Salesforce buys Slack to send message to Microsoft

Salesforce will buy workplace-collaboration software maker Slack for approximately $27.7 billion in what is the biggest tech deal of 2020. The blockbuster acquisition became official yesterday although it had been rumored for about a week. The deal means software-as-a-service pioneer Salesforce adds a potent brand name to its growing stable of services that already includes MuleSoft and Tableau. Until the Slack deal, Tableau had been Salesforce’s biggest acquisition — Salesforce bought the maker of data visualization and business intelligence software products last year for $15.7 billion. Tableau is a direct competitor of Microsoft’s Power BI, just as Slack competes in the same space as Microsoft Teams. Now with Slack in its portfolio, Salesforce can take its competition with Microsoft to a new level in the exploding SaaS and cloud-computing sector.

Software-as-a-service products have become especially in demand during the COVID-19 pandemic as companies shift to a remote work platform and IT admins are tasked with providing employees with the tools they need to do their jobs wherever they are located.

In announcing the deal, Salesforce chief executive Marc Benioff said, “Salesforce and Slack will shape the future of enterprise software and transform the way everyone works in the all-digital, work-from-anywhere world.”

Slack chief executive Stewart Butterfield was even more effusive in his praise of the deal. “Personally, I believe this is the most strategic combination in the history of software,” Butterfield said.

Microsoft wasn’t mentioned by either Benioff or Butterfield, but the Redmond giant was definitely the elephant in the room. Microsoft Teams has taken a big slice of Slack’s market share in the workplace collaboration market, perhaps making the deal necessary for Slack to get the resources needed to compete and grow. With Slack in its portfolio of products, Salesforce can offer businesses powerful software suites the way Microsoft does with Microsoft 365. Salesforce’s lineup of apps includes its signature customer relationship management software along with scheduling and graphics software that also competes with Microsoft. Salesforce’s enterprise collaboration app Chatter is far less robust and has far fewer features than Slack or Microsoft Teams, so Slack will be an excellent fit in the Salesforce lineup.

The deal, which is expected to close early next year, still needs approval from shareholders and the Federal Trade Commission.

Featured image: Wikipedia

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