Stewart Butterfield and Joel Greenblatt are two of the most studied names in modern business, but they work in different worlds. Butterfield co-founded Flickr and Slack. Greenblatt founded Gotham Capital and wrote The Little Book That Beats the Market. Are they connected? No known business partnership or collaboration exists. They tend to be searched together because they offer two contrasting lessons in creating value: one by building products, the other by buying businesses wisely.
Stewart Butterfield and Joel Greenblatt at a Glance
| Stewart Butterfield | Joel Greenblatt | |
| Profession | Technology entrepreneur | Investor, author, educator |
| Nationality | Canadian | American |
| Known for | Flickr, Slack | Gotham Capital, Magic Formula |
| Core philosophy | Solve real user problems, adapt fast | Buy good businesses at cheap prices |
| Main lesson | Usefulness creates value | Price and process create returns |
Are Stewart Butterfield and Joel Greenblatt Connected?
No credible source shows that Butterfield and Greenblatt were partners, relatives, or collaborators. Butterfield’s public career is in software. Greenblatt’s is in investing and teaching. When two names appear together in search results, the usual explanation is curiosity about comparing an entrepreneur with an investor, not a hidden relationship.
How to check connection claims: look for primary sources such as company filings, press releases, or interviews, and be wary of articles that assert links without citing any.
Who Is Stewart Butterfield?
Early Life, Education, and Philosophy Background
Butterfield was born in 1973 in a small community in British Columbia, Canada. He moved to Victoria at age five and taught himself to use computers as a child. He studied philosophy and later earned a master’s degree in philosophy at Cambridge. That training in logic and questioning assumptions shaped how he approached product design.
Flickr: From Game Experiment to Photo-Sharing Pioneer
Flickr began inside a company called Ludicorp, which was originally building an online game. The team noticed that its photo-sharing feature was what users loved, so they turned it into a standalone product. Yahoo acquired Flickr in 2005 in a deal reported at around $20 million, and Butterfield stayed on under a multi-year contract.
Glitch: The Failed Game That Led to Slack
Butterfield left Yahoo and in 2009 co-founded a new company called Tiny Speck. Its game, Glitch, was released in September 2011 but failed to attract enough users. The team had built an internal messaging tool to coordinate their work. Rather than abandon everything, they pivoted to that tool, and it became Slack. The name stands for “searchable log of all conversation and knowledge.” It is one of the best-known pivots in tech history.
Slack: Building a Workplace Communication Giant
After its public release in February 2014, the tool grew at a weekly rate of 5 to 10 percent. In early 2014, nearly 16,000 users had registered without any advertising. A $120 million round later valued the young company at about $1.12 billion. By December 2015, Slack had raised US$340 million and had more than 2 million daily active users, of which 570,000 were paying customers.
Salesforce Acquisition and Life After Slack
Slack went public and was then acquired by Salesforce in 2020 for $27.7 billion in cash and stock. Butterfield stayed about two years, then announced his departure. His note to staff said he was not planning to start a new business and wanted more time with family. His exit came days after Salesforce co-CEO Bret Taylor announced his own resignation, and Lidiane Jones succeeded him as CEO. Check for recent news before publishing, since reporting about his post-Slack role changes.
Stewart Butterfield’s Leadership and Product Philosophy
Butterfield is known for craftsmanship in software: simple interfaces, fast iteration, and listening closely to users. He has been candid about how much luck and timing shaped Slack’s success, which is a useful reminder that execution and circumstances both matter.
Who Is Joel Greenblatt?
Early Career and the Founding of Gotham Capital
Greenblatt, born in 1957 in Great Neck, New York, is a Wharton graduate. He co-founded Gotham Capital in 1985 with Robert Goldstein. The firm specialized in “special situations” such as spinoffs and corporate restructurings.
Gotham Capital’s Track Record
Between 1985 and 1994, Gotham delivered an annualized return of 50% before the general partner’s incentive fees, or 30% net of all fees. In January 1995 it returned all outside capital, roughly $500 million. Gotham’s performance is also often described as about 40% annualized over 1985 to 2005. Past performance never guarantees future results, and these figures are self-reported.
Teaching at Columbia Business School
Greenblatt has taught “Value and Special Situation Investing” at Columbia Business School since 1996, as an adjunct professor. He also co-founded ValueInvestorsClub.com, an online community where investors share ideas.
Books by Joel Greenblatt
- You Can Be a Stock Market Genius (1997): a guide to special situations investing.
- The Little Book That Beats the Market (2005): a plain-language introduction to the Magic Formula, and the best starting point for beginners.
- The Big Secret for the Small Investor (2011): a case for low-cost, value-oriented index-style approaches.
Joel Greenblatt’s Value Investing Philosophy
Greenblatt’s core idea is to buy good businesses at bargain prices and be patient. A great company can still be a poor investment if you overpay.
What Is the Magic Formula?
The Magic Formula is a rules-based method that ranks stocks on two measures and combines the ranks to find companies that are both high quality and cheap. The best-known backtest covers 1988 to 2004, when the formula returned 30.8% a year while the S&P 500 returned 12.4%.
