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Dropbox has been hammered by Wall Street ever since it went public. On the surface it should be trading well enough given it's revenue growth from when it went
by raiyu 6y ago
Dropbox has been hammered by Wall Street ever since it went public. On the surface it should be trading well enough given it's revenue growth from when it went public to now, however, the narrative of competing with both Microsoft and Google was a tough one to play down.
Revenue growth will slow down to below 20% in 2021 which basically starts to take DBX out of the high growth tech stock focus and it is trading at less than 5x 2021 revenue when the median is somewhere closer to the 12-14x range and that's for companies below 30% growth.
The same was seen with Slack. Though they had great revenue growth, the narrative was that they couldn't compete with Microsoft and so their stock never really traded at a comparable revenue multiple compared to others.
It could be said that they have a heavy spend on Sales and Marketing but the same could be said of plenty of other Enterprise tech focused companies like MongoDB that still commands a very high forward looking multiple.
Unfortunately from the end-user side the experience has suffered somewhat and I've personally switched away from Dropbox so I can't really say they are doing great on the product side and the amount of "Growth Hacking for Revenue" that is now part of the product experience is a bit off-putting.
Also shows the potential for issues if you end up solely dependent on one product and don't diversity, especially if it's seen as a commodity.
The work force reduction is purely to turn the company profitable on a net basis and the trailing twelve months they've already gotten into the black. That's down from a $400MM loss just a couple of years ago.
But the belief is that there isn't a tremendous amount of profitability internally, because the expenditures are just too high, and cutting further into that theoretically will reduce revenue growth further.
- brundolf 6y agoIt's dismaying that even the best, most shining examples of unicorns that took off on the backs of good products and have stood toe-to-toe with the mega-corps, are now losing value simply because they're competing with the mega-corps, and being forced to look for acquisitions just like all the other startups. If that doesn't plainly show that big tech has gotten too big, I don't know what will.
- aNoob7000 6y agoFor me it was the lack of storage tiers. When the only options is to get 1TB or more, I think you lost a lot of users. Additionally, they should have figured out a way to share storage with a family, if the only profitable storage tiers are 1TB or more then let people share it.
- brundolf 6y agoMeh, we're talking a single-digit increase in price to go from the previous-lowest tier to the current-lowest 2TB tier. I only use a tiny fraction of it, but it's still a good value. The family thing makes sense - I don't have a family I would share with so it's never come up - though couldn't you just sign into the same account on multiple devices?
- nvarsj 6y agoWhat do you use as an alternative to Dropbox? I haven't found anything that works as well across multiple platforms. I really hate all the feature bloat in it, which I never use, and weird decisions like dropping non-ext4. But still, for basic file syncing it seems hard to beat.
- raiyu 6y agoMy use case maybe different from yours but GDrive has worked well for me.
- beached_whale 6y agoThe others are generally not supported on Linux. Dropbox has a cli client here that mostly works. At least if we are talking Google/Microsoft. Or the companies are small enough to go under overnight and leave me in a lurch
- uniformlyrandom 6y agoGoogle drive unofficial client works pretty well for me on Linux.
- beached_whale 6y agoThere is a difference between official and unofficial support. Also, Dropbox is big enough to be around for a while, but this is their product and if it goes south, so do they. I don't trust Google to maintain any product before rebranding, pushing the work to the users, or dropping the product. They have shown otherwise.
- benhurmarcel 6y agoInsync works well for Google Drive on Linux.
- pedro2 6y ago
- shroom 6y agoI'm a paying customer for Dropbox and I've just had it installed on my computer for when I occasionally had to share files with customers. Never really felt I used it to any extent but I also never canceled my subscription because I'm happy for what it is and I can't bother to find alternatives. However my computer recently crashed and when "re-installing" Dropbox I discovered that they have many more useful "Apps" included like backup and password-sync and a neat paper scanning app for the phone. All of which I was very happy to discover. So I see myself keeping my subscription for the foreseeable future. :)
- nabla9 6y agoMore important than revenue growth is the expected margins after the growth slows down. What Dropbox is selling is something that will be bulk commodity. They will never be able to settle and get good revenue.
- u678u 6y ago> Dropbox has been hammered by Wall Street ever since it went public. "Hammered" ha SV lives in a dream world. Its barely making a profit and no great product in the future. It still has market cap more than say Wendy's and H&R Block put together.
- uyt 6y agoIt's funny that a lot of their acquisitions were in spaces that had the potential to exceed the market cap of their core product (which is currently stuck at 9B) had they been more successful: - HelloSign for esignatures, compared to DocuSign which has a 48.29B market cap - Zulip for chat, compared to Slack which has a 24.30B market cap - Carousel for photos, compared to Instagram which is estimated at 100B market cap - Paper for documents - Mailbox for emails
- kenhwang 6y agoI think Google Photos would be a closer comparison for Carousel. I think it would've been the smart play for Dropbox to expand on that if they wanted to maintain consumer customers. Photos are kinda the only thing people willingly pay to save/backup and they're a royal pain in the ass to organize. But then again, it's hard to compete against free for $0.10/user margins. Way easier catching a couple of big enterprise fishes.
- ant6n 6y agoIt sucks having to pay google and dropbox for storage cuz i have files and photos. Dropbox doesnt do photos well, i dont trust them for it. Dropbox wants to do photos, but doesn’t separate that from storing files, so just searches all my files for images or something. Also, it doesn’t allow searching based on image recognition.
- babesh 6y agoThey canceled Carousel after Google Photos came out.
- rapht 6y agoThe problem is that revenue growth per se does not make a company valuable - or actually, it does while you can convince someone else to buy under the assumption that said growth will deliver competitive profits. Selling to Wall Street is the "final sell": once it's done, you need to convince that profits grow, not just revenues.
- aivatra 6y agoThis scares the shit out of me. Long story short: I work for a company about to go public...this year to be exact. It sounded exciting at first but as I dug deeper I realized some companies start dying slowly after IPO. I guess I’ll have see it to believe it :(