Dropbox Files Confidentially for U.S. IPO

[chollida1]

Congratulations to the team and of course YCombinator!!

3 things I'm looking forward to knowing.

1) What is their profitability? I think they might surprise some people here, like Google did when they were private, hiding just how much money they are making.

It will be nice to see a cash flow positive tech company going public!!

2) What sort of share structure they are looking for. I think after SNAP its going to be a tough sell to get away with no voting control,

3) Can they go public at a valuation larger than the rumored $10+ billion they were valued at without resorting to cheap tricks like only floating 5% ala Groupon.

As a side note, it looks like JP Morgan and Goldman Sachs decision 4-5 years ago to start offering more services to private companies is starting to pay dividends

[cossatot]

From TFA:

Unlike money-losing Snap, Dropbox will come to the table with annualized sales of more than $1 billion, Chief Executive Officer Drew Houston said in an interview last year. It’s also been profitable, excluding interest, taxes, depreciation and amortization. Those benchmarks are the product of more than two years of focusing the company, expanding its product suite for businesses and reining in expenses, Houston said at the time.

[sulam]

7 years ago they were talking privately about being cash flow positive. It will be interesting to see how that’s held up as they scaled.

[unexpected]

Dropbox Team: Congrats on this great milestone! I think I was one of your first users back in the day, and your product has transformed my life - it's been the single greatest productivity tool I've used in the past 10 years!

I know some people will scoff at that, and there is always the "yeah but google drive/box/oneDrive is better", but you guys did it first and still do it best! I've been a Pro member for a long while now and I'll be with you guys until the end - good luck and I'm excited to see what the future holds.

[jurassic]

I recently did a purge of nearly all my software subscriptions and Dropbox was among the few that survived. Say what you want about storage being a commodity, I think they have built an outstanding service that continues to deliver a huge value to their users. I hope the employees see a nice windfall.

[bsharitt]

There are plenty of options out there for file storage services with decent phone client and being able to easily share file with non-techie friends and family. There are also plenty of file storage services that have clients for the desktop and command line Linux. But Drop box is the only one I've found that works across both of those very well with first party clients.

After all that, I'm not a paying Dropbox customer though. Unfortunately their pricing left me behind when it went to $10 a month for 1TB and nothing between that and free. So instead of I deal with the wonkiness of Google Drive when I need to on Linux and it works well enough everywhere else and the $2 a moth for 100GB is plenty.

[srathi]

If you don't mind me asking, which other services did survive? I'm also looking at purging my list.

[Gatsky]

Agree. It's always worked flawlessly for me.

From another perspective, it's a little concerning how big a company it takes to deliver a useful and consistent service like this.

[joering2]

I think if Google would put serious thought into Drive (desktop client, like Drop) and give 10 years of unlimited but reasonable (you know - don't dump all your DVDs and BluRays into cloud just because you can), I imagine plenty of people moving on. Its just Google Drive Sux... at the moment :)

[askafriend]

The cost of switching is very high partly because of extremely slow upload speeds. If we had insanely fast upload speeds available widely, the competitive landscape of storage and sync might look different.

[jedc]

To me, the interesting thing about Dropbox going public is how comparisons to Box could/will drive Dropbox's valuation. Any investor can easily check out Box's financials https://finance.google.com/finance?q=NYSE%3ABOX&fstype=ii&ei... and easily compare Dropbox's numbers to that.

So Box suffered the pain of being the first in the easy consumer/business online storage category to IPO -- but Box's numbers are now driving valuation of their competitor.

[mbesto]

Some napkin math:

Dropbox: $1B in revenue / $10B valuation (10x)

Box: $400M in revenue / $3B valuation (7.5x)

The real question is earnings(which we don't know yet for Box) and whether Dropbox has a compelling case that it grow faster than Box to justify the higher multiple.

[chrisper]

I tried using Dropbox as an alternative to Google Drive. However, just like the other alternative cloud providers it was quite slow.

With Google Drive I can max out my Gbit Fiber (I downloaded with 920 Mb/s last time), while Dropbox was slow 8 Mb/s. Though I am not sure if Dropbox isn't rate limited for the free accounts.

[msh]

Same problem for me, not google fiber but a 100/100 mbit fiber in Denmark. Dropbox gives me 6-8 megabits upload (download is much faster) at max, google drive gives me between 40-50 megabits upload consistently.

[wil421]

I don’t see that much benefit paying for Dropbox or Google Drive. At work my company pays for OneDrive. Personally I use OneDrive because it already comes with my Office subscription.

For $8.25 a month I get Office on all my devices and 1TB per 365 user.

