♪ emily: it all started with a line of code. written on the bus, traveling from boston to new york. that code is now the foundation for dropbox, a cloud-based file sharing service that allows you to share and store and access any file from any device anywhere. today dropbox is valued at $10 billion, with 400 million users in 200 countries around the world. joining me today, cofounder and ceo of dropbox, drew houston. so great to have you, drew. drew houston: thanks for having

me. emily: my life is stored on dropbox. 252 gigabytes. is that a lot? drew houston: it is pretty good. emily: ok. the criticism is it is so simple, other companies can do it also. google, microsoft, apple. how do you compete with that? drew houston: for our users, i think it is a couple things. one is the product is easy to use. the other is it is the most popular service of its kind in the world. if you share things on dropbox, it is much more likely that if i share something with you, that you are already going to have it. emily: dropbox has 400 million users. who are they? where are they? drew houston: the vast majority are all outside the u.s. more than 2/3. it has been that way since the beginning.

sharing has been at the heart of how we grow. emily: you grew up outside of boston. what kind of kid were you? when did you get into computers? drew houston: it started in a living room when i was maybe three. my dad had just taken this thing out of a box, and it was an ibm pc junior. my parents have pictures of me trying to mash the keys. i think i was mesmerized from an early age by this glowing screen. my dad showed me how to write my first lines of code when i was really little. he was an engineer. emily: and your mom resisted this, right? drew houston: i think she was sort of puzzled. she was like, aren't kids supposed to be playing with legos and going outside? they definitely urged me to have that kind of balance. emily: so you went to m.i.t.

tell me about this founding story, the line of code written on a bus. drew houston: i was on a trip to new york. i forgot my thumb drive. this was in the days before the iphone. if you didn't have anything to do, you really didn't have anything to do. i was like, i am so disorganized. what does this keep happening? because i had a bunch of time, i just opened up the editor and started writing some code, having no idea what it would turn into. emily: why is dropbox worth $10 billion? ♪ emily: you hear entrepreneurs

talk about starting companies, it's like staring into the abyss of death, i think elon musk said. what is it like for you? drew houston: i don't think it's that dramatic. all of the times i've had to

deal with these problems, it's like days of my life i have wasted. if you fast-forward to today, people say there are a billion files and dropbox. involved with building something at that scale are exciting for an engineer. emily: how many employees do you have? drew houston: 1200 or 1300. what do the bulk of the employees do? drew houston: everything from the bulk of the product, the interface design, there are people who work on marketing. emily: how many people are focused on security, for example? drew houston: they're probably a couple of a dozen that are dedicated. broadly, if you think about

our infrastructure, it has to be about the reliability of the service. emily: what does the office of the future look like? drew houston: i think there is a lot more freedom. in the old days, you would show up at work and they would issue you a laptop and phone and say you must use these things. now, we have a lot of choice. people are using all kinds of different devices. so, i think that has become an expectation. anybody at work wants to have a choice, and drop box is instrumental in that. people expect to work on their own terms. they want to be mobile, not tied down to any one environment. a big part of what people love about dropbox is that they can be free to work anywhere. it means a lot more fragmentation. you have all this stuff on your calendar -- it is kind of a mess. the big thing we think about is how can we tie together all these different things you use? that expectation of freedom and seamlessness is really important

and a big area of our focus. emily: those 400 million users -- how many of those are paying customers? drew houston: most people are using the product for free. if you need more space, you can buy more. dropbox is in 8 million businesses, up from 4 million two and a half years ago. we have 100,000 business customers. emily: who are the biggest companies you signed up? drew houston: the vast majority of fortune 500s are using us in some capacity. under armour, hyatt hotels. every quarter we are adding new , customers. emily: what has been the biggest challenge in terms of penetrating the enterprise? drew houston: i think that businesses -- every technology goes through this curve where in the beginning, people are unsure about it.

