Newsletters
News & Information for Technology Purchasers NewsFactor Sites:       NewsFactor.com     Enterprise Security Today     CRM Daily     Business Report     Sci-Tech Today  
   
This ad will display for the next 20 seconds. Click for more information, or
Home Enterprise I.T. Cloud Computing Applications Hardware More Topics...
APC Free White Paper
Optimize your network investment &
Enter to win a Samsung Galaxy Note

www.apc.com
Cloud Computing
Tame your scariest paperwork. Find Out How
Average Rating:
Rate this article:  
Is Dropbox Inflating an Internet Bubble?
Is Dropbox Inflating an Internet Bubble?

By Jennifer LeClaire
November 19, 2013 10:13AM

    Bookmark and Share
The valuation of Dropbox is greater than $8 billion, which is more than double its Oct. 2011 funding round. A lot of smart money has already bet Dropbox will make significant inroads into both the business market and the broader cloud-computing arena. But it's hard not to think there's a bubble forming in these inflated figures.
 



Call it a valuation frenzy. Twitter’s IPO went through the roof, then we saw a quasi-bidding war between Facebook and Google for social media startup Snapchat. News reports indicate Snapchat turned down at least $4 billion to bet on a brighter future.

Now, Dropbox is getting in on the headlines. Dropbox is a free service that lets you bring all your photos, docs, and videos anywhere, and share them easily. Any file you save to your Dropbox will automatically save to all your computers, your phone or iPad, and the Dropbox Web site. Dropbox also makes it easy to share with others.

The company recently announced a business service that's gaining momentum. Ready to take it to the next level in competition with larger enterprises, the online collaborative storage company is claiming an $8 billion valuation.

Bloomberg Businessweek is reporting that Dropbox will work to raise $350 million in the next few weeks. The media outlet cites “two people with knowledge of the company’s plans, who asked not to be identified because the discussions are private.”

Is a Bubble Forming?

Dropbox’s efforts ultimately seek a valuation greater than $8 billion, which is more than double its Oct. 2011 funding round. The company attracted some heavy-hitting financiers in previous campaigns, including U2’s Bono and The Edge, Sequoia Capital, Accel Partners, and Y Combinator.

Dropbox could not immediately be reached for comment but a company spokesperson told Bloomberg Businessweek, “What we can say is that with over 200 million users and 4 million businesses, Dropbox has continued and strong momentum.”

We asked Greg Sterling, principal analyst at Sterling Market Intelligence, for his thoughts on the proposed $8 billion-plus valuation. He told us there are two perspectives on the latest technology investment frenzy.

“One the one hand these valuations are based on market dynamics and investor demand,” Sterling said. “However, it's hard not to think we're seeing a bubble forming in these inflated figures.”

What Are Dropbox’s Revenues?

One difference between Dropbox and Snapchat is revenue. Snapchat doesn’t drive any. Dropbox does.

However, it’s not exactly clear what those revenues really are. In 2011, Forbes reported that Dropbox was set to post $240 million in topline revenue. By 2012, some estimated revenues of $500 million. But there are conflicting reports.

“The startup tallied $116 million in sales last year, more than doubling its $46 million in revenue in 2011,” The Wall Street Journal reported. “The year before, it nearly quadrupled sales from $12 million. Dropbox expects sales of more than $200 million this year, according to one of those people, but it isn’t clear how much more.”

Writing in a Forbes column, contributor Mark Rogowsky crunched all the numbers and decided that a lot of smart money has already bet Dropbox will make significant inroads into both the business market and the broader cloud-computing arena.

“But that bet is two years old, which is an eternity given how fast the landscape is changing these days,” he said. “Back then, Dropbox was less than a quarter the size is it today. Oh, and Snapchat was a month old.”
 

