Making Slack, the massively multiplayer online business tool

When a couple of small dev teams at software powerhouse Adobe first started using Slack, Cal Henderson and his team were pleased, but hardly surprised.

Henderson, chief technology officer and one of the founding team of Slack Technologies had designed the cloud-based collaboration service – conceived at the online game studio where they had previously worked – specifically for small, independent teams.

“We were basing it on what we’d built for ourselves when building video games and we knew it would be really good for people like us – small teams of developers, of like forty-ish people. We knew it would work great for that kind of model,” the Brit says.

But the tool started spreading across Adobe, used daily by teams without devs like the HR function, finance and facilities.

“We knew some people that worked there, but we didn't have any kind of formal relationship with them. And it just started popping up in all these teams in Adobe. There were hundreds of these small teams using Slack,” Henderson says.

The tool started spreading at other big tech companies, including the likes of IBM, Oracle, Autodesk and SAP. It usually taking hold in developer teams – Slack works on a freemium model, with advanced features accessed through a paid subscription – before finding users far removed from the function.

“For some reason in our minds we looked at big companies of 10 or 20 thousand employees and thought – well they work completely differently to small companies,” Henderson – who, by the way, claims to have never emailed anyone within the company – remembers. “It was a real surprise that it was so broadly applicable.”

Not long after the product’s launch in 2014, buoyed by the widespread adoption of some of the world’s biggest businesses Slack turned its attention to the enterprise.

That meant not only scaling up the technology behind the tools, making what works for a team of ten work for a company of thousands, but also scaling up Slack as a company.

It has been, as Henderson describes it, a “difficult and wild ride”.

Games often-ending

Slack can trace its origins back to a Vancouver game studio called Ludicorp – where Henderson was web development lead – which in the early noughties released a massively multiplayer browser-based roleplaying game called Game Neverending.

It emphasised social interaction, collaboration and object manipulation and found a passionate fanbase. But Game Neverending soon ended, with development halted in 2004.

From its ashes (and codebase), in particular the social image-sharing functions built into the game, would come image-hosting service Flickr.

(Game Neverending’s legacy remains in the ‘.gne’ file extension in a number of Flickr URLs.)

Henderson became head of engineering at Flickr – writing the platform’s APIs, which would influence the likes of oAuth and oEmbed – and stuck with the company when it was sold to Yahoo! in 2005.

In 2009 Henderson left Yahoo! to found another start-up with his Ludicorp crew called Tiny Speck, and took a second swing at launching a game, another browser-based massively multiplayer online game called Glitch. Like Game Neverending it was focused on collaboration between players, and again, was ultimately a flop.

"The dream in both cases was to make online video games,” Henderson tells Computerworld, “which definitely didn't work out either time!”

But again, all was not lost, from the "deliciously odd"Glitch and the tools Tiny Speck had created to collaborate within its small team came Slack (Searchable Log of All Conversation and Knowledge).

Screenshot from the "deliciously odd" MMO game Glitch

A little over five years ago, when the company launched Slack, it had eight people on staff. As of the beginning of this year there are more than a thousand people in its workforce.

“[The workforce has] doubled every few months consistently for years. The way we operate as a business, the way we build and deliver software for our service and help our customers has had to change constantly as a company has grown,” Henderson says.

Once a small group of product designers and engineers, Slack has since beefed up its finance, infrastructure, sales and marketing teams.

The bulk of staff in Slack’s Melbourne CBD office work in customer support – which is provided equally to both non-paying and enterprise users – a function Slack early ondetermined should be kept in-house.

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“With other products you've got to convince people to give it a go. With Slack we've got to convince people to convince their teams to give it a try. So there’s this high inertia to overcome. The more that we do around supporting people trying out the product with their team, the more support we can give them, I think the more successful they'll be,” Henderson says.

From humble beginnings, Slack now operates offices in San Francisco (where it’s headquarters are located), New York (where Henderson spends most of his time), Vancouver, Toronto, Dublin, London, Tokyo and Melbourne.

The company has a valuation in excess of US$5 billion.

“We've had to redo the process of how we do everything over and over again as the organisation grows. That still remains our biggest challenge and I think the hardest is to just grow at the rate we've been growing which has been tremendous over the last few years,” Henderson says.

Collaboration challengers

In January last year, Slack launched Enterprise Grid, a version of its product that fixed many of the issues that come with using Slack at scale. The main features allow administrators to set-up teams with their own centrally managed Slack instance, which can then be linked together using shared channels.

Since then more features have been added like app-management and user on-boarding tools and a suite of compliance, change control and security functions – anything to make sure “we can tick all those boxes that are just hard requirements to be able to roll out something like that in the enterprise,” Henderson says.

“Because we deliver software-as-a-Service we can’t ever take the service down or take six months to rebuild it. So refitting the engine without stopping the car has beenhellip;an experience as well,” he adds.

With feet now firmly in the enterprise space – with 150 customers including Capital One, Target, 21st Century Fox, Cond? Nast using Grid – Slack is facing far bigger competitors than ever before.

There is Facebook Workplace (Henderson doesn’t consider them a competitor, it’s “more of the company watercooler than for getting your work done” he says), Google’s G Suite and Atlassian’s Stride (made publically available in March).

The biggest threat, however, probably comes from Microsoft’s Teams which went live at the start of last year.

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While Slack relies on organic growth within a company, starting with a handful of employees, Microsoft (which reportedly considered paying $8 billion to acquire Slack)simply made Teams available to all Office 365 subscribers with Business Essentials, Business Premium and Enterprise plans.

“Definitely they have the advantage of massive distribution and a massive salesforce, but what we've increasingly seen over the last decade is that most enterprises are a Microsoft customer because they need Excel and maybe they need Outlook, but that hasn't stopped the rest of the SaaS world from continuing to grow and grow,” Henderson says.

“The landscape has opened towards multi-vendor software delivery. I think that definitely gives us a chance to be successful,” he added.

Slack has some other advantages, Henderson says, like the huge amount of knowledge it has on how people use the service and a greater willingness to integrate with third party applications.

“Our goal isn't to get an enterprise to buy a bunch of licenses, it is to have everybody at the company use it every day to get their work donehellip;That’s not the default stance of most enterprise software makers,” he adds.

For now at least, the numbers, both paying users and daily users are on Slack’s side – and by some way. Henderson’s focus continues to be on making Slack the very best it can be. Oh, and maybe a game – third time lucky?

“The dream is to continue to work on games. I don't think that can ever be a business, especially in the way that we wanted to turn it into a business before and failed,” says Henderson, a fan of minimalist text game A Dark Room. “When I have some time I’m definitely going to create a game and finish it and it’s going to be great!”

Copyright © 2018 IDG Communications, Inc.

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