Slack CEO Stewart Butterfield

image credit : Slack

Enterprise messaging unicorn Slack has now partnered with main competitor and software company Atlassian whose competing HipChat and Stride services will now be acquired by Slack which would in turn migrate these users onto its own service as both companies team up to take on Microsoft whose teams service count more paying users although Slack has more than double the total number of organizations using its service.

Atlassian is getting a stake in Slack as part of this deal with Slack paying an undisclosed amount over a period of 3 years to fully acquire HipChat and Stride’s suite and software stack as both companies collaborate to increase its share in the corporate communication software space.

Slack would also now offer better integration for Atlassian’s software suite consisting of its Jira Server, Cloud, Trello, Bitbucket, Confluence and other of its software products with newly added functionalities and consolidations.

After 6 years in the messaging market beginning with the acquisition of HipChat, Atlassian is now getting out with the HipChat and Stride service set to be discontinued next year as the $15 Billion market cap software company focuses on other aspects of enterprise software.

“Even with this change, we are not abandoning our original vision. We believe that this partnership is the best way to advance our mission to unleash the potential of every team. And it will allow us to improve our focus in other areas, including expanding our offerings for technical and IT teams.” quoting Atlassian in a newly issued press release where it also states that Atlassian’s over 2600 employees will now begin to make use of Slack’s services.

Slack has grown very rapidly since its launch and has become one of the hottest tech startups having raised $841 million in total since its start while being valued at $5.1 Billion post-money with its most recent $250 million Series G round led by Softbank’s $100 Billion Vision Fund.

In a bid to keep up with rapid growth, Slack has made 3 acquisitions so far and has led several investment rounds in related startups with partnerships to make its product much more desirable to customers which it has made very good progress on.

In reaction to this partnership, Atlassian stock jumped as high as 16% during after-hours trading boosting from around $67  to $81 a share (as of writing) representing a very good record for the company whose co-founder recently led self-driving vehicle startup Zoox’s $500 million Series B round which gave the company a valuation of $3.2 Billion.

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