Slack in Talks with Thrive Capital

Thrive Capital is in talks to take a big piece of Slack’s next funding round, according to people familiar with the situation.

Slack could raise between $200 million to $250 million at a $3.6 billion pre-money valuation, according to a person briefed on the conversations. The talks remain ongoing and fluid.

The Takeaway
Thrive Capital is in talks to take a big stake in Slack, which is poised to raise another round of financing at a modest increase to its last valuation.

Slack had floated as much as a $5 billion valuation at one point, according to investors who spoke to the company, but it has steadily marched the price down. The messaging company raised at a $2.8 billion valuation last year.

The situation suggests that Slack, which has continued to grow quickly, is still a prize for investors. With $64 million in annual recurring revenue at the end last year, the price is steep. Yet some investors wonder how much more Slack can grow. It’s already the most valuable messaging company by a long way.

The company’s focus is now shifting to new product areas, including tools to support bigger companies and new ways to help people use bots to search through mountains of chatter. The company says it has 2.3 million daily active users and 675,000 paid seats.

The investment would be a major deal for Thrive, which has managed to get into hot startups like Twitch and Stripe in their later rounds. In the case of Twitch, Thrive led a $20 million round less than a year before Amazon bought the company for $970 million.

Thrive declined to comment. Slack didn't immediately respond to a request for comment.

The Wall Street Journal and Bloomberg previously reported that Slack was looking to raise money.

Jessica Lessin founded The Information in 2013 after reporting on Silicon Valley for eight years for the Wall Street Journal. She writes a weekly column about all things tech, media and the wild ride both industries are in for. She can be found on Twitter at @jessicalessin.