Hard Drives That Stretch to Infinity

Silicon Valley startups used to tremble when Google released a product similar to their own. Now? Not so much. On April 24, Google unveiled its long-awaited Drive service, which lets people store files online and synchronize them across all their devices. Drew Houston, the chief executive officer of file-syncing service Dropbox, goaded the juggernaut with a tweet: “In other news, @Dropbox is launching a search engine. :)” Box, another cloud-storage provider, hosted a previously planned party on a Manhattan rooftop on April 25. CEO Aaron Levie shimmied in suit and sneakers while Elijah Wood (yes, that Elijah Wood) manned the turntable. If the Box chief was panicked, he hid it well.

Houston and Levie have earned the right to be confident. Their companies have lured Silicon Valley’s premier investors and tens of millions of customers. Sequoia Capital, Greylock Partners, and even Bono have contributed to a total of $257 million in funding for Dropbox, valuing the company at about $4 billion. Box has attracted $162 million from firms including Draper Fisher Jurvetson (DFJ) and Andreessen Horowitz. (Bloomberg LP, the parent of this magazine, is an investor in the latter.) “This is the kind of technology—à la the phone, Web browser, and e-mail—that everyone needs, and there just aren’t many products like that,” says Josh Stein, a DFJ managing director.