Dropbox CEO Talks European Expansion, Brexit, Trump And IPO

IN-DEPTH: Drew Houston outlines plans for European expansion and how Dropbox will change the conversation from syncing files to syncing teams

Dropbox believes its future role in the workplace will be to tie disparate applications and sources of data into one platform, but acknowledges it has a difficult task in continuing to provide the ease of use that has made its product so popular among consumers whilst offering the admin tools needed by business. 

During a visit to London, CEO Drew Houston outlined the importance of the European market, which the firm believes will be the biggest area of growth in the coming years – especially in the UK where 1 in 2 web users are signed up. 

The company has 500 million users and is present in 8 million businesses, of which 200,000 are paying customers.  

Dropbox Open 1


Problem solving 

It claims that unlike ‘traditional’ Software-as-a-Service (SaaS) companies like archrival Box, it doesn’t have to spend its money on “armies” of salespeople because of word of mouth recommendations and can instead spend its incremental revenue on product and development. 

“Those 500 million people have taken us into 8 million businesses,” said Houston. “But when you look at the 200,000 customers that’s a small percentage.  that’s still a lot of [room to expand]. 

“When you talk to customers there are a lot of problems not being solved.” 

Houston cited the various cloud applications used by different companies alongside legacy systems that need to be accounted for. 

Ease of use 

drew-houston-dropbox-ceo“The new stuff isn’t designed to care about the old stuff so we’re all kind of caught in the crossfire and we need to find a way to work together,” he said. 

“[The industry’s] incentive is to make it hard to leave the ecosystem so you [end up with] a lot of apps with different logins. And that’s a problem no one is solving. 

Earlier this year, Dropbox said the ease of use of its product was essential to driving European growth and it is working to make its administration console as easy to use as the front end.  

More security features have also been added as the company targets more regulated industries but the user-friendly experience of Dropbox is a principle that is strictly adhered to. 

“You have to be very careful,” said Houston. “You don’t want to degrade the user experience as a result. We obsess over every little detail … People love using Dropbox. 

European growth 

Europe accounts for one third of Dropbox’s user base and the continent is growing faster than the US. Box has previously spoken about the difficulties in expanding to Europe because of the invalidation of Safe Harbour and the absence of a European digital single market. 

When asked by Silicon what conditions Dropbox required to make its expansion easy, Dropbox COO Dennis Woodside said it needed the principles of privacy and security to prevail at a regulatory level within the European Union and that it was happy that Privacy Shield, the replacement for Safe Harbour, had been finalised. 

“We think [Privacy Shield] was very important for the EU to get through,” said Woodside. “It gives business clarity about how they can work with us. 

“We believe in the privacy of data. We don’t use that data for anything like advertising and those values are very consistent.” 

Brexit impact 

Dropbox has begun building its own storage in the US, repatriating data from the public cloud, but has agreed a deal with Amazon Web Services (AWS) so customer data can be stored in Germany and benefit from EU data protection regulations. Woodside said this plurality of strategy was motivated by a desire to give customers flexibility rather than ideology. 

“We have a lot of data so at some point it made economy of scale sense to build our own data centre,” he explained. “The needs of our users are [different] compared to those of public cloud. Latency levels outside Europe have fallen. 

Houston talks Brexit, Donald Trump and IPO on page 2…