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Glad to see them doing well. Working for a company that legally cannot use services that are not self-hosted can be quite a challenge and Mattermost really is a godsend in that regard.
What industry?
We switched to mattermost from slack. We're in trading.
Even for companies that aren't in trading, I can't think of many reasons why anyone would want to switch back to Slack on an organizational basis. Public communities, sure. But organizationally? No contest IMHO.
Most companies don't have the infrastructure and staff needed to host an application like this and take care of security, ongoing maintenance, updates etc. Much easier to pay a few bucks per user and trust someone else to handle it.
That 'few bucks per user' is a bit misleading.

Slack's cheapest business plan is usd $7 / month / seat.

Hosted mattermost is usd $3 / month / seat.

Electric utility and energy trading.
Am I assuming correctly that the idea behind this is that you self-host everything, to be isolated from energy failures that could have cascading effects? Or is it more due to security reasons to be harder of a target?
As far as I'm aware (I'm not exactly central to our information security processes), it is more of the latter.

Due to the amount of electric power we control, we, as a company, have been deemed critical infrastructure by the state and as such, we have to comply with rather rigorous information security standards.

We do, however, also have an uninterruptible power supply for the most critical hardware.

We're under no legal requirement but I simply don't trust Slack employees to be good stewards of our data. On a UI/UX basis, Slack and Discord are far superior to Mattermost, so hopefully they can use this funding to close that gap.
Probably a good call. Slack trains recommender systems w/ all user data mixed together. Although w/ attempts to preserve privacy... See their paper from recsys '18 Vancouver.
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Recommeneder for what ?
The only recommendations I remember on Slack are for channel participation - accidental suggestions to leave some I don't really read any much, and to join some I may be interested in.

YMMV, but for me that's a very low value feature.

The same for me. That's why I was asking.
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Does the thing they're trying to to build really cost more than 20M to build?

If so, why? That sum buys a lot of engineering and sales hours.

And if not, why raise so much?

Slack is raising a lot more money. Mattermost stands purely as a decent competitor to Slack.
Is mattermost the most popular self hosted alternative to slack now? I don't usually hear about rocket chat lately.
Yes -- I would think laregely because GitLab include in their instances thus Mattermost is the devlopers/tech persons choice of chat app while Slack seems more suited to general public and GSuite Hangouts will likely become the enterprise option due so many enterprises already paying Google for email services etc.
Is it normal for a startup this old to raise a Series A?
"Series A" is just a shorthand. Doesn't mean anything too specific.
(Shorthand for first formal vc round.)

B is second...

Seed rounds can still be pretty formal.
Slack will acquire them
I actually think it's more likely Microsoft will acquire them. A strong history of on-prem solutions, mixed reception to their Slack-killer Microsoft Teams, and a newfound mandate to create open and interoperable solutions make it a clear option.
As someone who is stuck with Teams at work and uses Slack with a small circle of friends, I'd say Teams is mostly acceptable. If either one were to replace the other in either context, I wouldn't care.
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I really hope they make the free version of mattermost a bit more safe to use. Currently, any user can archive the channel and the security is really scary.
how soon until our ultra-paranoid security team convinces our company we need to switch to this
Is it really not possible to bootstrap this or raise through debt? Why do you need $20m to compete in this market?

I wish more companies would avoid taking large outside investment, but maybe that’s unrealistic.

Whats wrong with taking large outside investment if the terms are favorable?

As an extreme example, if I thought my company was worth $40m and someone offered $20m in exchange for 10% of my company I would absolutely take that deal whether or not I needed the money.

The problem might not be that the company is taking a deal when they shouldn't. It very well could be that the investors are overpaying. It's also totally possible that this is a good deal if it helps the company get a bigger slice of the market because they can grow quicker.

You’d take that money, and now you have a 200m dollar company, so you need to hire, market and scale like a 200m dollar company. And btw you need to be worth a lot more than 200m next year otherwise your investors (who have significant influence) will be pissed off.

So instead of continuing to deliver for your current customers and users you start chasing bigger things, and if you’re lucky it works, if not you fail and your company burns all the cash in a couple of years and files for bankruptcy.

