As you may of heard, Slack just raised a $200M round of financing at a $3.8B valuation.
Per the first image below, they have 800K paying users.
If you look further down at the second image, you can see how much they charge paying users, between $6.67 per month or $15 per month.
Assuming all their 800K paying users are at the lower tier of $6.67 per month, they are at $64M in annual recurring revenue ($6.67 x 12 months x 800K). If they were a public company at this revenue, they would be trading at a 60x revenue multiple ($3.8B/$64M).
If their 800K paying users were at the high tier of $15 per month, they are at $144M in annual recurring revenue and 26x revenue multiple ($3.8B/$144M).
Realistically, their users are paying somewhere in the middle of $6.67 and $15, so splitting the difference of 60x and 26x multiple, they would need to trade at a 42x multiple.
Taking a look at the Bessemer Cloud Index, you can see that the largest multiple of public saas companies is Workday, trading at a 10x revenue multiple. So assuming the best case scenario, Slack is getting paying users at the upper tier of $15/month, the 26x revenue multiple is much bigger than Workday’s. That being said and a major implication to their current valuation, they are growing at a much faster pace than Workday or any other company in the Cloud Index.
If you look at the valuation of companies in the Cloud Index, fourth image below, only 9 companies have a higher valuation than Slack’s $3.8B.
Given Slack’s revenue and growth rate, they could IPO today, but the big question is what their market capitalization could be.
Shai's Blog 
Great writeup, Shai. My big question about Slack (I’m a user) is “stickiness”. I could quit using Slack tomorrow and my life wouldn’t change dramatically. Not the same for apps like Workday. I wonder if there’s a need to look at a “stickiness” axis as well, which might help establish a valuation floor.
for how long have you been using slack?
the longer you use it, the more history you have sitting there: valuable conversations, shared content/links, documented decisions etc.
like one uses to search email archives, you will turn to slack for reference.
so I would say there definitely is a lock-in…
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Remember when Twitter was the poster boy of unicorns a. la Slack? Twitter’s timeline got noisy and people just stopped using it. Slack, in my opinion, is also facing a similar possibility with noisy channels, thanks to all their gif & other integrations.
This kinda of touches on what Timothy mentioned. What is Slack’s long term play? It’s a great product but how far can they go before they are acquired?
High growth startups attract investors that are willing to invest at a high revenue multiple (compared to public comps) with the belief that they will grow into the valuation. Jason Lemkin did a great episode of TWiST back in November that touches on this: http://thisweekinstartups.com/jason-lemkin-saastr/
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