Databricks confirms US$1b in funding

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Databricks confirms US$1b in funding

Big data analytics software developer Databricks Monday confirmed raising US$1 billion in a new Series G round of funding that boosts the company’s post-money valuation to US$28 billion.

The new financing presages what many observers expect will be a blockbuster IPO from the San Francisco-based company sometime this year.

The latest funding round comes on top of the US$897 million the San Francisco-based company has already raised including the US$400 million Series F round of financing the company announced in October 2019 and the US$250 million Series E funding in announced in February of that same year.

Last week there were reports, which Databricks declined to confirm, that said the company might have snagged as much as US$2 billion in additional funding, pushing its pre-money valuation to US$28 billion to US$30 billion.

While US$1 billion is considerably less than that, the US$1 billion round is nevertheless impressive and points to an IPO potentially of the same magnitude as Snowflake’s blockbuster IPO last September in which the “data cloud company” achieved a market capitalization of more than US$70 billion.

Databricks, founded in 2013 by the developers of the popular Spark big data processing engine, has been one of the hottest IT startups in recent years.

The company’s product portfolio includes the Databricks Unified Data Service and the Databricks Lakehouse Platform – the latter a system that combines attributes of traditional data warehouse systems and data lakes used to store huge volumes of unorganized data.

The company also develops big data tools such as the Delta Engine query execution software, introduced in June, and SQL Analytics for running SQL queries against massive data lakes, which debuted in November.

The latest funding round was led by new investor Franklin Templeton, joined by other new investors Canada Pension Plan Investment Board, Fidelity Management & Research LLC and Whale Rock, along with new “strategic investors” Amazon Web Services, CapitalIG and Salesforce Ventures.

Earlier investors that participated in the latest round included Microsoft, Andreessen Horowitz, Alkeon Capital Management, Coatue Management, Tiger Global Management, funds and accounts managed by BlackRock, and funds and accounts advised by T. Rowe Price Associates Inc.

Other new and existing investors that participated in the round included Discovery Capital, Dragoneer Investment Group, Founders Circle Capital, Geodesic, GIC, Green Bay Ventures, Greenoaks Capital, New Enterprise Associates (NEA) and Octahedron Capital.

“We see this investment and our continued rapid growth as further validation of our vision for a simple, open and unified data platform that can support all data-driven use cases, from BI to AI,” said Ali Ghodsi, Databricks CEO and co-founder, in a statement following the funding news.

“Built on a modern lakehouse architecture in the cloud, Databricks helps organizations eliminate the cost and complexity that is inherent in legacy data architectures so that data teams can collaborate and innovate faster,” Ghodsi said. “This lakehouse paradigm is what’s fueling our growth, and it‘s great to see how excited our investors are to be a part of it.”

Databricks said the new financing will allow the company to accelerate its development and engineering work “and allow the company to scale and support the rapid adoption of the [data] lakehouse,” which the company said is “quickly becoming the data architecture of choice for data-driven organizations around the world.”

This article originally appeared at crn.com

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