Enterprise cloud file storage firm Box is raising an additional $100 million in capital at a valuation of around $2 billion. A filing with the State of Delaware was first noticed by VC Experts. We’ve heard from sources that Box is indeed raising a new round, at a $2 billion-plus valuation. The company raised $125 million in June of 2012 at a valuation of roughly $1 billion.
The new funds could be viewed as capital to help Box reach the public markets, provided that its revenue growth is on track. This will likely be the last round of funding for the company before it IPOs next year.
According to VCExperts’ Justin Byers, on October 14, 2013, Box authorized a new series of preferred stock. To be exact, there were 5,556,000 shares of Series E-1 Preferred stock authorized at $18 per share, or a $100 million value, authorized for this new preferred stock. The prior round of preferred stock authorized by the company was a Series E Preferred on August 3, 2012, at a price of $13.0949 per share. VC Experts is calculating the valuation following this round at just shy of $2 billion.
According to the data VC Experts has collected, this price at $18 per share is still a far cry from where they recently priced their Class B Common Stock. VC Experts obtained a filing from May 17, 2013, that showed the company pricing their Class B Common stock at $4.63.
Box just raised $125 million in new funding last year, and another $25 million earlier this year. A new round would put Box’s funding at over $400 million total. Box famously turned down a $600 million acquisition offer from Citrix in 2011.
The company was said to generate $10 million in the fourth quarter of 2011, with around $25 million in revenue for that full calendar year. Revenue for 2012 was tipped to be on track to reach $75 million. It was later reported that Box instead was on track for $85 million in revenue for that year.
It isn’t clear what Box’s current revenue rate is, though the company is presumably growing in keeping with its prior rates.
What’s odd about the news is that Box is raising funds at a valuation of one fourth that of its rival, Dropbox, a company that has had a somewhat comparable revenue curve. According to the Wall Street Journal, Dropbox had 2011 revenue of $46 million, $116 million in 2012, and will produce something over $200 million this year.
So, Dropbox was around $21 million ahead of Box in 2011, around $31 million ahead of Box in 2012, and likely a similar chunk this year. So, Dropbox appears to be ahead. But the percentage different isn’t anything close to a four times multiplier, making Box’s paltry – in comparison – $2 billion valuation almost strange.
For example, Box had 2012 revenue of roughly 73% of Dropbox’s top line. Which makes the delta between their valuation odd unless either Box has seen its growth decelerate, or Dropbox has found an updraft and is beating its internal metrics.
Assuming Box doubled its 2012 revenue in 2013 – essentially mirroring the doubling of its market capitalization – it will generate sales of $170 million in the year. At a $2 billion valuation, Box is valued at a mere 11.7 times trailing earnings. When Twitter went public, it was valued three to five times as richly, looking at its past revenue and market cap (using a diluted share count).
We contacted Box for comment and will update if we receive more information.