Yes that's true, but there was also a general feeling at the time (among investors, journalists, armchair experts) that cloud storage was a crowded space (there were like 8+ players in the space at the time [1]) and that Dropbox was either too late to the game or it was impossible for anyone to deliver a product that would appeal to the mass market.

It took them a long time to raise funding as a result.

[1] http://techcrunch.com/2006/01/31/the-online-storage-gang/