Slack

Instacart

Slack

Slack uses a freemium model. The free tier gives you access to your most recent 90 days of messages and 10 app integrations.

That's enough to get hooked. Then Slack charges per user per month — $8.75/month for Pro, $15/month for Business+, and custom pricing for Enterprise Grid.

The beauty of the model is that one person signs up, invites their team, the team gets addicted, and suddenly the company is paying for 500 seats. It's a virus that charges rent.

Instacart

Instacart operates as a marketplace connecting consumers with personal shoppers and grocery retailers. Revenue comes from multiple streams: delivery fees and service fees charged to consumers (typically $3.99+ per delivery), tips to shoppers (passed through, not revenue), retailer partnerships (grocers pay Instacart for access to the platform and fulfillment services), and advertising.

Advertising has become the crown jewel. Instacart Ads lets consumer packaged goods (CPG) brands like Coca-Cola, Procter & Gamble, and Nestlé pay for sponsored product placements within the Instacart shopping experience.

When someone searches for "chips," Doritos can pay to appear first. This is incredibly valuable because it's advertising at the exact moment of purchase intent.

Ad revenue was $871 million in 2023 and crossed $950 million in 2024.

The retailer partnership model is key. Unlike DoorDash or Uber Eats (which listed restaurants without permission early on), Instacart works with grocers as partners.

Over 1,500 retail banners including Costco, Kroger, Albertsons, and Publix have formal partnerships. Instacart provides the technology and shoppers.

Grocers provide inventory and stores.

Slack

Stewart Butterfield had already done this exact thing once before. In 2002, he was building a massively multiplayer online game called Game Neverending.

The game flopped but one of its features — a photo-sharing tool — became Flickr, which Yahoo bought for $35 million in 2005.

So in 2009, Butterfield did it again. He started a company called Tiny Speck to build another game called Glitch — a quirky, non-violent MMO where players collaborated instead of fighting.

The game was beautiful, weird, and a complete commercial failure. It shut down in November 2012 after never finding a big enough audience.

But the internal communication tool the Glitch team had built for themselves was something special. They had created a searchable, organized messaging system because email was driving them insane.

Every conversation was in channels. Everything was searchable.

Files were shared inline. It was everything email should have been but wasn't.

Butterfield looked at this internal tool and thought: this is the actual product. In August 2013, Slack launched in preview.

Within 24 hours, 8,000 companies had signed up. Within two weeks, it was 15,000.

The growth was so fast that Butterfield said it felt like "trying to drink from a fire hose."

Instacart

Apoorva Mehta was a 26-year-old Amazon engineer in Seattle who quit his job in 2012 to start a company. The only problem: he had no idea what to build.

Over the next year, he started and abandoned roughly 20 different projects. A social network for lawyers.

A way to track restaurant wait times. Nothing stuck.

Then one day he was too lazy to go grocery shopping. He looked for a service that would shop for him and deliver everything to his door.

Nothing good existed. The existing options were grocery store delivery services that only worked during specific windows, had limited selection, and required ordering days in advance.

Mehta wanted to order groceries the way he ordered everything else online — immediately, from whatever store he wanted.

He built a prototype in 2012 and applied to Y Combinator. The demo was rough — he ordered a six-pack of beer through the app and had it delivered to a YC partner's house during the application process.

It worked. He got in.

Instacart launched in the San Francisco Bay Area in 2013 with a simple promise: order from your favorite local grocery store and have someone shop for you and deliver within an hour.

Slack

Slack grew almost entirely bottom-up. Nobody sold Slack to companies.

Employees adopted it on their own and then convinced their bosses to pay for it. One developer would start using the free version, invite their team, and within weeks the whole department was hooked.

IT departments would discover that half the company was already on Slack before anyone asked for approval.

The integrations strategy was genius. Slack made it dead simple for other software tools to plug into Slack.

Instead of checking Jira for bug reports, Salesforce for deals, and GitHub for code changes, everything pushed notifications into Slack. Slack became the operating system of work — the one app you kept open all day.

Word of mouth was the main growth driver. Slack didn't spend heavily on advertising early on.

They spent on making the product feel delightful. The loading messages were funny.

The emoji reactions were addictive. The search actually worked.

People genuinely liked using it, which is almost unheard of for enterprise software.

Instacart

Instacart grew by solving a problem one city at a time. They launched in San Francisco, proved the model, then expanded to other major metros.

Each new market required recruiting shoppers, signing up retailers, and building enough consumer density to make the economics work.

