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C7 of Lindon gets $25 million capital infusion

Published October 2, 2012 7:56 pm

Tech • Data center company plans to build two facilities as part of expansion.
This is an archived article that was published on sltrib.com in 2012, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

C7 Data Centers of Lindon is getting $25 million in new capital to allow it to expand its existing computer server facilities by adding a 65,000-square-foot data center in the Salt Lake Valley and another somewhere in the West.

MCG Capital Corp. of Arlington, Va., and Signal Peak Ventures of Utah, a previous investor, are providing the capital for the company that already operates three data centers in Salt Lake and Utah counties.

"We're growing faster than we can build facilities, so this funding is going to be used for capital expenditures, not working capital," C7 CEO Wes Swenson said Tuesday. "The company has been profitable the last three years but our demand is growing faster than our cash flow will provide for."

C7 has data centers in Salt Lake City, Bluffdale and Lindon. It has closed two smaller data centers in Lindon and Orem.

One of the data centers that helps run Twitter is hosted by C7. Although neither company has officially confirmed the scope of Twitter's presence here, C-7 features Twitter and a quote from the California company on its Web pages.

For security reasons, many companies do not like to acknowledge where their computer facilities are located, but C7 said its customers include Motorola and EVault, a subsidiary of Seagate. Others are "iconic brands from the financial, high-tech, medical and education industries," the company said.

Big and small companies are increasingly using data center companies such as C7 to host and sometimes operate the banks of computers that help carry out the various functions of an enterprise and for backups in case of disasters. Having companies share a computer facility can be more efficient than each one build and run their own data centers.

C7 anticipates building a data center in the Salt Lake Valley and expects to make an announcement on it soon, Swenson said.

"C7 has an immediate and massive opportunity to convincingly sell to new customers and provide additional data center services to existing customers," Signal Peak Managing Director Brandon Tidwell said in a statement announcing the deal.

Another C7 center will be built in the West but not in California, Swenson said. Customers are asking that some facilities be located outside of Utah in case a disaster strikes here and forces data centers offline, he said.

Utah's climate matches well with data centers in that it offers lower cooling costs because outside air can be used to cool them when the temperature dips below 65, Swenson said. Utah also has one of the lowest rates of natural disasters in the nation, he said.

The new capital infusion will create construction jobs in Utah and probably will mean companies will relocate some computer technicians to Utah, said Swenson, who predicted that perhaps 100 full-time jobs will be created here.

tharvey@sltrib.com

Twitter: @TomHarveySltrib