Key facts
- Data center operator DayOne is planning an IPO as soon as November.
- DayOne could seek to raise as much as $5 billion at a valuation of about $20 billion.
- The company has secured about 2.1 gigawatts of capacity bookings across Asia-Pacific and Europe.
- SB Energy has postponed its IPO due to SEC questions and valuation concerns.
- Nvidia is providing a guarantee for SB Energy's data center lease and invested $1.5 billion in SB Energy.
Data center operator DayOne is moving forward with plans for an initial public offering as soon as November, despite a more challenging market for such ventures. The company, which develops and operates data centers for cloud and AI clients, aims to file with the US Securities and Exchange Commission in mid-October. This follows a period of strong investor enthusiasm for AI infrastructure, which is now maturing, leading to increased scrutiny.
DayOne's IPO plans come after setbacks for other data center operators, including the delay of SB Energy's expected IPO and a dispute that could affect a New Mexico project. Investors are now favoring companies with diversified customers, secured power supply, and contracted capacity, rather than those heavily reliant on a single AI customer or requiring large upfront capital. Ke Yan, head of research at Shenton Research, noted that the key differentiator is whether demand is already contracted and energized or merely planned.
Companies like Switch, Vantage Data Centers, and CyrusOne are also exploring or preparing for IPOs. DayOne's geographic diversification and existing operational data centers distinguish it from some rivals. The company, backed by investors such as Coatue and Hillhouse, raised $4.5 billion in a June funding round and could seek up to $5 billion in its IPO, with a potential valuation of around $20 billion. It has secured approximately 2.1 gigawatts of capacity bookings across Asia-Pacific and Europe.
Meanwhile, SoftBank-backed SB Energy has postponed its IPO marketing due to SEC questions and concerns over its valuation and reliance on OpenAI as a major customer. Nvidia has agreed to provide a guarantee of up to $105 billion to help SB Energy lease a data center and has invested $1.5 billion in the company. SoftBank is also raising a $10 billion debt deal to fund its OpenAI investments.
Financing the AI buildout is facing greater pressure due to higher interest rates, making it more expensive to fund facilities with long-term return horizons. Investors are demanding more visibility into customer cash flows. Neil Bear-Hetherington, director of data centre capital markets at CBRE, emphasized the importance of contracted revenue from creditworthy customers for servicing debt and funding AI-ready facilities. For companies preparing to go public, the less forgiving IPO market incentivizes quick action while investor demand is available.