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Box Seeks to Raise $250 Million in IPO on NYSE Next Month

A first look at its finances.

Asa Mathat

Box, the enterprise-focused cloud storage and collaboration company will formally announced its plans for an initial public offering later today. It said it will seek to raise about $250 million and is expected to price sometime next month.

It will trade on the New York Stock Exchange under the ticker symbol BOX.

The company just announced the move via Twitter.

The company, headed by 29-year old CEO Aaron Levie, initially filed for its IPO under the confidentiality provisions of the federal JOBS Act. Morgan Stanley, Credit Suisse and J.P. Morgan Chase are running the process. Other banks involved with the underwriting process are BMO Capital Markets, Canaccord Genuity, Pacific Crest Securities, Raymond James & Associates, and Wells Fargo Securities.

Update: The filing is live. Here’s some numbers: Box reported $124.2 million in revenue for the year ended Jan. 31 and a loss of $169 million. Revenue increased by 110 percent year-on-year from $59 million in the prior year. The loss swelled from $112.5 million.

The company recorded operating expenses of $257 million, which works out to more than $21 million per month. Even after backing out $46 million in annual research and development costs, Box has been burning through cash at a rate of $17.5 million a month on its operations alone. Either way that’s a lot worse than the $8 million figure I heard last summer. Still, Box exited the fiscal year with a little less than $109 million in cash on the balance sheet.

The biggest cost is sales and marketing, which at $171.2 million grew by nearly 73 percent year-on-year. Box has maintained an aggressive pace of expanding into several vertical industries. Of that increase, nearly $46 million was related to the expansion of Box’s sales team and about $16 million sales commission payments.

The company had 513 employees as of Jan. 31, up from 374 a year ago. That works out to revenue of about $242,000 per employee. But look at the loss per employee: About $330,000.

Since Box is a cloud services company, one of the key metrics to watch — and this is true of others like and Workday — is billings. Basically it means that since Box is a subscription service, it has to report money that comes in for an annual subscription in four quarterly or 12 monthly increments. That makes billings an important barometer of the health of the business going forward.

For the period ending Jan. 31, Box’s billings grew by 103 percent to $174.2 million, up from $86 million in the year ago period. If it were to maintain that same run rate, it would have billings on the order of about $350 million by this time next year.

Box’s biggest shareholder is the venture capital firm Draper Fisher Jurvetson, which led the $1.5 million A-Round in 2006. It owns more than 23 million share or about 25.5 percent of the equity. Second is US Venture Partners, which got in on the $6 million B round in 2008, and owns about 11.7 million shares or about 13 percent.

General Atlantic, which led a $150 million private equity round 14 months ago, and brought Gary Reiner to Box’s board of directors, controls about 7.6 million shares, or about 8.4 percent. Scale Venture Partners, which led the $15 million Series C in 2010 has 6.7 million shares of 7.4 percent of the company.

Bessemer Venture Partners, which was a late addition to Box’s $81 million Series D in 2011, has 5 million shares, enough for 5.6 percent of the company. Meritech Capital Partners, another D round investor, has about 4.6 million shares, good enough for about 5.1 percent of the company.

CEO Aaron Levie, controls a little less than 3.8 million shares, or about four percent of the company. CFO Dylan Smith has less than two percent.

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