IPO Watch: Dropbox A Blockbuster?


A series of fundraisings included one in early 2015 valued Dropbox at US$10 billion.

The gap between private valuations and public market aspirations highlights the disconnect between the premium that private investors put on potential innovation, and the financials-based analysis that public market shareholders are focused on. Still, listing flops in 2017 from Snap Inc. and Blue Apron Holdings Inc.

Dropbox's IPO could be a part of a wave of hotly anticipated forthcoming public offerings.

The company plans on offering its 36 million IPO shares at between $16 to $18 a share, according to its filing with the Securities and Exchange Commissions.

If all the stock is sold at the higher suggested price, the sale will be the third-highest IPO from an enterprise technology company in the past three years.

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Last Friday, Dropbox and Salesforce (CRM) announced a strategic partnership to connect Salesforce's CRM platform with Dropbox's collaboration platform, enabling companies of all types and sizes to collaborate and more deeply connect with their customers across sales, service, marketing, commerce, and more. The reason is that it will prevent the company from entering key stock market indices such as the S&P 500 that are tracked by major Wall Street investors.

The San Francisco-based company has touted its business as a path to unleashing creative energy and inspired work. While it claims to have 500 million users in 180 countries, it posted only 11 million paying clients at the end of past year.

The terms announced on Monday effectively kick off the company's roadshow, where executives and bankers will market the deal to investors. In the same period, the company's net losses shrank to US$112 million from US$210 million.

The company filed for its IPO in February, and said that it plans to trade on the Nasdaq under the ticker symbol DBX.

Goldman Sachs & Co, JPMorgan, Deutsche Bank Securities, BofA Merrill Lynch are the lead underwriters for the public offer.