Tell Us What You Think
Comment:

Name:

Eric P.:

Posted: 2013-11-19 @ 11:36am PT
I love DropBox and have used it for years both personally and in a business environment. The biggest challenge that they face is they provide a service that is easily replicated by any number of companies, including powerful ones like Google , Amazon and Microsoft. The services are a dime a dozen right now and they way I see it, there are two things that can set a company apart: 1) tight integration with multiple platforms and 2) lots of storage space. Dropbox is doing a great job on the integration front. It couldn’t be much easier to use, whether on a Mac, PC, or cellphone. But right now, they are getting pressure on the storage space issue. I keep getting emails that Norton wants to give me 50GB and Google wants to give me 100 MB. So right now I am making the switch to a product by Barracuda called Copy. They start you out with 20GB of space (more than I have on DropBox after years) and with referrals o 5GB a pop it can go quickly from there. Check it out at https://copy.com?r=BlX7tm.



APC has an established a reputation for solid products that virtually pay for themselves upon installation. Who has time to spend worrying about system downtime? APC makes it easy for you to focus on business growth instead of business downtime with reliable data center systems and IT solutions. Learn more here.


 Cloud Computing
1.   Oracle Debuts Slew of New Updates
2.   Cloud Wars: AWS vs. Microsoft, IBM
3.   Yammer Moved to Office 365
4.   IBM, California Partner in the Cloud
5.   Dropbox for Business Boosts Security


advertisement
Amazon Intros Zocalo Storage Service
Online storage and sharing for business.
Average Rating:
Avaya Pressing Hard on Cloud-Based UC
Provides easier, faster provisioning.
Average Rating:
Cisco Woos More Devs with DevNet
To create new network-aware apps.
Average Rating:


advertisement
Product Information and Resources for Technology You Can Use To Boost Your Business

Network Security Spotlight
Tor Internet Privacy Service Warns Users It Was Breached
You may never have heard of the Tor Project, but the Internet privacy service is making headlines. Tor’s devs say users might be victims of an attack launched against the project earlier this year.
 
Canadian Government Charges China With Cyberattack
The government of Canada is not happy with China. Canadian officials have accused "a highly sophisticated Chinese state-sponsored actor" of launching a cyberattack on its National Research Council.
 
Researchers Working To Fix Tor Security Exploit
Developers for the Tor privacy browser are scrambling to fix a bug revealed Monday that researchers say could allow hackers, or government surveillance agencies, to track users online.
 

Enterprise Hardware Spotlight
AMD's ARM-Based Opteron Out in $3K Dev Kit
It's dubbed "Seattle" and it's AMD's first 64-bit ARM-based Opteron processor. The low-power chip is being released as part of AMD’s Opteron A1100-series developer kit, and aimed at high-end data center needs.
 
Apple Updates MacBook Pros, Cuts Prices Up to $100
The popular MacBook Pro laptop line just got an update and a price cut of as much as $100. The MacBook Pro with Retina display now includes faster processors and double the memory.
 
Dell, BlackBerry Not Sweating Apple-IBM Alliance
IBM's recent move to partner with Apple to sell iPhones and iPads loaded with corporate applications has excited investors in both companies, but two rivals say they are unperturbed for now.
 

Mobile Technology Spotlight
Virgin Mobile Offers Custom Smartphone Plans
As the wireless carrier wars continue heating up, Virgin Mobile just threw the customization coal onto the fire. The firm has debuted a no-annual-contract plan with rates based on individual use.
 
Collaboration Provider Asana Revamps Mobile App
Asana, a collaboration software provider started by a Facebook founder, is now out with a rebuilt native iOS mobile app. It replaces one that even the company admits was not up to par.
 
Facebook: You Will Use Messenger, and You Will Like It
Starting this week, Facebook users with Android and iOS phones will be forced to use the separate Messenger app to send Facebook messages. Pending messages will still be visible in the main app.
 

Navigation
NewsFactor Network
Home/Top News | Enterprise I.T. | Cloud Computing | Applications | Hardware | Mobile Tech | Big Data | Communications
World Wide Web | Network Security | Data Storage | CRM Systems | Microsoft/Windows | Apple/Mac | Linux/Open Source | Personal Tech
Press Releases
NewsFactor Network Enterprise I.T. Sites
NewsFactor Technology News | Enterprise Security Today | CRM Daily

NewsFactor Business and Innovation Sites
Sci-Tech Today | NewsFactor Business Report

NewsFactor Services
FreeNewsFeed | Free Newsletters

About NewsFactor Network | How To Contact Us | Article Reprints | Careers @ NewsFactor | Services for PR Pros | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 NewsFactor Network. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.