VFN Holdings, Inc (Vero) Secures $80 Million in Preferred Equity Financing to Accelerate Fiber Construction Growth

Rhea-AI Summary

VFN Holdings, Inc (Vero Networks) has secured $80 million in preferred equity financing to accelerate fiber construction growth. The investment, led by Delta-v Capital and funds managed by Hamilton Lane, will enable Vero to:

• Build fiber to the home in underserved communities
• Finance accretive business acquisitions
• Facilitate wholesale and large enterprise opportunities

Vero, founded in 2017 by digital infrastructure industry veterans, has expanded to 237 markets in 20 states, serving over 21,000 customers. The funding will support Vero's mission to enable digital communications and connectivity solutions in under-connected areas across the United States.

Positive

• Secured $80 million in preferred equity financing
• Expanded network footprint to 237 markets in 20 states
• Serving over 21,000 customers
• Potential for accelerated organic and inorganic expansion
• Support for high-growth areas like AI, cloud computing, and 5G rollouts

Negative

• None.

Insights

Financial Analyst

The $80 million preferred equity financing for VFN Holdings (Vero) is a significant capital injection that will fuel the company's growth strategy. This funding, led by Delta-v Capital and Hamilton Lane, demonstrates strong investor confidence in Vero's business model and market potential. The capital will be used to expand fiber-to-home infrastructure in underserved areas, potentially increasing Vero's market share and revenue streams. Additionally, the funding will support accretive acquisitions, which could lead to rapid expansion and economies of scale. With 237 markets across 20 states and over 21,000 customers, Vero is poised for substantial growth in the rapidly evolving digital infrastructure sector.

Tech Expert

Vero's focus on expanding fiber infrastructure aligns with critical technological trends. The company's strategy to support high-speed internet access, artificial intelligence, cloud computing and 5G rollouts positions it at the forefront of digital transformation. The investment will enable Vero to capitalize on the increasing demand for robust digital infrastructure, important for emerging technologies like edge computing and advanced online services. By targeting underserved communities, Vero is not only tapping into an underexploited market but also contributing to bridging the digital divide, which could lead to long-term customer loyalty and positive brand perception in these regions.

Market Research Analyst

The fiber optic market is experiencing rapid growth, driven by increasing data consumption and the need for high-speed connectivity. Vero's expansion strategy, backed by this substantial funding, positions the company to capture a larger market share in this booming sector. The involvement of industry veterans, including a Zayo co-founder, adds credibility to Vero's operations and growth potential. The company's diversified portfolio, serving retail, enterprise and wholesale customers, provides multiple revenue streams and reduces market risk. However, investors should monitor the competitive landscape, as major telecom players are also investing heavily in fiber infrastructure, which could impact Vero's growth trajectory and profitability in the long term.

BOULDER, Colo., Sept. 16, 2024 /PRNewswire/ -- VFN Holdings, Inc. (Vero Networks, or Vero), a leading fiber infrastructure operator and broadband internet provider, is pleased to announce the successful completion of $80 million in preferred equity financing. This investment was led by Delta-v Capital and funds managed by Hamilton Lane, with participation from existing Vero investors, and closed in August of 2024.

VFN Holdings, Inc (Vero) Secures $80 Million in Preferred Equity Financing to Accelerate Fiber Construction Growth

The new round of funding will enable Vero to continue to build fiber to the home in support of high-speed internet access in underserved communities in both Colorado and other markets and states where Vero can leverage its unique, existing network footprint and fiber assets. In addition, Vero will utilize this equity capital, in conjunction with its debt facility, to finance accretive business acquisition opportunities, as well as facilitate success-based wholesale and large enterprise opportunities in the pipeline. This capital infusion marks another critical step forward for the company as it advances its mission of enabling digital communications and connectivity solutions in under-connected cities and towns throughout the United States.

