DGtek raises $7M in funding round for network expansion

Expected to help the provider reach 1 million homes and businesses by 2024.

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Melbourne-based fibre broadband services provider DGtek has raised over $7 million in a Series A funding round to expand the reach of its network across Australia.

Led by financial services group MA Financial’s Growth Capital Fund, the capital is expected to help the provider reach 1 million homes and businesses by 2024, according to DGtek CEO David Klizhov.

“We are proud to be able to deliver superior connectivity, capacity and speed for our customers, at a fraction of the cost of the NBN,” he claimed.

“The NBN continues to fail its customers across inner Melbourne and beyond. We are determined to meet the needs of businesses and residents - where unconstrained connectivity is an essential requirement during these times of increased work from home.”

Jaron Yuen, managing director at MA Financial, said he was impressed with DGtek’s business acumen.

“We have been impressed with the team’s focus on delivering a superior service to wholesale customers supported by deep expertise in building and managing ultrafast broadband networks on a cost-effective basis,” he said.

Treia Capital also contributed to the series A funding, following their initial investment as one of the provider’s original investors back in 2019, and saw the recent round as an opportunity to increase its shareholding.

"The investment in DGtek fits perfectly for Treia and our clients, said Michael Robinson, principal at Treia Capital. “Through its end-to-end full-fibre network, DGtek is offering an increasingly essential service to business and residential customers.

“We’re excited to support the company in its organic and acquisition growth strategies, with the aim to deploy significantly more capital over the coming years," he added.

A portion of the funding round has gone towards the acquisition of FG Telecom, which the provider previously announced in June.

That acquisition fuelled DGtek’s expansion aspirations and increased its network coverage by 25 per cent, with FG Telecom servicing customers around Port Melbourne and the Melbourne CBD.

“FG Telecom’s primary goal, much like DGtek's, has always been to provide customers with a quality product. Unlike a lot of the big players, we aren’t under constant pressure to streamline and cut corners in an effort to boost up the share price,” said Dev Oza, former FG Telecom CEO and current enterprise and commercial sales lead at DGtek.

“The capital raise which facilitated DGtek’s acquisition of FG Telecom is evidence of the fact that even investors are becoming more confident about the tremendous value and growth potential that challenger brands like FG Telecom and DGtek bring to the market."