This morning, content delivery provider Highwinds announced they have closed $205M in a debt financing deal with Cerberus Business Finance and Goldman Sachs BDC, Inc. along with a follow-on investment from General Catalyst Partners. Highwinds plans to use some of the money to buyout older investors, but won’t say how much of the $205M will be left once that’s done. The company raised $100M in financing between 2006-2010, so one has to imagine at least half of the new debt financing will go directly to Highwinds expansion.
Highwinds has been in the industry since 2002 and use to be in the large volume, low price, video delivery business but exited that market a few year’s back to focus on the gaming, advertising and software delivery markets. The company plans to use the money to expand their network in China and Russia and further expand their presence in Latin America. The company has egress capacity in excess of 4Tbps and plans to add to that as well. Highwinds isn’t disclosing revenue numbers, but I expect the company will do about $100M this year. One thing Highwinds is open about is that they are profitable, with the business generating a lot of positive cash flow each month. The majority of Highwinds business is CDN related, HTTP and NNTP delivery, with only a small portion coming from transit and co-location products and services. The company has done a good job of signing up PC gaming customers including Valve, GameFly, Wargaming.net, Hawken, World of Tanks, Bigpoint and others.