Dropbox files for public stock offering of $500 million

Bill Rogers
February 24, 2018

The S-1 form Dropbox filed with the Securities and Exchange Commission revealed that the company lost $111 million on revenue of $1.1 billion past year.

In a filing with the Securities and Exchange Commission on Friday, Dropbox said it planned to raise up to $500 million in the offering, and meant to use the money for a variety of purposes, including potential acquisitions.

It's official - Dropbox has finally filed for an initial public offering (IPO) after years of rumors and speculation. The company's revenue rose to $1.11 billion last year from $845 million the year before. Dropbox has been cash flow positive since 2016.

People familiar with the offering told the Wall Street Journal that Dropbox is expected to seek a public valuation of about $7 billion to $8 billion, making it the largest tech IPO since Snap in March 2017, but a far cry from its private valuation in 2014 of $10 billion.

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The IPO, which would provide an exit more than a decade after Dropbox was founded, also could spur other large "unicorns" ranging from Uber Technologies Inc.to Pinterest Inc.to test the waters. But the company still isn't profitable, according to the filing. The company said it generates average revenue of $111.91 per paying user.

The company said it has 500 million registered users, 100 million of whom have signed up since the start of 2017, but only 11 million paid users. "Dropbox's business model has scaled successfully".

Valued by private investors at $10 billion, the cloud storage company listed an initial offering size of $500 million in a filing with the Securities and Exchange Commission Friday.

"We estimate that approximately 300 million of our registered users have characteristics - including specific email domains, devices, and geographies - that make them more likely than other registered users to pay over time", the company said in the filing. "This is the world we want to live in". The company plans to list on Nasdaq Global Select Market under the symbol DBX. Goldman Sachs, J.P. Morgan, Deutsche Bank, Allen & Company and BofA Merrill Lynch are the joint bookrunners on the deal.

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