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Dropbox Shares Skyrocket in Best Technology Market Debut

Dropbox made the best technology market debut in 2018 as it went public on Friday. The company’s shares surged during the trading session estimating its market value to $12.67 billion.

Trading under the symbol DBX, its shares advanced 35.6% to end at $28.48. Its opening price was at $29 on the Nasdaq, and rose as much as 50% to a high of $31.60 in early trading.

Dropbox showing on an app store on a phone
Dropbox hit the biggest technology market debut.

At the opening price, Dropbox had a market valuation of $12.67 billion. It was well above the $10-billion valuation it had in its last private funding round.

Its IPO was priced at $21 per share late on Thursday, $1 above the projected range of $15 to $20, and was several times oversubscribed. Dropbox sold 36 million shares for $21 per share, raising $756 million.

The solid first-day gain came despite a decline in the wider US stock market. The S&P 500 fell 1.8%, while Nasdaq plunged 2.4%, extending losses of more than 2% each on Thursday.

“Dropbox is going public at the right time. It has an attractive story to justify its need for financing and the market dynamics are good,” said Jose Lerner, professor of investment banking at Harvard Business School.

“But at the same time, the environment is also competitive.”

Dropbox Hit the Biggest Technology IPO in more than a year.

Dropbox’s IPO is one of the technology industry’s biggest public market debuts since Snap went public last year. Dropbox had a private valuation of $10 billion, making it a member of unicorn startups with a private valuation of over $1 billion.

“In the case of Dropbox, investors get a chance to get exposure to a next-generation tech company, which is a proven business model,” said Tom Taulli, analyst at

 While it’s common for startups that invest heavily in growth, Dropbox has yet to turn a profit. It will be under pressure to quickly trim its losses being a public company.

In 2017, it reported revenue of $1.11 billion, up from $844.8 million a year earlier. Its net loss nearly halved from $210.2 million in 2016.

“The strong performance of the Dropbox IPO may open the door for more technology unicorns to IPO throughout the rest of 2018,” said Sohail Prasad, co-found and co-chief executive of Equidate. “If investors had bought Dropbox stock within the last 6 months, they’d be up over 75%.”

For the past years, Dropbox faced fierce competition from technology giants such as Google, Microsoft Corp,, Box, and Apple.

Aaron Levie, the CEO of rival online storage company Box, congratulated Dropbox CEO Drew Houston on Twitter. He said, “Welcome to the neighborhood!”

Another anticipated offering is the music-streaming service Spotify. It was valued at roughly $19 billion in the private market. The company will start trading on the New York Stock Exchange on April 3.

Last week, shares of an internet security company, Zscaler, another unicorn, surged more than 100% on its first day of trading.

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