The Next Web NYC - Cal Henderson, Slack

ubiquitous Wi-Fi or has that time ever, you know, really arrived? I'm not sure. Anyway, enough about Wi-Fi. He's also created a lot of really good stuff for people that are colorblind. He himself being colorblind, he's been noble and selfish enough to create some really cool tools to make the web a more accessible place for colorblind people. And he also created a product that I use absolutely every day. Ladies and gentlemen, I'm talking of course about the founder of Foursquare, Carl Henderson. No. Swarf. No. Slack. Slack. Definitely Slack. Carl Henderson. Go ahead. Hi everybody. I'm Max Kapp. I'm a So we're going to keep this really snappy because I know we're going up against lunch here. But I just really quick, just so we're all on the same page, is there anybody here who doesn't use Slack every day? Like if you don't, okay, there's like three maybe. So Slack, it's a common thing. It's a collaboration tool. Obviously it's growing very fast. Cal, first thing I wanted to ask you is, you know, you and Stuart Butterfield, the CEO, co-founder of Slack, go way back. You were an early employee of Flickr. I'm just kind of curious what's different this time around versus that time? What are the, why has it been so much easier for you guys building Slack than it was to build Flickr? Yeah. Well, it's not just Flickr. But I don't know. I don't know how many people know about the history of the company. But we are twice failed video game developers. We were trying to build a video game. Flickr came out of that. We tried to build another video game. And Slack came out of that. I think the huge difference between when we started Flickr and when we started Slack was Flickr was 2003. Which is like not that long ago. You know, whatever that is. 13 years. But there was, the Internet was such a different place. There was, relatively speaking, nobody used it. The Web was tiny. This is pre-Facebook, pre-YouTube. Before Flickr, you couldn't upload a photo and put it on a web page for other people to see. Unless you ran your own server. And that sounds insane today. You know, this is obviously pre-Twitter and pre-Snapchat. And there was just so many fewer people using the Internet. There was no social Internet products. And so, when we were building Flickr, we were, you know, helping create that category of people using the Web with other people. And that's, you know, that's something that we're not battling now. You know, it's just, it's obvious that you would use the Web and the Internet for work and social lives. So, obviously, easier to get users, I guess, is kind of what you're saying? There are a lot more users available and they're easier to get to. And money. I mean, that's a big one too. I mean, you know, when you're starting out in the early 2000s, you know, money, I'm sure, was always a concern. Stuart Butterfield, I don't know if you all saw this quote last year, but he said, It's the best time to raise money since the internet. It's the best time to raise money since, like, the time of the ancient Egyptians. So, I'd say that Slack's fundraising challenges have not been that great. It's definitely not as challenging as trying to raise money for a small, unproven team in Canada post-WorldCom and Ron financial collapse. It's definitely a better time than that. That's true. What set you guys apart? Because, like, you know, there were lots of collaboration tools, even when you were getting started. You know, we were talking backstage. I feel like there are just so many different chat apps that could have been candidates to be the chat app that you use when you're working. Did you guys think about that? Think about the competition? Or how did you sort of think about, like, what makes us different? Yeah, I mean, to some extent, not really. Because there was, there were a bunch of chat apps. And, like, IRC obviously goes back to the 80s. And we were heavily influenced by IRC. And we were either targeted or taken off in the, like, in the business space. But we were definitely, you know, building upon the success of chat in the, like, in the personal space. Because we'd seen the rise of Facebook Messenger and WhatsApp, WeChat and Line outside of the U.S. And it seemed like it was an inevitable direction that work was going to take. But nobody had really figured out how to translate that into the workplace yet. And, you know, like, we spent so much of our time at work and so much of our time communicating this with our coworkers. And for some reason, the default was still let's use e-mail, a tool built 20, 30 years ago to model the written letter. It seems just such a terrible way to communicate with people. They're exchanging hundreds of thousands of, you know, messages with a day. So you guys at Slack use Slack, right? Definitely. We are pretty heavy users of Slack. We use it at Bloomberg as well. So how often do you check your e-mail? Just in a normal course of a work day? In a normal course of a work day. So I'm, you know, within the company. I'm a little bit of a, like, outside edge case because I do have to communicate with people outside the company. So I check my work e-mail about once a day usually. Once a day. Okay. I usually hit that, like, before I'm out of bed. Like you're hitting the Gmail refresh button. Is that where we're going? I mean, do you think e-mail goes away? Or, like, what's the future look like? That's really tough to say. I mean, e-mail is, like, on one hand is like the cockroach of the Internet. It will be impossible. It's impossible to kill. Because it is the lowest common denominator. You know that however you, whoever you want to contact, they probably have an e-mail address and they probably check it at least once a day. So I think it's going to be a long time until that goes away. But as a new generation of people join the workforce and don't have an expectation that everybody has an e-mail address and everybody checks it, I think that's definitely going to change. But I don't think