As the leading provider of network-centric colocation and other essential Infrastructure-as-a-Service (IaaS) solutions, 365 Data Centers (365) had a significant 2020 – despite market uncertainty and extreme global volatility brought by the pandemic. Recently, CEO Bob DeSantis sat down with JSA TV to discuss how pivoting was critical for 365 this past year. From their 2020 company successes to lessons learned to 2021 industry predictions, no stone was left unturned in this informative interview.
For 365, 2020 brought along both its unique challenges and prosperous opportunities. “We weathered the uncertainty of last year well, and our business strategy was affirmed in several different ways,” said DeSantis. “2020 was the most transactional year for 365 since my partners and I acquired the business in 2017.”
In February, 365 acquired its flagship Tier III data center facility in Commack, Long Island from mindSHIFT Technologies, and in turn, mindSHIFT became a long-term customer. Then, in August, 365 and Crosslake Fibre partnered together to provide network access in Buffalo, New York, offering additional connections to Canada.
However, one of the most significant milestones for the company in 2020 was its acquisition of Atlantic Metro Communications (AMC). This would mark 365’s fourth acquisition since April 2017, doubling its customer base from 650 to approximately 1,300. Additionally, it expanded the company’s reach in the Northeast quadrant of the U.S. and extended its operations in California, Florida, and Tennessee. “This acquisition brought us not only customers, but also facilities and networks that reach Boston, New York, New Jersey, Philadelphia, Northern Virginia, and Miami,” DeSantis commented.
Now, with a broader set of IaaS offerings, DeSantis believes 365 is a more competitive player in every market they serve. Moreover, it gives credence to its network-centric colocation brand and allows for future financial flexibility when cross-selling and upselling to its customers. “We are currently [after acquiring AMC] the leading fully-hybrid IaaS business from Chicago eastward.”
Proper preparation was key in 2020 and a vital lesson learned for 365 when dealing with future crises. “Since we’re considered an essential services business, we attempted to get ahead of the pandemic by assembling a COVID-19 task force in February. We also immediately notified our customers and enabled remote hands’ capabilities free of charge to provide data security reassurance.”
DeSantis additionally noted that adhering to a proper M&A strategy is vital for external business growth during these unpredictable times. “If you’re a data center organization, 2020 was the year to focus on opportunities if you had the time and resources available. One notable, positive thing to come out of this pandemic is, if you can store and transport data and host network connectivity, your company is better positioned for any future uncertainties as well as engaging in the new normal.”
Overall, 2020 certainly impacted the entire telecom landscape, but as we wrap up the first quarter of 2021, DeSantis predicts more possibilities for growth and consolidation ahead. “My prediction is continued M&A and consolidation across the data center industry. We’ve already seen transaction multiples start to move up, and within the next 24 months, I anticipate seeing multiples two to three times higher than they were previously,” he comments.
To see DeSantis’ interview with JSA TV in its entirety, view the video below.