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Shira Ovide

Dropbox Is Not Like the Others, and Investors Are Just Fine With It

Stock buyers in the newly public company put their faith in its untested novelty.
Photographer: Victor J. Blue/Bloomberg

Investors have gone gaga over Dropbox Inc. in its first few hours as a public company. It looks as if their enthusiasm has become overheated. 

Shares of Dropbox, the digital file-cabinet company, shot up about 39 percent on Friday from their initial sale price. That gives Dropbox a valuation of about $13 billion, including the value of shares held by employees and others. Dropbox's multiple of revenue now stands at about 12 based on 2017 revenue, which is on the high end for companies that sell subscription software to businesses.