Aaron Levie, Chief Executive Officer and Co-founder of online storage and collaboration provider Box Inc., has announced the company is planning an initial public offering (IPO) for next year.
Box had been targeting 2013 for an IPO but Levie, who revealed his plans in a recent interview with Bloomberg news service, said that “2013 was a long shot,” with this year focused on continued growth. Box has an estimated 14 million individual and 140,000 company clients.
Founded in 2005 as a college business project, Box has concentrated on the enterprise as the online storage/collaboration space continues to grow. Other small vendors, like Dropbox, are also making efforts in that market.
Although Dropbox is more consumer-oriented, it does offer some business services, and last year it embarrassed Box when the Massachusetts Convention Center Authority turned to Dropbox’s services in order to overcome firewall issues that Box could not resolve. Box made a US$ 10,000 partial refund to the Authority.
Among larger providers, the business market for online storage and collaboration is also now being targeted by the likes of Microsoft, Citrix and Google. Levie has said that Box’s strategy for keeping its competitive edge includes continual cycles of registering customer feedback, conducting user testing and updating the product, sometimes on a daily basis.
IPO Favors B2B
Box could be riding a wave of business-to-business (B2B) companies that have had successful IPOs, such as Splunk and Workday. CB Insights, a venture capital research firm, noted late last year that, “whether it is selling to the enterprise or the SMB market, the Tech IPO pipeline clearly leans in favor of B2B companies with 80 percent of companies” that are expected to file an IPO “targeting their products and services at businesses.”
At the same time, consumer oriented tech companies, such as Facebook and Zynga, have had disappointing IPOs.
So far, Box has raised over US$ 280 million in venture capital funding from such investors as Andreessen Horowitz, Draper Fisher Jurvetson and Salesforce.com, and is maintaining an ambitious upward growth curve. The Los Altos, California-based company is expanding internationally into Japan and Europe, has plans for Australia and Brazil and expects to increase its workforce to about 1,000 from the current roster of about 670. Levie also said he expects to add at least half a dozen senior executives.