Dropbox Forced To Settle For $4 Billion Valuation After Markets Tank


[credit provider=”Flickr BabyBen” url=”http://www.flickr.com/photos/babyben/4757347004/”]

rumours have been swirling about the massive round Dropbox is raising.Today, TechCrunch zeroed in on the final valuation and the lead investor. Index Ventures is leading a round that will give Dropbox a $4 billion valuation, says Mike Arrington. 

The valuation falls at least $1 billion short of earlier reports. At one point Dropbox was rumoured to be getting offers at $8 billion.

So what happened?

The uncertain market likely scared investors. Yesterday we reported that investors were pulling out of signed term sheets, leaving entrepreneurs high and dry.  Dropbox probably experienced something similar.

Another possible scenario, Arrington says, is that Dropbox wanted specific investors who would only invest at a lower valuation.