00:00welcome to the a 16z podcast I'm Michael
00:03Copeland for as long as there has been
00:05software we've had this collective hope
00:08maybe more of a desire that software
00:11will make all kinds of work easier more
00:13productive and more creative
00:15spreadsheets computer-aided design tools
00:18digital publishing platforms though
00:20never perfect are examples of software
00:23that have definitely changed how we work
00:24and what is possible
00:26still you find very few people enthused
00:29about Excel over cocktails so what is
00:33going on with slack the messaging app
00:36crops up in conversation at dinner
00:38parties it's become a kind of cultural
00:41signifier of a tech-savvy workforce that
00:44is always looking for better ways to
00:45connect inside and outside of work in
00:48this segment of the a 16z podcast we
00:51discussed slack with its founder Stewart
00:53Butterfield why slack has resonated so
00:56well across all types of people from
00:58engineers at NASA's Jet Propulsion lab
01:01to dentists and what that says about how
01:04we work today and about our ongoing
01:06quest for the perfect tools and services
01:08to get the job done the conversation
01:12happened as part of a 16 ZZZ capital
01:15summit Stuart welcome i guess mark told
01:19your origin story how you're off to
01:23build a massively multiplayer online
01:25game so my only question we don't want
01:28to rehash that but like why for the love
01:30of god you've done this twice now can
01:32you not build a gaming company gaming
01:36companies are much harder and the games
01:38are harder to build and that's actually
01:39in some ways a serious answer that it's
01:42good practice for any other kind of
01:44software or you might want to make for
01:45two reasons one is because technically
01:47they're pretty challenging but probably
01:50more importantly the amount of patience
01:51that someone has for a game before they
01:53start playing it is about zero so if you
01:56not able to capture their attention
01:57really early on if the new user
02:00experience isn't really smooth then
02:02you're going to lose and those lessons
02:05apply to pretty much any other software
02:06product category so we have enough
02:09liquor but then let it happen again it's
02:11lack but was that the moment where
02:13people aren't playing our game but we
02:15have this other thing we built to build
02:17the game together like when did you know
02:19that the product was slack or at least
02:22the proto slack there was no a-ha moment
02:27I think there's a long process of
02:29argument and it's funny because I just
02:30found the pitch deck that I took down to
02:31John O'Farrell and Frank Chen Frank's
02:35here which is exactly what we ended up
02:38building it was like almost three years
02:41ago and the response was kind of yeah I
02:45guess you might as well do that what
02:48sure what else you're gonna do so
02:51there's definitely no moment of perfect
02:52clarity however in retrospect looking
02:54back at that I think what really helped
02:57us was we spent three half years working
03:00on the game there's 45 people at peak
03:02and we had a bit of patience for
03:06internal communication problems but in
03:09an entirely non self-conscious way with
03:11no speculation about what users might
03:13like we solved our most immediate
03:15problems in the fewest number of minutes
03:17we could and then just kept on doing
03:19that over the course of years and so by
03:21the end we had this system that we knew
03:22worked really well for us and it was
03:25still a question of whether it would
03:25work well for others and that's in
03:27contrast to you know often when you
03:29start off you have these kind of
03:30grandiose visions of what it could do
03:33what you could imagine people wanting
03:35from software but it's really generally
03:38very speculative and this was entirely
03:39like empirically tested and proven so I
03:41don't think we recognized that at the
03:43time but in retrospect though right
03:44so when you were building this product
03:46for yourselves what were the things that
03:47you just unselfconsciously wanted to
03:50solve for one of them was transparency
03:55across the organization so when
03:57transparency I feel like there's a
03:58little bit of a loaded term it has some
04:00political connotations and Edward
04:01Snowden and stuff like that or it means
04:04the bosses can see what the workers are
04:06doing or conversely the boxes are open
04:08with the workers about what's going on
04:09with a company and that's not the sense
04:11in which we mean it we mean lateral
04:13transparency so across functional groups
04:15people can see what their peers are
04:16working on can you get big enough within
04:19your group you'll be sufficient
04:21communication and then that'll go up to
04:23a manager and then the next morning
04:24stand-up meeting will go across to
04:26manager and then over the course that
04:27day go down to the other group but if
04:29the marketing team has perfect clarity
