Cloud storage company Box has 25 million users, large revenues, and larger losses: That cloud storage and collaboration can be useful is hardly in doubt, but the prospects for Levie’s company in particular and the similar but more consumer-focused Dropbox remain unclear. - by Philippe Mora (@philippemora)
Philadelphia, 03/26/14 - We're seeing yet another tech story that defies gravity, everybody is rolling their eyes, and yet, the gravy train is once again making the headlines. Don't get me wrong, Box is a really good product (disclaimer: I've been a dropbox premium customer since 2008) however here we're looking at the numbers. A public offering is fundamentally a funding event aimed at helping a company grow. In order to grow, you must first have a proven business model that is profitable and makes money. Growing a money losing business logically only grows the hole deeper. Today we're back in 1999-2000, when IPOs were all about giving the VCs their money back on the dime of the US investors: Box does not make money, the company's loss is widening, and it is in an industry where its competitors are thriving, and making real dollars.
Cloud storage collaboration company Box announced its intention to go public and raise $250 million. We profiled the company in November (see “The Continuous Productivity of Aaron Levie”), when the company’s colorful cofounder, Aaron Levie, summed up his company like this:
“It’s about real-time, collaborative, synchronous information sharing. It’s going to change work. Not just the technology of work, but work itself.”
That cloud storage and collaboration can be useful is hardly in doubt, but the prospects for Levie’s company in particular and the similar but more consumer-focused Dropbox remain unclear (see “Dropbox Founder Simplifies the Cloud”). Here are five nuggets from Box’s S-1 filing with the Securities and Exchange Commission that shed light on how the company is faring and the challenges it faces:
[ Read More Here. Thank You MIT Technology Review 03/24/14]