On Thursday slack went public at $23 billion, with their stock valued between $36 and $37. However, they did not issue an Initial Public Offering they issued a Direct Listing.

Ticker symbol WORK

What is Slack?

It is a company that provides workplace messaging. With Slack emails will be a thing of the past.

What is a direct offering?

For companies that want to trade publicly but cannot raise equity capital, this is where a direct offering comes in.

Companies do not need to issue new shares. They can sell some their holdings to investors. This removes the need for underwriters (banks which create shares) and makes it less expensive.

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Earlier this year companies like Uber and Lyft went public after raising tons of capital, however they have not performed as well as expected.

The future of Direct Listings over IPOs

Could the future of publicly traded companies be through direct listings and not through initial public offerings? Although risky, it might be more economical.