According to a report by MarketsandMarkets, the total Cloud Storage market is projected to grow 40% annually to $46.8 billion by 2018. The report projects North America to be the leading market with 60% market share, growing 33.8% annually to $21.8 billion by 2018. The growth in the market is attributed to the increased demand of these services by the Small and Medium sized businesses.
Los Altos-based service provider, Box, is one player that is making big news within the industry. Since it was founded in 2005, Box claims to have helped over 20 million individuals, small businesses and Fortune 500 companies store and collaborate on content in the cloud.
Box charges a subscription fee based on the number of users for their services. Plans start for free for individuals wanting to access 10 GB of storage space with a limit of 250 MB file size. Additional features are available at prices as high as $35 per user per month for organizations wanting access to unlimited storage space and enhancements such as security reporting and active directory and single sign on capabilities.
According to market reports, Box earned an estimated $85 million in revenues in 2012 and is projected to have doubled that revenue last year. That is significant growth over the estimated $11 million they earned in 2010. And Box has bigger plans. In a recent discussion on Forbes, founder Aaron Levie commented on how Box would successfully take on rivals like Microsoft because of the giant’s inability to adapt quickly to the mobile world.
Box’s Enterprise Focus
While Box does provide services to individuals, they remain focused on the enterprise market. Cloud storage services provider, Dropbox, may be wanting to strengthen their presence in the enterprise, but Box is already expanding their lead in the segment. Recently, they announced the acquisition of dLoop, a startup that helps IT administrators control access to content. The acquisition will help Box give their enterprise customers enhanced data analytics capabilities. dLoop’s services help simplify content discovery on a network. This will help IT administrators gain a better insight into the activities around content and thus provide more granular controls when needed.
Last month, as part of their enterprise offerings, Box also announced improvements to their file-storage platform that will help enterprise customers better manage their employees’ use of the product. Content Manager will allow companies to manage content from a central hub by being able to access accounts of individuals and change permissions. The new features also help stop a company from uploading sensitive information, such as digital signatures.
Box’s IPO Plans
Box is among the most anticipated IPOs this year. Till now, they have remained venture funded with $409 million in funding from investors including Mark Cuban, Draper Fisher Jurvetson (DFJ), US Venture Partners, Scale Venture Partners, Meritech Capital Partners, Emergence Capital Partners, Andreessen Horowitz, Salesforce, New Enterprise Associates, Bessemer Venture Partners, General Atlantic, SAP Ventures, The Social+Capital Partnership, Itochu Technology Ventures, Mitsui & Co, Telefónica Digital, Telstra, and Macnica Networks Corp. Their latest round of funding was held last month when they raised $100 million at a valuation of $1.95 billion.
Box plans to use these funds for market expansion. They have already established a strong presence in the Asia-Pacific markets. Their service is available in 14 languages including English and has 40% users outside the U.S. The latest round of funding was led by Japanese and Latin American investors and that will help Box push forth their initiatives in these regions. According to market reports, the Japanese cloud solutions market is projected to grow to $3 billion by 2017 and the Latin American market is projected to grow to $8 billion by 2016.
Box has confirmed plans of wanting to go public, but details have not been disclosed. They have selected Morgan Stanley, Credit Suisse and JPMorgan Chase & Co as lead bankers for the expected $500 million IPO. The IPO will further help them expand their global reach.