Aug
19
2020
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A pandemic and recession won’t stop Atlassian’s SaaS push

No company is completely insulated from the macroeconomic fallout of COVID-19, but we are seeing some companies fare better than others, especially those providing ways to collaborate online. Count Atlassian in that camp, as it provides a suite of tools focused on working smarter in a digital context.

At a time when many employees are working from home, Atlassian’s product approach sounds like a recipe for a smash hit. But in its latest earnings report, the company detailed slowing growth, not the acceleration we might expect. Looking ahead, it’s predicting more of the same — at least for the short term.

Part of the reason for that — beyond some small-business customers, hit by hard times, moving to its new free tier introduced last March — is the pain associated with moving customers off of older license revenue to more predictable subscription revenue. The company has shown that it is willing to sacrifice short-term growth to accelerate that transition.

We sat down with Atlassian CRO Cameron Deatsch to talk about some of the challenges his company is facing as it navigates through these crazy times. Deatsch pointed out that in spite of the turbulence, and the push to subscriptions, Atlassian is well-positioned with plenty of cash on hand and the ability to make strategic acquisitions when needed, while continuing to expand the recurring-revenue slice of its revenue pie.

The COVID-19 effect

Deatsch told us that Atlassian could not fully escape the pandemic’s impact on business, especially in April and May when many companies felt it. His company saw the biggest impact from smaller businesses, which cut back, moved to a free tier, or in some cases closed their doors. There was no getting away from the market chop that SMBs took during the early stages of COVID, and he said it had an impact on Atlassian’s new customer numbers.

Atlassian Q4FY2020 customer growth graph

Image Credits: Atlassian

Still, the company believes it will recover from the slow down in new customers, especially as it begins to convert a percentage of its new, free-tier users to paid users down the road. For this quarter it only translated into around 3000 new customers, but Deatsch didn’t seem concerned. “The customer numbers were off, but the overall financials were pretty strong coming out of [fiscal] Q4 if you looked at it. But also the number of people who are trying our products now because of the free tier is way up. We saw a step change when we launched free,” he said.

Aug
13
2020
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Slack and Atlassian strengthen their partnership with deeper integrations

A lot of “partnerships” between tech companies don’t get very far beyond a press release and maybe some half-hearted co-selling attempts. When Atlassian sold its chat services to Slack in 2018, the two companies said they would form a new partnership and with Atlassian leaving the chat space, a lot of people were skeptical about what that would really mean.

Since then, things got pretty quiet around the collaboration between the two companies, but today the companies announced some of the deep integration work they’ve done, especially within Slack .

Image Credits: Atlassian

Over the course of the last two years, Slack and Atlassian shipped 11 product integrations, which now see about a million active users every month, with Jira being the most often used integration, followed by Halp, which Atlassian acquired earlier this year.

Every month, Atlassian currently sends 42 million Jira notifications to Slack — and that number continues to grow.

At the core of these integrations is the ability to get rich unfurls of deep links to Atlassian products in Slack, no matter whether that’s in DMs, public or private channels. Coming soon, those unfurls will become a default feature within Slack, even if the user who is seeing the link isn’t an Atlassian user yet.

“Today, if you do drop a Jira link in your channel and you’re not a user — or even if you are and you’re not authed in — you just see a link,” Brad Armstrong said.

“You don’t get the benefit of the unfurl. And so one of the things we’re doing is making that unfurl available to everybody, regardless of whether you are logged in and regardless of whether you’re even an Atlassian customer.”

Image Credits: Atlassian

The two companies also worked closely together on making moving between the products easier. If you are a Jira user, for example, you’ll soon be able to click on a link in Slack and if you’re not currently logged into your Atlassian account, you’ll be automatically logged in. The two companies are taking this even further by automatically creating Jira accounts for users when they come from Slack.

“Even if you’re not a user, when you click on the link, we will then map you from Slack and create a Jira user for you that provisions you and auths you in so you’re immediately becoming a Jira user by virtue of wanting to collaborate on that piece of content in Slack,” Armstrong explained.

That, the two companies argue, turns Slack into something akin to a passport that gives you access to the Atlassian product suite — and that should also make onboarding a lot easier for new users.