i think in the last couple of years it has started to flip. people have realized it is actually safer to have our information in services like dropbox and the cloud. the same way we don't put our cash under our mattresses anymore. the bank does a good job at taking care of that. emily: what is the value proposition to a business to choose dropbox? drew houston: anybody can provide storage. more and more it is about -- of course, my stuff will live in the cloud. organize it for me. help me search it. help me share it with other people. help me collaborate. storage is just an ingredient. emily: another part is building apps on top of that. mailbox for e-mail, photos. how are those products doing? drew houston: good. each of those is a new adventure. emily: how many users do those services have? drew houston: we don't break them out separately but they have been growing. we want to make sure the product is right before we spread our new apps. emily: why is dropbox worth $10

billion? drew houston: we are in 8 million businesses now. there is a ton of room for us to grow. even at 400 million users, still -- there are still billions of people on the internet. you look at how valuable that problem is. the things people put in their dropbox are the most important possessions. the seven your dropbox is stuff that if your house were burning down, these are the things you would get. for a company making their team productive, having a safe place for the most important information, these are extremely valuable problems we solve. we are shipped on most samsung phones out of the box. we just partnered with microsoft last year to incorporate dropbox into office. there's a lot going on and investors see the potential here. emily: you always said dropbox is a standalone company. do you have that same conviction today you had two years ago, eight years ago when you started this?

drew houston: for sure. being independent allows us to support all of the different platforms equally. as the other companies try to move in this space, they tend to favor their native platform at the expense of others. that is something that is really core. that sort of switzerland approach is valuable to us and our users. emily: how do you weigh the decision to go public versus raise more money in this environment? drew houston: we have been able to do a lot in the private markets. we were even able to raise money we did not really need. emily: why take it if you don't need it? drew houston: we want flexibility. we do everything from investment in infrastructure, acquisitions. having a stronger balance sheet gives us flexibility to make big long-term investments. emily: do you have the cash you need to reach your long-term goals? drew houston: for sure. and we have control.

the important thing for us is not to generate a bunch of cash, it's to keep investing. emily: could you go public without raising any more money? drew: for sure. raising this money means we are not forced to go in any particular direction and we can stay focused on building and growing our audience. emily: what are your plans to go public? drew houston: we don't have any right now. again, that is what we get with the flexibility from raising this money. emily: what have you learned from box's ipo? it's gotten hammered. drew houston: i am happy we have our approach. our sales force of hundreds of millions of people means we don't have to spend the kind of money that others do on sales and marketing. emily: are you profitable? drew houston: we don't break that out right now. but again, our investors are happy. things have been going well. our focus is really not on profitability, it is on investing and growing.

emily: what is your view on burning through cash too quickly? drew houston: it has to start with your business model. we are fortunate that our model has not changed much. we have been largely funded by our users, not investors. emily: how do you balance between the fancy office and the company perks and making sure you are being responsible? drew houston: we have a great office space and we invest in things to make our employees lives easier. you will not see super expensive paintings -- we really make sure it does not look opulent. the danger companies can run into is giving everybody the impression that we have made it. we have tried to be balanced. emily: one of the things i have heard is that dropbox is losing some talented engineers. how hard is it to keep good people? drew houston: that is all part of the war on talent, selling information like that. emily: ok.

so it is not happening? drew houston: no, certainly people -- it is kind of the circle of life. people don't join any company and expect to stay there their entire lives. our recruiting numbers have been better than ever. emily: really, how so? drew houston: we monitor close rates and things like how many engineers are joining. we don't break that out, but that is another thing about building a great engineering team. they have friends and people they worked with at previous companies and if you get a core of great people, it makes it easier to recruit the next round. we're building this amazing roster of people and it makes it really exciting for those that consider joining. emily: what's dropbox is moonshot? -- dropbox's moonshot?

drew houston: our hands are pretty full. what companies like google have done for the world's public information, we are trying to do for the world's private information. emily: uber is working on a self-driving car. airbnb is going into cuba. what is dropbox going to do? is there a stretch goal? drew houston: take something like carousel. it's a photo app from dropbox. when you step back, we are like, ok, i have this problem of my photos are in 100 different places. in the future, we should be able to have every photo you've ever taken with you wherever you are in your pocket. you multiply that times hundreds of millions of people, and you're like, ok, this is one of the largest collections of human memory ever assembled. we want to reimagine how people work and remember their lives. those are going to keep us busy for a long time. emily: how much do you think about building your observers servers acca is that something

you would do? -- building your own servers? is that something you would ever do? drew houston: we invest a ton in our own infrastructure and rent a bunch from amazon. i think for a lot of our infrastructure, we can get a lot out of commodity servers or commodity hardware. there may be additional gains. there are already companies all over that do a good job of that. emily: meeting steve jobs. how did that happen, what was that like? ♪