04:32about what's going on with sales you can
04:34see where they're falling down see where
04:35they need better materials if the
04:37Technical Operations team can see what's
04:38going on with customer support if the
04:40engineers can see what the designers are
04:42working on next there's a huge amount of
04:43value you get out of that and the second
04:44one was and this is again this wasn't a
04:47thesis that we had right that I get just
04:48am a result of the work that we did we
04:51would have people start and they would
04:53have the whole history of all
04:54communication that happened before they
04:55got there available to them and that's
04:57in contrast to an email based
04:59organization where on your first day you
05:00literally have an empty inbox and the
05:02company might have exchanged depending
05:04on its size hundreds of thousands or
05:06millions or tens of millions or hundreds
05:07of millions and messages before you got
05:08there and you have access to none of
05:10those so sometimes it's important to be
05:12able to go back and see the origins of
05:14some decisions sometimes how we dealt
05:17with this problem last time it arose but
05:18also just the ability to scroll back and
05:20and have a writing transcript of how
05:22people interact with each other you get
05:23a sense of the social protocols what the
05:25expectations are about response time who
05:27really knows the answers to what kinds
05:29of questions who makes the decisions
05:30because there's that process of
05:32triangulation when you start in a new
05:34organization well you know a couple of
05:36your peers you know your manager and you
05:37have to figure out how this this place
05:39operates because every person is
05:41idiosyncratic but every organization is
05:43like them the multiplication of all
05:45those idiosyncrasies and can be hard to
05:46figure out look we've been trying to
05:49solve this problem of how to work
05:50together how to collaborate how to
05:51communicate for a long long time you
05:54know Lotus Notes and before that what's
05:57been so hard about it this is a
05:59three-part question what's been so hard
06:01you know why now what's in place both
06:03sort of in terms of Technology and
06:04behavior to make it work now and then
06:08also like what do you guys know that
06:10nobody else knew or or knows like how is
06:13it that you guys were able to pull it
06:15off so I'll take the Peter Thiel
06:17question first I don't know that there
06:20is anything that we know better like you
06:22know some secret that we have that no
06:24one else knows I think in our case is
06:26purely a matter of of execution but
06:29skipping back the why now question I
06:31think is really important
06:32and if you think back 10 years ago 2005
06:36many of you in this room will have had
06:39the very coolest phone that you could
06:41possibly get which was on backorder all
06:43the time and hard to get your hands on
06:44which was the Motorola RAZR and if you
06:47think back to that now like what a oh I
06:48had one yeah I love that funny and the
06:52little look the blue glow and the LED
06:54think of what a different kind of device
06:56that was then what you carry around
06:58today it's not just that like the screen
07:00is bigger and it's you know the
07:02processor is faster or something like
07:03that our relationship to those devices
07:06and our relationship to other humans as
07:08mediated by those devices is entirely
07:09different than what it was before so the
07:13reason I was into games was in 1992 I
07:15started college and I got an account on
07:17the school's UNIX server and I
07:18discovered Usenet and talk and IRC and I
07:21got my mind blown by the idea that
07:23humans could use computers to interact
07:25with each other and the games were you
07:29know a hope that we could build some
07:31social substrate that would make those
07:33interactions interesting in the form of
07:34a game right but I was on IRC in 1993 I
07:39was on ICQ and 99 or whatever that was I
07:43had a blackberry early on messenger so
07:46for for me and for almost everyone here
07:47messaging as an application of the
07:50Internet and as an application of
07:51computing technology is really old and
07:53very familiar but my mom didn't send her
07:57first and I'm trying to use my mom as
07:59the canonical example of a of a naive
08:01user but my mom didn't send her first
08:03message of any kind until about two
08:06years ago she sent me an iMessage and
08:08the advent of the smartphone I think
08:11opened that via SMS cuz as a mess back
08:14in the day of the Motorola RAZR was
08:15something for Scandinavian teenagers who
08:17were amazing at t9 but now you know the
08:22last four or five years Facebook's
08:23brought another 700 million people
08:25online and not just online but online in
08:27a in the sense that this is one of the
08:30avenues by which they conduct their
08:32relationships like their relationship
08:34with their significant other with their