Image Credits: Atlassian

“As you could probably imagine, as you know, onboarding is a pain, it’s hard because you have different roles, different size teams, so on and so forth,” said Bryant Lee, Atlassian’s head of product partnerships. “And that’s where you see some of the authentication stuff, the unfurling discovery piece really being an understanding of what those practices are. But the way that we look at it is not just about the product but people, products and practices. So it’s really about understanding who it is that we’re trying to optimize for.”

In addition to these new integrations that are launching soon, the two companies are also expanding their co-marketing efforts, starting with a new 50%-off offer for Atlassian users who want to also use Slack.

“We’re building on the strong foundation of our partnership’s success from the past two years, which has yielded tremendous shared customer momentum and impactful product integrations,” said Slack co-founder and CEO Stewart Butterfield . “Thanks to our strategic alliance, Slack and Atlassian have become the technology stack of choice for developer teams.”

Sep
05
2019
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Atlassian launches free tiers for all its cloud products, extends premium pricing plan

At our TC Sessions: Enterprise event, Atlassian co-CEO Scott Farquhar today announced a number of updates to how the company will sell its cloud-based services. These include the launch of new premium plans for more of its products, as well as the addition of a free tier for all of the company’s services that didn’t already offer one. Atlassian now also offers discounted cloud pricing for academic institutions and nonprofit organizations.

The company previously announced its premium plans for Jira Software Cloud and Confluence Cloud. Now, it is adding Jira Service Desk to this lineup, and chances are it’ll add more of its services over time. The premium plan adds a 99.9% update SLA, unlimited storage and additional support. Until now, Atlassian sold these products solely based on the number of users, but didn’t offer a specific enterprise plan.

As Harsh Jawharkar, the head of go-to-market for Cloud Platform at Atlassian, told me, many of its larger customers, who often ran the company’s products on their own servers before, are now looking to move to the cloud and hand over to Atlassian the day-to-day operations of these services. That’s in part because they are more comfortable with the idea of moving to the cloud at this point — and because Atlassian probably knows how to run its own services better than anybody else. 

For these companies, Atlassian is also introducing a number of new features today. Those include soon-to-launch data residency controls for companies that need to ensure that their data stays in a certain geographic region, as well as the ability to run Jira and Confluence Cloud behind customized URLs that align with a company’s brand, which will launch in early access in 2020. Maybe more important, though, are features to Atlassian Access, the company’s command center that helps enterprises manage its cloud products. Access now supports single sign-on with Google Cloud Identity and Microsoft Active Directory Federation Services, for example. The company is also partnering with McAfee and Bitglass to offer additional advanced security features and launch a cross-product audit log. Enterprise admins will also soon get access to a new dashboard that will help them understand how Atlassian’s tools are being used across the organization.

But that’s not all. The company is also launching new tools to make customer migration to its cloud products easier, with initial support for Confluence and Jira support coming later this year. There’s also new extended cloud trial licenses, which a lot of customers have asked for, Jawharkar told me, because the relatively short trial periods the company previously offered weren’t quite long enough for companies to fully understand their needs.

This is a big slew of updates for Atlassian — maybe its biggest enterprise-centric release since the company’s launch. It has clearly reached a point where it had to start offering these enterprise features if it wanted to grow its market and bring more of these large companies on board. In its early days, Atlassian mostly grew by selling directly to teams within a company. These days, it has to focus a bit more on selling to executives as it tries to bring more enterprises on board — and those companies have very specific needs that the company didn’t have to address before. Today’s launches clearly show that it is now doing so — at least for its cloud-based products.

The company isn’t forgetting about other users either, though. It’ll still offer entry-level plans for smaller teams and it’s now adding free tiers to products like Jira Software, Confluence, Jira Service Desk and Jira Core. They’ll join Trello, Bitbucket and Opsgenie, which already feature free versions. Going forward, academic institutions will receive 50% off their cloud subscriptions and nonprofits will receive 75% off.

It’s obvious that Atlassian is putting a lot of emphasis on its cloud services. It’s not doing away with its self-hosted products anytime, but its focus is clearly elsewhere. The company itself started this process a few years ago and a lot of this work is now coming to fruition. As Anu Bharadwaj, the head of Cloud Platform at Atlassian, told me, this move to a fully cloud-native stack enabled many of today’s announcements, and she expects that it’ll bring a lot of new customers to its cloud-based services.  

Jul
26
2018
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Slack forms key alliance as Atlassian throws in the towel on enterprise chat

With today’s announcement from Atlassian that it was selling to Slack the IP assets of its two enterprise communications tools, HipChat and Stride, it closes the book on one of the earliest competitors in the modern enterprise chat space. It also was a clear signal that Slack is not afraid to take on its giant competitors by forming key alliances.

