

Box faces Make-or-Break Moment - marban
http://www.nytimes.com/2015/04/20/technology/box-provider-of-cloud-computing-services-faces-make-or-break-moment.html?_r=0

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kmfrk
Every time someone mentions Box, I find myself obligated to quote one of the
funniest passages in recent tech history: the Risk Factors chapter from their
S-1 IPO filing:

    
    
        ## Risks Related to Our Business and Our Industry ##
    
        ### We have a history of cumulative losses, and we do not  
        expect to be profitable for the foreseeable future. ###
    
        We have incurred significant losses in each period since
        our inception in 2005. We incurred net losses of $50.3
        million in our fiscal year ended December 31, 2011, $112.6
        million in our fiscal year ended January 31, 2013, and
        $168.6 million in our fiscal year ended January 31, 2014.
        As of January 31, 2014, we had an accumulated deficit of
        $361.2 million. These losses and accumulated deficit
        reflect the substantial investments we made to acquire new
        customers and develop our services. We intend to continue
        scaling our business to increase our number of users and
        paying organizations and to meet the increasingly complex
        needs of our customers. We have invested, and expect to
        continue to invest, in our sales and marketing
        organizations to sell our services around the world and in
        our development organization to deliver additional features
        and capabilities of our cloud services to address our
        customers’ evolving needs. We also expect to continue to
        make significant investments in our datacenter
        infrastructure and in our professional service organization
        as we focus on customer success. As a result of our
        continuing investments to scale our business in each of
        these areas, we do not expect to be profitable for the
        foreseeable future. Furthermore, to the extent we are
        successful in increasing our customer base, we will also
        incur increased losses due to upfront costs associated with
        acquiring new customers, particularly as a result of the
        limited free trial version of our service and the nature of 
        subscription revenue, which is generally recognized ratably
        over the term of the subscription period, which is
        typically one year, although we also offer our services for
        terms ranging between one month to three years or more. We
        cannot assure you that we will achieve profitability in the
        future or that, if we do become profitable, we will sustain
        profitability.
    

[http://www.sec.gov/Archives/edgar/data/1372612/0001193125141...](http://www.sec.gov/Archives/edgar/data/1372612/000119312514112417/d642425ds1.htm#toc642425_2)

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dagw
Isn't that just standard language for basically all S-1 filings?

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wwarren
The most recent one that comes to mind for me is New Relic's S-1
([http://www.sec.gov/Archives/edgar/data/1448056/0001193125144...](http://www.sec.gov/Archives/edgar/data/1448056/000119312514406260/d709327ds1.htm#toc709327_2)):

> We have incurred net losses in each fiscal period since our inception,
> including net losses of $7.5 million, $22.5 million, and $40.2 million in
> the fiscal years ended March 31, 2012, 2013, and 2014, respectively, and
> $18.6 million and $19.4 million in the six months ended September 30, 2013
> and 2014, respectively. We had an accumulated deficit of $100.8 million at
> September 30, 2014....

Seems more or less word for word the same to me

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swimbtfly76
The whole premise of the article is centered around a single quote from a
Morningstar analyst. Does Box really face a make or break moment right now?

~~~
itg
This seems to be on par for tech journalism. Take a quote from some analyst,
accept it as truth without doing any further research, and then write a story
around it.

~~~
ams6110
Seems on par for most mainstream journalism these days, tech or otherwise.

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pkaye
Maybe they are losing money because they have 1200 employees. Do they really
need that many?

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ashwinaj
I work near their Los Altos office and I see a lot of Box employees (How do I
know? They wear the Box tees,shirts hoodies, caps etc.) roaming around the San
Antonio shopping center and surrounding areas (Which begs to question what am
I doing outside the office? Ha! I have a large floor to ceiling window
overlooking El Camino and the SA shopping center). I know it's totally
anecdotal, but it looks like their employees have given up too. Do they really
need 1200 employees?

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theklub
What happens to all the data if a big cloud provider goes under? They must
give their clients time to move the data, no?

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sososoko
they will give time, e.g Ubuntu One file services closed shop and gave some
time and even free migration services to another provider.

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Kurtz79
This was because the company behind Ubuntu (Canonical) shut down the service,
they didn't go under themselves.

If the cloud infrastrucure is Box's, and they cannot pay the maintenance fees
anymore, I would start seriously worrying.

In a way, committing to a company whose main business is cloud storage gives
you more guarantees they won't shut down the service out of the blue (since
it's their only, or main, source of revenue), while committing to a big
company with their eggs in more baskets (MS, Google) gives you more guarantees
that if they shut down the service you'll be given some time to react.

~~~
pavel_lishin
Is there insurance coverage for this sort of thing?

"In case Company X goes under, Insurance Company Y will pay $Z to cover
hosting costs for AA months so that customers can download their data"

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codecamper
backblaze is 5 bucks a month for unlimited. box is 6 or 7 bucks a month for 2
GB. why would anyone use box?

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atYevP
Yev from Backblaze here -> bit of a different use-case. Box isn't a backup
service, and Backblaze isn't a syncing/sharing/collaboration service. But
you're right, if they are paying to house their data somewhere, that gets
expensive. We can charge so little because of our own infrastructure that we
rolled out, but it's not designed for the type of stuff that they are doing.
Though, I suppose if you design it right it could be.

