Microsoft considered making an $8 billion acquisition bid for Slack

With more than 2.3 million daily active users, it’s not that hard to see why so many companies are interested in acquiring Slack, a popular service that helps co-workers interact and collaborate with each other. Microsoft was even considering making an $8 billion bid for the company, according to a report from TechCrunch on Friday, but Bill Gates and Satya Nadella were against the idea. Instead, Gates suggested that Microsoft start adding features to Skype to make it more of a Slack competitor, which would not only save the company money, but would also allow it to tap into Skype’s established userbase of around 300 million.

When Slack announced new voice and video services earlier this week, the enterprise messaging startup signalled a move into territory dominated by the likes of Microsoft’s Skype. But it looks like this is not the only moment when the two company’s paths have crossed in recent times. Microsoft eyed Slack as a potential acquisition target for as much as $8 billion, TechCrunch has heard. But an internal campaign around making an offer failed to drum up support. Microsoft co-founder Bill Gates and CEO Satya Nadella were among those unconvinced by the idea, with Gates pushing instead to add more features into Skype to make it more competitive with Slack in the business market, our source says. Slack’s momentum in picking up new users — it currently has 2.3 million daily active users, 675,000 of them paying — makes it a competitive threat for others who are hoping to lead in enterprise collaboration services. It’s no surprise that as of last year, Slack had already had 8-10 acquisition offers. The person at Microsoft leading the charge on Slack was EVP of applications and services Qi Lu. Lu, according to his Microsoft executive profile page, oversees all productivity, communications, education, search and other information services at Microsoft, and he also “sets the vision, strategy and overall direction of the Applications and Services Group,” including R&D for Microsoft Office, Office 365, SharePoint, Exchange, Yammer, Lync, Skype, Bing, Bing Apps, MSN and the Advertising platforms and business group.

By Michio Hasai

+Michio Hasai is a social strategist and car guy. Find him on Facebook, Twitter, and Pinterest.

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