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Dropbox Inc. has closed on about $250 million in a funding round that values the online-storage provider at close to $10 billion, according to two people famili

Dropbox Inc. has closed on about $250 million in a funding round that values the online-storage provider at close to $10 billion, according to two people familiar with the deal. A BlackRock Inc. BLK -0.33% investment fund is leading the deal, which also includes previous backers, said one of these people, who declined to provide more detail. Dropbox wasn't immediately available to comment. At $10 billion, Dropbox is one of the most highly valued companies backed by venture capitalists. The company's valuation has more than doubled since late 2011, when investors valued the San Francisco-based company at $4 billion. The company also got a higher price than expected when it approached investors as recently as November. Dropbox raised $250 million in its 2011 financing from Goldman Sachs and venture-capital firms including Sequoia Capital, Index Ventures and Accel Partners. The Wall Street Journal previously reported that Dropbox had expected sales of more than $200 million in 2013. The company made $116 million in sales in 2012, according to people familiar with the company's financials, more than doubling its $46 million in revenue in 2011. The year before, it nearly quadrupled sales from $12 million. --David Benoit contributed to this article.

jgalt212 13y ago
50X sales. That makes HP's purchase of Autonomy look cheap.
- jzwinck 13y ago
  Maybe not the best comparison, since HP later accused Autonomy of accounting fraud related to that acquisition.
mlyang 13y ago
Dropbox really needs to accelerate its enterprise sales to justify this valuation long term. Given the tight integration that Box has with so many enterprise software solutions and Box's focus on enterprise, it'll be interesting to see how these two firms fair against each other on the public markets eventually (inevitable at this point given their valuations). Maybe just being a household name will do it for Dropbox even if Box can close more/better enterprise deals.
- sliverstorm 13y ago
  Maybe just being a household name will do it for Dropbox even if Box can close more/better enterprise deals. Maybe, but "Box" evokes "Dropbox". I saw some ads for Free 50GB of storage on Box! and the very first thing I thought was, Is that slang for Dropbox? So, with the way Box is immediately reminiscent of Dropbox, that may reduce Box's disadvantage in terms of being a household name. Even though it's a new company, it feels familiar.
  - boomzilla 13y ago
    You may be in for a surprise: Box was founded a few years before Dropbox (2005 I think) and is still bigger, at least in terms of number of employees. I actually had a Box account before Dropbox's. Box also seems to be more popular with enterprise.
  - guelo 13y ago
    Which makes me wonder why Box never sued to protect their trademark. It's probably too late for them now.
    - pbhjpbhj 13y ago
      This appears to be their UK trademark record, http://www.ipo.gov.uk/tmcase/Results/4/EU005097555 http://www.ipo.gov.uk/tmcase/Results/4/EU005097555. [The USPTO trademark search is too blunt a tool for me to be bothered hunting that registration down at the moment.] This http://www.ipo.gov.uk/tmcase/Results/1/UK00002215537 http://www.ipo.gov.uk/tmcase/Results/1/UK00002215537 is a registration of the trademark "box" for the relevant computer and communication classes (inter alia 9, 38, 42) which was filed about 7 years before Box UK filed their application. TBH I can't see how the later one was granted RTM status except that this one appears to be an image mark. "Box" is widely used as a trademark and other companies are using it in the same class. Box presumably can't make the case for infringement of their mark without also making the case that they're infringing someone else's - Boks™ belonging to a Norwegian company for example. It's pretty generic as a term for storage/term in computing. That aside Dropbox would only be problematic if there was genuine confusion. For example Box UK had a series of offerings with trademarks using "box" as a suffix. If Dropbox were considered infringing, for example, Xbox would also be infringing as they operate within the same class - Box presumably haven't challenged the use of Xbox [which probably predates their use anyway].
blah32497 13y ago
I don't really know how these numbers are generated, so I really have no idea what I'm talking about - but just back-of-the-napkin: 100*($200 million / $10 Billion) = 2% So assuming no growth, the investors are back getting 2% a year? So basically matching inflation... So does this indicate that the market is split on whether they'll continue to grow or not?
- bayesianhorse 13y ago
  No, the investors are buying 2% of the equity, and by paying $200 million they indicate that they estimate that all of the equity together (the whole company) is worth $10 Billion. Return on investment would mean that the investors expect the valuation to rise, or that they derive some other kind of profit from owning the shares (sometimes patents, knowledge, influence etc).
  - benmanns 13y ago
    I think the commenter was referring to the $200 million revenue (not even profit) over the $10B price.
  - blah32497 13y ago
    EDIT: "benmanns" pointed out the point of confusion. thanks! I don't think we're disagreeing. Sure they bought 2% not 100% of the company, but that's not really relevant. The $200M/yr they currently make is I assume profit - which is either payed out as dividends or invested back into the company. It's not really important which ones b/c the two are in the grand scheme of things equivalent. An investment increasing the worth of the company and therefore the worth of their share of it. I feel like in the end it still represents an expectation of 2% growth...
    - vasilipupkin 13y ago
      No. The expectation of growth should be roughly similar to growth of similar tech companies. Typical return on equity of an S&P 500 company is about 15-16% per year, so investors should expect probably at least that much and more like twice that
nostromo 13y ago
Doesn't that imply revenue growth is slowing? $46m -> $116m (+152%) -> $200m (+72%) Then again "more than $200m" is probably conservative.
- broolstoryco 13y ago
  "Doesn't that imply revenue growth is slowing" do you really expect a constant growth of 152%? of course the percentual growth will slow down, that by itself says nothing.
  - deleted 13y ago
    [deleted]
- Joister 13y ago
  Or speeding up, depending on how you look at it $46m -> $116m (+$70m) -> $200m (+$84m)
andrewhillman 13y ago
Here's a link to story without paywall: http://online.wsj.com/news/article_email/SB10001424052702303465004579327001976757542-lMyQjAxMTA0MDEwNzExNDcyWj http://online.wsj.com/news/article_email/SB10001424052702303...

