Dropbox shows its freemium model works - 11 million users and 300,000 business teams are paying for its service
- Dropbox on Friday released the paperwork it filed to go public, offering new details on its business.
- The company reported it has 11 million paying users.
- Although Dropbox was late to pursue the enterprise market, it now has 300,000 business teams paying to use its service.
- The customer figures give a better picture of how Dropbox compares with Box, which, unlike Dropbox, focuses solely on enterprise customers.
Dropbox became popular by offering consumers free storage space in the cloud.
But many analysts, investors and other observers have long wondered how much success it would have charging customers - particular businesses - for its service.
On Friday, they got an answer: Dropbox is doing a pretty good job convincing people to pay for cloud storage.
The company has 11 million paying users, 30% of whom are accessing its service on a plan funded by their employer, Dropbox said Friday in its S-1, the regulatory document companies file in advance of their first public stock offering. The company also reported that more than 300,000 business teams were paying to use its service as of the end of last year.
About 50% of the company's paying users access its service through an individual plan.
"Our customers include individuals, teams, and organizations of all sizes, from freelancers and small businesses to Fortune 100 companies," Dropbox said in its filing. "Within companies, our platform is used by all types of teams and functions, including sales, marketing, product, design, engineering, finance, legal, and human resources."
All those paying customers added up to considerable revenue for the company. Dropbox posted $1.1 billion in sales in 2017. It recorded a $111 million loss for the year.
Dropbox's numbers compare favorably with Box, which is also in the cloud storage business. Box, which has had several difficult quarters since going public in 2015, is expected to report a loss of about $163 million on $506 million is sales for its fiscal year that ended January 31. The company said last May it had 74,000 paying customers - a figure best compared to Dropbox's 300,000 paying business teams.
Unlike Dropbox, Box exclusively serves enterprise and government customers, which are subject to extra regulatory scrutiny and require high-levels of security. While it trails Dropbox in total customers, the types of clients it attracts are generally considered to be more desirable and lucrative.
That's also the market Dropbox most needs to make headway in to stay financially afloat for the longterm, analysts have told Business Insider.