Dropbox raises $250m after declining Apple offer
Wednesday, October 19, 2011/
US-based tech start-up Dropbox has raised $250 million in funding, with a reported valuation of $4 billion, after it emerged that it turned down a nine-digit buyout offer from Apple two years ago.
Dropbox, based in San Francisco, was founded in 2007 by university graduates Drew Houston and Arash Ferdowsi.
After being forced to work from multiple computers, Houston was inspired to create a service that would let people bring all their files anywhere, with no need to email around attachments.
He created a demo of Dropbox and showed it to fellow student Ferdowsi, who dropped out of university one semester before graduating to work on the venture.
After securing seed funding from Y Combinator, Houston and Ferdowsi focused on building a world-class engineering team.
In 2008, Sequoia Capital led a $7.2 million Series A funding round with Accel Partners to help bring Dropbox to the market.
The company has confirmed it has now raised $250 million from seven new investors including Benchmark Capital, Goldman Sachs, Greylock Partners, Institutional Venture Partners, RIT Capital Partners and Valiant Capital Partners.
Accel Partners, Sequoia Capital and several angel investors also participated.
The company has declined to provide specific revenue figures or a valuation. Forbes reported the company expects to have $240 million in revenue this year, while other reports point to a $4 billion valuation.
Dropbox says it now has more than 45 million users saving one billion files every three days, and is poised to triple its user base this year.
The new funding will be used for acquisitions, strategic partnerships and the recruitment of new staff, the company said in a statement.
“Our goal has always been to build a service that hundreds of millions of people would love and trust. We’re inspired by the consumers and businesses who depend on Dropbox,” Houston said.
“We’re thrilled to have such world-class investors joining forces with us… We will continue to make sure that the world’s devices, services and apps work together seamlessly.”
The news comes amid reports that in 2009, the founders turned down a nine-digit acquisition offer from Apple, with the late Steve Jobs thought to be particularly interested in Dropbox.
It’s been reported that Jobs told the Dropbox founders they should sell because Apple would crush the company with a competing product – the recently-debuted iCloud service.
Sequoia Capital partner Bryan Shreier said while Apple’s offer was “flattering and a validation”, the company “never considered it for a microsecond”.
“This is a company that will have as many users as there are people who have cell phones. It’s in the billions, not millions,” Shreier said.