In an ambitious move, Atlassian has decided to pull Loom into its portfolio for a cool $975 million. Not too long ago, in May 2021, Loom boasted a valuation of $1.53 billion, post-securing a $130 million Series C. Those were the days when the digital dream of an entirely cloud-based workspace seemed just around the corner.
The landscape may have shifted since then, but to Atlassian, Loom’s promise remains undimmed. With a massive user base of 25 million and over 5 million video chats monthly, the video messaging platform clearly holds allure. Atlassian envisions it to be a stellar addition to its collaborative tools, particularly in Jira and Confluence suites.
Mike Cannon-Brookes, the co-CEO and co-founder of Atlassian, commented on the acquisition, “The asynchronous video model is emerging as the future of teamwork. Partnering with Loom allows remote teams to communicate more intimately and effectively.”
There’s also the intrigue of AI. Atlassian believes that AI-driven features like video transcriptions, summaries, and the resultant documents and workflows can revolutionize the way teams interact and work together.
Loom’s CEO, Joe Thomas, expressed optimism about this new chapter. “Loom aims to redefine communication at workplaces, irrespective of geography. Teaming up with Atlassian enables us to drive our vision forward and magnify our mission to supercharge team potentials,” he noted. A sentiment, it’s worth mentioning, echoed by many CEOs on the verge of such partnerships: the belief that together, they can scale greater heights.
It’s impressive to trace back Loom’s journey. Since its inception in 2015, the company has raised north of $200 million. Its 2019 Series B funding of $30 million witnessed participation from the who’s who of the tech and VC world. The likes of Figma’s Dylan Field, Front’s Mathilde Collin, and Instagram’s Kevin Systrom and Mike Krieger, alongside heavyweight VCs Sequoia and Kleiner Perkins, pitched in.
A quick glance at Loom’s clientele is equally impressive, with giants like Ford, Tesla, Disney, Walmart, Goldman Sachs, and Amazon featuring prominently.
However, it wasn’t all smooth sailing. The generous free tier of Loom’s services could have been a double-edged sword. Perhaps the balance skewed too much towards non-paying users, which can be inferred from the workforce downsizing by 14% that the company announced last June.
As for the acquisition’s logistics, Atlassian is all set to finance the deal with its existing cash reserves. The companies anticipate wrapping up the deal by the third quarter of the upcoming year, following the usual regulatory green lights and approvals.