Cloud file storage company, Dropbox, has reportedly filed paperwork to raise $500 million in an initial public offering. Prior to this, the company had been privately valued at $10 billion.

Dropbox is part of a broader group popularly known as “unicorns”, a term used to refer to startups which are valued at more than $1 billion by the private investors that have funded their growth so far. Also, how Dropbox fares when it goes public will serve to determine if the other unicorns will follow its lead.

The company’s plans to go public were unsealed by the US Securities and Exchange Commission on Friday, which were reportedly filed confidentially by the company earlier. The amount of the IPO, i.e. $500 million is a placeholder and is likely to change. Dropbox intends to use the proceeds from the IPO towards funding a plan revolving around upgrading more users to subscriptions and expanding integration with third party software.

The company would be one of the biggest US technological companies to list domestically in quite a few years. In 2015, Data Corp went public at a market value of $14 billion, which was the biggest such IPO in the past five years.

“While we’re at scale, we can still move quickly,” Dropbox Co-founders Drew Houston and Arash Ferdowsi said in a letter to shareholders included in Friday’s filing. “Imagine if every minute at work were well spent — if we could focus and spend our time on the things that matter. This is the world we want to live in.”

While Dropbox has been promoting its scale – having over 500 million registered users – and the fact that its cash flow positive, the filing provides a more in-depth view into the company’s financials. The filing states that the company had revenue of $1.11 billion in 2017, which is 31 per cent higher than the prior year. In the same period, it made a net loss of $111.7 million, which shrank from $210.2 million in losses in 2016. In addition to this, around 100 million registered users have signed up since the beginning of 2017 and the company has paying user base of 11 million users.

Dropbox’s expenses have been driven by swelling R&D budget, but the company became free-cash-flow positive in 2016. Unlike many cloud companies that rely on enterprise sales teams, over 90 per cent of Dropbox’s revenue comes from users purchasing their own subscription.

Dropbox has faced some stiff competition. Aspects of the company’s business compete with global giants including Google, Amazon, Apple, and Microsoft. The IPO will be underwritten by prominent firms including Goldman Sachs, JP Morgan, Deutsche Bank and Allen & Company.  The company will list on the NASDAQ under the symbol “DBX”.

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