Exclusive: Compass Raises $100M for Expansion

Data center developer gets infusion of debt and equity funding to accelerate construction

Yevgeniy Sverdlik

May 27, 2014

2 Min Read
Exclusive: Compass Raises $100M for Expansion
Illustration of a data center by Compass. Image by Compass Datacenters

Compass Datacenters has added $100 million of investors’ money to its war chest that will fuel the developer’s next stage of growth.

Started by Digital Realty Trust alumnus Chris Crosby and developer Chris Curtis in 2011, Dallas-based Compass has a standardized design for a 1.2 megawatt data center it claims it can build quickly anywhere a customer desires, targeting primarily second-tier U.S. markets. Now, with three service provider customers and a few completed data center builds under its belt, the company is looking at further expansion.

The latest capital infusion consists of $35 million in equity commitments and $65 million in additional capacity under the company’s revolving credit facility, bringing that facility to a total of $110 million. The additional debt financing came from a syndicate led by KeyBank, which also included Regions Bank and Raymond James. Equity financing was provided by private individuals.

Crosby, the company’s CEO, said it was “looking at accelerating things in the next 12 to 18 months and deploying that capital in a pretty quick fashion for our clients.”

Compass has built a data center for Iron Mountain in Northborough, Massachusetts (just outside of Boston). It also recently completed a build in Minneapolis, Minnesota, for CenturyLink, and hosting company Windstream is using its facilities near Nashville, Tennessee, and in Durham, North Carolina.

Compass owns a piece of land near Columbus, Ohio, but has not yet announced a client for that location. Crosby said expansion plans were still focused on North America, including development on the Ohio property.

A lot of companies are shopping for data center space at the moment, whose requirements fit the Compass model. “We’re tracking about 85 MW of opportunities right now,” Crosby said, adding that most of those deals would be for its single-pod 1.2 MW deployments.

To date, Compass has been successful with service-provider customers, and Crosby expects it to continue winning deals in that space. There are also more enterprises considering data center space in second-tier markets now, he said.

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