A big pile of cash has found its way to the coffers of Dropbox during a recent private funding round, giving the company a $10 billion valuation. Asset management firm BlackRock Inc. led the $250 million funding round.
The San-Francisco-based Internet storage service provider has been known for giving users large free online storage space. Founded in 2007, Dropbox has now around 200 million users with 4 million of this representing Fortune 500 companies. Beefing up its services, the company announced Dropbox for Business in November with augmented sharing, transfer, and security options. Its enterprise storage service is expected to roll out later this year.
Going for businesses will be its money cow but Dropbox also needs to boost its sales force and hire talented executives that will guide it to conquer a competitive cloud computing market and to convince the top brands to trust its storage service. To do this, it needs to spend a lot of money and the fresh round of funding will help it achieve its goals.
The newly injected funding has not been announced yet but according to the source of a Wall Street Journal report, the deal will include previous backers.
According to tech blog Re/code the latest investments can be as much as $400 million.
"What's still in flux is an additional $100 million to $150 million that mutual fund giants Fidelity and T. Rowe Price - who have already invested in Dropbox - are angling to add to the round, again at the $10 billion pre-money valuation. Both had considered a bigger investment, but BlackRock apparently swooped in and quickly made the initial giant commitment," Liz Gannes of Re/code wrote.
Dropbox is said to be planning to go for an initial public offering in New York this year but CEO Drew Houston said in an interview last fall that IPO is not yet the company's focus.
"I think it's something I'm sure we'll do eventually, but for now, it's really nice to just really focus on recruiting, really building a great foundation, really building the next generation of great products that we're excited about," Houston said.
The company has not commented about the new round of funding.
The last investment round for Dropbox was in 2011 when Goldman Sachs, Sequoia Capital, and Accel Partners injected $250 million. At that time, the company was valued at $4 billion.