How They Started (30 page)

BlackBerry’s launch in the European markets was helped by its development in 2002 of the 5810 model that incorporated mobile phone functions. In the UK, this led to a huge deal with the cellphone network provider Vodafone, and a similar agreement followed with Deutsche Telekom in Germany. Over the following months, BlackBerry was launched in France, Italy, Spain and Switzerland. However, by 2002, RIM had net losses amounting to $28.3 million as a result of the mounting costs of product development and international expansion. The company therefore made the decision to cut 10 percent of its staff.

By 2004, the company was back on course, and there were now 1.7 million BlackBerry subscribers worldwide. With 82 percent of these still based in North America, the company took steps to ramp up its international expansion plans. Europe was a particular focus, and in 2004 RIM had secured deals with most of the major European networks, including Orange and BT, which doubled sales in this region. Key to this success was the fact that BlackBerry sales staff were giving free trials to companies that wanted to give the devices to their workers. Around 90 percent of these companies ended up as paying customers.

Also in 2004, RIM released a new version of its email server to support Chinese and Arabic alphabets. In 2005, Hutchison’s Hong Kong branch partnered with language support company Onset to introduce Japanese and Korean language support functions for BlackBerry users in Hong Kong and Macao. This partnership ensured BlackBerry could make significant headway in Japan and Korea.

Throughout its history, RIM has continually raised its game when it comes to product development and has remained a true pioneer in the design, manufacture and marketing of mobile communications tools, winning numerous awards for product innovation.

While the BlackBerry was an instant hit with executives and fast-paced business people, the company has now adapted the model, with video cameras and music players, to draw in more retail customers. The BlackBerry Pearl 8100 was introduced in 2006, and helped BlackBerry shed its heavily corporate image. It’s now quite common to see people on trains and planes playing games on BlackBerrys.

RIM has worked hard to make its email portals as secure as possible. Since becoming the first product to offer dependable mobile email in 1997, the brand has become synonymous with data security and is used by many customers who are sending sensitive, “for your eyes only” material, be they celebrity A-listers or government officials. The company has also faced several legal battles to protect its multiple-award-winning patented technology from being used by competitors (serial inventor Mike holds more than 30 patents).

BlackBerrys are now used all over the world, and the company has offices in North America, Europe and Asia Pacific. The devices, which run on nearly every network, have become so successful that many users (typically senior executives of large companies and business owners) now wonder how they ever lived without them. Unofficially dubbed the “Crackberry,” the BlackBerry is known for being addictive. With the option to receive an alert whenever a new email arrives, many business people are unable to resist the temptation to check out the latest addition to their inbox, no matter where they are or what the time is.

The brand has become synonymous with data security and is used by many customers who are sending sensitive, for your eyes only material.

In 2007, RIM was named one of Canada’s Top 100 Employers, as published in
Maclean’s
, Canada’s leading business magazine. What’s more, it was the only wireless technology company on the list. Meanwhile, the BlackBerry continued to be synonymous with the concept of email on the go, and the device’s ability to synchronize with its owner’s desktop proved a valuable feature.

RIM also created a dedicated corporate philanthropy program to donate money to help students in the fields of science, engineering and business to commercialize their ideas or inventions.

Sometimes the best business ideas come from simple solutions
to life’s small problems. Conceived in 2007 and officially launched by co-founders Drew Houston and Arash Ferdowsi a year later, Dropbox is a Web-based file-hosting service that uses cloud storage to let its users share and back up files using file synchronization capability.

Drawing comparisons with pioneers Apple, Google and Facebook, Dropbox’s growth has been nothing short of stunning. And it grosses far more per employee from its 70-strong team than those luminaries do. Despite the fact that 96 percent of the company’s approximately 50 million users pay nothing for their service, Dropbox is said by analysts to be on course to take in revenue of $240 million in 2011. What’s more, it’s been said that the company can double its sales in 2012 without recruiting a single new customer, as users exceed their “freemium” allowance.

But as the company prepares to move into a new 87,000-square-foot headquarters early in 2012, and while rumors abound that the company is in the process of raising between $200 million and $300 million in funding at a whopping $5 billion valuation, it’s clear that Drew and Arash have no need to be modest.

The story of Dropbox begins with a precocious child who grows into an overachieving teenager. As a mere 5 year old in suburban Boston, Drew began messing about on an IBM PCjr, and not long after, he started writing his first code.

Drew recounts that his mother, a high-school librarian, sensed his burgeoning computer “geekiness” and did her best to help him fit in with other kids by refusing to let him skip grades. Things changed, however, when Drew was a teenager. At just 14, he signed up to beta test an online video game. In the process, he made a detailed list of all of its security flaws. Impressed, the company hired Drew as their networking programmer in exchange for equity in the company. Drew continued to work with small startups throughout high school, and when he wasn’t working he was still coding.

Drew says he knew then, in high school, that he wanted to run a computer company. But inspired by Daniel Goleman’s book
Emotional Intelligence
, he knew that just being smart wasn’t enough to make a company succeed, and so he spent the summer before his freshman year at MIT reading business books.

“No one is born a CEO, but no one tells you that,” Drew has said of that time. “The magazine stories make it sound like [Facebook founder Mark] Zuckerberg woke up one day and wanted to redefine how the world communicates with a billion-dollar company. He didn’t.”

Drew’s first hands-on education in managing people came when he rushed the Phi Delta Theta fraternity, and took on a leadership position as treasurer for the sole purpose of gaining that experience. But when fellow fraternity brothers left to go pursue their own entrepreneurial visions, Drew was left frustrated. He had the desire and was building his skill set, but he was waiting for that moment of divine inspiration. He needed an idea. And then he got one.

“No one is born a CEO, but no one tells you that.”

In January 2007, Drew boarded a bus going from Boston to New York City. He’d brought his laptop and planned to do some work during the four-hour trip. But as the bus pulled away he realized he had forgotten his USB memory stick, and without those files he wouldn’t be able to get anything done. It was actually a frequent problem of his, but this time, on the bus, he had a moment of clarity. There must be a way to sync your important files to devices over the Web. Immediately Drew began doing what he did best: writing code.

Driven by the frustration of working from multiple computers, Drew sought to create a service that would let people bring all their files anywhere, with no need to email attachments. Drew coded a demo of his idea. Four months later, in June 2007, Drew left Boston for good and flew to San Francisco, where he pitched the idea to Paul Graham of the highly regarded startup incubator Y Combinator. Graham had seen a demo of Dropbox that Drew posted online and was keen to learn more.

The model Drew pitched was simple: Dropbox makes all of your important files available to you wherever you may be in the world. Using cloud technology, files are synced and accessed from any computer or phone. Working late at the office? Just add the file you’ve been working on to your Dropbox folder and pick it up later at home. What Dropbox was selling was never again having to remember a USB stick or think about where your files are.

Drew wrote software that users could download and install for free, creating a special folder on the user’s computer. Anything added to this Dropbox folder would automatically save to all of that user’s computers, as well as to the Dropbox website. The true innovation, however, was its social nature, with users able to invite people to share any folder in their Dropbox, making it essential for a wide range of users, such as teenagers who want to share music, or businesses sharing information and designs with colleagues and clients.

What Dropbox was selling was never again having to remember a USB stick or think about where your files are.

Ultimately, everything hinged around a business model called freemium. Users would pay nothing to sign up for Dropbox, and just by signing up they would get 2GB worth of space. Drew knew this would lure people in. But Drew also knew the nature of the Internet and that users would blow through 2GB. At that point, the Dropbox model would offer users upgrades to 50GB and 100GB with monthly fees of $10 and $20, respectively.