Updated at 4:24 p.m. ET Thursday

In just five years, Slack has grown to have more than 10 million users and has become a verb in the process. "I'll Slack you" is shorthand for sending a message via the workplace chat platform.

On Thursday, the company took that popularity to the New York Stock Exchange, where its shares soared on its first day of trading. Slack Technologies opened at $38.50 per share — 48% above the starting price that had been projected Wednesday. It soared to as high as $42 per share Thursday, but closed at $38.62. That puts the company's value at about $20 billion.

Instead of having a conventional initial public offering, Slack entered the market as a direct listing, which means the shares were simply listed on the New York Stock Exchange. Most firms that pass on an IPO are widely known companies that are in good financial shape.

As Fortuneexplains:

"Unlike an ordinary IPO, a direct listing means the company doesn't issue any new shares and doesn't raise additional capital. It's primarily a way for company insiders to sell some of their holdings to investors, while bypassing the formidable fees and requirements of using an underwriter."

Spotify, the music-streaming company, went public as a direct listing last year.

In the fiscal year that ended Jan. 31, Slack nearly doubled its revenues, to about $400 million. But it had a net loss of nearly $139 million.

As it continues to grow, Slack's biggest hurdle will be proving to its users that it's more than just a chat application.

Forrester analyst Michael Facemire says it's hard for people to understand why the platform is more useful than other chat applications without trying it for themselves. With Microsoft Teams as a major competitor, Slack is facing pressure to distinguish itself in the market.

"If the world were only composed of technologists and developers and Silicon Valley illuminati, then Slack would be far, far ahead," Facemire says. "There is a large percentage of the population that isn't that. This is where tools like Microsoft Teams do just as well."

Slack is one of NPR's financial sponsors.

Slack's decision to begin trading as a direct listing follows a wobbly start for Uber, which has had one of the most anticipated initial public offerings in the tech sector. Last month, the ride-hailing company reported a $1 billion loss in its first public financial report, just weeks after its IPO.

Slack, which was publicly released in 2014, stemmed from an internal chat platform created by CEO Stewart Butterfield during a failed video game development. The software was created to avoid the confusion of email and, per its acronym, provide a "Searchable Log of All Conversation and Knowledge" for the team, which had people working all over North America.

Butterfield co-founded Flickr, which he sold to Yahoo for around $25 million in 2005. But despite interest from Amazon, Google and Microsoft in 2017, he held on to Slack, which continued to compete with emerging chat platforms.

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