Box CEO Aaron Levie sketched out the cloud storage and collaboration company’s plans in an interview with Re/code earlier this year. On Wednesday, he will flesh out the specifics at BoxWorks, its annual conference in San Francisco.
It boils down to this: Box wants to sell a cloud platform to companies in the insurance, finance, health care, pharmaceuticals and media industries.
As more companies begin to build their own custom software to do the things that are unique to their business, Box wants to be the company that provides the back-end infrastructure on which those apps will run. When a claims adjuster for an auto insurance company takes a picture of accident damage using a smartphone, Levie wants Box to provide the underlying computing horsepower to get that picture to the people who need to see it. When a doctor orders an X ray on a patient, the image files and associated data might go into a medical imaging app that uses Box as its backbone. Levie has previously described this industry-specific plan as “more important than anything else we’re doing.”
Box has been building up a sales force with a lot of industry-specific expertise, and earlier this year lured Graham Younger away from SAP to head its global sales effort.
That effort brings with it considerable costs. As of April 30, the closing date of its most recent filing with the U.S. Securities and Exchange Commission, Box had 1,016 employees, most of them in sales and marketing roles.
In that filing, Box reported a net loss of $38.5 million and revenue of $45.3 million. Most of that loss can be attributed to combined sales and marketing costs of $59 million for the quarter. Most of its marketing costs came from carrying free customers in the hope of persuading them to upgrade to paid services, and Box spent more on that than it made in revenue — 105 percent of sales.
But Box has been landing increasingly larger customers of late: One example is industrial giant GE. As the size of its base of paying customers gets bigger, those losses, Box hopes, will decline. Levie hopes to use his talk at BoxWorks to bring more big customers into Box’s cloud.