Story Series Part 4 : Teraco

From the stories series.

The brief history of Teraco.. South Africa’s first vendor neutral data centre business.


Matt, Abz and I started the business in 2006.

In June/July 2006 I took a tour of vendor neutral DC’s around London Docklands.

I remember while working at Amazon with Ben and James they suggested I should have a chat with Matt about ISP business things, so when I spotted an email from Matt on the IOZ list around 2006 about building data centres I quickly emailed him. Abz and I went to see him.

[IOZ] Datacentre expertise
Matthew Tagg
Tue Aug 8 12:54:20 SAST 2006

HI All

We are having difficulty finding a specialist experienced in world-
class datacentre construction and planning. If anyone can help out
with a contact in South Africa we would be eternally grateful!

Warm regards,

Matt wanted to build a DC for WebAfrica in Hope Street.

I suggest to Matt that maybe he should not build a DC for WebAfrica.. maybe we should build a vendor neutral data centre business.


Why vendor neutral?

At this point we have to jump back to 2001. I was working for IOL at the time. We figured Cape Town needed a peering point. The Hub Project was started. The idea was that IOL was moving lots of traffic and they could peer with some ISPs (including Frogfoot).

The Hub failed. Mostly in my mind because of two people working for UUNet at the time: Edwin and Rob. The Great Westerford building was a well connected building. Frogfoot’s DC was there. IOL was hosted in the UUNet DC. UUNet controlled the cabling inside their DC and they did not want peering to happen because they obviously liked the idea that IOL was paying the same money for a packet that moved 10m than a packet that moved 15000km.

After The Hub failed it became obvious that we needed data centre space where the data centre provider was not as ISP. I registered a “capecolo” domain and then stared talking to some property developers, did some research on big gensets and UPS systems.. expensive toys, but in the end SA was not ready.

The power of No

So, why did I tell you The Hub story?

Because, it all started with the motivation from somebody saying: No. And somebody thinking: we’ll just have to see about that. “No” can be a good motivator.

Getting the business funded

DC’s are not cheap. Teraco needed about R100m.

I knew Dave Gale also from IOL days and Abz and I did some consulting work for Storm in 2000ish. Abz bumped into Dave at a 27 Dinner (which Bev dragged him to) and asked what the two Tims were up to after selling Storm to Vox.

So for a while it was the 4 of us: Matt, Abz, Joe and Tim P.

At this point we were on business plan version 7 or something like that and the word “bar” was used often.

Tim managed to get the business funded, which was kinda nice (-:

I wrote about the day Teraco was funded here: Running with the Big Dogs.


In March 2009 Teraco opened it’s first data centre, in the same building it all kinda started: Great Westerford.. and the rest is history.

I sold my shares in Teraco in mid 2009.