Salesforce CEO Marc Benioff bought Slack for a $28 billion and then never used it

Slack co-founder Stewart Butterfield and Salesforce CEO Marc Benioff met for barely an hour before the $27.7 billion Slack sale.Slack co-founder Stewart Butterfield spent barely an hour with Marc Benioff before Salesforce agreed to buy Slack for $27.7 billion in 2020. The last of those meetings ended early because a Hollywood star walked in. The detail comes from Johnny Rodgers, a former Principal Engineer at Slack and one of its earliest employees, who has been documenting the company’s story on his Building Slack blog.“I only got about one hour of total facetime with Marc before the deal was announced. My last meeting with him was cut short because McConaughey arrived,” Butterfield told Rodgers for the second part of his Salesforce series. That is Matthew McConaughey, whom Salesforce reportedly pays $10 million a year to be its spokesperson. Rodgers also writes that it was clear inside the company that Benioff himself did not use Slack and did not quite get it.Salesforce offered Slack more than double its share priceThe deal came as a surprise to most of Slack. In the first part of the series, Rodgers recalls an untitled calendar invite from Butterfield in late 2020, sent to the company’s original team. On the Zoom call, Butterfield asked how they would feel about selling Slack to Salesforce at $45 a share. The stock was trading around $22 at the time.The approach had come from Bret Taylor, then Salesforce’s chief operating officer, in the late summer of 2020. Slack was nearing $1 billion in annual recurring revenue, and the pandemic had made it a default tool for remote teams. At $27.7 billion, it was the second-biggest software acquisition ever at the time, behind IBM’s $34 billion purchase of Red Hat.Benioff publicly called it “a match made in heaven”.Marc Benioff praised Slack Huddles but did not use the app himselfThe deal closed in July 2021. Butterfield reported to Taylor, who soon became co-CEO alongside Benioff. The plan was for Taylor to run day-to-day operations while Benioff stayed on as the founding face of the company.Huddles, the quick audio calls Slack rolled out in mid-2021, became its first big feature under Salesforce. Benioff singled it out at a company all-hands and praised how fast the team had built it. But Benioff was not a Slack user, and that left Slack’s leaders unsure where they stood inside Salesforce.Salesforce’s sales teams had the same problem. “They didn’t understand the product. So they sold the products they understood,” Slack co-founder and former CTO Cal Henderson told Rodgers.Butterfield, meanwhile, grew frustrated with how Salesforce was run. Rodgers writes that he watched executives sign off on expensive celebrity appearances while cutting employee travel between offices. Millions were spent flying senior staff to Hawaii every year for an event called Laulima. His suggestions to Taylor and Benioff went nowhere.A Davos panel with will.i.am pushed co-founder Butterfield out of SalesforceThe breaking point came at Davos. Butterfield went expecting to meet customers on behalf of Slack and Salesforce. Instead, he was booked on an innovation panel with will.i.am, another Salesforce celebrity spokesperson. “It was so f***ed up,” he told Rodgers.Butterfield planned to announce his exit on December 1, 2022, with Salesforce executive Lidiane Jones taking over as Slack CEO. A day earlier, Taylor announced that he was leaving Salesforce. “I had no idea,” Butterfield posted internally. Rodgers believes Taylor most likely made a bid for the sole CEO job and quit when Benioff said no.Rodgers stayed on until spring 2023, ending 11 years at Slack. He is now building a new chat app called Supergroup and says one final Building Slack post is still to come.