Cloud storage company Dropbox is considering an initial public offering (IPO) in 2017 intended to take advantage of the current vogue for technology stocks.
Bloomberg quoted "people familiar with the matter" in reporting that Dropbox has had meetings with advisers to discuss the possibility of a flotation. The move represents a big shift for a company which said only last year that it had no plans to go public.
Dropbox was valued at $10bn in its last round of funding, but a number of investors in that round have since written down the value of their holdings as it became increasingly clear that cloud storage is very much a commodity service, and that other vendors have made more inroads into the all-important corporate market.
More tellingly, Dropbox's main independent rival, Box, went public in 2015 and has a current market value of $1.63bn, well below the value when it went to IPO.
Box targeted the corporate market from the start, but Dropbox focused on consumers, including students, who have proved reluctant to purchase subscriptions to extend their capacity on Dropbox beyond 2GB.
Dropbox and Box also have to compete with Google Drive and Microsoft OneDrive. OneDrive is bundled with Office 365, which is widely used by corporates and dramatically cuts the size of the market that Box and Dropbox can realistically address.
Another factor is that Dropbox is not yet profitable, although CEO Drew Houston claimed that the company has become cashflow positive and has some 200,000 business subscribers.
Dropbox has extended into offering more cloud-based collaboration tools in a bid to attract more corporate customers, particularly major corporates, in a move mirroring Box's strategy.
This year has seen comparatively few technology IPOs, despite the high prices attached to dotcoms and technology companies in mergers and acquisitions in 2016. LinkedIn is in the process of being acquired by Microsoft, and UK chip designer ARM is being taken over by Japan's SoftBank in a £24.3bn acquisition.
Dropbox, meanwhile, was criticised by US National Security Agency whistleblower Edward Snowden in 2014 for being "hostile to privacy".
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