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In 2007, documents, photos and videos were largely stuck on individual computers. A few frustrating sync options existed, but most people relied on a messy tangle of email and thumb drives. Then came Dropbox.

Arash, Drew and Bryan remember the high-cost, high-risk move that paid off big.

Bryan Schreier
Sequoia

Before Dropbox, everyone rented their own servers. Drew and Arash were among the first to get to scale on Amazon Web Services (AWS).

Drew Houston
Co-Founder, Dropbox

We’d heard all these stories about people hauling servers around in the trunks of their cars. We didn’t have to worry about any of that. We just had a slightly bigger check to write each month.

Bryan

It helped them build an infrastructure-intensive company with a low burn rate; they were cash flow positive a couple of years in. Eventually, though, as Dropbox grew and as Amazon became more of a competitor, we decided to leave AWS.

Arash Ferdowsi
Co-Founder, Dropbox

The bet was we would be more efficient on our own and save money over time. We did a fair amount of financial modeling, but it was a risky decision. Buying the hardware was a lot of money up front.

Drew

Another investor might have said, “You’re cash-flow positive. Why screw that up?” Bryan and Sequoia encouraged us to think long-term. They helped us see around the corners, and they understood the best companies make these big investments.

Arash

Our leadership team had to take a leap of faith, and so did the board. Ultimately, it came down to the caliber of the Dropbox teams who owned the project. We believed they could make it a success.

Bryan

It was a very bold move. Even Netflix is still on AWS. But Drew and Arash are the full package—deeply technical, incredible insight, excellent leadership skills. That makes it easy to get behind them 100 percent.

Drew

The transition was a huge undertaking. We knew we couldn’t lose a single piece of data, so we rebuilt large portions of AWS and mirrored everything across the cloud and our own infrastructure.

Arash

There was zero margin for error. The team invested a tremendous amount of time in developing validation in different layers of the stack and in other processes. I think it was the right strategy, but it was a big investment. There was a period of time where we were essentially paying double.

Drew

Sometimes, we missed a milestone and had to reset the clock. That level of rigor, understanding that getting it right was more important than cost—it took a lot of patience in the boardroom.

Bryan

It would have been easy to second-guess, but once we made the call to switch, we locked arms. They were prioritizing customers and the product over maximizing short-term profits, and we supported that.

Bryan

The bet paid off and the migration off AWS ended up performing even better than expected. Dropbox was cash flow positive again a couple of years later.

Drew

It’s contributed significantly to the financial strength of the business; we went from burning cash to generating hundreds of millions of dollars in 2016. It was a major factor in having a successful IPO.

Dropbox is designing a more enlightened way of working for its over 500 million registered users around the world. The company generated over $1B in revenue in 2017 and went public in 2018.

Dropbox
Collaboration platform transforming the way people and teams work.
Milestones
  • Founded 2007
  • Partnered 2007
Team
  • Drew Houston
  • Arash Ferdowsi
Partner