Slack to buy HipChat and Stride assets from Atlassian, Atlassian will make equity investment in Slack; HipChat and Stride to shut down in February 2019
Atlassian Corp. is selling its corporate chat software to rival Slack Technologies Inc. and taking a small stake in the startup …
Context & Ripple Effects
Atlassian spent a year trying to beat Slack head-on: it launched Stride as a Slack-like workplace service in September 2017 starting at $3/user/month beyond the free tier, then opened Stride's API to all developers five months later to court third-party integrations. Neither move dislodged Slack, and today Atlassian is conceding the category outright.
The structure of the concession matters as much as the fact of it: rather than a clean sale, Atlassian swaps its chat assets for an equity stake in Slack, keeping financial exposure to the market it failed to win directly. Its retreat from chat continues afterward, when it sells Jitsi, its chat and videoconferencing tool, to cloud conferencing provider 8x8 as part of the post-HipChat wind-down.
First-order effects
- HipChat and Stride customers have until February 2019 to migrate, and Slack inherits their accounts — converting its best-funded rival's user base into its own overnight.
- Atlassian exits direct competition in team chat while retaining upside through its Slack equity stake, freeing it to focus on its remaining collaboration and developer products.
Second-order effects
- Slack's competitive moat widens without a product battle: the last large independent software company backing a rival chat client becomes an investor instead, removing subsidized price competition like Stride's $3/user tier from the market.
- Atlassian's piecewise divestiture of its chat stack — assets to Slack, Jitsi to 8x8 — signals to other enterprise vendors that partnering with the category leader beats funding a losing challenger.
Third-order effects
- If the pattern holds, team communication consolidates around fewer standalone platforms, with would-be competitors exiting via asset sales and equity stakes rather than multi-year product wars — a quasi-exit template other subscale challengers may follow.
The trend: Enterprise team chat is consolidating around a single independent leader, with defeated rivals converting their products into equity positions rather than continuing to compete.