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News Releases
New Edge Networks Raises $62.5 Million to Grow On
VANCOUVER, Wash. - (Jan. 18, 2000) - New Edge Networks has raised $62.5 million in additional funding which will be used to help the company expand and accelerate the deployment of high-speed digital subscriber line (DSL) service in small, midsize and semi-rural areas.
About half of New Edge Networks' new capital comes from the three original venture capital partners. They include Accel Partners, Palo Alto, Calif., Crosspoint Venture Partners, Woodside, Calif. and Greylock, Boston, Mass.
New Edge Networks also is getting funds from Comdisco Ventures, a division of Comdisco, Inc.; Goldman, Sachs & Co.; Intel Corporation; Meritech Capital Partners, Menlo Park, Calif.; and Morgan Stanley Dean Witter. New Edge Networks' management team and other current shareowners also invested new capital into the company.
In addition to expanding and accelerating its network deployment, New Edge Networks also expects to use the new capital to add 130 new employees to its current payroll of about 170 employees as it expands its national presence.
"The significant level of participation by each of our three original venture capital sponsors is a solid vote of confidence in our business plan and the New Edge team's ability to execute," said Dan Moffat, president, CEO and co-founder of New Edge Networks. "In addition, we're pleased to have this new slate of investors at this stage of our development as a national wholesale player.
"We have stayed focused on becoming a national wholesale DSL provider in small, midsize and semi-rural areas in all 50 states. We look forward to using this investment, as well as the extensive CLEC, ILEC and ISP experience of our team to take our deployment further, faster."
With $15.3 million in first round equity funding last June, New Edge Networks took just 120 days to begin offering DSL service. In doing so, New Edge Networks also filed for regulatory authority to offer service in every state; submitted requests for collocation space in more than 850 telephone company central offices across the country; built a state-of-the art backoffice operating support system (OSS); negotiated reciprocal service agreements with other national wholesale DSL providers; and staffed the organization from five co-founders to 170 employees.
Since initiating service last November, New Edge Networks has installed Digital Subscriber Line Access Multiplexers (DSLAMs) systems in more than 50 central offices. New Edge Networks is scaling to install more than 100 DSLAMS a month to capture a huge market potential of business users that currently do not have broadband and Internet data capabilities in under served smaller cities and semi-rural areas.
"New Edge has a rock solid record of performance and huge momentum," said Mike Gordon, managing director of Meritech Capital Partners, the lead investor in the second round equity funding. "New Edge Networks is an attractive investment because of the enormous broadband play and a proven operating team."
High-speed DSL technology replaces analog modems and provides access to the Internet and Corporate LANs at speeds up to 100 times faster and at affordable costs. The principal benefits of DSL technology are: speed; continuous "on demand" connectivity eliminating dial up or waiting; secure access using dedicated facilities; and, reliability because the network is monitored around the clock.
According to industry analyst projections, up to 7 out of 10 people and businesses, representing 70 million to 90 million households and businesses, will be on the Internet by 2003. Of this number about half, or about 40 million, will have broadband access through DSL service, cable television modems or wireless devices. DSL is expected to lead with a more than 50 percent broadband market share. Industry analysts believe 2 out of 10 DSL users will choose to live or operate businesses in small and medium size communities outside the major urban areas, where New Edge plans to offer wholesale DSL service.
About New Edge Networks
Based in Vancouver, Wash., New Edge Networks is the leading national wholesale DSL provider in small, midsize and semi-rural markets. The company's Web site address is www.newedgenetworks.com.
Contact:
Sal Cinquegrani
(360) 906-9723
ATTN: New Edge Networks news releases contain information that is accurate as of the date they are issued. Information contained in past news releases may become out of date and the company does not assume responsibility for updating information contained in past news releases.