jgalt212 13y ago

50X sales. That makes HP's purchase of Autonomy look cheap.

jzwinck 13y ago
Maybe not the best comparison, since HP later accused Autonomy of accounting fraud related to that acquisition.

mlyang 13y ago

Dropbox really needs to accelerate its enterprise sales to justify this valuation long term. Given the tight integration that Box has with so many enterprise software solutions and Box's focus on enterprise, it'll be interesting to see how these two firms fair against each other on the public markets eventually (inevitable at this point given their valuations). Maybe just being a household name will do it for Dropbox even if Box can close more/better enterprise deals.

sliverstorm 13y ago
Maybe just being a household name will do it for Dropbox even if Box can close more/better enterprise deals. Maybe, but "Box" evokes "Dropbox". I saw some ads for Free 50GB of storage on Box! and the very first thing I thought was, Is that slang for Dropbox? So, with the way Box is immediately reminiscent of Dropbox, that may reduce Box's disadvantage in terms of being a household name. Even though it's a new company, it feels familiar.
- boomzilla 13y ago
  You may be in for a surprise: Box was founded a few years before Dropbox (2005 I think) and is still bigger, at least in terms of number of employees. I actually had a Box account before Dropbox's. Box also seems to be more popular with enterprise.
- guelo 13y ago
  Which makes me wonder why Box never sued to protect their trademark. It's probably too late for them now.
  - pbhjpbhj 13y ago
    This appears to be their UK trademark record, http://www.ipo.gov.uk/tmcase/Results/4/EU005097555 http://www.ipo.gov.uk/tmcase/Results/4/EU005097555. [The USPTO trademark search is too blunt a tool for me to be bothered hunting that registration down at the moment.] This http://www.ipo.gov.uk/tmcase/Results/1/UK00002215537 http://www.ipo.gov.uk/tmcase/Results/1/UK00002215537 is a registration of the trademark "box" for the relevant computer and communication classes (inter alia 9, 38, 42) which was filed about 7 years before Box UK filed their application. TBH I can't see how the later one was granted RTM status except that this one appears to be an image mark. "Box" is widely used as a trademark and other companies are using it in the same class. Box presumably can't make the case for infringement of their mark without also making the case that they're infringing someone else's - Boks™ belonging to a Norwegian company for example. It's pretty generic as a term for storage/term in computing. That aside Dropbox would only be problematic if there was genuine confusion. For example Box UK had a series of offerings with trademarks using "box" as a suffix. If Dropbox were considered infringing, for example, Xbox would also be infringing as they operate within the same class - Box presumably haven't challenged the use of Xbox [which probably predates their use anyway].

blah32497 13y ago

I don't really know how these numbers are generated, so I really have no idea what I'm talking about - but just back-of-the-napkin: 100*($200 million / $10 Billion) = 2% So assuming no growth, the investors are back getting 2% a year? So basically matching inflation... So does this indicate that the market is split on whether they'll continue to grow or not?

bayesianhorse 13y ago
No, the investors are buying 2% of the equity, and by paying $200 million they indicate that they estimate that all of the equity together (the whole company) is worth $10 Billion. Return on investment would mean that the investors expect the valuation to rise, or that they derive some other kind of profit from owning the shares (sometimes patents, knowledge, influence etc).
- benmanns 13y ago
  I think the commenter was referring to the $200 million revenue (not even profit) over the $10B price.
- blah32497 13y ago
  EDIT: "benmanns" pointed out the point of confusion. thanks! I don't think we're disagreeing. Sure they bought 2% not 100% of the company, but that's not really relevant. The $200M/yr they currently make is I assume profit - which is either payed out as dividends or invested back into the company. It's not really important which ones b/c the two are in the grand scheme of things equivalent. An investment increasing the worth of the company and therefore the worth of their share of it. I feel like in the end it still represents an expectation of 2% growth...
  - vasilipupkin 13y ago
    No. The expectation of growth should be roughly similar to growth of similar tech companies. Typical return on equity of an S&P 500 company is about 15-16% per year, so investors should expect probably at least that much and more like twice that

nostromo 13y ago

Doesn't that imply revenue growth is slowing? $46m -> $116m (+152%) -> $200m (+72%) Then again "more than $200m" is probably conservative.

broolstoryco 13y ago
"Doesn't that imply revenue growth is slowing" do you really expect a constant growth of 152%? of course the percentual growth will slow down, that by itself says nothing.
- deleted 13y ago
  [deleted]
Joister 13y ago
Or speeding up, depending on how you look at it $46m -> $116m (+$70m) -> $200m (+$84m)

andrewhillman 13y ago

Here's a link to story without paywall: http://online.wsj.com/news/article_email/SB10001424052702303465004579327001976757542-lMyQjAxMTA0MDEwNzExNDcyWj http://online.wsj.com/news/article_email/SB10001424052702303...