we're going to see it disappear from, like, from professional life for the next couple of decades at least. It's kind of just wedged in there to stay. So, okay, so you have, I think, 4 million users. Is that right? Daily active. Daily active. Yeah. How did you get there? Like, were there tricks? I mean, like, if you're, you know. I mean, you know, on the one hand we get there one user at a time. Right. But the, I think the most important part was the, you know, early on when we're building a product like Slack, unlike a, you know, a straight consumer product, I don't have to convince you to use it. I have to convince you and everybody you work with to use it at the same time. So that was a very difficult proposition. So getting from just using it ourselves internally to having our first external customer try it was a, you know, a real big hump to get over. And the first company, I think, that used Slack, you know, outside of ourselves was Rdio, rest in peace. And, you know, we were just friends with people on the design team there and we badgered them, like, constantly until they would give it a try. Yeah. And then what we saw there was that once you have a team adopting it. Adoption, like, really picks up. Like, you either start using it and everybody uses it immediately or it doesn't work out. And so, and then, you know, within Rdio we saw it grow to eventually take over the entire company. And we saw that pattern again and again with startups we were friends with. And that's. So basically, like, somebody works at Rdio, they get a job at a different place, they bring it with them or? Yeah, we did see a lot of, like, the diaspora after the company shut down. Yeah. And I think it's a lot of our initial spread, other than the very initial spread where it was like, please, I'm not going to do this. Please, please try our crappy product. We promise that it will pay off in the end. After that kind of initial seeding, which we had to do very manually, was that people would be using it at work and then they'd start to use it for a social group or at home or some, like, you know, cross company interest group. And then it would grow into companies like that. Got it. Did you do a lot of marketing, though? I mean, was that the main? Through the first couple of years of the company, none at all. We didn't do any advertising. You know, we had tech PR. Right. But, you know, it quickly grew outside of Rdio. It quickly grew outside of the tech sphere. So, saying we're, like, being in San Francisco, in the Bay Area, it feels like absolutely everybody uses Slack and everybody knows what it is. But outside of the tech sector, that's not the case. Well, we have a lot of people in, you know, different industries using Slack. It's not a ubiquitous tool that absolutely everybody uses yet. So, how big a thing for you guys, I mean, I've read some of this stuff. I think we were talking about it before. How big a deal is sort of chat bots? And AI? And, like, the ability to, you know, use software to, like, communicate? So that I'm, rather than asking, like, my HR manager, like, you know, does my healthcare cover this? I'm just going to ask a robot or something in the future? Is that the idea? Yeah. I like the vision of asking, like, a giant Chrome robot about that, you know, where all people in HR are replaced by automatons. That's probably not the future. No offense to anyone who's in HR. No offense to anyone who works in HR. There are probably, I think, two really interesting tracks there. There is the conversational interface side of bots, which is, you know, like, is it easier than using some interface designed specifically for the task you're doing versus asking a computer to do it in natural language? And that's, we've seen an interesting rise in that outside of Workspace with Siri and Cortana and whatever Google's amalgam of tools. But none of that stuff really works yet. I don't think. I mean, it works so much better than it did five years ago. Yeah. Much like AI and machine learning and natural language processing is not a smooth increase in, like, you know, effectiveness, we saw this with photo recognition. Back when we were working on Flickr in the early days, the idea of being able to look at a photo and tell you what was in it was just like, oh, hard computer science problem. Nobody will be able to do that for decades. And then suddenly overnight, neural networks and we can say that's a dog and that's a kitten and that child is smiling. And that ceased to become a difficult problem. And I think, you know, leaps like that happen in machine learning. And so natural language processing is getting so much better. But at the same time, the English language is just so horrible to learn and speak. Google, I think, poached a couple of big time AI engineers earlier today. You know, you guys, obviously, you're well funded. You know, you're a unicorn, et cetera. But, I mean, you're a lot smaller than a Google. And there are a lot of startups out here in the audience, you know, trying to do things with AI where you just like have like no hope of, I mean, I don't know. Can you win in these, in a battle for like AI supremacy? Or like how do you even think about like what your role is in terms of technological innovation in a world where Google can basically spend, you know, an unlimited amount of money to do better natural language? That is definitely true and definitely frightening to all, you know, to compete with companies on that scale. But at some point, Google didn't exist. At some point, Facebook didn't exist. And they don't always win in every category. Like pouring an infinite amount of money into things doesn't guarantee that you'll be successful. On the other hand, they're probably more likely than any individual tiny startup to be successful. But I think that from Slack's point of view, when people, you know, like solve natural language processing, whatever that means, or are able to like use machine learning to really get more value out of the data