08:35children with their with their siblings
08:38with their business partners is mediated
08:41through these little devices in their
08:42hands and that's so different and so I
08:44think if we had started slack three
08:45years earlier and we just
08:46it wouldn't have taken off the way I did
08:48it might have been a moderate success
08:49right and have taken off the way it did
08:50so technology mobile and then also this
08:52behavioral part where your mom and the
08:55rest of us are all yeah it's like
08:58necessarily just a form factor or mobile
09:00in particular but mobile as like a proxy
09:02for all the other changes that that
09:04brought so first of all new software
09:06systems but also connectivity we forget
09:09now I think how how Rison it is that
09:12we've had amazing internet everywhere we
09:13go like it's like three years or
09:16in 2002 the Netherlands became the first
09:19country to get over 50% penetration of
09:22Internet connections in homes and that
09:24was still dial-up so it was like I think
09:252004 in the US before dial-up got to 50%
09:28and this is this kind of always on
09:31availability is really new I was about
09:33to call you an enterprise software
09:34company and but then like is that even a
09:37correct description or does it sort of
09:40if the distinction is consumer versus
09:42enterprise and definitely yes enterprise
09:43yeah I think we think of ourselves as a
09:46business software company so we value
09:50and treasure our customers SMB sector
09:54just as much as the enterprise sector
09:56we end up with on a per customer basis
10:00obviously much more revenue from our
10:02biggest customers it's kind of
10:03tautologically true and I think over
10:06time we will have higher margins from
10:08those customers and they'll represent a
10:10greater percentage of our total revenue
10:11versus the total users but I think to be
10:14successful at the scale we would like to
10:16be successful we would like every
10:18dentist to be using it right well so
10:20let's suddenly you brought it up so
10:22let's talk about customers at the
10:23beginning one of the things that you
10:24noticed was there were advocates or you
10:27know profits for slack out there who
10:29were using it and it was sort of the
10:30cool companies and San Francisco and
10:32Silicon Valley and they talked about how
10:33much they'd liked it but then you saw a
10:35shift where it wasn't just Airbnb or
10:38whomever it was kind of across the board
10:40so what did their customer base look
10:42like at the beginning and how did it
10:44sort of cross pollinate and let's talk
10:46about where you're headed next in terms
10:48of customer base so there's a really
10:53interesting experience when we going
10:55back to that origin story for a second
10:57we decided that we were gonna do this
10:58right at the very end of
10:59twelve so we didn't get started until
11:01January 2013 and by March we had done
11:03enough that we could use it and then May
11:05we started trying to convince our
11:06friends at other companies to use it and
11:08immediately they were like oh this is
11:10gonna be way harder than we thought
11:11because we have to a ask a whole group
11:13of people to change their behavior which
11:15is hard enough and we compared to say
11:18Dropbox which I can decide by myself
11:20hey I'm lazy I don't like to backup and
11:23I want my same files on these two
11:24computers nine bucks a month great deal
11:26I'm gonna do it but you can't
11:27unilaterally decide that you are going
11:29to use slack for team communication you
11:30have to get the whole team and
11:32especially the early stages it's very
11:34it's vulnerable to anyone crankypants
11:36person who doesn't want to go so the key
11:39is like everyone has to use it yeah and
11:40it's it's it's absolutely binary so if
11:42we get to 80 percent of the team and
11:44that's it then it goes to zero it's a
11:47hundred percent quartz there it's
11:48nothing so with that in mind you know
11:51that the very first customers were the
11:52ones that we were persistent enough to
11:54be able to convince and look a handful
11:56of startups all in San Francisco and
11:59from there it started to spread in many
12:01different ways so one was people like
12:04mrs. entrepreneurial dream people liked
12:06it enough that they would tell their
12:07friends about it and most people don't
12:09tell their friends about the software
12:11that they use it work like no one would
12:13forgive me if there's anyone from concur
12:15here but no one liked at the dinner
12:17parties that I had there's amazing
12:19experience filing my expenses and I
12:21would highly recommend it to everyone
12:23else I was reading a story the other day
12:26about how San Francisco was changing
12:28demographically and slack was used as
12:30kind of a cultural shorthand for the
12:33people who are moving into San Francisco
12:34I mean so it's again it's gone beyond
12:36this kind of you know humdrum work a day
