File hosting service Dropbox, Inc. is going public, several media outlets reported, citing sources familiar with the matter.
Established in 2007 as a startup, California-based Dropbox offers cloud storage, client software, file synchronization and personal cloud. Its service boasts of having 500 million users, including 200,000 businesses. Dropbox was valued at nearly $10 billion during a private funder in 2014.
According to the reports, the company filed quietly for an IPO with the Securities and Exchange Commission and intends to list in the second half of 2018. Sources also said Goldman Sachs Group and JPMorgan Chase & Co. will head the listing, although the company is in discussions with other banks for further roles in the offering.
Dropbox could turn out as one of the largest enterprise tech firms to list in the U.S. in recent years, although it would follow Snap Inc. (NYSE:SNAP) disappointing foray into the public markets. The Snapchat parent went public in March, and it was regarded as the biggest IPO for a tech firm since Facebook (NASDAQ:FB) in 2012. Snap’s shares, however, are down 15 percent since then.
Dropbox will be entering the market with over $1 billion in yearly sales, and this could be the key difference between it and money-losing Snap. According to CEO Drew Houston, the company has been profitable as it focused on broadening its product suite and curbing expenses over the years.
Dropbox may have also been preparing for the IPO process since last year as it tapped prominent people to its board. The company appointed Hewlett Packard Enterprise Co. (NYSE:HPE) CEO Meg Whitman in September and former Nike Inc. (NYSE:NKE) CFO Don Blair in December.
The company’s public foray would be considered as a harbinger for startups, Venky Ganesan of Menlo Ventures noted. “Will unicorns realize they have to grow up and grow out of their Peter Pan mentality?” he was quoted as saying by The New York Times, adding that the move would also pave the way for whether other ones “reignite and grow, or do they fade away?”
Aside from Dropbox, ADT Inc., Apollo Global Management’s security firm, and paid music service Spotify are preparing for IPOs. ADT is targeting raising up to $2.1 billion in its offering that is expected to price in January 18, while Spotify seeks to carry out a direct listing this quarter.
Other companies including Airbnb, Lyft and Uber could also follow and launch their own offerings in the coming years.