Notes from the Box S-1 IPO Filing

The much anticipated Box S-1 IPO filing was just released and it’s filled with a ton of interesting data. Box was co-founded by Aaron Levie, purveyor of the some of the most astute 140 character quips Twitter has ever seen (see 10 Awesome Startup Tweets from Box’s Aaron Levie). Another reason the S-1 is so interesting is due to how it lays out how a Software-as-a-Service (SaaS) company can raise $400+ million in capital and already burn through $300+ million of it in pursuit of amazing growth.

Here are a few notes from the Box S-1 filing:

  • Box provides a cloud-based, Enterprise Content Collaboration platform (pg. 1)
  • 34,000 paying organizations and 225,000 total registered organizations (freemium model, so they have an astounding 15% conversion rate at the organization level to go from a free user to a paid user – pg. 2)
  • Revenue (pg. 2)
    2011 – $21.1 million
    2012 – $58.8 million
    2013 – $124.2 million
  • Losses (pg. 2)
    2011 – $50.3 million (wow!)
    2012 – $112.6 million (wow!!)
    2013 – $168.6 million (wow!!!)
  • Industry trends (pg. 2)
    Shift from On-Premise to Cloud-Based Applications
    Increased Functionality and Proliferation of Mobile Devices
    Explosion of Content and Data
  • Accumulated deficit of $361.2 million (pg. 14)
  • Grew from 369 employees as of January 31, 2012 to 972 employees as of January 31, 2014 (pg. 15)
  • Retention rate calculated as of a period end by starting with the annual contract value (ACV) from customers with contract value of $5,000 or more as of 12 months prior to such period end (Prior Period ACV) and a subscription term of at least 12 months (pg. 48)
  • Non-U.S. customers represented 20% of revenue (pg. 50)
  • Interesting quips from Aaron Levie’s letter (pg. 75)
    So with some free time and online poker winnings, we set out to change how people could access, share and collaborate on information…
    Neither Dylan nor I had storied careers at IBM or Oracle (though I did use Lotus Notes once in an internship)…
    We’ve seen companies that were once wildly successful become shadows of their former selves.
  • Current ownership (pg. 126)
    Named VCs – 63% (VCs own more than this but weren’t explicitly named)
    Co-founder/CEO – 4.1% (5.7% if you count unexercised stock options)
    Co-founder/CFO – 1.8%

Outside the amazing amounts of money burned and the growth rate, the S-1 filing was pretty vanilla. No patent trolls. No private jets. Nothing. Box is growing incredibly fast in a massive market which will result in a successful IPO.

What else? What are some other thoughts on the Box S-1 IPO filing?

10 thoughts on “Notes from the Box S-1 IPO Filing

  1. so what’s it worth?
    to an expert

    what should Dropbox be
    could amazon box or
    any other destroy them?
    what are the barriers to entry
    to big tech players?

    1. On the worth side, I’m guessing it’ll settle in at 12-14x trailing twelve months revenue (and the market is overvaluing SaaS companies).

      Amazon can’t destroy them. The network effects are too strong now for another company outside of Dropbox to make inroads.

    2. Thanks David.
      dropbox is a great product…..hard to
      value these thing on 5 years from now in such
      a changing world

  2. Hi David,

    Great post as always! Quick question — is there a way I can Tweet your post directly from my email without having to go to your website? I access your posts on my mobile email.

    Thanks, Ruchika

    Sent from Ruchika’s fiddly device.


  3. “According to Forrester, there were 615 million information workers as of 2013, and there are expected to be 865 million information workers by 2016.” That’s nearly the entire population of US in knowledge jobs within 3 years.

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