When childhood friends Aaron Levie and Dylan Smith left college to start Box Inc. (NYSE: BOX), they were driven to succeed and determined not to turn on each other. More than a decade later, the two quirky friends remain close and are still very involved in the company’s day-to-day operations. Levie and Smith have helped Box carve a niche in the crowded world of cloud computing, providing file-sharing, collaboration, and other services to over 82,000 businesses worldwide. It boasts of impressive clients that account for nearly 69% of the Fortune 500 companies.
Early Days of the Box Team
Levie and Smith first met at Islander Middle School in the sleepy Seattle suburb of Mercer Island, Washington. While the idea of Box first came from the two friends, they had help from the neighborhood. Jeff Queisser, the company’s vice president of technical operations, a self-proclaimed programming nerd, lived down the street. Levie and Smith began bouncing programming ideas around with Queisser in elementary school. Sam Ghods, vice president of technology at Box, moved to Mercer Island in the 10th grade, befriending Queisser on the school bus. In high school, the four friends used Levie’s parents’ hot tub as their boardroom, brainstorming possible business plans and dealing with possible programming hurdles late into the night.
Born to Be an Entrepreneur
Aaron Levie was born in Colorado, and when he was 8 years old, he pulled weeds, walked neighbors’ dogs, and did just about any other odd job possible to earn money. When he was 10, Levie and his family moved to Mercer Island, and he grew up listening to his parents discussing business ideas at the dinner table and building websites in his free time. Admittedly, his websites were not very good. He jokes that the search engine he called Zizap was "the world's fastest search engine if you have never been to Google,” and his downloadable news toolbar “probably gave people viruses.”
Dylan Smith, One Unique Computer Nerd
Dylan Smith is the ultimate computer nerd - and proud of it. The perfect counterbalance to Levie’s wit and charisma, Levie convinced Smith to leave Duke University to join Box. Not only did he join the startup, but Smith also provided Box with $20,000 in seed capital he had earned playing online poker. Smith once appeared on an episode of the reality television show “Millionaire Matchmaker.” It seemed perfectly logical to Smith, as he was simply trying to fulfill his five-year plan of finding a relationship leading to marriage. While the TV appearance was filled with awkward moments, such as Smith trying to learn hip-hop dance moves, there was no romance. Not one to give up on a plan, he did get married within his self-imposed five-year window, tying the knot with Yael Goshen in 2013.
Fundraising and Development
Living and working in a tiny apartment with free rent from his uncle in Berkeley, Levie, along with Smith, Ghods, and Queisser, quickly raised over $400,000 in 2005. Levie, the only one of the four even old enough to drink at the time, famously convinced Mark Cuban to invest in Box after sending him just one email. As CFO, Smith continues to lead funding.
Challenges Facing Early Online Storage Services
In the early days of cloud computing, it was difficult to convince customers that online storage was a better choice than carrying USB sticks. While they knew security was an important advantage, Levie and Smith were sure that the ability to share information was the greatest benefit to online storage. From its early days, they set out to use file-sharing services to distinguish Box from competitors such as Dropbox (DBX), Xdrive, and GoDaddy.
Box is moving beyond traditional cloud storage and into the realm of cloud content management through a whole host of value-added services like Box Skills (AI application for business processes), Box Zones (workflow platform), etc. This put the company in a sweet spot compared to its competitors and generated some investors' interest. Social Capital's Chamath Palihapitiya unveiled Box as his stock pick at the 2018 Annual Sohn Investment Conference, placing his confidence in the company's growth potential in the artificial intelligence vertical.