Box Signs Up U.S. Justice Department for Cloud File Storage

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U.S. Justice Department employees will start using Box Inc. to share files and collaborate on documents, an endorsement that will bolster the startup’s efforts to expand government sales.

It’s the cloud-storage and file-sharing company’s first agency-wide deal, Chief Executive Officer Aaron Levie said in an interview. While Box’s products are already in use at 40 federal government accounts, those are smaller deployments, he said.

Along with the new deal, Box is seeking approval under the Federal Risk and Authorization Management Program, which could boost the use of cloud services in government agencies. Box, which sold shares to the public in January, is trying to add customers in areas where security is a key factor, such as health care, government and financial services. In its first quarter as a public company, billings fell short of some estimates and Box needs to show it can sustain growth.

“This is pretty massive given their security requirements and given the kinds of content they deal with,” Levie said of the agreement with the Justice Department.

Box shares rose 4.4 percent to close at $17.75, putting the stock up 27 percent from its Jan. 22 initial public offering.