File sharing startup Dropbox confidentially files for IPO

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Dropbox chief executive Drew Houston

Comment icon Dropbox chief executive Drew Houston Credit AP

Data-sharing business Dropbox Inc has filed confidentially for a US initial public offering led by Goldman Sachs Group Inc and JPMorgan Chase & Co, Bloomberg reported, citing people familiar with the matter. The company is taking a much more conventional approach to the IPO than Spotify Ltd., which is also said to have quietly filed for a public offering recently. That's made it easier for Dropbox to cut costs while speeding file transfers, Chief Operating Officer Dennis Woodside said in an interview a year ago.

Dropbox achieved its $10 billion private valuation in its last private funding round in 2014.

San Francisco-based Dropbox, which was founded in 2007 by Massachusetts Institute of Technology graduates Drew Houston and Arash Ferdowsi, counts Sequoia Capital, T. Rowe Price and Greylock Partners as investors.

Dropbox filed confidentially with the Securities and Exchange Commission, which companies that are generating less than $1 billion a year in revenue can do, affording it time to make its preparations away from the glare of potential investors. Dropbox plans to hire more banks as advisers, they said. There has been no official confirmation about this just yet, either from Dropbox or Goldman Sachs and JPMorgan for that matter.

Dropbox is likely to tout its biggest investment in recent years: its own cloud.

Goldman Sachs had been helping the company prepare IPO documents. Houston, the company's chief executive, said last January that Dropbox was on a pace to collect $1 billion in sales on an annualized basis and had positive free cash flow.

Dropbox started as a free service for consumers to share and store photos, music and other large files. Box has since rebounded to a market cap of about $3 billion.

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