File hosting service Dropbox, Inc. is going public,
several media outlets reported, citing sources familiar with the matter.
Established in 2007 as a startup, California-based
Dropbox offers cloud storage, client software, file synchronization and
personal cloud. Its service has 500 million users, including 200,000
Dropbox was valued at nearly $10 billion during a private
funder in 2014.
According to the reports, the company filed quietly for
an IPO in the Securities and Exchange Commission and intends to list in the
second half of 2018. Sources also said Goldman Sachs Group and JPMorgan Chase
& Co. will head the listing, although the company is in discussions with
other banks for further roles in the offering.
Dropbox could turn out as one of the largest enterprise
tech firms to list in the U.S. in recent years, although it would follow Snap
Inc.’s (NYSE:SNAP) disappointing foray into the public markets. The Snapchat
parent went public in March, and it was regarded as the biggest IPO for a tech
firm since Facebook’s (NASDAQ:FB) in 2012. Snap’s shares, however, are down 15
percent since then.
Dropbox will be entering the market with over $1 billion
in yearly sales, and this could be the key difference between it and
money-losing Snap. According to CEO Drew Houston, the company has been
profitable as it focused on broadening its product suite and curbing expenses
over the years.
Dropbox may have also been preparing for the IPO process
since last year as it tapped prominent people to its board. The company
appointed Hewlett Packard Enterprise Co. (NYSE:HPE) CEO Meg Whitman in
September and former Nike Inc. (NYSE:NKE) CFO Don Blair in December.
The company’s IPO would be regarded as a harbinger for
startups, Menlo Ventures venture capitalist Venky Ganesan noted. “Will
unicorns realize they have to grow up and grow out of their Peter Pan
mentality?” he was quoted as saying by The New York Times, adding that the
move would also pave the way for whether other ones “reignite and grow, or
do they fade away?”
Aside from Dropbox, ADT Inc., Apollo Global Management’s
security firm, and paid music service Spotify are preparing for IPOs. ADT is
targeting raising up to $2.1 billion in its offering that is expected to price
in January 18, while Spotify seeks to carry out a direct listing this quarter.
Other companies including Airbnb, Lyft and Uber could
also follow and launch their own offerings in the coming years.