Box Delays IPO until Labor Day; TPG offers up $150M Investment
The Box IPO is being pushed back until after Labor Day. At least that seems to be the perception of many investing analysts. Box first tried to go public earlier this year but a sour reception of the company’s $168 million dollar annual loss listed on its S-1 documents combined with a slight market correction in many cloud stocks at the time caused Box to hold off on the IPO.
Perhaps the timing just wasn’t right for the innovator in cloud storage. The Wall Street Journal reports that TPG bought into that theory by investing $150M into Box. The WSJ is also the source of the news that Box is planning on re-launching its IPO around the Labor Day holiday. Bryan Taylor from TPG spoke about the deal saying, “Box has established a strong leadership position in the transition to the cloud, and we are confident that the company can continue to scale.”
When combining this news with the latest IDC survey that mentions the cloud market will become 23% larger by 2018, it seems as if Box may just be waiting for the right time to go public which seems to be Labor Day. If Box can get into the publically traded market, its current valuation of over 2 billion dollars could be marked up significantly more due to investor confidence and market expansion. Small businesses and international clients will likely make up much of the growth that IDC predicts will happen by 2018. The IDC study points to a larger untapped market, a market that Box expects to be able to target once these businesses reach the point of needing cloud storage solutions.
Earlier this year, it seems as if many investors were spooked by Box’s $168M dollar loss listed on their S-1 sheets. If Box can continue to innovate or acquire other cloud storage solutions in efforts to bolsters its own platform, Box could become the predominant cloud file sharing and file storage service for businesses of all sizes which would all but erase the $168M loss and bring the company to profitability for its investors.
