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Business

Dropbox is a unicorn among unicorns

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Opening sequence

Business

Dropbox is a unicorn among unicorns

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COMING UP:Dropbox is a unicorn among unicorns

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00:00:02
>> It is finally been sighted, a unicorn that's cash flow positive. At least that's according to Dropbox founder Drew Houston. Saying the cloud storage firm isn't simply burning through the billions venture capitalists have dumped on it. Reuters breaking views columnists Robert Siren.>> It's impressive for Unicorn, but it's a really low bar to jump over.
00:00:22
Bill Gurley's a venture capitalist. He says it's the first unicorn he's aware of that's cash flow positive. In other words, they have more cash coming into the business than going out. But if you think about it, they're worth $10 billion at their last valuation. That's kinda, it should be the norm for a business to have more cash coming in than going out.
00:00:38
>> For Dropbox, it means it's got some control over its future. The IPO market has been tough, and venture capital isn't flowing like before. But the company can use the money it makes, to expand as it sees fit. It's not clear how much money it's making, it boasts half a billion users but only a small fraction of them paying, and there's a lot of competition in the cloud business.
00:01:01
>> It has to generate a lot of cash to be worth $10 billion, indeed that's why companies cut the valuation on Dropbox in the past couple of quarters. Fidelity, for example, thinks Dropbox is worth between 6 and 7 billion dollars. Well the problem is that if it's the only company that's generating cash flow positive and there are about 160 unicorns according to the last count, and there's not enough cash going into the sector, that means a lot of these unicorns are gonna die.
00:01:29
>> For now Dropbox will be a unicorn among unicorns.