Dropbox’s surge on the stock market has continued, with the company going up another 7% on its second day on the stock market.
The company saw its shares close at $30.45, giving the company above a $13 billion market cap, fully diluted.
When it priced its IPO, there was a question as to whether Dropbox would surpass the $10 billion valuation it achieved in its last private round. It eliminated those concerns overnight.
The first few days have been a strong indicator of investor demand for the cloud storage company.
To recap, Dropbox initially hoped to price its IPO between $16 and $18, then raised it from $18 to $20. Then it ultimately priced its IPO at $21, closing the day above $28. And it still continues to go up.
Investors like Dropbox’s improving financials.
It brought in $1.1 billion in revenue in its most recent year. This is up from $845 million in revenue the year before and $604 million for 2015.
Yet while it’s been cash flow positive since 2016, it is not profitable. Dropbox lost nearly $112 million last year. But its margins are looking better when compared with losses of $210 million for 2016 and $326 million for 2015.
Co-founder and CEO Drew Houston is the largest shareholder, owning 25.3% of the company ahead of its IPO. Sequoia Capital owned 23.2% of Dropbox.
Although Dropbox is very different than Spotify which intends to list next week, investors will view this favorable debut as a sign that the IPO window is “open,” meaning that there is strong demand for newly public tech companies.
Zuora, Pivotal and Smartsheet also unveiled IPO filings recently, suggesting that they will go public in April. And we broke the news that DocuSign’s IPO is coming up.