The COVID-19 pandemic was the inflection point. Grocery delivery went from luxury to necessity overnight.

In March 2020 Instacart announced it would add 300,000 shoppers, then raised that by another 250,000 weeks later. Order volume increased 500%.

Years of planned growth happened in weeks. The pandemic proved that grocery delivery wasn't a niche — it was the future of how a significant chunk of the population would shop.

The enterprise play is the long-term moat. By providing white-label technology to grocers, Instacart becomes embedded in their operations.

Even if a grocery chain wanted to build its own delivery service, they'd need years and hundreds of millions to replicate what Instacart provides. The more deeply integrated Instacart becomes in grocery operations, the harder it is to rip out.

Slack

Microsoft Teams was the existential threat. When Microsoft bundled Teams for free with Office 365 in 2017, Slack knew it was in trouble.

Microsoft had 300 million Office users who could start using Teams without paying anything extra. Slack even took out a full-page newspaper ad welcoming Microsoft to the chat market — a bravado move that masked genuine fear.

By 2020, Teams had overtaken Slack in daily active users purely on distribution.

The pandemic was a double-edged sword. Remote work exploded demand for Slack, but it also exploded demand for Teams, Zoom, and every other collaboration tool.

Slack's growth accelerated but so did everyone else's. The window where Slack was the obvious default was closing.

Revenue growth started slowing. After years of 50%+ annual growth, Slack's growth rate dropped to the low 30s by 2020.

Wall Street punished the stock, which dropped from its IPO price. The writing was on the wall — Slack couldn't outrun Microsoft alone.

In December 2020, Salesforce announced it was acquiring Slack for $27.7 billion. Butterfield stayed on as CEO until 2023, then left.

Instacart

The post-COVID hangover was brutal. After pandemic demand normalized, growth slowed dramatically.

The company's valuation dropped from a peak of $39 billion in early 2021 to about $10 billion at IPO in September 2023. Investors who bought at the peak saw a 75% paper loss.

The narrative shifted from "essential infrastructure" to "nice-to-have luxury."

Unit economics are perpetually tight. Paying a person to walk through a grocery store, pick items, bag them, and drive them to someone's house is expensive.

Unlike meal delivery (one restaurant, one bag), grocery delivery involves dozens of items per order, refrigeration requirements, and substitution decisions. Every order that requires a shopper to call the customer about an out-of-stock item eats into efficiency.

Amazon is the existential threat. Amazon Fresh, Whole Foods delivery, and Amazon's own logistics network represent a competitor with nearly unlimited resources and a Prime membership base of 200+ million.

Amazon has been willing to lose billions on grocery delivery to build market share. Instacart's advantage is retailer partnerships — Kroger and Publix use Instacart specifically because they don't want to help Amazon dominate grocery.

Slack

Slack is the core messaging platform — channels for teams, direct messages, threads for focused discussion, and huddles for quick voice/video calls. Slack Connect lets you message people at other companies directly through Slack instead of email.

Slack Canvas is a built-in document editor for notes and wikis right inside channels. Workflow Builder lets non-technical users automate repetitive tasks without writing code.

The App Directory has 2,600+ integrations — connect Google Drive, Salesforce, Jira, GitHub, or basically any tool your company uses.

Instacart

Instacart Marketplace — the core platform where consumers order groceries from 80,000+ stores for delivery or pickup, with personal shoppers fulfilling orders. Instacart+ — subscription service ($9.99/month) offering free delivery on orders over $35, reduced service fees, and credit back on pickup orders.

Instacart Ads — a retail media platform letting CPG brands run sponsored product listings, display ads, and coupons within the shopping experience. Instacart Platform (Enterprise) — white-label e-commerce technology that lets grocers build their own online ordering and fulfillment powered by Instacart's infrastructure.

Caper Cart — AI-powered smart shopping carts (from the 2021 Caper AI acquisition) with built-in screens, barcode scanners, and payment that let shoppers skip the checkout line.

Slack

Accel Partners, Andreessen Horowitz, Social Capital, GV (Google Ventures), SoftBank, Dragoneer Investment Group

Instacart

Sequoia Capital was an early and consistent backer. Andreessen Horowitz invested in growth rounds.

D1 Capital Partners led the 2021 round that valued Instacart at $39 billion. Existing investors including Valiant Capital, T.

Rowe Price, Fidelity, and Tiger Global participated across rounds. Y Combinator was the starting point (Summer 2012 batch).

The September 2023 IPO on NASDAQ priced at $30 per share, valuing the company at approximately $10 billion.