Dropbox
Founder(s): Arash Ferdowsi, Drew Houston
Year founded: 2007

Meta Description
Dropbox is a free service that lets you bring your photos, docs, and videos anywhere and share them easily. Never email yourself a file again!

Background
Drew taught himself how to code at a young age. He refined the skill by working for various startup companies prior to Dropbox. At 14 he was hired as a contractor to do development for an online gaming company. He cold emailed the company a list of security vulnerabilities with their game. They hired him to fix them. After high school Drew enrolled into MIT. Although he did not start his own company during school, he worked on various side projects and assisted friends with their startups. The idea for Dropbox came after Drew graduated from MIT. His friends were moving to Silicon Valley to pursue startups and this motivated him to start his own company. The idea for Dropbox came from a particularly frustrating problem that inspired him to build a product to solve it.

Problem(s)
Anyone using a computer has a process for managing, sharing, and backing up files. Before Dropbox many used a flash “thumb” drive to store and transfer files. Emailing files to yourself or colleagues was also a common method. These methods have limitations and are prone to human error. For example you can’t email someone a 500 MB file. And unless you snail mail it, you can’t give someone a flash drive if they live in a different state. Plus, if you lose your flash drive, you lose your files. These limitations were a big pain.

All computers at MIT were configured to back up a user’s files and desktop configuration. For example if student moved an icon on one computer, then logged into another computer across campus, the change would be preserved. File syncing was commonplace on the MIT computer network. It bewildered Drew that file syncing was not nearly as seamless in the outside world.

After graduating from MIT Drew traveled to New York. He took the bus and planned on getting some work done during the ride. Upon entering the bus he realized he had left the flash drive containing all his work files at home. He had no other way to access the files. He was stuck. This event became the catalyst that inspired him to search for a better solution for file storage.

The web “drives” he found were not very good. They either did too little, were unnervingly unreliable, or too confusing to use. He browsed various support forums and found many examples of users complaining about lost files or unreliable support. Although file storage was considered an obvious problem that had already been solved, Drew felt there was an opportunity to create a better solution.

Solution
Dropbox is a fast, easy-to-use, and elegantly designed cloud storage product for managing your files. Users setup an account on the web and install Dropbox software on their computer. This will create a Dropbox folder on your computer that behaves just like any other folder. However files inside the Dropbox folder have a green check signaling that the file has been synced to the web and your machine. Therefore if you log in to Dropbox on another machine, all your files will appear (just like at MIT!). Dropbox eliminates the need for flash drives or e-mailing files to yourself because your files are backed up in the cloud.

Dropbox also introduced shared folders. Any file stored in a shared folder receives a unique URL that can be shared with anyone. Therefore instead of e-mailing files as attachments or using a hosting service like YouSendIt, you could simply send a Dropbox URL to your friend and they can easily access the folder and its content. Changes to files in shared folders will be reflected to all users who have access to those folders.

Shortly after launch the founding team was accepted into the highly selective startup accelerator, Y Combinator (YC). At YC they prepared the product for massive adoption. They grew their user base by employing various creative marketing tactics. For example they gave users free storage space if they completed activities such as a “how to” tutorial. Bonus storage was also given to users who invited their friends to register. This combination of creative marketing and an easy-to-use product that “just worked” generated an influx of early users to Dropbox.

Andrei’s Insight Corner
One moment that stood out from this story was Drew’s observation of how the file syncing system worked at MIT. The observation reminds me of a quote by Jack Dorsey:

…entrepreneurs need to cultivate an ability to recognize fortunate situations when they are occurring…

The essence of the quote is the importance of being aware of your environment in order to identify opportunities. In Drew’s case, he recognized the efficiency behind the MIT computer network. He wondered why the same solution did not exist in the outside world. On the bus ride to New York he could have easily blamed himself for being absentminded and forgetting his flash drive. He could have accepted the situation and told himself to be more careful next time. Instead, (with the MIT system in the back of his mind) he recognized an opportunity to create a better solution to this problem.

Source(s)
PandoMonthly: Fireside chat with Dropbox CEO Drew Houston
MVP Dropbox