that, say, Slack stores. It's, there's, you know, we already provide a bunch of value in being able to look back through those and search over them. But if we could, we could provide or somebody could provide a lot more value by saying these are the most important conversations that happen today. Or these are the most important things that happen over the course of the year. Or to be able to answer questions like free form questions intelligently based on the messaging. So if I say, what were our revenue numbers between February and March last year? And how do they compare to this month? Having natural language processing understand what that means and then extract all of that just from your messaging. So that's like kind of creepy though, right? I mean, it's, there's a Slack app called Growbot, right? Where it like listens to your conversations. And if you're praising someone, it'll basically amplify that praise and sort of alert people. And like do people get, that's kind of weird, right? Like I mean, that's a level of kind of intrusiveness that maybe we're not used to. Like as, you know, workers. Or is it something that we're just going to all just sort of learn to live with or? I think it's the same as when any kind of new technology is introduced. It seems weird and terrible at first. And then we figure out what's important about it and what we can actually learn from it. And how it can, you know, make us work more effectively. And then it becomes normalized. I mean, you wouldn't think it was creepy if a human was doing that. So it's like, it's a bit weird that we think it's creepy if a bot's doing that. Well, I guess what's different is that like if my human manager wanted to read all my emails. It would take a really long time. Whereas like a really smart AI could maybe like read it in, you know, a couple of minutes. And search for signs of, you know, dissent or discomfort. Or, you know, use it in a way that's like a little bit different. I guess that's true. Although for anybody who's worked at a large company. Probably the only person reading all of your email are lawyers when you're involved in a lawsuit. And like, I don't know, I'm less creeped out by robots than lawyers. Fair enough. But I think that it's. You know, anytime any kind of new technology comes along. It takes a while for us to understand how we're going to use it. And how we're going to interact with it. And I think that is definitely true of bots. I think, you know, being able to talk to a Pepsi bot about the Pepsi brand. Is not the be all and end all of bot interactions. That is, you know, we're just scratching the weird surface right now. Have we had that cat moment? Like what you were talking about with Flickr. Where suddenly, you know, has that breakthrough moment happened yet with chat bots? I don't think so. I mean, like, obviously we've demonstrated that if you put a Twitter account. You know, on Twitter. Then it becomes a weird fascist in about 24 hours. But I don't think Tay is like the breakthrough. Nice Microsoft dig there. Oh, I forgot that was even Microsoft. Another dig. But there's, I think we haven't had that breakthrough moment in natural language processing. But it may not be super obvious when it comes along. Got it. So that's a good segue. You know, you guys talk about Slack as an operating system for business. Of course, the, like, the operating system for business that everybody thinks about is, I think, you know, Microsoft Windows, Microsoft Office. Maybe Mac OS in this. Yeah, yeah. Maybe a Mac. But Microsoft obviously looms large. Which is kind of interesting. Because just a couple of weeks ago, you guys took out a full page ad in the New York Times kind of dissing Microsoft. Microsoft had launched sort of a competing app. And Slack wrote this. A letter that I think was kind of inspired by a letter that Apple wrote to IBM welcoming them to the revolution. And I guess my question is kind of a long preamble. But do you guys want to kill Microsoft? Is that the kind of long-term play here? No, I don't think we're out to kill anybody. You know, the, you know, that letter was that we knew Microsoft was launching a competing product. Yeah. And we either get out in front of it or react to it. And we chose to get out in front of it. But what about Microsoft? What does this operating system for business mean? Yeah, I think that can be a super confusing and misleading term. Because, you know, like 10, 15 years ago, you would get all of your software tools that you used for your business from a single vendor. And that was probably Microsoft. But if you're a bigger company, that could be SAP or Oracle or somebody like that. And there has been an evolution in the last decade that has created all of these new categories of software that just didn't exist before. You know, whatever your business is, you're probably using 20, 30, 40 different tools. All from different vendors to get different aspects of your job done. You know, it's like marketing analytics is now a big segment that just didn't exist as a software segment before. And there's been all of this fragmentation. And it used to be that the operating system, probably Windows, was like the core of where all those things came together. But with the rise of the smartphone and using that at work, like you're not just using Windows or Mac OS. You're also using iOS and Android. And your apps, like, don't even run on any of those. They run in a browser. They run from 20, 30, 50 different vendors. And there's no longer, like, a center of gravity for business computing. And I think that with, like, multi-platform, multi-vendor, and the web, the only place that it makes sense to tie those things together is at the communication layer. So that's what we mean when we say an operating system for business. It is you use all of these services. What is the, like, the common core and how they interact? And we think Slack is a great platform to be able to do that on. Right, right. And that's kind of important. And if you