That the announcement came from Slack co-founder and CEO Stewart Butterfield on Twitter only exacerbated that fact. Atlassian has a set of popular developer tools like Jira, Confluence and Bitbucket. At this point, HipChat and Stride had really become superfluous to the company and they sold the IP to their competitor.

Not only is Slack buying the assets and Atlassian is effectively shutting down these products, Atlassian is also investing in Slack, a move that shows it’s throwing its financial weight behind the company, as well, and forming an alliance with them.

Slack has been burning it up since in launched in 2014 with just 16,000 daily active users. At last count, in May, the company was reporting 8 million active users, 3 million of which were paid. That’s up from 6 million DAUs and 2 million paid users in September 2017. At the time, the company was reporting $200 million in annual recurring revenue. It’s a fair bet with the number of paid users growing by one-third at last count, that revenue number has increased significantly, as well.

Slack and products of its ilk like Workplace by Facebook, Google Hangouts and Microsoft Teams are trying to revolutionize the way we communicate and collaborate inside organizations. Slack has managed to advance the idea of enterprise communications that began in the early 2000s with chat clients, advanced to Enterprise 2.0 tools like Yammer and Jive in the mid-2000s and finally evolved into modern tools like Slack we are using today in the mobile-cloud era.

Slack has been able to succeed so well in business because it does much more than provide a channel to communicate. It has built a platform on top of which companies can plug in an assortment of tools they are using every day to do their jobs, like ServiceNow for help desk tickets, Salesforce for CRM and marketing data and Zendesk for customer service information.

This ability to provide a simple way to do all of your business in one place without a lot of task switching has been a Holy Grail of sorts in the enterprise for years. The two previously mentioned iterations, chat clients and Enterprise 2.0 tools, tried and failed to achieve this, but Slack has managed to create this single platform and made it easy for companies to integrate services.

This has been automated even further by the use of bots, which can act as trusted assistants inside of Slack, providing additional information and performing tasks for you on your behalf when it makes sense.

Slack has an otherworldly valuation of more than $5 billion right now, and is on its way to an eventual IPO. Atlassian might have thrown in the towel on enterprise communications, but it has opened the door to getting a piece of that IPO action while giving its customers what they want and forming a strong bond with Slack.

Others like Facebook and Microsoft also have a strong presence in this space and continue to build out their products. It’s not as though anyone else is showing signs of throwing up their hands just yet. In fact, just today Facebook bought Redkix to enhance its offering by giving users the ability to collaborate via email or the Workplace by Facebook interface, but Atlassian’s acquiescence is a strong signal that if you had any doubt, Slack is a leader here — and they got a big boost with today’s announcement.

Apr
13
2017
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Custom status messages are coming to Slack

 AFK, BRB, in a coffee meeting or what not — Slack, with its constant stream of communication, is probably not the the first place you’d drop an away message or status update to keep people informed of what you’re up to. But now Slack is adding its own flavor of status updates and away messages. Read More

Aug
18
2016
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Atlassian’s HipChat gets group video chats

HipChat_Group_Video In Atlassian‘s view, video is the next battlefield in the enterprise chat wars (a war it is mostly fighting with Slack, it seems). Its HipChat group messaging app launched one-on-one video chats back in 2014, but today, it is pushing this further by launching group video chats, as well.
To enable this, Atlassian built a new video platform based on its acquisition of BlueJimp and that… Read More

Jan
25
2016
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Workato Chat Bot Brings Enterprise Workflow Into Slack

Businessman tossing apps out of a smartphone. As we head into 2016, enterprise chat applications like Slack are suddenly a hot commodity, and if you’re inside chat a good portion of the day the argument goes, you should be able to access other work without leaving the chat client. This is exactly what Workato’s newly announced chat bot, Workbot, is designed to do. Chat bots are small programs that integrate with a chat… Read More

May
06
2014
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HipChat Launches One-To-One Video, Audio And Screensharing For All Users

Hipchat vid 1 Real-time communication platform HipChat is facilitating more than just text-based messaging with its most recent feature addition – it now supports one-to-one video chat, audio calls and screensharing across its apps for paid users. The move follows a beta test of these features, but now the feature is live for anyone, and HipChat founder Pete Curley believes this is a key step in helping… Read More

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