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Box’s Stock is Under Pressure, but CEO Aaron Levie Isn’t Frowning

January 26, 2016, 1:37 PM UTC
Box's Aaron Levie Talks With FORTUNE's Jessi Hempel - 2014 SXSW Music, Film + Interactive Festival
speaks onstage at Box's Aaron Levie Talks With FORTUNE's Jessi Hempel during the 2014 SXSW Music, Film + Interactive Festival at Austin Convention Center on March 10, 2014 in Austin, Texas.
Photograph by Richard Mcblane — Getty Images for SXSW

These should be dark days for Box (BOX), the online storage and collaboration service for businesses. Public for a year, Box’s shares are worth less than $10 each, down from a high of more than $24. Despite being more than a decade old, Box loses money like a startup. And the Wall Street Journal, relying on the it-makes-sense-theory of news reporting, suggested last week that Box and others will be scooped up by bigger competitors eager to capitalize on their diminished valuations.

For all this, Aaron Levie, Box’s recently-turned-30-years-old CEO, couldn’t be sunnier. Yes, it takes time for new customers to become profitable, he says. It took 18 months, for example, to sell Box services to General Electric (GE). “That’s unprofitable,” Levies says. “Then it’s a multi-million-dollar deal.” GE has 150,000 users of Box and is highly unlikely to leave Box any time soon. In fact, the cloud software company claims a 120% retention rate, meaning that few customers leave and many add users over time.

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Box is an anomaly among startups in the “unicorn” era. From its founding in 2005 until 2007 it went after business and consumer customers. Then it pivoted to focusing exclusively on businesses. Users will find Box similar to Google Drive, a place to store and share files on the Internet. Behind the scenes, Box manages sophisticated tasks like encryption keys, complicated workflows, and regulatory compliance. Levie says businesses are willing to pay for such tools, compared with more fickle consumers. “If we can change how drug companies develop their products, that’s equally exciting to sharing photos,” he says, an unsubtle dig at competitor Dropbox. Its still-private competitor has toggled between consumer and business approaches, and recently killed a much ballyhooed consumer photo feature.

Business adoption isn’t enough, however. Levie believes his company needs to become a “platform of record” for customers who are attempting to go digital. This means opening its software to customers who can then offer Box services to their customers.

Is this a case of Box envy?

There’s no guarantee Box can pull off this audacious strategy, a bid to be as important a software provider in the future as Oracle (ORCL) is today. “That’s precisely why we decided to raise hundreds of millions of dollars,” Levie says. “To go big.”