VYCON, which makes flywheels for backup power systems, announced today that it has closed a $13.7 million round of funding. The Los Angeles company said it would use the financing to ramp up manufacturing to meet strong demand from data centers, hospitals and rail transportation applications.
Flywheels are an alternative to using batteries in a data center UPS (uninterruptible power supply) system. A flywheel is a spinning cylinder which generates power from kinetic energy, and continues to spin when grid power is interrupted. In most data centers, the UPS system draws power from a bank of large batteries to provide "ride-through" electricity to keep servers online until the diesel generator can start up and begin powering the facility.
The funding, led by the BankInvest Group in Denmark, includes conversion of $6.5 million in existing convertible notes and $1.1M of existing trade debt. Several of VYCON’s existing investors participated, as well as several new investors.
"We’re extremely pleased in the confidence of our existing investors and at the same time welcome our new investors," said Vatche Artinian, CEO of VYCON. "While the past year included extremely difficult economic conditions around the globe, VYCON enjoyed tremendous sales growth during the year, particularly in the power quality markets and was able to achieve several important milestones. This latest investment positions us well to accelerate our expansion strategies. We’re excited about the fast growth of the energy storage marketplace and VYCON’s opportunities in the new decade.”
In addition to working with data centers and hospitals, VYCON said it worked closely with local port operators and metro transit authorities to obtain American Recovery & Reinvestment Act of 2009 (ARRA) grant funding for projects using clean flywheel technology. “We see tremendous opportunities for organizations to integrate our flywheels into their energy infrastructure that will enable them to lower operating costs and improve overall reliability and uptime of their systems,” said Frank DeLattre, president of VYCON.