Cloud Storage Provider Box Delays $250M IPO Until Late May: Reports

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Enterprise cloud storage company Box is reportedly delaying its entry into the New York Stock Exchange until late May, several weeks later than many had expected.

Based on its SEC filing filed in March, the company expected to raise $250 million in its Initial Public Offering, which many suspected would lead to a mid-April market debut.

According to a Box spokesperson, the company had never set an IPO date. “Since filing, we’ve planned on going when it makes the most sense for the market. That plan hasn’t changed,” they stated.

Some suggest that current market volatility is forcing Box to delay its IPO, while others consider weaknesses in the company’s business model and its place within the market. For instance, TechCrunch noted that this has been a rough week for Box, which had missed out on buying information rights management vendor DocTrackr to Intralinks.

As many have noted, much of what Box offers has become commoditized, and many people are choosing cloud storage services such as Microsoft SkyDrive and Google Drive that are already integrated into software they use.

There are also new entrants to cloud storage such as Open-Xchange which launched OX Drive, its file synchronization and collaboration service, earlier this year. And Peer-2-Peer options are building steam with the success of BitTorrent, Inc.’s BitTorrent Sync, and Mega, headed by controversial founder Kim Dotcom.

In 2013, Box was doubling its revenue (from $58.8 million to $124 million), but also significantly adding to its net losses which grew from $112 million in 2012 to $168 million in 2013.

According to its SEC filings, Box only has $108 million in cash and equivalents to offset its losses.

Lawrence Hawes, principal at Dow Brook Consulting, told TechCrunch that if Box is unable to raise operating funds for the next few years of operating expenses, it may be on the market to be acquired.

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  1. The biggest problem for Box, it seems, is that it doesn't offer any unique business features. Added with the fact that its pricing is so high, it makes it difficult to see where Box will begin to turn a profit. Right now, the market is not strong which may make now not such a good time for any cloud startup to try and go public. However, I'm beginning to question whether there will ever be a time that's right for Box.