Can Box.net Overtake Microsoft SharePoint?

Can Box.net Overtake Microsoft SharePoint?

Can Box.net Overtake Microsoft SharePoint?

If Microsoft Windows is the dominant operating system in the world and Microsoft Office the most popular productivity suite, Microsoft SharePoint is the preeminent file sharing platform. However, after years of dominance, a new challenger has appeared in the form of Box.net.

As things stand today, Box.net with 7 million customers is just a pretender to the throne occupied by SharePoint with 125 million customers. However, with Box.net’s user base increasing by 250,000 every month and its current clientele including 350 companies in the Fortune 500 list, Microsoft may have cause for worry. What’s more, Box.net is not short of cash either, having just closed a round of funding that swelled its war chest by $81 million and valued the company at $600 million. For something that began in 2005 as a college business project at the University of Southern California by Aaron Levie (the current 26-year old CEO) and Dylan Smith (the current 25-year old CFO), that is tremendous growth.

It is not without reason that Box.net has, time and again, featured on CloudTweaks. From raising cash (See: Venture Capitalists Flock To Cloud Computing Startup) to signing up a major client (See: Procter and Gamble Collaborates in the Cloud with Box ) to raising cash again (See: Cloud Computing Startups Raise Big Money), the company has always been in the news here.

A company getting so much media and investor attention will undoubtedly attract suitors. However, Levie and Smith are adamant at forging their own path and have rejected a $600 million buyout offer from Citrix, recently in the news for acquiring Cloud.com in July (See: Citrix Changes the Game in Cloud Infrastructure with Cloud.com Acquisition). Although the buyout would have potentially delivered high returns to early Box.net investors like Mark Cuban, Draper Fisher Jurvetson, US Ventures and Scale Venture Partners, the latest round of financing would assure them of the company’s long-term viability.

Several prominent names participated in the recent $81 million round, including new investors Bessemer Partners, Salesforce.com and SAP, and returning investors Draper Fisher Jurvetson and Andreessen Horowitz. This increased the total amount raised till date to $162 million. And Levie is sure of how he wants to spend the money.

In addition to augmenting the company’s enterprise sales staff and infrastructure, Levie is going to invest in the Box Innovation Network scheduled to launch next month. The Network will provide support for other startups, Box partners, and even customers to build custom apps that can help improve customer experience. In this way, Box.net wants to encourage innovation in the enterprise space, something that Levie feels is lacking currently.

Levie realizes that he is competing directly with the behemoth that is Microsoft, and is not afraid to show it. On stage at the company’s inaugural customer conference, Boxworks, he said, “Enterprise software isn’t sexy, and that’s because it makes you think of this guy”, and displayed a picture of Microsoft CEO Steve Ballmer. While it’s too early for Microsoft to be afraid of Box.net, it wouldn’t hurt to be careful, especially with giants like Salesforce.com and SAP evincing interest. After all, there was once a time when IBM was the No.1 PC manufacturer in the world – it is no longer present in that market.

By Sourya Biswas

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