Dropbox looks for $250 million additional funding
20 Nov 2013
File-sharing and online storage firm Dropbox is targeting $250 million in additional funding, which would see its value touch a level that would be astronomical even for a tech firm - $8 billion.
The company was trying to raise the cash to expand its sales and engineering teams and acquire technology, Bloomberg Businessweek reported, citing two people with knowledge of the matter.
Last week, the company announced several upgrades to its services for businesses, in a bid to ensure it remained a viable rival to the likes of Microsoft and Amazon in the cloud computing sector.
According to commentators, $8 billion sounded like a lot for a company that had only been around for six years, but it would hardly be out of place in a place where profitless Twitter was valued at $20 billion on the stock market and Pinterest was valued at around $3.8 billion - before it even had much of a plan on how to make money.
The site was created by Drew Houston, after he created the service for his own personal use six years back. In the meantime the site has become one of the most popular cloud-based services around.
According to commentators, now it would be up to Dropbox to convince investors it was worth such a high sum and to that end spokeswoman Ana Andreescu told Bloomberg that what Dropbox could say it had said with over 200 million users and 4 million businesses and the continued strong momentum.
Houston points out that Dropbox had not spent all the money it had raised during its last funding round, so while the $8 billion might seem ambitious, it would be hard to claim the company had been squandering money.
On the contrary, Dropbox had changed with the times, shifting focus from being a consumer oriented company to focusing on businesses as of late, he emphasises.
According to commentators, however, $8 billion was a massive valuation, but increasing competition at this stage from the likes of SugarSync, Box, SkyDrive, and Google Drive, plus full featured backup services like Mozy and Carbonite, to name a few, did not help.
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