want to tie these services into Slack, you have to pay for Slack generally, right? I mean, that's a, it's sort of a way to get people to become paying customers. Yeah, I think that's definitely true. Like, if, you know, if you're using Salesforce or you're using NetSuite or you're using Google Docs, and we can make it, you know, 2%, 3%, 5% better, your experience of using that through using it with Slack, then that's going to add value to your organization. That's going to make Slack super valuable to you. So I want to ask sort of a culture question. So Cal is so, you know, famous and beloved at Slack that there is no Halloween at Slack. There's just Caloween, as I understand it, where everybody just, you know, they dress up. So this is super fucking creepy and is not, to be clear, this isn't something that I endorse or am involved in. But for some reason, a couple of years ago, Ali, who's our head of customer care, decided it would be really funny if everyone dressed up like me. So, like, I dress like this every day. I wear shorts, sneakers, and plaid shirts. Like, it's my thing. And I came into the office two years ago on Halloween, and everybody was dressed like me and wearing glasses and, like, had their hair done like me. It was like, what the fuck? I saw a picture. There's even, like, a little kid dressed up. That's my kid. Okay. So the first year, we were like an office of 40 people. I was like, whoa, that's super weird, but at least it's not going to happen again. And then the second year, 350 people around the world dressed like me. I'm like, well, that was an amazing effort, of course. It will never happen again. And then two weeks ago, 700 people in, like, ten offices all dressed like me. I hope this is the end of it because it's, like, you have meetings throughout the day, and I think that I'm in them. So this is a good. We actually got covered in TechCrunch because we were out getting lunch, and there was, like, everyone in Silicon Valley dresses the same. It's such a weird . Like, they're literally dressed as me. So, but it seems like there's sort of an interesting subject. I think there's a lot of interesting subtext here, which is that, you know, in a world where, you know, we're not maybe talking out loud as much to one another, where, you know, Slack has a bunch of different offices, where we're sort of, you know, basically working through these chat apps. Like, it seems like it's harder to kind of maintain your company culture and to, like, to feel close to people. And I'm kind of curious, like, do you have thoughts on that? Do you have tips for people as they're trying to build businesses or, you know, work within organizations where this is a very, very different world? Like, how do you sort of, you know, I don't know, create that kind of closeness or form, like, a coherent culture? I think that, like, fragmentation of culture has happened just as people have been working remotely and work has been spreading out, you know? Yeah. The, you know, original reason that we created the precursor to Slack was because we were split between an office in San Francisco and an office in Vancouver in Canada. Yeah. And we needed to work tightly together. And so that's why, you know, that's kind of how Slack was born. Yeah. And I think that because that has been the direction that companies have been going anyway, that's, you know, in some senses Slack has become a digital water cooler. Yeah. It's the equivalent of how you chat to your coworkers outside of the main task you're doing. And I think, you know, there's ways that you can encourage that in Slack. So we have, as well as, like, you know, the Random and the Cats channel, we have employee resource groups and interest groups. So it's like if you're really into running, there's the running channel. Right. You know, and that doesn't matter if you're in New York or in Dublin or in San Francisco. Right. You know, you can still be part of that. But, you know, there's a lot of things that you can do in Slack where in the past, like, you would have, those people would have never talked. So big takeaway for me, we're going to need to wrap up, is from this conversation just that, you know, work is changing. And that, like, this thing that you're building is having a big impact on that. I mean, when you think about, like, say, like, ten years from now, like, how work is going to look, like, what do you think is going to be different? Or, like, what is the thing that we don't appreciate? And, like, you know, one idea I have is maybe there will be fewer managers. Because a lot of, it seems like a lot of these apps, like, are basically doing tasks that, you know, managers do. But I'm wondering kind of, like, yeah, take us ten years from now and, you know, what's work? Yeah. And how is it different from what it is today? So, you know, impossible to say with any amount of clarity. But I think the characterization of less managers is probably wrong. But it is hopefully that people spend less time doing mundane tasks that can now be automated. You know, like, we don't have a typing pool anymore in offices. Right. And we're not going to have so many rote tasks for people. Like, if you can, instead of having to ask somebody, you know, to answer a simple question that's been asked 30 times before, if a bot can answer that for you, then it's, you know, it's taking away the boring, like, rote tasks of people's jobs. And, you know, focusing on where they are uniquely adding value. Right. And things that humans are really good at as opposed to robots. So when is Slack going public? Who knows? Thank you. Thank you very much for the time. Thank you all for listening. See you soon. All right. Thanks very much. Nice, man. That was fun. Great job. Thanks so much, guys. So we're going to go into lunch break. Lunch break up until quarter past 1. There will be a lot of food available, all done by local Brooklyn and area restaurants. So enjoy. Meet some new people. And I'll see you all back here at quarter past 1.