Earnings Yield Explained
Earnings yield compares a company’s operating profit with its enterprise value. A higher yield means you pay less for each dollar of earnings.
Return on Capital Explained
Return on capital measures how much profit a business earns on the capital it uses. A higher figure signals a stronger business.
A Simple Worked Example
Suppose Company A earns $50 million in operating profit, has an enterprise value of $500 million, and uses $200 million of tangible capital. Its earnings yield is 10% and its return on capital is 25%. Rank every stock on both measures, add the two ranks, and the lowest combined scores come out on top.
Limitations and Criticisms of the Magic Formula
Backtests are not live results. Independent researchers have found somewhat lower numbers in replication attempts, and the figures exclude real-world factors such as costs and taxes. The strategy can underperform for years, and it requires discipline. No formula removes risk.
Stewart Butterfield vs Joel Greenblatt: Key Differences
Building Products vs Evaluating Businesses
Butterfield asks, “What should we build?” Greenblatt asks, “Is this business worth owning at this price?”
Experimentation vs Investment Discipline
Butterfield’s career rewards testing ideas and changing course. Greenblatt’s rewards sticking to a tested process through market noise.
How Each Defines and Measures Success
Butterfield looks at adoption, retention, and customer engagement. Greenblatt looks at earnings, return on capital, and investment returns.
How Each Handles Risk and Uncertainty
Butterfield manages risk by shipping small and learning fast. Greenblatt manages it through diversification and by buying at a discount to value.
| Factor | Butterfield | Greenblatt |
| Starting point | Customer problem | Business price and quality |
| Tools | Prototypes, user feedback | Financial statements, rankings |
| Key metric | Active, paying users | Earnings yield, return on capital |
| Time horizon | Product cycles | Typically one-year holding periods in the formula |
What Do Stewart Butterfield and Joel Greenblatt Have in Common?
Both think independently and focus on real value rather than hype. Both take a long-term view, and both are willing to go against conventional wisdom: Butterfield by abandoning a game to build a chat tool, Greenblatt by buying unloved, overlooked companies.
Lessons Entrepreneurs Can Learn From Stewart Butterfield
- Solve a real problem. Slack began as a fix for the team’s own communication pain.
- Pivot when evidence demands it. Glitch failed, but its by-product succeeded.
- Obsess over usability. Simplicity drives adoption.
- Build culture early. Strong teams execute through setbacks.
Lessons Investors Can Learn From Joel Greenblatt
- Understand the business before buying.
- Price matters. Quality alone is not enough.
- Use a process to avoid emotional decisions.
- Be patient. Value strategies can lag for long stretches.
- Accept uncertainty. Even good analysis can be wrong.
How to Combine Both Mindsets
For Founders: Add Financial Discipline
Track margins, retention, and return on invested resources, not just user growth. A popular product that loses money is not a sustainable business.
For Investors: Evaluate Product Quality and Competitive Position
Numbers do not tell the whole story. Understanding why customers love a product helps you judge whether profits will last.
Practical Framework
| Goal | Action | Lesson |
| Build a product | Identify a recurring customer problem | Focus on usefulness |
| Improve a service | Collect and analyze feedback | Learn through experiments |
| Evaluate a company | Review financials and competitive position | Look beyond popularity |
| Compare investments | Weigh quality against price | Value and price both matter |
Common Misconceptions About Stewart Butterfield and Joel Greenblatt
- “They are partners.” There is no evidence of this.
- “The Magic Formula guarantees profits.” It does not.
- “Slack was a planned success.” It emerged from a failed game.
- “Greenblatt only picks stocks.” He is also a teacher, author, and community builder.
Conclusion
Stewart Butterfield and Joel Greenblatt are not business partners, but together they show two sides of business success. Butterfield proves that listening to users and adapting can turn a failed game into a $27.7 billion company. Greenblatt proves that a disciplined, price-aware process can compound capital over decades. Entrepreneurs should learn to build what people need, and investors should learn to pay sensibly for quality. Understanding both makes you a sharper decision-maker, whichever side of business you are on.
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Frequently Asked Questions
Who is Stewart Butterfield?
A Canadian entrepreneur who co-founded Flickr and Slack, and who led Slack until Salesforce acquired it.
Who is Joel Greenblatt?
An American investor, author, and educator who founded Gotham Capital and created the Magic Formula.
Are Stewart Butterfield and Joel Greenblatt business partners?
No known partnership exists. Their careers are in separate fields.
What is Stewart Butterfield best known for?
Co-founding Flickr and Slack.
What is Joel Greenblatt best known for?
Gotham Capital’s returns, value investing education, and The Little Book That Beats the Market.
What is the Magic Formula?
A stock-ranking method that combines earnings yield and return on capital to find cheap, high-quality companies. It does not guarantee results.
How did Slack start?
It began as an internal communication tool built by the Tiny Speck team while developing the game Glitch. After the game failed, the team turned the tool into Slack.
Which Joel Greenblatt book should beginners read first?
The Little Book That Beats the Market.
What is the main difference between their careers?
Butterfield builds products. Greenblatt evaluates and invests in businesses.
Why are they searched together?
People compare entrepreneurs and investors to understand different paths to creating value.
