Slack Technologies Inc. is being valued at $16 billion U.S. to $17 billion U.S. ahead of its initial public offering next week.
That valuation is based on the workplace chat and collaboration software company’s projected revenue and current growth rate, according to the investment banks that are managing the share offering.
The expected value is up from the $7.1 billion U.S. in the company’s most recent private funding round held last August. It’s similar to the company’s share sales on the private market, where in April investors were snapping up stock at prices that would give the company a valuation of about $16 billion U.S.
Slack is planning to have its shares start trading on June 20 on the New York Stock Exchange under the ticker symbol "WORK." Slack said Monday that it expects at least $590 million U.S. in revenue in its 2020 fiscal year, which ends next January. That’s a growth rate of as much as 50% compared to the previous year.
That suggests the company could bring in almost $900 million U.S. in fiscal year 2021, and investors are looking to value the company at roughly 20 times that projected revenue growth.
However, Slack said in its filings with the U.S. Securities and Exchange Commission that it can’t guarantee that its plans to increase revenue and cut operating losses will ever allow the company to become profitable.
