The decision by Box management to significantly increase its focus on strategic solution sales and building deeper relationships with customers this year is continuing to pay off, with “strong attach rates for add-on products and large deal growth” seen in the company’s third quarter (ended Oct. 31), according to company CEO Aaron Levie.
“In Q3, this strategy continued to gain phenomenal traction as we saw more than 40 percent growth in all large deal categories,” he said Nov. 29 on an earnings call. “We had another solid quarter in Q3, including wins and expansions with leading organizations like the city of Boston, National Bank of Canada and the National institute of Health,” he told analysts.
Box ended Q3 with more than 90,000 total paying customers globally, he noted. The company closed 57 deals greater than $100,000, up from 40 a year ago; 11 deals over $500,000 versus five a year ago; and three deals more than $1 million versus just one a year ago, he said.
Another positive for the company: More than 80% of those deals included at least one add-on product including Box Governance, Zones, KeySafe or Platform, compared to about two-thirds of deals greater than $100,000 including those products a year ago, he pointed out.
“Enterprises are choosing Box as a strategic technology partner and the Cloud Content Management platform to power their digital transformation,” he went on to tell analysts.
He explained: “Content is at the heart of how we work. And it is only becoming more critical as powerful new technologies” including artificial intelligence (AI) and machine learning “create opportunities to make the business processes around content more intelligent and automated. Enterprises need a central hub for their content, connecting best-of-breed applications, while meeting security and compliance demands for multiple industries and geographies. With our solution selling strategy more deeply embedded into our business, we are in a stronger position than ever before to deliver more value to our customers.”
As discussed by Levie previously, the company is “focused on two major objectives,” he noted. The first one is “innovating in cloud content management to power how companies work and run in the digital age,” while the second objective is “advancing our global go-to-market efforts so that we can reach more enterprises around the world and make them successful with Box,” he said. During Q3, Box “continued to make solid progress on both of these objectives,” he told analysts.
Box recently announced that Box Skills Kit, which helps enterprise customers, third-party developers and system integrators build custom AI integrations of Box, will be generally available Dec. 18. Levie told analysts on the earnings call that Box Skills Kit “will unlock powerful use cases like computer-powered audio, video and image recognition by leveraging advanced AI and machine learning capabilities from a wide range of technology leaders like IBM, Google and Microsoft, who are excited to see what our customers and developers create with Box Skills Kit starting next month.”
Security, meanwhile, “continues to be a critical differentiator for Box and a primary reason why customers choose our cloud content management platform,” he said. At the company’s BoxWorks conference over the summer in San Francisco, the company previewed Box Shield, a set of advanced security capabilities built on our proprietary advanced machine learning technology that he said Nov. 29 “will help customers protect their content and users from internal and external threats.”