ANN ARBOR – Online Tech has received a $20 million investment from News-Press & Gazette Company and will use the money to build four more data centers over the next 24 months.
Online Tech CEO Yan Ness said with experience in traditional media across a number of secondary markets, NPG saw the emerging opportunity centered on the data center business, one of the fastest-growing segments of the economy today.
?Online Tech has built the leading data center operating company in Michigan,? Ness said. ?This investment provides us the capital we need to expand our data center business into additional markets across the Midwest.?
Online Tech focuses on two key areas: Mid-sized businesses in secondary data center markets and compliance-focused vertical markets.
According to Rick Kurtzbein at 451 Research, many secondary markets are underserved as opposed to the 6 top North American data center markets (that is, New York, Northern VA, Chicago, Dallas, LA & Silicon Valley/San Francisco), where most of the data center investment has gone in the past few years. To date, Online Tech services the secondary market in Michigan with over 60,000 square feet of data center space between three data centers located in Ann Arbor and Flint, with the bulk of its local business from mid-sized businesses with revenue ranging from $20 million to $1Billlion.
With the additional capital investment, Online Tech plans to expand its footprint into additional secondary markets across the Midwest and additional vertical markets that require both the high level of compliance and excellent customer service that Online Tech uniquely delivers.
News-Press & Gazette is a leader in print and broadcast media in a number of secondary markets across the U.S.; owning and operating 40 broadcast television stations and 14 publications. With the expansion of traditional media into the digital realm, NPG invested more than $2 million dollars building two data centers in St Joseph, Mo. at the beginning of 2012 and prompting their decision to invest in the data center industry more aggressively over the summer.
After visiting a number of data center operators across the Midwest, NPG focused those efforts on Online Tech. ?Online Tech?s culture and execution framework are very similar to NPG making this a perfect opportunity for NPG,? said NPG Executive Vice President Bill Severn.
The fit with NPG was just as comfortable for Online Tech?s executive team. ?We chose to partner with NPG from a number of investor groups we spoke with because of the cultural fit between the organizations,? said Mike Klein, President and COO of Online Tech. ?The shared Midwest values, focus on customers and employees, and alignment around our win-win approach to business made NPG a great fit as a capital partner.?
