Thread by @GavinSBaker

1) Slack S-1: growth is decelerating, annual market efficiency is improving, quarterly marketing efficiency is deteriorating and annual net dollar retention is slowing.

Changes to metrics are likely due to Teams. Overall, metrics and growth are still really impressive.

2) On a more granular basis, marketing efficiency has deteriorated for the last 3 quarters and January quarter saw the lowest marketing efficiency of the last 7 quarters (80%, which is still quite good).

Curious to see the April quarter when they update the S-1 on June 10.

3) Net dollar retention has declined for last 5 quarters, which supports the idea that there was some impact from Teams (which feels like it moved beyond MVP status in early 2018).

Last 12 months *may* have been peak incremental YoY competitive impact from Teams.

4) G&A deleveraged in fiscal 2019, suspect they will leverage it in fiscal 2020.

Important for Slack’s metrics around marketing efficiency and net dollar retention to begin stabilizing over the next 2-3 quarters. As noted, while metrics have deteriorated, they are still good.

5) Aggressive/predatory(ish) by Microsoft to make Teams available for free to Office 365 Business Essentials and up subscriptions. Ironic as I don’t think they would have gotten away with this in the late 1990s or early 2000s but regulatory scrutiny is now elsewhere…

6) Would love to see Slack’s adoption curves broken out between G-Suite users and Office365 users over the last 3 years. Instinct is that there has been no change to adoption curves or metrics within G-Suite users.

7) There is always “pent-up revenue” within Slack’s business as long as free users are growing and F2P conversion ratios are stableish (i.e. a certain % of the free customers added over the last twelve months will convert to paid).

❤️ well implemented freemium business models.

8) Shared channels are a smart way to begin establishing network effects from Slack across organizations rather than just within them but may have been launched too late given Teams. If only Teams had only been launched 2 years later than it was…

9) Impossible to comment on the stock as no valuation yet, but overall am really positive on Slack as a business – a searchable information archive organized by topic is obviously superior to email.

10) $28b TAM seems reasonable and Slack is in a duopoly with Teams. Super bullish that Hipchat couldn't compete in this category as $TEAM is a fantastic company.

❤️ owning duopolies and monopolies *especially* within software.

11) Curious to see where it trades. Looked at Slack when it is private and was cautious due to the valuation – that was a mistake! 🤦‍♂️

Stewart has executed really well.

I was not able to watch the analyst day on May 13 and hope to watch the replay soon.