- Slack grew from zero to 1.1 million daily active users in under two years, making it the fastest-growing B2B SaaS product in history before its $27.7 billion acquisition by Salesforce in 2021.
- Stewart Butterfield co-founded Flickr in 2004 as a pivot from a failed online game, sold it to Yahoo for an estimated $25 million, and left the company in 2008.
- Butterfield’s second company, Tiny Speck, launched a multiplayer game called Glitch in 2011 that failed to find an audience — but the internal chat tool the team had built became Slack.
- Since leaving Salesforce in January 2023, Butterfield has become an active angel investor with a portfolio of 30+ startups spanning AI, fintech, and enterprise software.
1.1 Million Users in Two Years and a $27.7 Billion Exit
Slack is one of those products that changed the texture of work itself. More than 750,000 organizations use it daily. At its peak growth phase in 2015, it was adding $1 million in new annual recurring revenue every 11 days. Its free-to-paid conversion rate hit 30% — nearly unheard of in enterprise software.
In July 2021, Salesforce closed its acquisition of Slack for $27.7 billion, one of the largest enterprise software deals in history. Behind that number is Stewart Butterfield, a philosophy graduate from rural British Columbia who failed his way into building one of the most important workplace tools of the 21st century.
A Log Cabin in British Columbia, No Electricity, No Running Water
Dharma Jeremy Butterfield was born on March 21, 1973, in Lund, a fishing village on the coast of British Columbia. His parents were Americans — his father had crossed into Canada to avoid the Vietnam War draft. For the first five years of his life, Butterfield grew up in a log cabin on a commune with no electricity and no running water.
When the family moved to Victoria, he discovered computers. He taught himself to code as a teenager and changed his first name from Dharma to Stewart at age 12. He attended St. Michaels University School, earned a B.A. in philosophy from the University of Victoria in 1996, and a Master of Philosophy from Clare College, Cambridge, in 1998.
A philosophy degree was an unusual foundation for a tech career. But Butterfield has always credited it with shaping how he thinks about products — not what they do, but what they mean to people.
Game Neverending Dies, Flickr Is Born
In 2002, Butterfield co-founded Ludicorp with his then-wife Caterina Fake. The plan was to build a massively multiplayer online game called Game Neverending. The game flopped. But a photo-sharing feature the team had built as part of the game’s social layer started getting traction.
They stripped it out and launched it as Flickr in February 2004. Within a year, it had become the largest photo-sharing platform on the internet — one of the first products to define the Web 2.0 era. Yahoo acquired Ludicorp and Flickr in March 2005 for a reported $22 to $35 million.
”We thought we were building a game. We ended up building a photo-sharing site. You have to be willing to have your mind changed.” — Stewart Butterfield
Butterfield stayed at Yahoo as General Manager of Flickr until July 2008. He watched the company fail to invest in Flickr while competitors like Facebook and Instagram ate its lunch. It was a masterclass in how large corporations mismanage acquisitions — and it left a mark.
Glitch: The Beautiful Game Nobody Played
In 2009, Butterfield founded Tiny Speck and raised $17.5 million to build Glitch, a whimsical, non-combat multiplayer game. It launched in September 2011 to critical praise and player indifference. The audience was too small to sustain it.
By November 2012, Glitch was dead. Butterfield had to lay off most of his team. It was his second failed game in a decade — and this time, the stakes were higher. Tiny Speck had taken real venture money. The shutdown was public. The pressure was personal.
”The loss of the game was more traumatic than Game Neverending. We had more people, more money, more time invested.” — Stewart Butterfield
But something survived. While building Glitch, the team — split across Vancouver, New York, and San Francisco — had built an internal messaging tool to stay coordinated. It was fast, searchable, and organized by channels. Everyone who touched it preferred it to email.
August 2013: Slack Launches and Rewrites the SaaS Playbook
Butterfield pitched his investors on the pivot. Instead of a game, Tiny Speck would ship a workplace communication tool. In August 2013, Slack launched in preview. By February 2014, it had 16,000 daily active users. By June 2015, that number was 1.1 million, with 300,000 paid seats.
No enterprise SaaS product had ever grown that fast. Slack was adding users at consumer-app speed while charging business prices. Its subscription revenue grew 8% month over month. Competitors scrambled. Microsoft built Teams. Google revamped its chat products. But Slack had something its rivals could not replicate: a product so good that individual teams adopted it without waiting for IT approval.
”We are not building a chat tool. We are building an organizational transformation tool.” — Stewart Butterfield
By 2019, Slack filed for a direct listing on the New York Stock Exchange, opening at $38.50 per share with a market cap of $23 billion. NASA’s Jet Propulsion Laboratory used it. So did the New York Times, the Economist, and the Teen Text Crisis Line. The range of adoption stunned even Butterfield.
From $23 Billion IPO to $27.7 Billion Salesforce Deal
The pandemic supercharged Slack’s growth — but also intensified competition. Microsoft bundled Teams into Office 365 for free, making it nearly impossible for Slack to compete on price in large enterprises. In December 2020, Salesforce announced it would acquire Slack for $27.7 billion in a cash-and-stock deal that closed in July 2021.
Butterfield stayed on as CEO of Slack within Salesforce for 18 months. In December 2022, he announced his departure, effective January 2023. The transition was quiet — no drama, no public feuding. He simply moved on.
Angel Investor, Philosopher, and the Question of What Comes Next
Since leaving Salesforce, Butterfield has pivoted again — this time from operator to investor. His angel portfolio has grown to more than 30 companies, including Lovable (AI-powered app building), Neo Financial (Canadian fintech), and Linear (project management). He has spoken on podcasts like Masters of Scale and Lenny’s Podcast about product thinking, pivots, and what makes software worth using.
He has not announced a new company. But the pattern is hard to ignore: every time Butterfield sets out to build one thing, he ends up building something else — something bigger. Two failed games produced two of the most influential internet products of their respective eras. The philosophy student from a log cabin in Lund, BC, has made a career out of finding gold in the wreckage.
