Dropbox CEO On His $11 Billion IPO
Dropbox CEO Drew Houston famously turned down Steve Jobs when Jobs offered to acquire the company. After the rejection, Jobs not-so-subtly implied that he’d have to put Dropbox out of business instead.
On Friday, Dropbox went public, with its stock popping 35% by the end of the first day of trading, defying the rest of the bleak market.
Houston is probably feeling pretty good about rejecting the tech legend. He’s now a billionaire a few times over.
Going into Dropbox’s IPO Friday, there were worries that the company’s valuation would be well below the $10 billion that private investors pegged it at a few years ago. But those concerns were quickly squashed. It now has a market cap of $11.03 billion.
In an interview with Business Insider on Friday, CEO Houston said he wasn’t concerned about near-term stock price of his newly public company. He told his employees not to focus on what could have been, and could still be, a fluctuating stock price.
“One thing I tell the team is get used to the stock going up and down,” Houston said. “This will be a normal, everyday occurrence… that’s outside of our control. So what I make sure the team stays focused on is that our customers don’t care if we’re public or private. They just want a great experience.”
Dropbox is the first of the so-called tech unicorns — companies valued over $1 billion — to go public this year. Music streaming service Spotify will have its IPO in the coming weeks, and Lyft, Uber, and Airbnb, are all seen as the next major tech companies likely to go public either this year or next year.
“I think we’re all excited about this cohort of companies,” Houston said. “And I’m looking forward to see Daniel [Ek] take Spotify public. A lot of these founders are my friends. It’s certainly a lot of fun to watch them scale their businesses.”
Houston’s take on Silicon Valley’s troubles
Dropbox may not be mired by accusations of spreading fake news or mishandling personal user data, but it is growing in an environment tainted by a lack of employee diversity. Dropbox released its latest employee diversity stats in February, and they don’t look much better than other Silicon Valley tech companies. Women make up 39% of Dropbox’s workforce, and the company is 55% white and 32% Asian.
Houston recently joined a group called Founders for Change, a coalition of tech companies and startups that have pledged not to take venture capital funding from groups that didn’t have a woman or person of color who could write the check.
It’s one of many efforts to fix the diversity problem in Silicon Valley, but it’s not going to happen overnight.
But one quick fix that can be made is the gender pay gap, when female employees are paid less for the same work. It’s simply a matter of analyzing salary data and making sure all employees are getting equal pay for the same work. Houston said that’s an issue Dropbox is looking at too.
“While as an industry we have a long way to go, there are things that are directly within companies’ control, and so by all means within our company we take a close look at gender pay equity, and I think everybody should,” Houston said.
And then there’s the other black eye on Silicon Valley’s reputation. Facebook’s failure to protect user data that was given to third-party developers sent the company headfirst into one of its biggest crises since its founding. In a series of interviews this week, Facebook CEO Mark Zuckerberg said he’d be open to some form of government regulation.
Even though Dropbox isn’t a major social network, Houston did say it’s responsible for keeping user data stored on its servers secure.
“We shouldn’t wait for [regulation],” Houston said. “I think we all realize that it’s critical that we trust all the services we use, and that’s certainly top of mind for us, as you can imagine.”
“I think what the government does from a regulation standpoint, from a policy standpoint, can go in a lot of different directions,” Houston later added. “But we want to make sure that we — whether as a public company or whether as a private company — are doing everything we can to keep our user’s information safe.”
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