It is already official: Slack has registered its IPO in the United States, and the document provided reveals that it does not plan to do it in the conventional manner.
Slack has registered its IPO in the United States Securities and Exchange Commission (SEC) providing confidential documents.
They announced the event through a statement, in which they reported that the “flotation was expected to take place after the SEC completed its review process, being subject to the market and other conditions.”
The work tool was among the list of startups most likely to go public in 2019, along with other companies such as Uber, Airbnb and Lyft.
Of course, Slack’s debut on Wall Street differs from the conventional way that many startups tend to opt for. Like Spotify, the company seeks to go public on a “direct quote” basis.
The direct quote differs from the Initial Public Offering because instead of increasing capital and issuing new securities, the owners sell their shares to the public. Thus, they save costs since they do not hire investment banks, which usually take charge of the process and invest in the company to avoid the volatility of the shares.
“Slack can afford to opt for this route, less stable than the conventional one, since they have sufficient liquidity. In October of 2018 Slack had about 900 million dollars of cash, and in January of the same year had an income of 221 million dollars, according to CNBC.”