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Why Slack Stock Jumped Today

By Evan Niu, CFA – Jul 8, 2020 at 1:49PM

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The enterprise messaging platform scoops up a corporate directory startup.

What happened

Shares of Slack (WORK) have jumped today, up by 8% as of 1 p.m. EDT, after the company announced that it had acquired Rimeto. The start-up offers an advanced business directory tool that will complement Slack's enterprise messaging platform.

So what

Slack plans to integrate Rimeto's profile and directory features directly into the platform while continuing to offer Rimeto as a stand-alone product for its existing enterprise customers. Rimeto was founded approximately four years ago to reinvent the enterprise directory. Profiles in Rimeto include far more information than traditional corporate directories that historically only include basic information such as names, titles, and contact information. 

Slack app on Mac

Image source: Slack.

Rimeto believes that including more data in the directory can facilitate greater collaboration by strengthening social connections, particularly in remote-work environments. Rimeto directories are also more easily searchable, allowing workers to find the right colleague based on a wide range of attributes.

"We've been on a mission to help everyone easily find and understand their colleagues -- and all of the groups, teams, and projects within their organization," Rimeto founder Ted Zagat said in a statement. "Joining Slack is a special opportunity to accelerate the impact and reach of the product we've spent years building." 

Now what

Slack did not disclose financial terms regarding the deal, but said the acquisition is not expected to have a material impact on financial results for the fiscal year. The tech company also added that it is not updating its guidance for the fiscal year.

Evan Niu, CFA has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Slack Technologies. The Motley Fool has a disclosure policy.

Stocks Mentioned

Slack Technologies Stock Quote
Slack Technologies
WORK

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