Dropbox files for initial offering

San Francisco firm has been privately valued at $10 billion

Dropbox, the San Francisco filesharing company that’s been privately valued at $10 billion, has filed for an initial public offering, touting its potential for growth.

The company filed Friday with the Securities and Exchange Commission for an offering of $500 million. That amount is a placeholder and is expected to change. The company plans to use the proceeds to pay down debt and for general corporate purposes.

Dropbox established the $10 billion valuation in a 2014 funding round. It would be one of the biggest enterprise technology companies to list on U.S. markets in several years. First Data

Corp. went public at a market value of about $14 billion in 2015 — the biggest such IPO in the past five years.

“While we’re at scale, we can still move quickly,” Dropbox co-founders Drew Houston and Arash Ferdowsi said in a letter to shareholders included in Friday’s filing. “Imagine if every minute at work were well spent — if we could focus and spend our time on the things that matter. This is the world we want to live in.”

While Dropbox has been boasting about its size — more than 500 million registered users — and the fact that it is cash-flow positive, the filing gives a more indepth look at its financial status. The company’s revenue increased more than 30 percent last year, to $1.1 billion from $845 million in 2016. In the same period, the company’s net losses shrank to $112 million from $210 million.

Goldman Sachs Group Inc., JPMorgan Chase &

“Imagine if every minute at work were well spent — if we could focus and spend our time on the things that matter.” Drew Houston and Arash Ferdowsi, Dropbox co-founders, in a letter to shareholders

Co., Deutsche Bank AG and Allen & Co. are leading the offering. The company plans to list the shares on Nasdaq Global Select Market under the symbol DBX.

In its registration for the IPO, Dropbox said it granted about $190 million in stock awards to three top executives last year. CEO Houston received restricted shares worth $109.6 million, and Ferdowsi was handed stock worth $46.7 million. Their shares will vest if Dropbox’s stock achieves a series of price hurdles ranging from $20 to $60 within a decade of the offering’s close, the filing said.

Quentin Clark, who joined last year to oversee engineering, product and design, was given shares worth $34.1 million in September. They’ll vest over five years as long as he remains on the job. He also received a $340,000 signing bonus.

The three earn base salaries of $400,000 and have cash bonuses with annual targets of $260,000. Houston and Ferdowsi haven’t previously received equity awards since they founded the company, the filing said.

Meg Whitman, the former CEO of Hewlett Packard Enterprise Co. who joined Dropbox’s board in September, received stock worth $908,800.

Companies often grant large blocks of equity to executives when they go public, saying such awards are necessary to keep them on the job. Snap Inc. gave CEO Evan Spiegel shares worth $636.6 million as the firm went public last year. Chief Strategy Officer Imran Khan got a grant of stock worth about $100 million.