be very successful (11).
The Merger
Salesforce is buying Slack for a whopping 27.7 billion dollars. The merger is huge from an ecosystem perspective (12). Both firms inherited the enabler role by supporting other firms like other Enablers, Realizers, and Orchestrators with a focus on B2B services. Salesforce especially focuses on CRM, customer service, marketing, automation, analytics, and application development, while Slack is in business communication.
Both firms have already established ecosystems with a significant amount of partners. It means that this merger is not one of two companies but the merger of two ecosystems, which forms an immense joint enabler ecosystem with a focus on life area work.
The merger instantly allows Salesforce to compete better with other enabler ecosystems. For example, it allows Slack to compete with Microsoft Teams by surging the user base via existing Salesforce enterprise relationships.
Moreover, together the merger can offer even more holistic and user-centric offerings. Combining their software products, advisory, and workflow services along with data and knowledge solutions, they could build added value for their B2B customers. Thus, they have the opportunity to create a more seamless and integrated work and workflow experience.
For example, integrating front-end applications even better with existing tools to streamline business processes via bots within the Salesforce and Slack ecosystem would increase the clients’ switching costs and solidify their enterprise software solutions’ dependency.
The merger is another showcase manifesting the acceleration and evaluation of the ecosystem economy. From an ecosystem to human, E2H perspective, both firms ride the trend wave of working from everywhere, which is especially essential for firms in a pandemic.
In the future, we are expecting more M&A activity and more corporations such as the recently published Oracle and TikTok deal all the Microsoft acquisition of ADRM software, a leader in large scale industry-specific data models (13).
The fight of mammoths within the super-enabler ecosystem in the life area work, and the ecosystem category, B2B services, has just started.
Big digital players get under pressure, but all enabler companies from manufacturing engineering to infrastructure providers should also review their portfolio and their partner network with an ecosystem perspective. Analysis suggests that only companies that are part of ecosystems will survive the next decade from a position of strength (14).
The Big Picture and Opportunities
Slack is just one example of a platform with an exploding app Marketplace. Asana, Zoom, Monday, and Shopify are only a few others.
The key to profiting in the space is to go niche.
“The neat part about the ecosystem is that because we have more than a million stores, we have so many different verticals. There isn’t one particular thing that everyone needs. But every single business has particular needs that are not like anyone else’s. That is where the opportunity exists for someone to come in and build for particular verticals.” – Harley Finkelstein, the President of Shopify (15).
Notably, the opportunity for new remote work apps developed for Slack and its next big competitor is a highly controversial topic on Twitter (16).
The continuous shift has led organizations to develop or buy solutions to bring the in-office experience into the Slack workspaces. Here one can find a few opportunities for building businesses.
Culture in the remote world has dropped off the cliff. No matter how cool you might be, but no one wants to attend your mandatory zoom happy hour. However, casual conversations and gossip accounted for almost 52 minutes of every person’s workday, as per a study. The gossip, whether it is good or bad, leads to more team cohesion.
Donut is a slack app built on the same premise which connects team members around the virtual water cooler. There is a clear opportunity to build on this idea.
Notably, there was a 2500% increase in interest online for virtual team building activities during quarantine time, but no clear market leader. An app focused on raising the community inside Slack workspaces is an excellent way to get people to learn more about each other.
Another important point worth highlighting is that job stress cost employers more than 300 billion USD every year. That’s why businesses are spending nine figures annually to address the predicament. A Deloitte study pointed out an hour of 1.25 USD per dollar spent on employees’ mental health and wellness programs (17).
Organizations are looking for improved ways to offer these programs and get their workforces to use them. And what could be a better channel for adaptation than Slack? Offer guided daily meditations straight to Slack DMs or do weekly check-ins to get an insight on how team members feel all within the app.
According to analytics, 70% of organizations say they want and require more people analytics because quantifying productivity in an office setting is tough.
Communication, project management, and online status are now quantitative, thanks to Slack’s treasure trove of data and integration. It creates an opportunity to find workload and productivity trends among the workspace.
It allows businesses to make more informed decisions and recognize the workforce for their achievements. According to employees, it is the number one thing that leads to better work output (18).
When a company can see who communicated the most, who spent the most time active on the Slack platform, and where work happened gives one a data-focused and bird’s-eye view of what has happened across the company.
While Slack’s App Directory is standing at more than 2400 applications, over 500,000 workspaces have failed to find what they are looking for in the directory and have developed custom solutions. More than 95% of slack app users say that Slack apps have made the parent software more valuable (19).
As a few businesses are centering solely on the issue, they have already observed a growing opportunity to jump into leveraging developmental knowledge or Slack’s new built-in workflow builder to make custom solutions to Slack customers’ requirements and their workspaces via an agency style approach.
The Final Note
Based on everything that we have observed apart from the love that Slack is receiving from its users and developers, it seems safe to assume that the platform is still just at the beginning of its journey.
Where the journey will lead the platform is impossible to know. Still, an educated guess would be that we will see more Slack Bots powered by AI, Artificial Intelligence, and more functionality built on machine learning in the near future.
When intelligent bots begin to use advanced tracking to find patterns and get to know each user, Slack will increasingly offer businesses the exact information and service they need right when they need it.
Stewart Butterfield, the CEO of Slack, has previously mentioned the Chinese platform WeChat as a model for what Slack could evolve into (20).
Notably, WeChat went from what it was initially a messaging tool to today’s all-encompassing platform where users can do everything from ordering pizza and paying bills to follow the news and connect with their fellows through a single app.
One of the biggest strengths of WeChat is that it has succeeded in filtering, collecting, and repackaging the overload of information and options users face daily in a way that makes it not only feel but become more manageable and less overwhelming. Slack already has that effect in workplaces around the globe.
