CARY — Frank Brick took over as chief executive officer at Arsenal Digital Solutions on tax day a year ago with a complex mission:

Look over the storage management services provider’s operations and figure out a path to growth and profitability without sacrificing quality.

Monday, the company disclosed the latest part of Brick’s strategic plan when it not only announced another $10.5 million in venture financing but also created new management positions. Randy Whitehead, senior vice president of operations, was promoted to chief operating officer. And Dan Lewis was brought in as chief commercial officer.

The flurry of announcements put Brick in a one fine mood.

“We tried to hit the first day of spring,” he tells Local Tech Wire.

Storage systems and data management are bright spots in an otherwise dour economy. And brick sees an opportunity to rapidly grow Arsenal, which already operates 22 data centers in 17 cities and has some 700 customers.

Brick already is driving growth. He wants more — but he won’t sacrifice service.

“I was brought in by the board predominately to evaluate the organizational structure from a management standpoint and system and fulfillment capabilities so we could rapidly grow without compromising quality,” he says. “The first customer should never suffer from you getting your 701st customer.”

Even as Arsenal grew in 2002, Brick and his management team plotted two plans for 2003. The investors, including Covestco, Southeast Interactive Technology Funds and Southern Cross Capital, bought the aggressive one.

“Looking at the 2003 operating plan and growth initiatives, we presented two plans in December — one for normal growth and speed, and we already had 215 percent top-line revenue growth in 2002,” he said. “The other was for more aggressive growth.

“They are confident we can get the kind of return on capital that they required, so with enthusiasm they said ‘Let’s go forward; let’s get the bigger numbers.'”

The investors put up more cash, Brick reached out to broaden management, and Arsenal is lining up more customers through its major partners (such as AT&T) and other companies looking for data security salvation.

“We’re on track for positive cash flow and EBITDA in 2003,” he says.

Arsenal was able to close on somewhat more money than they had targeted in 45 days after investors received his plan. That’s lightning speed these days.

9-11 helps drive growth

So what is driving storage network services growth?

Brick traces the trend to the fallout from the terrorist strikes on 9-11.

“Post 9-11, there was a lot of buzz in industry about wanting to be able to do data replication offside, and many of our partners were approached about companies wanting to use their hardened facilities,” Brick recalls. “We also had been approached by our complimentary partners about integrating our solutions into their data solutions.

“We are expanding our partner base to take advantage of the emerging opportunities.”

Arsenal private-labels its services, so no one will find an “Arsenal Digital” logo as he or she enters a hardened network facility.

But there is much more to Arsenal than storage. The firm also offers a variety of services designed to protect data. And Brick points out an interesting statistic.

“Of all the data that is lost in the United States, only 4 percent is lost due to a catastrophic event or disaster,” he says. “Over 60 percent is non-restorable due to human errors, lack of tools or lack of backup services.”

Brick says the 9-11 aftermath has many companies looking into data protection and discovering just how vulnerable they are to other kinds of threats..

“We’re getting an inflow if inquiries from people who also realize that internal and external sabotage are big enemies of data security,” he says. “They are making investments to protect, to secure, to recover data no matter what the reason.”

Because Arsenal has “always focused on the restorability and security of data,” Brick says, the company offers guarantees of reliability. “In fact, our tag line is ‘The most trusted name in storage management services.’ The biggest obstacle our partners have is trust, so we developed from a security standpoint reliability, we guarantee performance and services financially. Therefore we are trusted.”

Broader brain trust

To help gain more trust, sales and help, Brick reached out to Lewis, a former executive at Compaq and also a joint venture of Compaq and Cable & Wireless, for the commercial officer job.

“I also had been the chief sales guy and business development guy,” Brick says. “We decided to make the investment in Dan because of his extensive experience both in procurement management services and also being able to manage product line profitability.”

Whitehead was promoted from vice president of operations to the COO post. “He has 25 years experience in storage, storage management and out-scouring,” Brick explains. Whitehead also will take over responsibility for development, Brick adds.

Arsenal Digital has raised more than $63 million through four rounds. The new cash infusion, Brick says, should put Arsenal in the black.

“We have the adequate capital to fund our business offerings, to make sure we don’t miss a beat,” he says.

Arsenal Digital: www.arsenaldigital.com

Rick Smith is managing editor of Local Tech Wire.