12:39thing to a cultural touch point yeah so
12:42some of those it spread from there
12:43because people would tweet about it and
12:44they would say that they love it and so
12:46people would see it we also this took a
12:48little bit longer but we got the sort of
12:50who are in the same position that
12:52Twitter was in 2010 where approximately
12:540 percent of the world uses your product
12:57but a hundred percent of the tech press
12:58does than the business press so I mean
13:00like The Economist in New York Times and
13:03Fast Company in courts and Business
13:04Insider and Fox and Gawker and you know
13:06almost everyone who covers either tack
13:09or business and and pretty much every
13:12Howell and besides that user slack so
13:13everything we do seems like it's super
13:16significant and important and that
13:18helped in the spread as well because
13:19people would hear about it multiple
13:21times they would see people tweeting
13:22about it they had a friend mention it
13:23they would see it on people's phones and
13:24asked what it was they would read an
13:26article about it and then there's two
13:28different ways they would spread one was
13:30here's what example Nordstrom bought two
13:32companies one company called outlook
13:34another one called Trump Club and both
13:37of them were slack users so slack got
13:38into Nordstrom and through that a Trojan
13:41horse kind of huh yeah and also people
13:43would get recruited from their current
13:45job at a slack using company to a new
13:46company and say the way you do I mean
13:50this every person you hire has a way of
13:52coming in saying this is not what we did
13:54at Google and this is probably the wrong
13:56thing that you're doing but they would
13:57say we really should use slack it was
14:00great at my previous company here's all
14:01the reasons why and sometimes that would
14:03work and it would spread in that way so
14:06yeah it's pressed from team to team to
14:07team and then takes over an enterprise
14:09er yeah so going back to original
14:11questions people have the impression
14:12that it's Silicon Valley companies at
14:14this point the US and Canada put
14:16together our 47% of our daily active
14:19users roughly 30% in Europe 20% in Asia
14:21Japan was our number two country both
14:24for paid seats and daily active users
14:26until it got dislodged by the UK and
14:28Germany and it's across all kinds of
14:31industries we have a big team at the
14:33General Services Administration which is
14:35kind of like the the least like a
14:39Silicon Valley story that I can I can
14:42imagine but also the Jet Propulsion
14:44Laboratory I had NASA and a small dental
14:49practice in the north of England and
14:51everything in between and is it I mean
14:53in the early days the way people were
14:55describing is like look you it's it's
14:56trying to kill email but what are you
15:00trying to kill or not kill or or
15:02perpetuate within a within a an
15:05I had hippie parents and grew up in a
15:07log cabin so I'm not trying to kill
15:08anyone man but that's it's a very easy
15:13headline and it's people want to click
15:15on it and to some extent it makes sense
15:18and I think that in the ideal case we
15:20will kill email inside of the
15:22organization because I think he Mel is a
15:25to handle internal communication for a
15:27couple reasons one is the transparency
15:29they mentioned the second one is having
15:30that that transcript you know that that
15:33archive that builds value over time so
15:35that when a new person comes in they
15:36have access to everything but email
15:39crosses organizational boundaries very
15:41well it's how we set up this
15:42conversation is how people that gospel
15:44set up conversations like that's 10
15:45years from now if you try then internet
15:48I mean sorry email will probably be
15:50around you know three four decades from
15:53now and it might even be like the
15:54cockroach of the internet like it just
15:56won't ever be exterminated but it does
15:59have some virtues I just think it's it's
16:01a not a great tool for internal
16:03communication so you talk about your
16:05customers in the growth and you also
16:07talk about how the paying customers it's
16:09expensive this is sort of a roundabout
16:11way to get to your valuation you're a
16:13rational guy and I want you to explain
16:15to me rationally how you view your your
16:18valuation okay that's a good question
16:21and look where we are what a great
16:23audience for this so part of it and I'm
16:28not sure how the degree to which
16:29everyone would like to admit this is one
16:31of the factors that drives valuation is
16:32there is exactly one of us and if you
16:37want to invest in us this is the price I
16:39mean so there's a supply and demand
16:41issue that comes into play the second
16:44one and this is something that we're
16:46very conscious of because we have a
16:47conversation what would be too high
16:51evaluation for us you know like what
16:53would make us uneasy and why would it
