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Entrepreneurship case analysis : DropBox |
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Biswajit Mishra P122056, PGPM 2012-13, Great Lakes Institute of Management, Gurgaon | |

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Question1:
Dropbox is a late mover in crowded space. What opportunity did Houston see? Specifically what are the key elements of Dropbox’s current business model? Houston wanted to develop a product keeping in mind the voice of the customer. He wanted to develop a product which could have the ability to sync and share files online and across networked computers automatically where the user simply downloads the service on any number of computers and syncs the account to those computers after which the files are automatically upgraded. Dropbox’s business model

Value proposition
* Allowed creation of easy to use cloud drive.
* Keeps track of older version of files.
* Performs automatic backup of online data.
Target Customers
* Users with multiple PC’s or handheld devices who wanted to access the data across systems. Revenue Model
* Free for the first 2 GB and payable thereafter.
Core Competency
* The founders and engineers were all competent enough to develop code. Marketing
* Viral marketing
* Word of mouth spread
Partner Network
* Used Amazon’s storage service to eliminate need for huge infrastructure.

Questions2:
Is DropBox profitable as of June 2010? Are you optimistic about its prospects? How do your current estimates of Dropboxes current profitability influence your evaluation of the venture? mid-2010 Dropbox’s estimated revenue = between $10 million to $15 million. Assuming that by mid-2010 Dropbox had 3 million users

company was $.11 per free user
per paid user for space =$3.18. Following conclusion can be made Estimated Revenues- $10 million to $15 million.
No of users by mid 2010(assumption)- 3 million...
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