The anatomy of a billion-dollar pivot.
In 2012, Stewart Butterfield watched his video game company bleed to death. After three years and $12 million, the game was too weird to reach mainstream success.
Seeing the end, Stewart tried to return the remaining $5 million to his investors, but they refused. They hadn’t bet on the game; they bet on him.
It was a gamble that would pay off massively. While working on the game, his engineers had hacked together an internal chat tool to make working across time zones easier. Over three years, they had turned a cobbled-together tool into a highly advanced communication hub that was addictive to use.
So Stewart pivoted. He let the video game die and refocused the company on the tool they named the Searchable Log of All Conversation and Knowledge, or Slack for short. (I’d love to know how many hours it took them to make that acronym work.)
A pivot with everything to lose.
Fast forward to July 2013 and they are two weeks from sharing Slack with the world. The team is exhausted and ready to crash. But instead of ordering pizzas to boost morale (thankfully), Stewart publishes a 3,000 word memo. In it, he lays out their mission…
“Our job is to build something genuinely useful, something which really does make people’s working lives simpler, more pleasant and more productive.”
He warns them of what they’re up against…
“We are setting out to define a new market. And that means we can’t limit ourselves to tweaking the product; we need to tweak the market too.”
And he closes with a rallying cry…
“Why?” Because why the fuck else would you even want to be alive but to do things as well as you can?”
Stewart saw the future.
Stewart understood that Slack would change the world of business communication, but only if they could shift customer behavior en masse.
“We are asking our customers to spend hours a day in a new and unfamiliar application, to give up on years or even decades of experience using email for work communication. It is an almost impossibly large ask.”
A shift this big required a perfect user experience. Stewart wanted every pixel, UI detail, UX interaction, workflow, and touchpoint to build a cohesive and flawless experience.
“We need to look at our own work from the perspective of a new potential customer and actually see what’s there. All of us, and we have to do it every day, over and over and polish every rough edge off until this product is as smooth as lacquered mahogany.”
So just what idea was Stewart trying to sell in his memo?
Obsession. Passion. Excellence.
But how do you engineer obsession?
Telling a tired team of developers to “be passionate” won’t cut it. Stewart needed to hack their mindset, so he turned to a powerful rhetorical device.
Research shows the average person uses 600 to 1,500 analogies every single day. Cognitive scientist Douglas Hofstadter argues that analogies are the primary way our brains make sense of a chaotic world.
And that’s what Stewart used; the extended analogy.
An extended analogy doesn’t just make things easier to understand, it allows the listener to run ahead of the speaker and form connections on their own. They become active participants in understanding.
To build this obsession, Stewart anchored his memo in a few, very rich analogies:
He uses the Acme Saddle Company as his core analogy for what they were really selling…
“They could just sell saddles, and if so, they’d be selling things like quality, styles, sizes, durability, or price. Or, they could sell horseback riding.”
He used a top-tier restaurant to show how every detail must work together to create a single great experience…
“The room, the vibe, the timing, the presentation, the attention, the anticipation of your needs (and, of course, the food itself); nothing can be off. They serve with a quality that is measured by its attention to detail.”
And he uses Lululemon and Harley Davidson as proof that selling the outcome can be a game-changer…
“Harley Davidson especially sells freedom and independence. Lululemon, when there was not a large market for yoga-specific athletic wear, sold yoga like crazy.”
When obsession builds an empire.
Two weeks after Stewart’s memo, Slack announced its preview release. Primed by a massive PR comeback story and an exclusive, invite-only rollout, the launch was a massive success. Less than a year later, Slack hit 500,000 daily active users and earned a valuation over one billion, making it the fastest-growing enterprise software company in history.
If Stewart hadn’t used the extended analogy so deftly, his memo would have been another CEO begging his team to work harder. But by forcing them to think about horseback riding and Michelin-star restaurants, Stewart helped his team think beyond the software they were building and how to obsess for the humans who would use it.
Ignoring how analogies can help you communicate is like having a superpower you don’t know how to use. The next time you need to rally your team, skip the generic clichés like, “We need everyone rowing in the same direction.” Take the time to build an extended, cohesive analogy that challenges them to greatness.
Want to read Stewart’s original memo? You can find it here.
Note: Quotes have been edited to improve readability while preserving meaning and voice.
