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Chicago-based firm New World Ventures made its largest-ever investment in a startup today.
The 15-year-old firm has poured $50 million into IO, a provider of data center services. IO initially asked for $75 million but had to take it up to a higher amount ($90 million) to satisfy internal investors. Jon Mauck, IO’s CFO, told me during a phone interview that this “pre-IPO” round was highly over-subscribed.
Mauck said the Phoenix Arizona company will use the funds to extend its salesforce in Asia and Europe and to expand its research and development program. Recently, it partnered with investment banking giant Goldman Sachs. Goldman will deploy modules in IO data centers in Singapore, the U.K., and the U.S.
“Their innovative technology and services will allow Goldman Sachs to scale its data center operations more efficiently and further advance the firm’s broader commitment to environmental stewardship and reduced carbon footprint,” Don Duet, global co-chief operating officer of the Technology Division at Goldman Sachs told Data Center Knowledge last month.
It’s a green solution for enterprises, but is also a huge market opportunity.”We have something that is fairly unique and are are addressing the infrastructure portion of the IT stack,” said Mauck.
Traditionally, enterprises have wildly overbuilt their data centers to ensure they never go offline — they were overspending to play it safe. With its software, IO is providing real-time analytics and feedback to improve the use of the space so companies can optimize their infrastructure.
According to Mouck, construction prices have increased 900 percent since 1968. As a result, IO also offers data center hosting services and competes with companies like Digital Realty. The company is not yet profitable from a net income standpoint so it can built out its hosting capabilities but is on track for an IPO in the next two years.
“From the moment we saw this product, we knew it would revolutionize the industry,” said Chris Girgenti, New World Ventures’ managing partner and newly-appointed member of the company’s Board of Directors in a statement.
Image via Shutterstock
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