16:55make us uneasy and obviously that we cut
16:57off a lot of options
16:58the higher the valuation the the fewer
17:02possibilities there are for acquisition
17:05because only a smaller number of
17:06companies can afford it and them but
17:07they might even going to go to the rest
17:09when the the dangerous one for us is we
17:11don't hit that price by the time that we
17:14are ready to IPO and we have to wait and
17:18more in this weird limbo where we just
17:19can't do it unless we're willing to take
17:21the haircut and that's not the end of
17:24the world right like you know if you if
17:25you still created several billion
17:30dollars worth the value and it's not
17:32quite as many billions at the time of
17:34and then it could have been then that's
17:36not so bad but valuations in general I
17:40think now I don't have a lot of insight
17:42into other companies I don't know where
17:43they're at but I think they're largely
17:46on the basis of the ability to generate
17:49revenue or free cash flow and the rate
17:52of growth so our multiple is crazy
17:55in one sense but although our valuation
17:57has gone like this over the last year
17:58the multiple has come down pretty
18:01dramatically mm-hmm and it's continuing
18:03to come down because we're still growing
18:05at 15% a month so it 15 yeah and so if
18:08you if you think about that in
18:10comparison to a public company the
18:12multiples gonna be very different but
18:13there aren't public companies that are
18:14growing revenue fifteen percent a month
18:15that this is that's not a thing so it's
18:18it's what you believe about the total
18:21addressable market is what you believe
18:22about the trajectory and you know
18:24whether as you extrapolate out there's
18:27whatever the Delta is when you go out
18:30eighteen months or mountain in your
18:31projections if the bottom end feels
18:33comfortable for that price then the
18:34bottom end feels comfortable for that
18:36price whatwhat are your customers so
18:38it's hard to get people to pay for
18:39anything but you know what are they
18:40willing to pay for and why are they
18:42happy to pay for it shall we say they're
18:44willing to pay because the value has
18:47it's tough being but because the value
18:49that they're getting is much more than
18:50what we're asking them to pay we're
18:51asking them to pay about 1 mm of the
18:54total cost of employment for a knowledge
18:55worker do you don't see it that way when
18:58you get this new bill you didn't have to
19:00pay for all at once and you're like
19:02depending on the size of your business
19:04you know it's five grand or it's 250
19:07grand right whatever but you know we did
19:09this survey of 16 16 hundred and
19:13something responses from slack team
19:15owners and administrators and we asked
19:19them a bunch of questions so to what
19:20degree has slack and reduced your
19:22internal email or reduced medians or
19:24increased productivity and so this is
19:26entirely subjective this is the weighted
19:27average of their responses and I'm not
19:31sure this would stand up to econometrics
19:33scrutiny but 50% less email 25% fewer
19:36meetings eighty percent agreed increases
19:38transparency but the big one was the
19:39weighted average of all the responses
19:41and how much it has it increased your
19:43productivity was 32 percent and if it
19:45was really 32 percent
19:47you know that's that's like a couple
19:49decades worth of accumulated
19:50productivity gains in the natural course
19:52of economic development so that's that's
19:55probably an exaggeration but even at a
19:581% productivity gain there's a huge are
20:00alive right and if it's 2 or 5 or 8
20:02percent that is that's a pretty magical
20:04thing that's like a lot more capacity
20:06and it's obviously much cheaper to buy
20:09some software for 5 grand or 10 grand or
20:11a hundred grand depending on the size
20:12your organization than it is to hire 5%
20:14more head count or 8% more head count
20:16right let's talk about the future you
20:19know the old world of software that we
20:23use at work I'm not gonna probably call
20:24it enterprise software but was this
20:26suite approach right so my Microsoft
20:28mspi I give you everything you need
20:31whether you want it or not and here are
20:33the different products I use do you as
20:35you grow and your ambition sounds like
20:38do you need to take that kind of like
20:41you know the enterprise this way and
20:43this way is it necessary that you have
20:46that kind of suite approach and or do
20:49you think that that's a relic of the
20:52I think relic of the past might might
20:55not be the right way to put it but I
20:56think it's something that's no longer
20:58possible and if you'll allow me to
21:00pander to our hosts for a moment
21:01software is eating the world and one of
21:05the side effects of that I think is the
21:07application of software to problems that
21:09didn't have software applied to them
21:11before so there's new product categories