"We are thrilled to have secured this level of commitment from our new capital partners," said Greg Friedman, Chief Financial Officer of Vero. "This investment is a testament to the success Vero has had in serving our wholesale, enterprise, and retail customers, as well as the incredible effort and dedication of our fantastic team. This capital raise will allow Vero to broaden its market reach and accelerate our organic and inorganic expansion efforts."

Vero was established in 2017 by a group of digital infrastructure industry veterans, including Matt Erickson, one of Zayo's Co-Founders and Chief Operating Officers. Since its inception, Vero has expanded its network footprint to 237 markets in 20 states, serving over 21,000 customers. This equity investment will enable Vero to continue to address the evolving needs of fiber to the home, artificial intelligence, cloud computing, 5G rollouts, enhanced online education, high-definition video streaming, social media advancements and edge computing applications.

Rand Lewis, Partner at Delta-v, added, "This is a management team that we've known since before they founded Zayo. We have the utmost respect for their capabilities as operators and are proud to be investing alongside them again. This funding will support the company's inorganic and organic growth plans. We are pleased to work with Hamilton Lane and the Vero team as they build upon their proven track record of success."

"We are excited to partner with Vero Networks as it embarks on its next chapter of growth," said Brent Burnett, Head of Infrastructure and Real Assets at Hamilton Lane. "Vero has an exceptionally strong team and a differentiated value proposition. We look forward to working with the Company to capitalize on the significant opportunities ahead."

About Vero:
Founded in 2017 and based in Boulder, Colorado, Vero designs, builds, owns and manages fiber infrastructure services to retail consumers (FTTH), K-12 schools (E-Rate), governments entities, enterprises, wireless and wireline carriers and hyperscale/cloud providers. Vero's key services include wide area networks, internet access circuits, dark fiber, lit fiber and private fiber networks. Vero operates a portfolio of companies that can leverage fiber assets across a broad range of verticals and customer segments, doing business as Vero Networks, Vero Fiber Networks, Vero Broadband, Clearnetworx, Deeply Digital, Fast Track Communications, and Glass Roots Construction. For more information, visit www.veronetworks.com.

About Delta-v
Delta-v Capital is a growth equity firm that has been investing in leading technology businesses since 2009 and currently manages assets in excess of $1.2 billion on behalf of institutional investors, large family offices, and high net worth individuals.  Delta-v targets investments in cloud services, enterprise software, infrastructure software, and vertical software. Delta-v has a flexible strategy to provide companies with secondary liquidity, M&A financing, and growth capital. Delta-v has offices in Denver, Colorado and Dallas, Texas.

About Hamilton Lane
Hamilton Lane (Nasdaq: HLNE) is one of the largest private markets investment firms globally, providing innovative solutions to institutional and private wealth investors around the world. Dedicated exclusively to private markets investing for more than 30 years, the firm currently employs approximately 700 professionals operating in offices throughout North America, Europe, Asia Pacific and the Middle East. Hamilton Lane has more than $940 billion in assets under management and supervision, composed of nearly $130 billion in discretionary assets and more than $810 billion in non-discretionary assets, as of June 30, 2024. Hamilton Lane specializes in building flexible investment programs that provide clients access to the full spectrum of private markets strategies, sectors and geographies. For more information, please visit https://www.hamiltonlane.com/en-us. or follow Hamilton Lane on LinkedIn.

 

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SOURCE Vero Fiber Networks

FAQ

How much preferred equity financing did VFN Holdings (Vero) secure in August 2024?

VFN Holdings (Vero) secured $80 million in preferred equity financing in August 2024.

Who led the investment in VFN Holdings (Vero)'s recent financing round?

The investment was led by Delta-v Capital and funds managed by Hamilton Lane, with participation from existing Vero investors.

What will VFN Holdings (Vero) use the new funding for?

Vero will use the funding to build fiber to the home in underserved communities, finance business acquisitions, and facilitate wholesale and large enterprise opportunities.

How many markets and states does VFN Holdings (Vero) operate in as of September 2024?

As of September 2024, VFN Holdings (Vero) operates in 237 markets across 20 states.