What? Cloud-based document management company Box.net has raised $81m of new funding. The deal values the Silicon Valley-based company at around $650m.
Techcrunch reported that Box.net has raised $81 million in Series D funding from strategic investors Salesforce.com and SAP Ventures with Bessemer Venture Partners, NEA, and prior investors including Andreessen Horowitz and Draper Fisher Jurvetson Growth participating in the round. The new investment brings Box.net’s total capital raised to $162 million.
The company was founded in 2005 by Aaron Levie and Dylan Smith from out of their dorm rooms. Today, the company provides storage solutions for 77% of the Fortune 500. Currently, 100,000 businesses are using Box.net’s service with 250,000 new users joining each month.
This goes to show that if you have a simple, but brilliant idea and a strong business plan, are not in a rush for an IPO but want to generate some private investment, then market conditions are likely to be perfect for you at the moment. Box.net’s $81m funding deal follows hot on the heels of Twitter’s $800m super-funding in August.
The company reportedly turned down a $600m offer to purchase it, preferring to focus on product strategy and organic growth. The question in the minds of the industry must now be whether organic growth is the way forward for start-ups. Currently, less than ideal market conditions are pushing tech companies into a phase of IPO reassessment. Zynga will probably pull its proposed IPO for now and Facebook is also reassessing. Even if there is pressure to float and realise short term cash gain, many tech companies are resisting and playing a longer game.
This trend may well be motivated purely by economics but it is also possible that something bigger than just financial gain is beginning to filter through from the industry’s decision makers. Steve Jobs’ often-quoted 2005 Stanford speech embodied the entrepreneurial spirit which may be driving some of today’s young business people: “Don’t let the noise of others’ opinions drown out your own inner voice. And most importantly, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.”