♪ emily: you are 32 years young. what is the hardest lesson you have learned as a ceo? drew houston: well, i think the hardest challenges are really around people. you bring 1300 people together and get them pointed together in the same direction. in any group, there will be

people that are unhappy, so how do you get people to collaborate even if they have different backgrounds? friends know you are with mark zuckerberg. what kind of advice as he given you? drew houston: a lot of advice on company scaling. how do you organize people, set up these systems -- with scale, you have to be a lot more thoughtful about how you compensate people, think about mundane things like their titles. you have early stage things, have more mature products, a portfolio. how you keep that all running when the challenges are so different? it's a lot of things like that. emily: your cofounder -- i read it was married at first sight at the beginning. how has your relationship changed over the years? drew houston: i think it has been pretty steady. we had kind of grown up together

doing this. our values have been shaped by going through this experience together. emily: i know you pitched paul graham in the early days. one thing he told us was that on your first application you said you would sell dropbox for $1 million. drew houston: that's right. emily: obviously, that has changed. drew houston: well, no one has offered us $1 million, so there hasn't been an opportunity there. emily: it was good you did not get that offer, right? drew houston: then and today what motivates us is most building something people love. emily: meeting steve jobs. what was that like? drew houston: it was interesting. apple became aware of dropbox early on. it wasn't steve who first learned about it, but we had some conversations with their

team, because they were curious about how we managed to put the little green icons on the files. turns out to do that, it was actually a pretty tough technical challenge. we had to do open-heart surgery on a code we did not write and their team understood this was some pretty crazy acrobatics and something no other company had done. eventually, steve reached out and wanted to talk to us. we are said we're not interested -- we had repeatedly said we are not interested in selling the company. we want to be respectful of your time. if you want to hang out, sure. it was wild. we would get up in the morning - we had a zip car -- emily: perfect. the formal part ofdrew houstod:

the meeting was maybe 15 minutes. it was pretty clear they were interested in buying the company , but we were having fun building it. emily: he said i want to buy you? drew houston: in so many words. we did not talk about numbers. i did not want to go too far down that path. we spent the rest of the time talking about -- i had a lot of questions about why he came back to apple. why cupertino? he had different advice for us. he spent a lot more time than he needed to with us. you know, we were pretty clear that we were not going to sell the company, but he was also taunting us a little bit. emily: they did. they unveiled the icloud. how do you think that has worked out for them? drew houston: different products solve different problems. what people love about dropbox is it is easy to use.

you are not locked into any one platform. emily: obviously apple had a huge problem. icloud was not hacked, but people's passwords were hacked. how do you make sure that doesn't happen? drew houston: we have teams of people who think about what can we do even if you are kind of sloppy with your passwords. we try to proactively identify suspicious behavior. we go at it from a bunch of different angles. emily: how has your personal life changed now that you are rich and famous? drew houston: people would be surprised. it is not that different. i still spend most of my waking hours thinking about dropbox. emily: you have been on "silicon valley." the hbo hit show. drew houston: yes, i had a very important role standing there at a party. it is fun. i look at all of this as a new series of interesting experiences. emily: what is next for drew houston? drew houston: we have a lot work to do. emily: what do you want your place in silicon valley history to be?

my cofounder and i -- the two things we really care about are , one, we want to create a great company, a place were people can do their best work and our culture is a little -- we admire all of the other companies but we have our own distinctive culture and there is a handful of aspects we really want to preserve. for me it is, how do we -- we are a pretty big scale now. work, we still have a lot of problems today. what are ways that we can go even further? build this kind of treasure. this home for everybody's most important stuff is something that matters to a lot of people. emily: have you ever regretted not selling? not selling to steve jobs? drew houston: no. there are good times and hard times, but it is all part of the adventure. emily: all right. drew houston. thank you for joining us.

this was awesome. drew houston: thank you. emily: great to have you here. ♪

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♪ >> i was told when i started that i could not be a director because i was a woman. and i have been directing now for many years. but certainly not as frequently as i would have had i been a man. >> i was going into meetings on projects with people as a featured director that would work with acy