Dropbox Could Be A Bargain At An $8 Billion Valuation • Hacker News Board

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#11

Post by ed » Tue, Nov 19, 2013, 12:51 AM UTC

casca wrote: post #4

This seems like a very convoluted way of coming to the valuation. Revenue != profit. I can easily create business that generates $1bn/month in revenue by selling dollars for 90 cents. Dropbox may be worth $8bn, but surely it makes more sense to assess the valuation based on the growth in profitability?

Doesn't seem like a stretch to imagine Dropbox has very attractive margins.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#12

Post by dcc1 » Tue, Nov 19, 2013, 12:52 AM UTC

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

Downvoted? really? for pointing out a huge problem with Dropbox business model?

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#13

Post by rwissmann » Tue, Nov 19, 2013, 12:54 AM UTC

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

That would however permanently damage Amazon's AWS business, which Bezos believes could become their largest revenue generator. Amazon and Dropbox aren't even competitors at the moment. Very unlikely.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#14

Post by dcc1 » Tue, Nov 19, 2013, 12:57 AM UTC

rwissmann wrote: post #13

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

That would however permanently damage Amazon's AWS business, which Bezos believes could become their largest revenue generator. Amazon and Dropbox aren't even competitors at the moment. Very unlikely.

You would think an 8billion dollar business would be able to afford a server or two (or datacenter or two) and not be reliant completely on someone else

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#15

Post by matthunch » Tue, Nov 19, 2013, 12:59 AM UTC

ed wrote: post #11

casca wrote: post #4

This seems like a very convoluted way of coming to the valuation. Revenue != profit. I can easily create business that generates $1bn/month in revenue by selling dollars for 90 cents. Dropbox may be worth $8bn, but surely it makes more sense to assess the valuation based on the growth in profitability?

Doesn't seem like a stretch to imagine Dropbox has very attractive margins.

Not sure, There are a lot of indirect costs as well which dropbox needs to pay off. IMO, If they are profitable, PM would be >30% before taxes.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#16

Post by jedc » Tue, Nov 19, 2013, 12:59 AM UTC

eliben wrote: post #7

casca wrote: post #4

This seems like a very convoluted way of coming to the valuation. Revenue != profit. I can easily create business that generates $1bn/month in revenue by selling dollars for 90 cents. Dropbox may be worth $8bn, but surely it makes more sense to assess the valuation based on the growth in profitability?

Indeed. Especially given that Dropbox uses Amazon for the actual storage and the massive scale, I wonder what % of that revenue ends up in Amazon's pockets.

Do they still? I would have thought that by this stage they'd have started building their own (at least mini-) data centers.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#17

Post by consonants » Tue, Nov 19, 2013, 1:01 AM UTC

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

A bigger threat would be Amazon competing with Dropbox, not some passive-aggressive slight.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#18

Post by staunch » Tue, Nov 19, 2013, 1:02 AM UTC

Twitter's and Dropbox's business models couldn't be more different. Heck, everything about their businesses is dissimilar. This comparison is idiotic.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#19

Post by antimatter » Tue, Nov 19, 2013, 1:03 AM UTC

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

Are there any plans for Dropbox to move to its own infrastructure? At their scale, I would think it would be much cheaper just going by how much Everpix was paying Amazon for storage.

Re: Dropbox Could Be A Bargain At An $8 Billion Valuation

#20

Post by baddox » Tue, Nov 19, 2013, 1:03 AM UTC

dcc1 wrote: post #8

Considering that Dropbox are completely dependant on Amazon for their service and overnight Amazon could sink them "ooops your instances just got deleted, oops" 8 billion is a bit of a joke Now if they owned their own equipment in their own datacenters...

...and their own ISPs, and their own operating system developed completely internally...