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Gigstreem, a provider of residential and commercial broadband networks, announced Monday that it had raised $59 million in the first quarter 2023 from its existing investor base. The funds will be used to finish buying assets from competitor GigaMonster Networks.
The Tysons Corner, Va.-based internet provider raised the $59 million in two separate transactions, including a $19 million tranche led by Crestline Investors, with participation from proptech venture capital firm RET Ventures and multifamily industry companies Essex Property Trust and UDR.
The capital will help Gigstreem more rapidly scale its growth and deploy internet services to markets across the country. Crestline led an additional $40 million raise in March to provide Gigstreem with the strategic capital to pursue acquisition opportunities, including assets from Atlanta-based GigaMonster following the company’s filing for Chapter 11.
The majority of Gigstreem’s customers are in the multifamily rental market, but the company also provides business-to-business commercial services in New York City through the previous acquisition of Manhattan-based Rainbow Broadband, as well as in other national markets, said Andrew Kusminsky, CEO at Gigstreem.
“During COVID, we were seeing a huge spike in business on the multifamily side and really started to invest heavily there,” said Kusminsky. “From what I’ve seen of the residential rental world it is extremely interesting right now. It’s doing very well and we’re seeing an enormous amount of demand. With interest rates as high as they are, rental becomes far more interesting, and the owners of those properties are demonstrating that with the amount of opportunity we have currently to build networks at these residential properties.”
Since launching in 2017, Gigstreem has served as a national internet service provider for apartment buildings, residential communities, businesses and events. The company has onboarded more than 100 properties through acquisitions and it services a total of 52,000 apartments spanning 28 markets nationwide.
The platform plans to launch operations in some 40,000 additional apartments in 2023. It has proposals out in 33 states, said Kusminsky.
Additionally, in securing a significant portion of GigaMonster’s assets and subscribers, Gigstreem will expand its presence into new markets, while increasing its market share in several existing markets, including California, Florida, Georgia, Texas and Washington state.
“Providing our residents with integral services like reliable, ubiquitous Wi-Fi greatly enhances their living experience and serves as a foundational component to the functionality of numerous community features we offer,” said Josh Gampp, senior vice president and chief technology officer at UDR, a real estate investment trust that invests in multifamily.
Philip Russo can be reached at prusso@commercialobserver.com.
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