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June 24, 2019 03:20 pm

How One VC Firm Amassed a 24% Stake in Slack Worth $4.6 Billion

An anonymous reader shares a report: Stewart Butterfield loved the game, but not enough people agreed with him. He spent two years and raised roughly $11 million to build an online adventure game called Glitch that featured garrulous, blue-headed creatures and milk-drunk butterflies. Once people had a chance to play it and Butterfield could track the numbers, the verdict was clear: Glitch was a flop. "There was this night where I just lost faith," Butterfield said in a podcast interview. He decided in 2012 that it was game over. Butterfield made plans to shut down the company and give the remaining money back to his investors. Andrew Braccia, a partner at venture capital firm Accel, wouldn't accept the refund. He and other investors urged Butterfield to keep the remaining $5 million and try something else. That turned into Slack Technologies, the maker of corporate chat software that went public Thursday. At the close of trading, Slack's market value was $19 billion. Accel invested about $200 million in Slack over seven years, largely driven by Braccia's unwavering faith in Butterfield. As of the stock debut, Accel held 24% of the company, the biggest VC stake in a newly public unicorn in recent history. Those shares are worth $4.6 billion today.

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