All was quiet on the IPO front until late Friday, when Dropbox (DBX – proposed) lit up the U.S. Securities and Exchange Commission’s filing window at 3:15 p.m. Dropbox, one of the largest unicorns waiting in the SEC’s “quiet filing” line, had just sent a jolt of electricity into the IPO market with its bid to go public.
Every IPO outlet sprang into action with something to say. It’s not every day that a unicorn with a market value estimated at $10 billion files for an IPO. A unicorn is any company that has $1 billion or more in market capitalization. The latest unicorn count shows 228 companies with a total investment value of about $790 billion on record, according to CBInsights.com. (That’s close to $1 trillion in unicorn market cap, folks.)
Now back to that lightning bolt dancing across the winter sky: Dropbox filed to offer $500 million of common stock in its S-1, or initial filing, for an IPO.
The tantalizing question: When will Dropbox go public? Answer: We’ll have to wait for its updated filing with the SEC.
Dropbox by the Numbers
Dropbox, based in San Francisco, likes to say that “knowledge lives in the cloud.” The company is a global collaboration platform. Dropbox lets its users bring photos, documents and videos in from anywhere so the files can be stored in the cloud, accessed from any device and shared via the Dropbox website. The idea is to make collaboration easier.
The prospectus had some interesting numbers about this pending IPO. Dropbox was founded in 2007. In 2017, Dropbox reported revenue of $1.11 billion – up 30.2 percent from $844.8 million in 2016 – and up 39.9 percent from $608.2 million in 2015.
Dropbox has over 500 million registered users across 180 countries. The company had about 11 million paying users in 2017, up from 8.8 million paying users in 2016 and up from 6.5 million paying users in 2015. The company generates about 90 percent of its revenue from self-serve channels — users who buy a subscription through Dropbox’s app or website.
Dropbox has never been profitable. The company reported a net loss of $117.7 million in 2017, a net loss of $210.7 million in 2016, and a net loss of $325.9 million in 2015. It reported an accumulated deficit of $1.05 billion, as of Dec. 31, 2017.
The word around Wall Street is that the IPO market is expected to pick up in March. Dropbox was among a flurry of IPO filings late Friday afternoon.
One reason why March looks friendly for IPOs: The U.S. stock market indexes are looking good, ending last week with gains. The Dow Jones Industrial Average jumped 347.51 points, or 1.4 percent, on Friday to end at 25,309.99, while the Nasdaq Composite Index climbed 127.31 points, or 1.8 percent, to close at 7,337.39. The S&P 500 added 43.34 points, or 1.6 percent, on Friday to end at 2,747.30. For the week, the Dow rose 0.4 percent, while the S&P 500 added 0.6 percent and the Nasdaq advanced 1.4 percent.
Wall Street is also awash in earnings news. IPOs are no different. The latest IPO filings include each company’s year-end results.
This week’s IPO calendar lists just one deal that is a carryover from last week. It is Union Acquisition (LTN.U – proposed).
Union Acquisition is a “blank check” company recently formed to focus on businesses in Latin America, including but not limited to natural resources, industrial operations and the financial services and technology sectors.
(For more information about these companies and others on the IPO calendar, please check the profiles found on IPOScoop.com’s website.)
For the week of March 5, 2018, the calendar is clean and green, but anything can happen when the SEC’s filing window opens again for business on Monday morning.
Disclosure: Neither the author nor anyone else on the IPOScoop.com staff has a position in any stocks mentioned, nor do we trade or invest in IPOs. The author and IPOScoop.com staff do not issue advice, recommendations or opinions.