Box Attempting IPO, Once More

On March 2014, Box, Inc. (formerly Box Net, inc.), in online storage and file sharing services on the web, tried its first IPO, hoping to raise up to $250 million but delayed its plans as investors found the operation too risky.

Now it attempts a second one, reducing the amount to $162.5 million, corresponding the sale of 12.5 million shares priced at an average of $12, valuing the company at around $1.4 billion.

Also remember that Box rebuffed a takeover offer of over $500 million by Citrix in 2011.

$162.5 million is a small figure for the investors when you remark that the company raised $554.5 million, according to our calculation, following 8 rounds:

* in $ million

The Palo Alto, CA start-up, founded in 2005 by current chairman and CEO Aaron Levie, 29, and his friend, CFO Dylan Smith, claims globally 32 million registered users and supporting 275,000 organizations that collectively interacts with their content on average 4 billion files every three months. They include 99% of Fortune 500 companies. Among its 44,000 paying customers – with the largest deployment with 97,000 users -, 48% are working in Fortune 500 firms and 22% in Global 2000 companies. Among them are General Electric in the process of rolling the product out to 300,000 employees. Box also offers storage facilities to companies like Ameriprise Financial, Inc., Bechtel, Eli Lilly and Co., Gap, Inc., Schneider Electric, Sunbelt Rentals and Viacom.

Data are stored in USA only within two their-party data centres located in Northern California and replicated in a facility in Las Vegas, NV, and another third-party platform on the East Coast.

Some information are not in favor of a successful operation
for the company to be public on the New York Stock Exchange:

• Online storage is becoming a commodity business with thousands of actors worldwide, Box’s being its biggest independent competitor. Other main rivals include huge companies like Google or Microsoft offering more free storage (15GB) than Box (10GB).
• 90% of registered users are just using non-paying services.
• Box is losing money since its inception and does not expect to be profitable “in the foreseeable future.” Accumulated deficit have reached $482.7 million as the firm is investing huge sums in sales and marketing – $73 million for fiscal year ended January 31, 2014 – to increase market shares.
• A pending lawsuit was filed against Box by Open Text on patents notably on its core cloud software.

Financial results of Box

* in $ million

Box acquired five small companies:

* in $ million

We have counted only 26 successful IPOs the last 15 years in the storage industry while more than 800 start-ups entered in this field.

IPOs in WW storage industry

* in $ million

Read also:
Box Files for IPO
But no profit in foreseeable future