21:13that emerge all the time application
21:16performance monitoring is a whole new
21:17thing that no one in this didn't exist
21:1910 years ago right even things that did
21:21exist 10 years ago or 15 years ago 20
21:23years ago CRM for example are
21:25unrecognizable in the contemporary form
21:27versus what they used to be the
21:30proliferation of marketing analytics
21:32tools and BI tools of productivity
21:36enhancers for software development
21:37organizations very big and now so I mean
21:42I remember 20 years ago we bought most
21:45of our software like most companies from
21:46Microsoft we had some other stuff we
21:49design agency there's not this
21:50but even so we bought several things
21:52from Adobe and there's a couple of other
21:54vendors but we got most of it from
21:56Microsoft that's no longer possible
21:59because if you think about first of all
22:00it wouldn't make sense anyway Wow not if
22:03you're talking to Microsoft but anyway
22:04well you just you you need to do more
22:06things than Microsoft empowers you to do
22:09no matter how broad the suite is I look
22:12around our company we buy software from
22:14about 50 different vendors and this is
22:16like software-as-a-service infrared
22:17anders because there's at least five
22:20things on the marketing analytics side
22:22because they're paid advertising in
22:23there so I mean convert ROA Marketo
22:26Optimizely and CRM to different packages
22:30and we buy NetSuite and concur but also
22:33the software developers just keep their
22:36code in github and we as n desperate
22:37customer support ticketing and on and on
22:40and on so document editing and
22:42collaboration all those different
22:45categories project management bug
22:47tracking mobile crash reporting and
22:49application performance monitoring most
22:51companies are in a bind could software
22:52from all over the place so first of all
22:54the suite would be far too broad for
22:56anyone to do period and certainly for
22:59anyone to do well but that's actually
23:01something that that one of the reasons I
23:03think slack has been successful now is
23:04because there is no place where it all
23:06comes together twenty years ago when
23:08everything almost everything we bought
23:10was from Microsoft the same vbscript
23:12that we used to do Excel macros could be
23:15used to tie ms project to Outlook for
23:17task assignments and there was these
23:20technologies like ActiveX and le which
23:22made Microsoft stuff work with other
23:23Microsoft stuff and the the server
23:26environment - that we developed for were
23:30perfectly matched with visual sourcesafe
23:32and stuff like that so it was a neat
23:34package and it was for a lot of the
23:37things you had to do but now there's too
23:38many and there is no place where
23:39everything comes together for most teams
23:41that come to use luck it's not just the
23:43messaging which is very important but
23:45not just the messaging from humans
23:46it's the messaging from everyone else so
23:48on our team the slock team we have 250
23:51people we do about 20,000 messages today
23:53from people and we do another 80 to
23:55100,000 messages a day from machines and
23:57doesn't if you think about your own
23:59email of them and just try to divide a
24:01lot probably 80% of it is from machine
24:03it's things like someone followed you on
24:05Twitter or this expense report requires
24:06your approval or here's the receipt for
24:08your lift ride or whatever it is in the
24:11business context obviously there's all
24:12those messages and more we get 20,000
24:1525,000 support tickets in Zendesk a
24:18month we have about an equivalent number
24:19of people tweeting at us every month we
24:22have every sale going through there
24:24every crash report every time I check in
24:26code every bug that gets reported and
24:27having all of that searchable and
24:29accessible in one place is something
24:32that just wasn't possible before and I
24:34think it's also one of those things that
24:35once you get it you will not be able to
24:38so how does then slack sit within all
24:42that stuff like just how do you describe
24:44it are you the the the what for the
24:46enterprise then sometimes we say the
24:49bottom layer of the business technology
24:50stack something there's a customer had a
24:52really nice mix metaphor which is the
24:54blank canvas operating system for your
24:56team the blank canvas operating system
25:00for your team yeah and and people do
25:02treat it like that I think the bottom
25:05layer of their business technology stack
25:07is the articulation we like because it
25:08you know gives us a nice place right
25:10right now everything else plugs into it
25:12but the relationship that we hope to
25:15have with everyone else is we make them
25:17a little bit better or we make their use
25:19of you make your use of their product a
25:22little bit better so there's an example
25:23of that if you use Dropbox and you're
25:26gonna send someone a link to a file and
