4 ms·
Commentary on valuation: 1. Box, a public company, is currently valued at $3.17B. It had revenues of ~$480M with a net loss of $150M in 2017 [1] 2. In contras
by mankash666 9y ago
Commentary on valuation:
1. Box, a public company, is currently valued at $3.17B. It had revenues of ~$480M with a net loss of $150M in 2017 [1]
2. In contrast, Dropbox had revenues of $1.11B with a net loss of $111M in 2017.
The higher revenues, and lower losses bode well for Dropbox. Objectively, that would value Dropbox in the $8B-$9B range, $1B-$2B short of it's previous $10B private valuation
[1]: https://goo.gl/Agf5Xt https://goo.gl/Agf5Xt
- maxxxxx 9y agoHow are they planning ever to make any profits? Their product was innovative some years ago but now they have a lot of competition so I'd expect their margins to get squeezed even more.
- swampthinker 9y agoThose numbers are even more impressive given that 2 years ago they had $600m in revenues with a net loss of $300m
- mankash666 9y agoBut it also means transfer of more equity from founders to investors, as investment terms these days typically include equity transfers if an IPO falls short of private valuations
- olivermarks 9y agowould like to see more evidence and proof those numbers are credible...
- mankash666 9y agoDropbox's numbers are in their S1 filing and Box's in their financials already linked. Are you questioning the legitimacy of these filings?
- olivermarks 9y agoUnhappily it's common to find that S1 financial claims are overstated after the fact, it's a part of making ipo prospects as positive as possible.
- zawerf 9y agoDoes this mean that investors in their $10B round lost money? Is this common?
- phamilton 9y agoRumor was they had a weird liquidation preferences in that round, which made it more like debt. Something like a 2x floor and 3x cap. Not sure how that resolves in an IPO though.
- hkmurakami 9y agoThey likely have protection clauses.
- totalZero 9y agoNot necessarily. First, the "vs Box" valuation above is simplistic and may not be comparing apples to apples. They are competitors but they are not identical companies, so scaling valuation based on a couple of inputs fails to capture all of their dissimilarities. Also, there is no consideration for a relative spread between the two if you value Dropbox directly off Box (or in other words, which one trades over). Second, the IPO is not always priced efficiently. Some executives might prefer to price lower just to see positive headlines about sustained gains after IPO. Others may counter that a low IPO price leaves money on the table. You should wait to see where the stock trades after IPO and any significant lockup expiries before evaluating the success of investors in the $10bb round.