SaaS Strategists,

There’s a company on the market we all know a little too well.

But do you know how they went from $0 to $2.3 billion in annual revenue & over 15 million paying users?

Steve Jobs offered a 9-digit acquisition offer to them & they refused.

iCloud & Google Drive were born because of them.

92% of Fortune 500 companies use them today.

Ultimately it became one of the most successful file-sharing companies in the world.

Today, we dive into the incredible origin story of Dropbox. 👇️ 

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💾 From Forgotten USB Stick to a 9-figure Steve Jobs Acquisition Offer

It’s 2005 and Drew Houston just graduated from MIT.

He’s already feeling like he is missing out.

One of his friends just raised a $5M investment.

The other just launched JustinTV (now known as Twitch).

He knew he wanted to pursue a similar path, but he didn’t have the big idea.

One day he got on a bus from Boston to NY.

He had some unfinished work to complete, so he wanted to do it while traveling.

But there was a problem.

He forgot his USB stick, with all of the important files on it!

So there he was, sitting on a 4-hour ride, having nothing else better to do, than to think.

And suddenly an idea popped into his head.

“I need a way to access my files from anywhere.”

He partnered with his friend Arash Ferdowsi and they got to building.

The first version of Dropbox launched in 2008 and quickly gained initial traction.

But in 2008 cloud sharing wasn’t yet a big thing.

People had a hard time understanding what the company ACTUALLY does.

Drew needed to find a way to explain to his users what Dropbox is, as simply as possible.

So they tweaked their interface a bit.

Recorded a simple & engaging video.

And it went viral.

Almost 75k users signed up just from that video ad.

He knew that he can’t keep printing videos for every marketing campaign.

Dropbox needed a more sustainable way to acquire new customers.

This was their turning point.

They launched a referral feature that if you recommended Dropbox to your friend you both get 16GB of space for free.

Dropbox acquired around 4 million users just from this strategy!

Also, this feature grabbed the attention of one of the biggest marketing minds that ever walked this planet.

Steve Jobs.

Steve Jobs noticed the big potential in Dropbox & offered to acquire them for a 9-digit buy-out.

They refused.

The world was in shock.

Apple launched a Dropbox competitor in 2011, what we all now know as iCloud.

In 2011 they encountered a first serious problem.

Data breach.

This incident was a wake-up call for Dropbox, and they quickly implemented stronger security measures to prevent future breaches.

Despite these setbacks, Dropbox continued to grow and innovate.

In 2012, they introduced Dropbox for Teams, which allowed businesses to collaborate and share files more easily.

The company also expanded into new markets, such as enterprise software and file synchronization.

People went crazy when they saw the real-time sync feature.

2 people could work together on a document and it synced changes instantly across their devices.

Dropbox's IPO launched in March 2018.

They went public on the Nasdaq & the IPO raised $756 million which valued the company at $9.2 billion.

This was a significant milestone for the company and marked a new chapter in its growth story.

In 2019 they expanded into e-signatures & acquired HelloSign for $230M.

It was their biggest acquisition yet.

This move has put them in the space with top competitors such as Adobe and DocuSign.

Today, 1.2 BILLION files are saved on Dropbox every day.

There are 100,000 shared folders and links created on Dropbox every hour.

Their user base counts well over 700 million, out of which, over 15 million are paid users.

They used The Lean Startup methodology to listen to the customers, acquire feedback & implement changes.

It took them from $0 to $2.3 billion in annual revenue.

And the product was simply built out of the founder’s need to solve a problem for himself.

And there’s a big lesson in that.

🔝 Top Tweets

Here are the 2 top tweets from this week:

🔥 SaaS Fire

SaaS products so good they'll light up your week:

DivByZero SaaS Tools can get you hyped & inspired. Steal these strategies & implement them in your SaaS!

Omni is a B2B cold outreach platform that can help you close leads on autopilot.

💡Idea of the Week

Here’s the SaaS idea of the week:

An AI-powered interviewing tool that assesses candidates' cognitive abilities, communication skills, and personality traits. AI feature can also analyze candidate behavior, facial expressions & communication skills in order to form a personality profile.

Pros

• Automated interviewing process: The AI-powered interviewing tool streamlines the interview process by automating the initial stages, saving recruiters time and resources

• Improved hiring decisions: By accurately assessing each candidate's potential, recruiters can make more informed hiring decisions, improving the quality of their workforce

Cons

• Limited human interaction: The tool automates the initial stages of the interview process, which can result in limited human interaction with candidates

• Potential for bias: As with any AI-powered tool, there is a risk of bias in the evaluation process

Did you enjoy today’s issue of SaaS Strats?

If you have to walk off this email with 1 key takeaway it would be the following:

Try & utilize a referral strategy for your SaaS.

It might not bring you 4 million new sign-ups as it did for Dropbox, but you will 100% get more eyes on your product.

Humans like to share & reciprocity goes a long way.

I’ll see you next Thursday.

Ognjen Gatalo

Chief SaaS Strategist ☁️ 

P.S. If someone forwarded this email to you: