Ask HN: Why all these funding of filesharings sites? | Hacker News Reader

Ask HN: Why all these funding of filesharings sites?

35 pointsKevindish20 comments

I have been wondering why all these file sharings sites is getting funded lately. I think it is strange for two reasons:

1. Nobody wants to pay for filesharing. If a filesharing site cost money, the user will just find one there is free, which there is plenty of! I use Dropbox, but i do not pay for it, maybe if the solve a bigger problem for me, but for now the free version is fine for me (+ a few referals). 2. Files sharing isn't that big of a science, of course it is not easy to make something stable, but it is a really simple task. I am thinking, why not fund other startups which solves a deeper problem instead of making another file sharings site?

Have you been thinking the same? or what do you think?

I would be really glad to hear what you think! :)

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No. Not thinking the same.

File-sharing is more of a usability problem. Invention of email + attachments solved file sharing a long time ago. Its the integration with your everyday life that has been a challenge up till now and this is what Dropbox and iCloud are solving.

Companies like YouSendIt never became as successful as Dropbox because they were before their time; and when the time came, they failed to innovate instead hoping for people to adapt as they adopt. Except I don't think they did it right.

You don't want to pay for file sharing as a feature; but it'll be part of the infrastructure that runs your life. Its synonymous to when Bill Gates' separated the software and hardware and focused on software. No customer wanted to pay for it; but the companies that made the hardware (IBM, Apple) did want to pay for it.

What does it mean to "solving a problem"?? Every attempt at a startup has and solves some kind of problem.

I just think the same as you with the YouSendIt, they really did not come anywhere. And these sites(mention above) are only online as it is right know.

It just men there is slot of filetering sites, like rapidshare, megadownload, and i could go on forever, so why are these websites getting funded, when there already are tons of filesharing sites and app free. And filesharing is not that complicated, upload -> store -> share.. But as mention above, they are properly trying to be the hun for other programs.

"upload -> store -> share."

Upload where and for how long? What happens to the files over time? What about huge files and ability to pause/resume upload? What about encryption? What about sharing with more that one person at the time? Will it allow me to preview a file before I download it?

Saying " upload -> store -> share." is oversimplifying as " upload -> store -> share" does not work for anyone who is using file sharing to conduct professional services (think of a law firm with bounced emails because the 5Mb attachment was too big, or a law firm that needs to receive email notification on file delivery etc.)

There is a reason why Law firms sends by snail mail, and I think if they choose to store it online, i do not think they will trust it to a other company, that they do not own, they will either make there own service or use branche-organisation product.

Actually I'd say 90% of the file sharing problem is not yet solved. It won't be until I can attach a 1 GB file to an email message, hit 'send', and have the recipient(s) be able to retrieve it as easily as they could if I'd sent a 1 KB file.

Dropbox does absolutely nothing to solve this problem. They've made a good stab at solving the in-cloud backup problem, but their one-way, account-centric nature makes them nearly useless at the core business of sharing files. There is still plenty of room for innovation in this space. Make large email attachments Just Work(tm) somehow, and you will own the planet.

Absolutely this is a very good point and often over overlooked.

Plus I would argue that up until recently the whole file sharing industry was living by some form of "illegal" filesharing (rapidshare, megaupload, etc). Systems like dropbox are most likely benefiting from the same idea but making the whole thing more "private" among friends and therefore making it less obvious. I still can't see there any substantial market in the filesharing area for normal users outside of the classic movie and music sharing. It is not like we are all now operating with music and video master files and need to juggle 1gig+ data files around.

What I don't like about Dropbox is that it downloads every file from a common folder (shared with other people from my group) to my local computer, whether I'm interested in it, or not.

It should just give me access to it, in the cloud, not just download everything behind my back and using up many, many megabytes, on my rather limited diskspace. (Diskspace is always limited, no matter how large disks get.)

SkyDrive's integration with Hotmail seems to mostly solve that problem, from what I can tell. You can "attach" an Office doc or image in the email composing interface (just like a normal attachment) and they'll be uploaded to SkyDrive and linked to in the email.