25:28Dropbox and you send it via gchat then
25:30what they will see is a long nonsense
25:33string like that's the URL if you send
25:36it in slack then we'll go and get the
25:38actual name of the file and we'll show a
25:40preview of it and we'll also index it
25:41will take a copy and index it for search
25:43so that you can find it again later does
25:45that make your use of Dropbox like a
25:46hundred percent better no but it makes
25:48use of Dropbox like two percent better
25:50or five percent better and if we can you
25:52know and by the way we'll do that for
25:53box as well and also do that for Google
25:55Drive all good different one drive and
25:56go through every other single tool you
25:59use it will make all of them just that
26:00little bit matter and that's you know
26:02that would be enough to justify and
26:05certainly the cost of slack which is 22
26:07cents per user per day on the base plan
26:09so it's not really is less than what
26:12most companies spend on soda pop but at
26:15but just the enhancement to productivity
26:18and all the other tools would be worth
26:21Microsoft made an amount announcement
26:24recently with its office 2016 product
26:26and they said they had a slack killer
26:29clearly they weren't raised by hippies
26:31in Canada but what Wow first off what
26:35was your reaction to reading that was a
26:37very proud moment as you might imagine
26:39that's kind of what you want the was
26:43was it must have been sanctioned at some
26:47level because it was the CMO is that it
26:48but the sentence went on to say a slack
26:51killer for teams that are using office
26:54365 and I think that'll be the the
26:57access by which we're able to compete
26:59because office 365 is actually doing
27:00really well I don't know if all the
27:02people are actually using it but the
27:03headline number is a hundred million
27:04people but if you have to be fully
27:07committed to the Microsoft stack in
27:09order to use their slack killer than
27:11their stock killer can only kill a slack
27:13to the extent that so if they had a 30
27:16percent could kill slack if they end up
27:18with 40 percent of the total market for
27:21whatever office 365 is now that leaves
27:2560 percent for us and we'll also take
27:27some of the people who are fully
27:28committed to the Microsoft second it's
27:30not to say that it's not dangerous for
27:31us it's and we don't know what this
27:34Microsoft is yet I have a huge amount of
27:37respect for Sasha and she Lou was one of
27:40the 3s ups I worked with for a long time
27:42Yahoo and he's an incredible hard worker
27:45and a genius I don't know if this is the
27:47same Microsoft that just wants to kill
27:50stuff too like Netscape for the sake of
27:52killing it whether they view us as that
27:56kind of threat or what yeah possibly
27:57work together how aggressive they'll be
27:59so we'll see I mean they did to be
28:01totally Frank it's the one company that
28:03I'd really worry about from from a
28:06competitive angle right and I think it's
28:09going to take them a long time to get
28:10where we are and I think it's also gonna
28:12take them a long time if ever to lose
28:14the mentality of its Microsoft first
28:17mm-hmm so I mean I I just want to get a
28:20little bit into the culture of while you
28:21and your team then how do you fend off
28:23it sounds like you you know you guys are
28:25hurting yourselves to you know see where
28:28and take them on but I mean as a company
28:31how do you plan on fending Microsoft and
28:34others off I might have a very different
28:37answer for this question eighteen months
28:39from now so we'll see how it plays out
28:41but we try not to be reactive to what
28:45competitors are doing and we hired a CMO
28:47a guy named Velma situs who was the
28:50perfect match culturally for us because
28:52the priority has been and will continue
28:54to be if we make our customers very
28:57happy then a will retain them and we
29:00have industry beating churn like 20
29:03basis points of churn a month and they
29:06will go on to recommend us and if that's
29:08where the focus is on making customers
29:10really happy then we will continue
29:13succeed on the same basis that we have
29:14because that 15% monthly growth is
29:16coming from people recommending us we're
29:18just at the very beginning stages of
29:20being able to test paid advertising and
29:22other marketing programs so that I hope
29:24will be a factor that allows us to
29:26continue to drive growth into the future
29:27but that 15% a month right now is coming
29:30from people love it and right if we can
29:32keep that as we grow then it doesn't
29:34matter what that flywheel doesn't matter
29:35what no one else does right Stuart final
29:38question will you ever successfully
29:41build a gaming company no I'm done
29:44that's good that's fine I'm actually
29:46glad to hear that Stewart Butterfield
29:49thank you so much thanks Michael
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