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Box founder Aaron Levie tells the story selling 25% of the company for $80k

Name: Box founder Aaron Levie tells the story selling 25% of the company for $80k
Uploaded: 2024-08-04T09:06:17+00:00
Duration: 1 min 31 s
Channel: Lorenzo
Description: Aaron Levie (Box founder) recounts Box's early fundraising in 2005 after launching Box.net, a simple file-sharing service. He describes challenges…

4 Aug 2024 · 2 min

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1:31

Aaron Levie (Box founder) recounts Box's early fundraising in 2005 after launching Box.net, a simple file-sharing service. He describes challenges raising capital—rejections from VCs and angels who cited Microsoft as an unbeatable incumbent—then raising $80,000 in a first round in exchange for one-fourth of the company, receiving later investment from local real estate investors and Mark Cuban (about $300,000). Anecdotes include cofounder Dylan's youthful appearance and the fact Mark Cuban invested without meeting them in person.

Questions this video answers

2005.

$80,000.

One-fourth (25%).

Box (Box.net).

Mark Cuban.

Chapters

If anybody ever feels stressed out about fundraising, our first round of funding. Anybody want to guess what we raised? Any guesses? 200. What? No. It was $80,000. We gave away a fourth of the company. Okay, good. Okay. Hearing some groans. Okay, good. Welcome to 2005 fundraising, ladies and gentlemen. We started the company. The idea was let's build a really simple way to be able to share files from anywhere. It was like that simple of an idea. We launched it. It was called Box.net my co founder and I, Dylan, we went to go and just raise money from anybody that would talk to us. And we had this massive disadvantage though, which was that Dylan, my CFO and co founder, looked like he was 11 years old. He looks like we're going to go off to Disneyland with the proceeds. So really, really, really difficult funding environment. We went to the VCs, we went to the angel investors. Everybody turns down. They were like, you guys will never be able to compete with Microsoft. So everybody rejected us. We eventually got some kind of local real estate investors. They threw in some money, and then the big break was Mark Cuban, actually, where we ended up getting Mark to invest in us for about $300,000. Lo and behold, the lesson actually was Mark never met us in person. So that was the only way that we probably would have been able to get funding was him not actually meeting me or Dylan. I don't know what lesson to take from that, but really, really hard to fundraise just because of the massive incumbent in Microsoft that we were kind of trying to compete with. And then other incumbents.