Published: Fri, January 12, 2018
Science | By Eileen Rhodes

Dropbox confidentially files for IPO

Dropbox confidentially files for IPO

Dropbox Inc.is reportedly ready to hit the stock market, finally.

Dropbox, the cloud computing storage company valued at $10 billion, has confidentially filed the paperwork for an IPO, according to a Bloomberg report on Thursday citing anonymous sources. A successful offering could open up the sluice gate for a flood of other companies waiting to go public. The service works by Dropbox creating a special folder on the a computer.

The joke surrounding Dropbox for years was that the company was set to go public in the fourth quarter of that year - every year. The music streaming provider is pursuing an unusual direct listing that will not have any underwriters backing it, an arrangement that could create additional risks.

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One big question that hangs over a potential IPO is what sort of valuation Dropbox would command as a public company. It launched in 2008 and is privately valued at $10 billion, based on previous venture capital fundraising.

On the flip side, Dropbox has a strong balance sheet. Goldman Sachs advised the company on earlier funding rounds and extended the company credit, while JPMorgan led a $600 million credit line to Dropbox previous year, the people said. It's also been profitable, excluding interest, taxes, depreciation and amortization.

Wall Street will no doubt take note of that fact once Dropbox's stock starts trading. Box has struggled to achieve profitability since its 2015 IPO, but Dropbox is said to be profitable already and on a rate to do $1 billion in revenue, according to Bloomberg. JPMorgan led a credit line extended to Dropbox, along with Goldman Sachs, Bank of America Corp., Deutsche Bank AG, Macquarie Group Ltd. and Royal Bank of Canada, people familiar with the matter said last March.

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