Dropbox boosts its price range for its IPO as it nears an $8B valuation

Dropbox said it would be increasing its IPO price range – the range for which it will sell its shares for its initial public offering — from $16-$18 per share to $18-$20 per share, giving the company a valuation that could reach close to $8 billion, according to an updated filing with the Securities and Exchange Commission.

Including all shares offered from stockholders selling in this offering, the “greenshoe” and the actual IPO, Dropbox will have a valuation between $7.2 billion and $7.96 billion. Based on a fully-diluted share count, Dropbox’s valuation should land between $7.8 billion to $8.75 billion. It’s below Dropbox’s previous $10 billion valuation, but it’s still a signal that investors are interested in buying up Dropbox’s IPO, which will be the most well-known enterprise name to go public this year. Cloud security company Zscaler went public earlier this month and immediately saw a massive pop, but Dropbox will probably be lumped into a similar boat as Snap as a signal to whether investors are going to be interested in hyped startups.

There will indeed be some shareholders selling stock in this offering, though it looks like for the most part the ownership is going to stay the same. There are a lot of reasons to sell a stock beyond just getting liquidation, such as paying taxes for other share options and exercises, so it’s not clear exactly what the motivations are for some employees for now.

Dropbox has more than 500 million users, 11 million of which are paying users. While originally born as a consumer service, the company has sought to crack into the enterprise in order to help build a robust second line of business to tack alongside its typical consumer operations. Dropbox at the start had the benefit of spreading via word of mouth thanks to its dead-simple interface, but since then has started building out new tools geared toward larger businesses, such as Dropbox Paper.

It’s also what’s made this IPO a somewhat tricky one. The process for this is normally the same, with the company setting a price range and then throwing it out there to see who bites. If things go well, the range goes up. If things go poorly, like the case of Blue Apron, the range is going to drop. This could always change at the last minute, but you can take this as another step toward its eventual listing, which is expected to happen later this week.

Roblox, the Club Penguin for Gen Z, is now cash-flow positive

I’m familiar with Roblox because my 8-year old daughter watches YouTube videos of kids playing the game almost every day. I’m also familiar with Roblox because she whined while we were running errands one weekend that she needed to “get on the internet right now” because she had scheduled a playdate with a friend in Roblox. And I’m familiar with Roblox because the other day, she uttered, “ugh, this obby,” which forced me to turn to Google like the old person I am to find out what the heck an obby was.

(It’s an obstacle course, in Roblox lingo, by the way.)

You see, I’m not the core demographic for Roblox, the massive gaming platform that now sees over 50 million kids playing every month. I’m a grown-up.

Roblox users tend to be young – ages 8 through 18 play the game, though the core demographic is really more 9 to 15.

For those unfamiliar, Roblox is a universe of user-generated 3D virtual worlds, where kids can engage in open-ended play. They customize their own characters, and then do things like run through obstacle courses, build the roller coaster of their dreams, pretend to be a superhero, ride a hot air balloon to a castle in the sky, go scuba diving, run a pizza parlor, and much more.

But more importantly, kids aren’t generally playing alone.

“A lot of kids come to Roblox to play with their friends,” explains Craig Donato, Roblox Chief Business Officer. “It’s like a virtual playground where they tend to jump from game to game with their friends – almost like jumping like I used to jump from the swing set to the monkey bars.”

Kids can chat in the game, which is moderated both automatically to filter out bad words, as well as by human moderators. There are also “report abuse” features, and Roblox scans all user-gen content before it’s added to the platform.

But often, kids aren’t using in-game chat – they’ll call each other on FaceTime and play Roblox together. And sometimes record long YouTube videos of them just goofing around in the game.

Also of note, everything in Roblox has been built by other players, typically kids or young adults. That’s why the company of ten years only really began to take off a couple of years ago – when there was finally enough user-generated content to keep kids engaged.

Users often start off by playing Roblox in elementary school, then in middle school download Roblox Studio, the company’s creation engine, to build their own games and experiences. By high school, those who have learned to code start to customize their games even further.

To date, there are over 15 million user-generated games on Roblox, with over 11 million titles released last year alone. Those 11 million titles were produced by over 2 million creators, up from 1 million creators the year prior. 1,500 of those titles have topped 1 million views.

The games themselves are all free-to-play, with the creators instead charging for virtual items that kids can buy with virtual cash called Robux.

Roblox says it paid out more than $30 million to its creator community in 2017. (The company splits revenue from the games with creators, keeping about 30 percent after payment processing and hosting costs.)

“The top creators on the platform – which are typically high school kids – are making two to three million dollars a year,” notes Donato.