The problem is that you need control over the email clients to really have a shot at solving the problem.

Or your should have them interested in your API (profit sharing?)

I'm not sure what you mean about 'all this funding for file sharing sites', but I haven't been following the sector closely.

What you will often find is a gang mentality within sectors. Investors won't get in on one-deal, but they may think the sector is going to experience huge growth, so they invest in the next best company. We saw it with Foursquare, gowalla, etc.etc, as well as groupon, livingsocial...

It seems the distribution is normally a big dog, an also ran, and then everybody else fighting for scraps.

With respect to why Dropbox is interesting, it is my understanding that the interesting parts aren't that you as a user can store and share your files. I think the long-term potential is for applications you interact with to access your data through services like dropbox. This could mean that you don't end up paying for it directly, but rather it would be built into the costs of other services you use.

Think of it like iCloud, but for all platforms and open to any developer. That's my understanding of where Dropbox is going, but like I said, I don't follow that segment.

It is sites like Ge.tt, Box.net, Minus, Titanfile...

But yeah, i think you are right about the thing about programs connecting with the file sharing site to make an complete ex.

But where the sites are right now they are mostly online, but they would properly come to desktop too.

At Drew Houston's Startup School talk he mentioned something almost in passing which I think summarizes exactly why every investor wants or should want a piece of the filesharing pie: these systems have the opportunity to become the "filesystem of the internet". In this world of systems such as iOS and Chrome OS where the local filesystem becomes abstracted away, and while internet connections become increasingly ubiquitous, it isn't unreasonable to expect that "uploading" files to a website will really mean linking to a third party where those files are kept and "downloading" files will really mean pointing to the place where you want said third party to keep them. If that were to happen, and there existed a dominant player in the space who wasn't already a Google or a Facebook, they would quickly become one.

I had no clue why dropbox was so special up until that point when Drew mentioned that -- and it very much was mentioned 'in passing'.

"Filesystem of the internet" is the end goal for them -- dropbox of what you have today is nowhere near what it will be like in 3-4 years if they are still kicking ass.

I called that a while ago:

http://jacquesmattheij.com/the+dropbox+endgame

I can see what you mean about the filesystem of the future, but as it is a lot of these sites are only online for desktops, dropbox is the only one for ios, and is only doing a descent job.

The overall market is estimated to be at 10's of billions of dollars in size. No one is even close to being a market leader, although companies like box.net, dropbox, and sharefile have some established customer base. But there is plenty of opportunity for new players to enter and disrupt the market, and investors don't want to miss out on that.

Investors already in this space may see investing in other guys like an insurance policy to maximize the chances of one of their portfolio companies making it big. But there are other investors who missed the boat on earlier opportunities and are looking for ways to enter this market through the newcomers.

From the perspective of a cofounder in this space - there are many interesting problems that no one has solved yet and there is a lot of potential to innovate, disrupt, and make a difference. At least that's what's driving my passion.

Disclaimer: cofounder of TitanFile.

For most investors, it's about making money. Making money by controlling a niche. Each of the funded File Sharing startups that got funded I came across, had these two components:

1.) Clear advantage in a specific Niche (for us it was legal compliance, security and tracking - all of it matters a lot to lawyers and auditors).

2.) Have a serious (and usually viable) plan to further differentiate.

Disclaimer: I am from bellow mentioned TitanFile.

Well far from a small problem in terms of all yc startups thus far I think Dropbox is easily been one of the best problems solved. Sure that was varying method of file backup before it but nothing as straight forward and painless. Many people using Dropbox have never backed up files before and would have been unlikely to invest in previous solutions but Dropbox is just so intuitive that pretty much everyone gets it.

because the trend appears to be (as an outsider) that what matters is not revenue or chance of profit, it's the amount of users a site can acquire. File sharing is easy to do (arguably hard to perfect) and a good file sharing site will get a lot of users. Maybe they're funded in the hopes of a buyout? Dropbox validated the idea that file sharing can get high valuations...

Dropbox validated the idea that a ton of revenue can get a high valuation.

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