Dropbox: A Digital Firm’s Journey Abroad

Seattle-based Dropbox Inc. (Dropbox) was a leading provider of cloud storage and online collaboration tools. The company had successfully grown a global user base by combining digital channels (user-driven viral growth) with investments in physical assets (offices and infrastructure) overseas. However, in 2020, when the COVID-19 pandemic forced individuals and organizations worldwide to work remotely and created an unprecedented growth opportunity, the company found itself outflanked by more aggressive rivals. Dropbox needed to reassess its existing strategy and find a way forward.

This case can be used in undergraduate- and graduate-level courses on digital strategy, global strategy, international entrepreneurship, or international business. It outlines the internationalization trajectory of a digital firm and the challenges the company faced in the wake of COVID-19. Students are introduced to the brace model of internationalization, in which digital firms balance both digital and physical aspects of internationalization. After working through the case and assignment questions, students will be able to do the following:<ul><li>Explain the brace model of the internationalization of digital firms and the need to balance the digital and physical aspects of foreign expansion.</li><li>Evaluate the key success factors for digital firms pursuing a brace model of internationalization, focusing particularly on the nature of firm resources, strategic alliances, and network effects.</li><li>Highlight the competitive and institutional challenges faced by digital firms pursuing a brace model of internationalization, and assess the different strategic tools available to overcome those challenges.</li><li>Discuss platform envelopment strategies.</li><li>Recommend a course of action for digital firms engaged in the process of internationalization.</li></ul>

• internationalization
• digital
• platform