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Abu Dhabi, UAESaturday 23 June 2018

Softbank said to be among backers for start-up Slack

Slack 'raising the fresh funding at a valuation of slightly more than $5 billion'

Mubadala agreed this year to co-invest in Softbank’s $100bn technology fund, alongside the Public Investment Fund, Saudi Arabia’s sovereign wealth fund, Apple, Foxconn and Qualcomm, among others. Issei Kato / Reuters
Mubadala agreed this year to co-invest in Softbank’s $100bn technology fund, alongside the Public Investment Fund, Saudi Arabia’s sovereign wealth fund, Apple, Foxconn and Qualcomm, among others. Issei Kato / Reuters

The software start-up Slack Technologies is raising US$250 million in a new funding round, according to people familiar with the matter, boosting the company's valuation as Silicon Valley companies enjoy a surge in venture capital investments.

Slack, which makes messaging and collaboration software for businesses, is raising the fresh funding at a valuation of slightly more than $5 billion, the people said, a step up from its previous $3.8bn valuation.

The investment is being led by SoftBank and the venture capital firm Accel, a previous investor, said the people, who declined to be identified. SoftBank has been heavily investing in startups, and it recently launched a $93bn Vision Fund for technology investments.

Other previous investors are participating. Slack has in the past raised money from the venture firms GGV Capital, Spark Capital and Thrive Capital, among others.

The Slack spokeswoman Julia Blystone declined to comment on "funding rumours". Slack is headquartered in San Francisco.

Bloomberg and the news website Axios previously reported the funding deal.

Slack's sizeable funding round reflects the trend of a growing number of $100m-plus checks pouring into technology startups. In the second quarter this year, there were 34 venture capital deals of $100m or more, nearly triple the 12 such transactions in the first quarter, according to data firm PitchBook.

These large rounds have helped drive an uptick in startup funding since the end of last year, with venture capitalists investing $15.7bn in companies during the second quarter this year, a 27 percent increase from the first quarter and making for the strongest quarter in a year, according to Reuters data.

Reuters