November 19, 2013
CEO Drew Houston Claims Dropbox Is Worth $8 Billion
Peter Suciu for redOrbit.com - Your Universe Online
How much is online shared storage really worth? The answer is potentially billions.
Dropbox CEO and co-founder Drew Houston is reportedly looking to raise $250 million in funding this year, and if successful that would put the value of the five-year-old company at just about $8 billion.
The last fund-raising round from DropBox occurred in October 2011, when it raised $250 million at a valuation of about $4 billion. If successful this new round of fund-raising could double Dropbox’s valuation.
The file-sharing service provides a way for users to transfer large files across the Web through virtual folders, and its consumer version allows this transferring and sharing to be done for free. Premium accounts are also available. Given these low costs it has seen its user base increase as steadily as its valuation.
“What we can say is that with over 200 million users and 4 million businesses, Dropbox has continued and strong momentum,” Ana Andreescu, a Dropbox spokeswoman, told Bloomberg Businessweek in a Monday interview.
Expanding deeper into the business realm is where the company now looks to see its continued growth, even if there is already serious competition in cloud storage from the likes of Box, Microsoft, Amazon and Google.
Earlier this month Dropbox launched a service aimed at corporate users, which offers features including unlimited space, sync and file sharing, and notably 256-bit AES and SSL encryption, along with two-step verification. In addition the service provides central control and file recovery. The service is offered at $795 a year for five users, with additional users costing $125 per year.
“We introduced Dropbox for Business to help companies work smarter,” Houston and a colleague posted on the company’s blog last week. "And as more teams picked it up, we discovered a new challenge for businesses and users. On one hand, people wanted to access their personal stuff at work; meanwhile, IT admins wanted to keep company data separate and free of personal files. Both needs were real, but people had to choose between two Dropboxes.”
“We thought about this from scratch and designed a solution we’re excited to share: connecting your personal Dropbox to your Dropbox for Business account,” Houston added. “This’ll give you a personal Dropbox and a work Dropbox on all of your devices so you’ll never have to choose between them. It’ll be like having your house keys and your work keycard on the same keychain.”
Launched just five years ago Dropbox now has more than 400 employees, and it has seen its active users double this year. The company continues to seek a high valuation, even though it has no apparent plans to go public anytime soon.
Raising the funds might not be that difficult given the current interest from investors in start-ups that have no clear revenue streams.
In October the social media photo sharing site Pinterest, which makes no revenue, successfully raised $225 million in a financing round that now puts that company’s valuation at $3.8 billion.
Then there is Box, a rival online storage start-up, which is now valued at more than $1 billion and looks to conduct its IPO early next year. Apparently online storage is worth a lot!