Dropbox is beefing up its roster of talent by acquiring an online collaboration and communication tool (and its leadership) Cove.
The engineering team in charge of Cove, Aditya Agarwal and Ruchi Sanghvi, as well as Akhil Wable and Joshua Jenkins will join the cloud-sharing company Dropbox immediately.
Agarwal and Sanghvi were both well-respected members of the Facebook family from 2005 to 2010 and Sanghvi recently received a TechFellow award for her contribution engineering efforts.
This is Dropbox’s first acquisition and was settled for an undisclosed amount.
“Building a world-class engineering organization is a top priority for us,” said Drew Houston, Dropbox co-founder and CEO, in a statement. “The team at Cove represents some of the best talent in the Valley and we look forward to the technology, skills and perspective they will bring to Dropbox.”
Agarwal, Sanghvi, and Wable founded Cove in 2011.
“Dropbox has built a really simple and powerful product with a small team, despite complex technical challenges that exist under the hood,” Aditya said in a statement. “The long-term product vision for Cove and Dropbox is very much aligned and the infrastructure we’ve built at Cove can be utilized at Dropbox.”
While at Facebook, Aditya was director of engineering -- creating some of the crucial engineering used for products such as its search, news feed, photos and profile.
Prior to Facebook, Aditya worked on self-healing databases at Oracle.
Sanghvi was the first female engineer at Facebook and was instrumental in implementing the first versions of key features such as news feed. Later during her years at Facebook, Sanghvi also played a major role in the development and product management Facebook Platform and Facebook Connect.
This acquisition of Cove and its leadership team is a first big move with the flsuh of VC money the company collected at the end of 2011.
The online file storage company recieved a hefty Series B $250 million financing in October from Index Ventures, with Benchmark Capital, Goldman Sachs, Greylock Partners, Institutional Venture Partners, RIT Capital Partners and Valiant Capital Partners also investing.
Dropbox, which is estimated to be worth $4 billion, is a file-hosting service that uses cloud storage technology to allow users to share files and folders. The San Francisco-based comany has over 45 million users and saves 1 billion files every three days.
Revenue at the fast-growing company is reportedly estimated to hit $240 million this year. The company uses a "freemium" business model, where initial services are free, while premium services require payment. Dropbox offers the first 2 gigbytes of storage free. After that, a 50 gb plan costs $9.99 per month, and 100 gb costs $19.99 per month.
The cloud storage business seems to be booming these days. Dropbox competitor, Box.net secured the final round in a total $162 million fund on October 11. Other competitors include iCloud and Windows Live SkyDrive.
As more companies scramble to grab their share of the cloud and Dropbox competes with other top-tier companies like Box.net, we may see more power grabs in the coming months.