It’s raining money from the cloud. Kind of anyway. Dropbox just got a $600M credit line to tide it over as it explores an IPO, maybe this year. This is a huge vote of confidence in Dropbox after the company sort of shifted its selling focus of it’s cloud service to larger businesses and is also doing some cost cutting. I guess they watched and learned from rival Box’s IPO experience back in 2015. Anyway, congrats to the Dropbox team. Nice read.
“Dropbox Inc. is opening a $600 million credit facility from six banks led by JPMorgan Chase & Co., said people familiar with the plans, as the cloud file-sharing startup pushes toward an initial public offering as soon as this year.
The line of debt has commitments from the banks and is expected to close on Monday, said the people, who asked not to be identified because the deal isn’t finalized. The financial security provides Dropbox with flexibility as it deliberates an IPO.
The San Francisco-based startup has been meeting with bankers to discuss plans to list, people familiar with the talks said. While the company hasn’t set specific timing, potential advisers believe it will be ready to go public by the end of this year. Dropbox and its lenders declined to comment.
Dropbox has said it’s not in a hurry to go public and that the business is nearing profitability. The company is cash-flow positive, with annualized revenue of more than $1 billion, Chief Executive Officer Drew Houston said last summer. Dropbox could tap debt if it wants to expand more aggressively or make acquisitions, said one of the people. It never touched a smaller credit facility, which was expiring, the person said.
After opening up in 2007, Dropbox gained a loyal following from people looking to store photos and other files in the cloud, making them available from any computer or mobile device. It rode this wave to a $10 billion valuation in early 2014, vaulting it to become one of Silicon Valley’s most valuable unicorn startups. A few months later, it secured a $500 million credit facility led by JPMorgan…”Read Full Article at Bloomberg