A key Dropbox exec quit just weeks after its blockbuster IPO — but experts say it could be good in the long run (DBX)

Dropbox CEO Drew Houston

Dropbox VP of product Todd Jackson has left the company to join First Round Capital as a founder in residence.
His move comes on the heels of the cloud storage company's successful IPO.
It also comes just as Dropbox is looking to expand its focus on enterprise products as a means of growing revenue and, eventually, reaching profitability.
Despite Jackson's status a superstar in the consumer space, investors think his departure could actually help Dropbox accomplish its product strategy.

Dropbox lost its superstar VP of product Todd Jackson, just two weeks after the file-sharing service's huge IPO. And analysts say it could be just what Dropbox needs to execute on its promise to refocus on selling its services to larger businesses.

Jackson announced via Twitter on Monday a new role at First Round Capital as its first-ever founder in residence. His job will be to advise startup founders in the First Round portfolio, and to launch a Los Angeles edition of the firm's Product Program — a masterclass for early-career product managers.

"We're grateful for all the contributions Todd made to Dropbox over the past 2.5 years. While we'll miss him greatly, we wish him all the best in his new role at First Round," a Dropbox spokesperson tells Business Insider. Jackson could not be reached for comment.

Dropbox hasn't named a replacement for Jackson yet, but for the time being, the company has confirmed that its product organization will be managed by Quentin Clark, Dropbox’s senior VP of engineering, product and design. Clark, who was Jackson's boss, joined Dropbox in September, after two years at SAP and two decades at Microsoft — which is to say he's extremely familiar with business-to-business technology products.

"From the looks of things, one would say this news was a hard-to-turn-down opportunity for Todd, but also a leadership adjustment to put Dropbox on a more solid money-making path. That might be welcomed news for investors," Gartner research director Karen Hobert said.

Before joining Dropbox in 2015, Jackson spent his career doing product management across some of the biggest companies in tech: Google, Facebook and Twitter. He's a big name in Silicon Valley — but not one associated with enterprise-grade subscription market that Dropbox is looking to conquer.

Todd Jackson "Todd’s background is predominantly startups for consumer products over pure business products," Hobert said. "Given that, his leaving might be an indication of more investment in monetizing and growing the enterprise side of the business — which Dropbox needs to do."

When Dropbox filed for its IPO at the end of February, the 11-year-old company made public for the first time that the company isn't profitable.

Only 11 million of Dropbox's 500 million registered users pay to use the service, according to its S-1. But the company has 300 million users that it has identified as likely to convert to the paid model, and winning over these users is part of its strategy to become profitable.

"They need a solid enterprise leader for that plan," Hobert said.

And while it's a big deal for any company to lose an executive so soon after its IPO, analysts don't foresee there being a big impact on business in the near term.

"Customers are a trailing indicator and product changes will begin to show up in the roadmap in six months or beyond," IDC research director Terry Frazier said. "If the current product and roadmap are acceptable, they will buy. If that changes in six months or a year, they will not. That’s when customers will begin voting on the change. "

First Round was an early investor in Jackson's startup

What may have been a liability at Dropbox is an asset in the eyes of First Round.

"This career arc makes Todd a rare breed," First Round said in an announcement. "He’s experienced enough to have helped build some of the most iconic products in tech, including Gmail. But he’s also worked at the scrappiest end of the spectrum, scaling high-performance teams from scratch."

Jackson first met with First Round in 2013 when he was fundraising for Cover, a startup he founded. Cover, which made a smart Android lock screen, was acquired by Twitter in 2014, and Jackson became Twitter's director of product management. In 2014, his wife Arielle — a veteran of Google and Square — joined First Round as a marketing expert in residence.

Jackson left Twitter for Dropbox in 2015, just a few months after CEO Jack Dorsey reclaimed his role at the helm of social media company.

Incidentally, when Jackson first joined Dropbox, he replaced Ilya Fushman, who left the company to join Index Ventures as a general partner. Fushman has since moved to another VC firm, Kleiner Perkins Caufield & Byers.

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