What Does the Great Box IPO Mean for the Cloud Industry?
Its long-delayed march to the NYSE was worth the wait -- it opened at more than $20 per share.
The cloud computing arena can feel as crowded as the trading floor of the New York Stock Exchange; new companies are popping up weekly, selling the glories of the cloud. In that space, it's getting harder to stand out.
Box did just that last week, with a strong IPO that was way above expectations. And although it was perhaps inevitable that it couldn't maintain that level, it's still going strong, and trading significantly higher than initially predicted.
The IPO for the file-sharing and storage platform happened last Friday. The initial price per share was $14, but it opened up instead at $20.20. The stock got as high as $24.73 per share on Friday. It's now been trading for four days, and closed on Wednesday at $19.78. Although that's down a bit, it's still well above the most rosy predictions.
Box was supposed to go public early last year, but put off the IPO due to what it said were difficult market conditions. A Computerworld report quoted a venture capitalist as saying that high marketing costs and other significant expenses may have scared investors and caused the IPO delay.
Whatever the reason, Box has gotten a fast start out of the blocks. It needs to keep up its pace, because it has a crowded field of better-known challengers, including Citrix Systems Inc., Microsoft, Google Inc. and Dropbox. But the very fact that its IPO went so well is an indication that the entire field is viewed favorably by Wall Street. That can only be good news for all those new -- and old -- cloud players.
Keith Ward is the editor in chief of Virtualization & Cloud Review. Follow him on Twitter @VirtReviewKeith.