Dropbox pitches user-friendly collaboration tech to enterprise

Phil Wainewright Profile picture for user pwainewright January 30, 2017
Dropbox is reborn today as an enterprise SaaS vendor with a $1 billion run rate, officially launching its Smart Sync and Paper collaboration tech

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File sharing cloud platform Dropbox yesterday declared itself the fastest growing SaaS vendor in history as it pitched new versions of its user-friendly file sync and collaboration tech to the enterprise market.

Co-founder and CEO Drew Houston revealed the company, which is widely expected to file for an IPO later this year, has become just the fifth SaaS pureplay to reach a $1 billion-a-year revenue run rate, claiming to have done so faster than the likes of Salesforce, Workday and ServiceNow.

Its new product enhancements firmly target the business market, with several only available initially to Dropbox Business account holders.

That includes Smart Sync, the feature previously known as Dropbox Infinite, which makes all the content in a user's Dropbox account seamlessly accessible from their desktop file system, without taking up local disk space until it's needed. The feature effectively provides “a company-level Dropbox,” says Dropbox CTO Aditya Agarwal.

Paired with the team folders functionality which debuted last month, Smart Sync is a cornerstone of Dropbox Business, since it gives all users access to the entire online file system of an enterprise that uses Dropbox. Agarwal says:

The idea that you’ll be able to go from having 2GB on your device to having potentially 20TB on your device, that’s a pretty revolutionary idea.

It's currently unique to Dropbox, although other players may have caught up by the time the feature, which is offered to customers today under an early access program, becomes generally available. Microsoft, for example, which withdrew a similar OneDrive capability with the release of Windows 10, has promised to introduce a feature called On-Demand Sync.

Paper comes out of beta

The second major introduction brings the collaboration tool Dropbox Paper out of beta into full availability in 21 languages worldwide. It also gains new functionality, including much faster search and the ability to assign due dates or owners to tasks, which is useful for project management.

While many have described Paper as a rival to conventional online document products such as Microsoft Word or Google Docs, Dropbox has designed it to operate more like a container for other documents, as Agarwal recently told diginomica:

A Paper document is less a word editor and it is essentially a canvas for ideas, that you can throw ideas on, that you can get feedback on it. You can coordinate and collaborate ...

When I think of a Paper document, I think of it as like the modern container, for anything you want to put into it.

Our goal is you can throw whatever you want into Paper and it can store any kind of data that you want ... Then we can provide organization and search across your entire data set, for your whole company, through that.

The Dropbox web user interface gains enhancements designed with teamwork in mind, again introduced initially just for Business users.

Dropbox is also introducing new pricing plans for business, with different levels depending on whether customers require administrator functions, and custom enterprise plans for larger businesses.

My take

Dropbox is reborn today as an enterprise vendor. Classing itself as a billion-dollar SaaS vendor invites comparisons to the likes of Salesforce and Workday, and sends a clear signal how the company wants to be seen.

While a significant proportion of its $1 billion revenue run rate comes from individual subscribers who pay for extra storage on their Dropbox consumer accounts, the figure is still a notable achievement and one that overshadows already publicly listed rival Box, which is forecasting revenues of $400 million for its fiscal year ending today.

Dropbox has a broader reach, too, claiming 200,000 paying business customers, compared to 70,000 for Box, and it has spread its wings internationally, achieving higher market penetration in several European countries, including the UK, than in the US.

Its approach is an interesting contribution to the continuing evolution of enterprise collaboration, which Agarwal outlined in our recent discussion of Dropbox Paper vs Box Notes. He elaborated on that approach in an interview published yesterday on Backchannel:

Agarwal says the jury’s still out on whether, as he puts it, 'everything is going to be keyed off a unit of communication, or communication is going to be keyed off some core unit of content.' All of these tools are looking for the perfect balance point between real-time communication and long-term knowledge-sharing.

Above all, though, it's Dropbox's viral appeal to users that is its biggest asset. It's an important milestone if that can now be safely enlisted to bring effective digital collaboration to the enterprise.

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