Roblox, in other words, is hitting its stride.

Today the company is announcing these metrics and others, along with news that it’s now cash-flow positive having generated hundreds of millions in 2017 billings, up 150 percent over last year. It’s now bringing on a CFO, Mike Guthrie, previously CFO at TruCar, to help it figure out its next steps.

To determine its position in the state of the entertainment industry, Roblox had comScore compile data on how it compares to other online entertainment properties during the month of December 2017, and found that kids under 13 were spending more time in Roblox (51.5M hours) than on YouTube, Netflix or other social properties. And Roblox came into second place for teens, behind YouTube.

Roblox also saw more monthly visits during the month, for both kids and teens.

Around half Roblox usage is on mobile, with 40 percent on desktop and 10 percent on consoles.

“We’ve been around for about ten years, but the company started taking off about two years ago,” says Donato. (It was formally founded in 2006, and became COPPA compliant in 2007). “It just took awhile before we hit that mix of having a great amount of content. Obviously, the more players showed up, the more content was created, and that created a virtuous circle,” he added.

With its community now well-established in the U.S., Roblox is preparing to take its gaming platform international this year, by adding support for other languages besides English, and other currencies.

It will also expand its efforts with physical goods, where it today has action figures and has started to sell branded apparel. Roblox books based on the intellectual property created by its community will be released, with creators getting a split of these revenues, too.

However, physical goods aren’t a large part of Roblox revenues, nor is advertising, which only constitutes around 5 percent of revenue. Most of it comes from the user-gen content.

Roblox will soon go after more brand partnerships, as well, like one it did recently with Warner Bros. to promote the movie “Ready Player One” in-game. And it will double its 300-person team to 600 over the next year.

To date, Roblox has raised over $100 million in funding from Meritech, Index Ventures, First Round Capital, and Altos Ventures.

Apple Watch gets new bands for spring

Apple has unveiled new Apple Watch bands for spring.

Bands include Woven Nylon bands direct from Apple, Nike bands, and Hermès bands. Long story short, there are a bunch of new colors and styles.

The Woven Nylon bands focus on stripes, alternating white with another color (Black Stripe, Blue Stripe, Gray Stripe and Pink Stripe). Meanwhile, the Sport band is coming out in Denim Blue, Lemonade, and Red Raspberry, while the Sport Loop comes in Flash Light, Hot Pink, Marine Green and Tahoe Blue. And then there’s Classic Buckle, which comes in Spring Yellow, Electric Blue, and Soft Pink.

Meanwhile, The Nike Sport Loop will now be sold separately, coming in Black/Pure Platinum, Bright Crimson/Black, Cargo Khaki, Midnight Fog, and Pearl Pink, while the Nike Sport will come in Barely Rose/Pearl Pink, Black/White and Cargo Khaki/Black.

Finally, Hermès will be revealing new Apple Watch bands with an accent color. The 38mm Double Tour will come in Indigo or Blanc with rouge H polished edge and contrasted loop, and the 42mm Single Tour Rallye will offer the same colors.

Apple sold more than 18 million Apple Watch units last year.

Otonomo and Waze founders join the TechCrunch Tel Aviv conference

The TechCrunch Tel Aviv conference is in June and we’re excited to announce our first speakers for the day-long event. Today, we’re delighted to announce that Uri Levine, co-founder of Waze, and Ben Volkow, CEO and co-founder of Otonomo will be speaking on our stage.

TechCrunch Tel Aviv is focused on mobility and all that it entails, from autonomous vehicles, to sensors, drones, and security. It makes perfect sense then to have the godfather of the modern mobility: Uri Levine .

Levine is a passionate serial entrepreneur and disruptor. He co-founded Waze, the world’s largest traffic and navigation app with more than 250 million drivers around the globe. It was acquired by Google in June 2013 for more than $1.1 billion.

After Waze, he co-founded and joined several startups as chairman or board member. Levine focuses mainly on consumer services that all have one thing in common, “creating a lot of value to a lot of users.” For instance, he believes in services that help you save money and time, that empower you — in other words, doing good and doing well.

We’re equally thrilled to welcome one of the new kids on the block, Ben Volkow of Otonomo . Otonomo’s platform powers the first connected car data marketplace. And when it comes to autonomous vehicles, data is the new oil. Otonomo was founded in 2015 by serial entrepreneurs to disrupt the entire connected and autonomous car industry.

The event will be on June 7, 2018, at the Tel Aviv Convention Center. Israel is one of the world’s fastest growing and most impressive startup ecosystems, and we simply can’t resist coming back. Buy tickets here!