Dropbox Paper as a Digital Work Hub: Will It Lead to An IPO?
By Jim Lundy
(Aragon Research) – Rumors have been circulating (via Reuters) about Dropbox looking for Underwriters for an Initial Public Offering (IPO). For Mobile Content Management firms, it has been a challenge to compete against Google and Microsoft, who continue to win accounts with their Cloud Office Suites and renewed focus on Google Drive and Microsoft OneDrive, respectively. Content Management is still a pressing need in the enterprise; today it’s about getting work done with a more integrated approach. This blog looks at Dropbox and the shift to Digital Work Hubs.
Defining Digital Work Hubs
Digital Work Hubs is a concept introduced by Aragon earlier this year. Digital Work Hubs bring people, teams, and work together, and are more integrated than an Office Suite. This is the reason that providers like Slack are challenging Suite providers like Google and Microsoft. There will be many different types of Digital Work Hubs. For example, Cisco Spark, with its Workspaces, is a communications-focused Work Hub that makes it easy to meet and collaborate around content, particularly around Digital Whiteboards. Sales Engagement Platforms, such as ClearSlide and Savo, are also Digital Work Hubs for Sales Professionals (we refer to them as an ‘Office for Sales’).
This trend of integrated Work Hubs emerging from multiple providers spells trouble for standalone content management applications, whose days are numbered.
Dropbox Paper Is a Work Hub in Process
The great news for Dropbox is that it appears to understand the need for more integrated work. Dropbox Paper has been around as a concept since 2015, and it formally shipped in early 2017. Dropbox Paper has all the ease of use that Dropbox was originally known for. We expect that Dropbox Paper will succeed in Corporate Marketing Departments where Dropbox has had a stronghold.
Dropbox versus Box, Google, and Microsoft
We will also note that the Dropbox Business team has been working very hard to win corporate accounts – and they’ve succeeded. The challenge is that Box, Google, and Microsoft have been focused on the enterprise longer and as a result, are more entrenched. We would also note that today, there is more of a co-existence model that has emerged. Dropbox, Box, and Google are all pitching co-existence with Microsoft Office 365. While Microsoft welcomes this, it is also pitching OneDrive and SharePoint Online very hard, and CIOs and Business Buyers are coming around. This is partly due to improvements Microsoft has made to OneDrive. That said, the attractiveness of OneDrive is because it is part of Office 365.
Dropbox IPO and the Long Haul
The battle for Digital Work Hubs is on and Dropbox Paper is one of the emerging Work Hubs for enterprises to evaluate. Will Paper be enough to get Dropbox to IPO? We expect that it will, but Dropbox will have to do more to break out of its stronghold in marketing to be able to compete at the broader enterprise level against Box, Google, and Microsoft.