Crown Castle-backed Vapor IO raises $90M for nationwide edge rollout

IoT network
Vapor IO's Kinetic Edge platform is a fully integrated system of edge colocation, networking and exchange services that operate in key metro regions. (Pixabay)

Vapor IO announced an additional investment by private equity firm Berkshire Partners and Crown Castle, bringing its aggregate Series C funding to $90 million and providing the means to accelerate its Kinetic Edge buildout.

The rollout appears timely for the cellular industry as operators deploy 5G and edge capabilities. Vapor IO’s mini data sites can be used to support these and other operators.

The company now says it has the funds to build out its platform in 36 markets by 2021. Vapor IO already is live in four markets: Chicago, Atlanta, Pittsburgh and Dallas, and it has another 16 markets in the pre-construction phase, most of which it expects to build out in 2020.

The other markets it has identified are its home town of Austin, Texas, as well as Boston, Charlotte, Columbus, Denver, Houston, Indianapolis, Las Vegas, Los Angeles, Miami, Nashville, Phoenix, San Antonio, San Francisco, Seattle and Washington, D.C. It hasn’t yet announced the next 16 after these.

Validating the news is a deal with Cloudflare, a customer that has committed to be on the Kinetic Edge platform in all 36 markets, in lock step with Vapor IO’s deployment, according to Matt Trifiro, chief marketing officer at Vapor IO.

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While the idea of Vapor IO’s Kinetic Edge platform sounds appealing—it’s building an integrated system of edge colocation, networking and exchange services to serve metro regions—it’s actually a rather complex process.

It starts with approaching municipalities for permission to deploy its Vapor Edge Modules (VEMs), which are self-contained modular edge data centers. These VEMs can be accommodated in a mere a 10-foot by 20-foot area, which can be either rectangular or square. (They sometimes use repurposed iDEN pads.) A concrete slab is laid on the ground and a crane lowers the unit onto the footprint.

Vapor IO map
The expansion capitalizes on years of effort and planning. (Vapor IO)

Vapor IO has a just-in-time inventory system, so when it’s ready to deploy a new market, it drives the data centers to the site on a truck. Its target is 90 days to bring each site online, according to a blog post.

Getting the sign-off from municipalities is a 24- to 36-month-long process, so the company obviously has to plan ahead. Initially, it will have two or three data centers in a market, but it probably won’t take that long before it has on the order of five to seven in some larger markets, according to Trifiro.

The process starts with Vapor IO identifying multiple sites in a city where it can put the edge data centers, then connect them with redundant fiber optic feeds and overlay on top of that its own software defined network (SDN).

“What that essentially allows you to do is treat the entire city as one data center,” Trifiro told FierceWirelessTech. “Even though you’ve got workloads in multiple locations, you can easily move them from one location to the other” or place them in one particular location for latency or geography reasons.

Inside the data centers are racks of equipment. Its data centers are designed to operate without any humans on site and to be multi-tenant, meaning there are at least two companies, sometimes rivals, being served through the same data center.

One can imagine how companies feel about having their gear that close to their competitors. “We’ve had to build a tremendous amount of physical and logical isolation between tenant equipment,” he said, and that didn’t exist off the shelf. Vapor IO custom builds its micro data centers.

From Day One, Vapor IO approached the business knowing that it could not afford to have people at these sites to monitor what’s going on and to serve as security guards, so it built them with a lot of IoT technology, artificial intelligence (AI) and round-the-clock monitoring by both software and off-site humans to maintain the requisite level of security; that means a lot of sensors managing the facilities.

Because they knew they were going to be going out in a very distributed fashion and that it would not be possible to have humans there, “we had to re-architect how we thought about data centers,” Trifiro explained.

The expectation is there will be multiple operators in its facilities, not just wireless carriers but cloud, content providers and others that need infrastructure near the edge. The idea is that operators will not want to build all these data centers themselves for cost and efficiency reasons.

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Vapor IO has the advantage of having Crown Castle as an investor and partner, but it is not beholden to Crown Castle, Trifiro said. Crown has a lot of fiber and land, but in areas where it does not, Vapor can use other partners.