You're both right. Whether taking VC capital makes sense is context-dependent. What kind of business is it, and what are the market dynamics? What are your own goals for the business? Etc.
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Slack has raised $1.2 billion and is now going to raise even more by going public. Discord has raised $280 million. Microsoft is putting who knows how much into teams.
I was under the perhaps mistaken impression that Slack was not raising money from going public since they were doing a direct listing
IPO’s are always about money and getting rid of unwanted investors
This is correct. They are just listing their existing shares; not issuing new capital. But once public, they can issue stock at will.
To buy lots of advertising and sales staff.
Hi @albertgoeswoof, Mattermost CEO and co-founder here.

To me, a Series A investment is about bringing on more supporters for the business. Redpoint led our round and they've also been investors in companies we admire: HashiCorp, Zendesk, and Twilio.

I'm excited to have their help to deliver more value, more quickly to our users and customers.

While I think it's possible to build a great company without significant outside funding (e.g. Valve), I think it's more rare, therefore higher risk.

Thanks! Mattermost is an excellent product already so good luck.
Thanks @albertgoeswoof!!
When I worked at Uber we used this an it was internally called "uChat". I have two things to note about this:

1) When uChat was first rolled out the team who ran the rollout did everything they could to make it seem as though they had created uChat from scratch and that it was an internal tool, even though everyone knew it wasn't. The rollout was comically inefficient and the platform didn't scale at all to Uber's size. The uChat team then tried at an all-hands to talk about what a great job they had done building uChat which was followed by a slew of questions around all of uChat's massive failings such that the CEO started grilling them a bit. It was both embarrassing and strangely funny to watch what was either their total lack of self-awareness or their blatant misrepresentation of everything they had done.

2) When I left Uber in November of last year, uChat was still pretty dysfunctional. I use Slack today in my new role and it's a MASSIVE step up.

What was it? A skinned version of some OSS app?
It was Mattermost, the company that just raised $20M in the article. He says it in the first sentence, though I didn't see that at first either.
Hi @h3throw, Mattermost CEO here. I highly appreciate your feedback.

People care a lot about their communication systems and we're continually listening and working to improve.

The $20M Series A helps us more quickly narrow the gap between open source and proprietary solutions.

We want to continue to invest, grow and raise funding so we can relentlessly improve open source options.

I've found that the customers that choose Mattermost have a long term view. They're joining us on the journey that brings more choice to the market. They share the belief that the world can be made safer and more productive through open source technologies.

A $20M Series A may not seem like a lot compared to the $1.2B Slack has raised to date--But it's four times the size of Slack's $5M Series A in 2010: https://www.crunchbase.com/funding_round/slack-series-a--539...

@h3throw, may I beg you for a favor?

So I can learn more about addressing your comment in 2), could you help share one thing we can improve?

FYI this comment comes across as very unnatural marketing through 'community engagement', hijacking the top comment. This is HN not some business Bros you can lull to market with 'journey' fluff. Please don't abuse HN.
Thanks @jabberthemutt, you might be right on the marketing-y speak for HN.

Basically I was one of the people that started the open source project and I'm trying to find out what the top issues are so we can fix them.

The last lines would have sufficed then! ;)

Thanks for your wonderful software BTW!

Thanks @jabberthemutt!!
How long ago was that? And if the problem were simply scaling issues ( Technically solvable ) or were they design issues? ( Basically the product guys don't really get it )
Mattermost gets so many more things right. Switched from Slack in 2018 and never going back.
I'm a big fan Mattermost but it really needs to spend this money on:

-making decent mobile apps. I know the current Android one is awful -introducing end to end encryption for conversations

Thanks @secfirstmd!

Just curious:

- Which version of the mobile apps are you using? We've been making significant improvements on Android - Is your use case for E2E more for enterprise or is it more for online communities (what kind of community)?

Trying to understand more,

Hi. So using the version on 18th Jan 2019. I love the tool and deploy and use it a lot but the Android still needs more work.

Regarding E2E. We use Mattermost for online communities. Primarily human rights defenders, aid workers and journalists all over the world. There lives are very clearly at risk in many cases so without E2E for a lot of them we unfortunately cannot use Mattermost as surveillance is an issue.

Mattermost is open core and doesn't federate. Matrix.org / riot.im is the better alternative, even if it has taken them a longer time to get to this point.