TL;DR:
- Arkon Energy, a data center infrastructure company, secures $110 million in private funding.
- The funding round was led by Bluesky Capital Management, with participation from Kestrel 0x1 and Nural Capital.
- Arkon Energy, founded in 2021, has grown from a 5-megawatt facility in Australia to over 130 megawatts globally.
- The company plans to acquire an additional 200-megawatt capacity across new data centers in Ohio, North Carolina, and Texas.
- Arkon Energy serves both bitcoin miners and AI/machine learning clients with high power computing needs.
- $30 million of the funding will be used to develop an AI cloud service project at Arkon’s data center in Norway.
Main AI News:
Arkon Energy, a leading data center infrastructure firm, recently concluded a successful $110 million private funding round, as revealed exclusively to TechCrunch by CEO Josh Payne. The round, spearheaded by Bluesky Capital Management and featuring key contributions from Kestrel 0x1 and Nural Capital, marks a significant milestone for the company.
Founded in 2021, Arkon Energy embarked on its journey with a modest 5-megawatt facility in Australia. Since then, it has experienced remarkable growth, boasting an impressive 130-megawatt capacity spread across various global locations, including the United States and Europe.
Josh Payne, CEO of Arkon Energy, emphasized the appeal of their data centers to both bitcoin miners and AI/machine learning clients with substantial computing power requirements. To provide context, a single megawatt can supply electricity to anywhere from 400 to 900 households annually, according to the Nuclear Regulatory Commission.
Approximately $80 million of the secured funding will be dedicated to acquiring an additional 200-megawatt capacity, strategically distributed across new data centers in Ohio, North Carolina, and Texas. This expansion is part of Arkon’s ambitious plan to boost their total megawatt capacity by an astounding 130% by mid-2024. Payne noted that this expansion complements their existing 100-megawatt facility in Ohio, acquired in June.
Payne further elaborated on the company’s strategic focus on the US market, citing its attractiveness due to high domestic customer demand, a robust energy industry with flexible and deregulated markets, political and regulatory stability, and its allure to institutional investors. He also highlighted the abundance of underutilized power generation assets in the US, many of which are renewable and connected to some of the world’s most cost-effective electricity sources.
Arkon Energy’s US data center portfolio primarily serves institutional-grade bitcoin mining companies, effectively positioning them as infrastructure asset owners in the sector.
Arkon’s business model centers on acquiring distressed data center assets across the globe. Payne emphasized the unprecedented demand for data center capacity globally, particularly in the US, driven by energy-intensive platforms that require professionally managed and operated electrical infrastructure.
The remaining $30 million of the investment will be channeled into the development of an artificial intelligence cloud service project at Arkon’s data center in Norway. This endeavor aims to cater to the generative AI and large language model training markets, which have experienced significant growth in recent times. Payne highlighted the shortage of specialized physical infrastructure to power the computers and servers behind these AI products, with Arkon stepping in to fill this critical gap by providing the essential infrastructure layer.
The past year has witnessed a meteoric rise in AI applications, accompanied by potential growth and adoption of bitcoin in mainstream institutional markets, especially as the prospect of a spot ETF approval looms. This positions specialized data centers like Arkon’s for exponential growth in the foreseeable future. Arkon Energy is poised to play a pivotal role in facilitating these transformative developments.
Conclusion:
Arkon Energy’s substantial funding and expansion plans reflect the growing demand for data center capacity, driven by energy-intensive platforms and the rise of AI applications. This strategic move positions Arkon Energy to play a pivotal role in supporting both the bitcoin mining and AI sectors, while tapping into the potential growth of bitcoin in mainstream institutional markets. The investment underscores the company’s commitment to addressing critical infrastructure needs and capitalizing on evolving market trends.