I have gigabit internet and there isn’t much difference in OneDrive or Google Drive.

[hunter23]

I actually tested dropping up 2 exact copies of a photo folders on Google Drive and Dropbox.

Google Drive is way way slower due to lack of block level syncing and other issues. You shouldn't be looking at the bandwidth usage you should be looking at how long it takes the files to sync.

[sbarre]

Speaking as a paying user, I see speeds way higher than what you see.

That doesn't confirm your hypothesis, but it's a counterpoint I suppose.

[woolvalley]

Have you tried amazon cloud drive? How does it compare?

[bflesch]

Congrats to Arash for getting to this point. He has been very helpful when I reported security flaws nearly half a decade ago. I'm still wearing their sweater from time to time.

[kayhi]

First YC company to go public. Congrats everyone!

[dawhizkid]

Wow didn't realize it was the first...not sure if that's more depressing than exciting tbh!

[ea016]

First YC company to go public ! Congrats

It's always fun to look at the comments at the time the MVP was posted here on HN:

https://news.ycombinator.com/item?id=8863

[40acres]

I feel like this has got to be one of the most infamous / inspiration posts in HN history. Just to be able to look at the MVP of a billion dollar company and watch it get scrutinized, doubted and critiqued at that early stage.. it's an amazing look for anyone w/ thoughts of launching a startup.

[coherentpony]

I don't understand. What does it mean to file 'confidentially' if now the entire general public knows about it?

[hortonew]

It seems it doesn't really refer to their announcement being public or private, but rather what they have to submit in financial statements. They have much looser guidelines, so they don't have to disclose/document as much. They can be more "confidential" about what they submit, and that data is not released to the public until a much later date. This is how I understand it.

[nishantvyas]

Dropbox has come a long way... Kudos to them!

My YC app: Dropbox - Throw away your USB drive https://news.ycombinator.com/item?id=8863

Dropbox launches (YC summer 07) https://news.ycombinator.com/item?id=134405

[staunch]

This is definitely the best Show HN I've had the pleasure of watching evolve! Dropbox is a cool technology started by a cool person. That's what I like to see succeed.

Too bad we didn't have the opportunity to buy some "DBCoin" back in 2007. I'd have bought a lot!

Congrats dhouston & co on building a company that improves the world in a significant way.

[akulbe]

Question: since an IPO is going to be a matter of public record, why would you want to file it confidentially? What's the advantage?

Thanks.

[foolfoolz]

Dropbox has always been a successful company with great mindshare. While not quite a household name, if you worked there and told your family there's a chance they would know what the company is (how many of you can do that?). Yet still, dropbox was founded in 2007. It's been over 10 years to reach IPO. Just a friendly message to any engineers out of school who see the tempting offer to work at a small fast moving startup, you may get the payout like dropbox is about to, but you might have to wait a decade.

[habosa]

I know some people who joined Dropbox as new grads in 2014. The company had <1000 employees and seemed like it had a lot of upside.

The options given out at that time were priced at a $10B and have been basically under water since.

So even if you do join a fast growing company with a good brand and the potential to go public there's still a solid chance you make no money.

[jeremyis]

Early dropbox employees have had opportunities to cash out. Same has happened for other big private startups.

[TallGuyShort]

Waiting a decade is not necessarily a bad thing unless you're just looking for a quick payout. As a customer (and honestly as an employee most of the time), I like to see a company that built a business for 10 years and wasn't rushing to a huge infusion of cash that comes with a big burden attached.

[econner]

This exactly. There's very a small chance you end up at a company like Dropbox, and even if you do it could still take 10 years to see any profit from it. Add to that the significant financial risk you probably have to take on to exercise options and pay AMT, all the while completely uncertain of payoff.

[msmith10101]

More likely a new grad will get nothing: recruiters, dilution, and taxes will see to that.

[sharpshoot]

Huge! congrats Drew and Arash on the first YC IPO

[arachnids]

Less work for the company because the process is simpler, and allows them to "test the waters" and back out if response is cooler than they imagined it would be.

https://www.inc.com/christine-lagorio/public-offerings-how-c... is a good read.

[kbumsik]

I don't know much about the stock stuff so I am wondering why they are doing it secretly? Just because they are not ready to announce yet?

[post_break]

Sorry dropbox, I was one of your first few paying customers, but then you started taking features away one by one and I had to just cancel.

[djsumdog]

Out of curiosity, which features did you lose?

[toblender]

Would be great to know what day the IPO will be.

Why is there no easy place to see this?

[sagivo]

i probably gonna get downvoted but i don't get their product. anything they offer you can find better/cheaper elsewhere (google docs, photos etc) or not really needed (paper)