Box Shares Begin Trading at $14, Valuation at $1.67 Billion

Written by DH Kass 1
January 23, 2015

Shares of cloud storage provider Box will begin trading on the New York Stock Exchange on Jan. 23, priced at $14 a share, above the expected range of $11-$13 per share, valuing the company at about $1.67 billion.

Shares of cloud storage provider Box (BOX) will begin trading on the New York Stock Exchange (NYSE) on Jan. 23, priced at $14 a share, above the expected range of $11-$13 per share, valuing the company at about $1.67 billion.

In the months-delayed IPO, technology’s first of the new year, Box sold all of the 12.5 million shares of Class A common stock in the offering. Also priced at $14 a share, the Box IPO raised about $175 million. Company founder Aaron Levie retained 3.4 percent of the company, now worth about $57 million. Dylan Smith, Box chief financial officer, holds about 1.5 percent of the company, valued at about $25 million.

Should investors look past the company’s inability thus far to make money and the stock surges, Box’s bankers could exercise an option to sell another 1.9 million shares.

Last summer, Box landed an unusually timed $150 million capital infusion from private-equity firm TPG and hedge fund Coatue Management that valued the company at about $2.4 billion.

While Box claims that its 44,000 paying customers include more than 48 percent of Fortune 500 companies and more than 22 percent of Global 2000 companies, and its 32 million registered users include employees from 99 percent of Fortune 500 companies, the company has yet to earn a profit in its 10-year history.

For the nine months ended Oct. 31, 2014, Box lost $121.5 million, a 3 percent improvement from the same period a year earlier, on an 80 percent increase in sales to $153.8 million.

According to Box’s IPO prospectus, the company believes its market opportunity hinges on an expected 40 percent boom in the number of so-called information workers to 865 million by 2016, based on researcher Forrester’s data, and a spike in the number of mobile workers to 1.3 billion by 2015, as IDC figures.

Its growth strategy spans increasing its customer base globally, gaining a strong presence among existing customers, targeting industry verticals, building a stronger channel partner network and expanding its platform ecosystem.