Prime Highlights
- Databricks raised $5 billion, lifting its valuation to $190 billion after receiving about $15 billion in investor interest.
- The company’s annualised revenue run rate has reached $7 billion, growing 80% year-on-year.
Key Facts
- Databricks is an AI and cloud data company that provides data analytics, database and AI tools for businesses.
- The company has raised about $20 billion over the past 20 months as it increases spending on AI research, cloud capacity and acquisitions.
Background
AI data company Databricks has raised $5 billion in fresh funding, taking its valuation to $190 billion as strong investor demand pushed the company to raise more than it initially planned.
Co-founder and CEO Ali Ghodsi said Databricks originally planned to raise about $1 billion. However, investor interest surged after reports in June indicated that the company was preparing for a major funding round. Ghodsi said the company received around $15 billion in interest from a selected group of investors.
The strong demand led Databricks to expand the size of the round rather than turn away existing and new investors. The company had earlier closed the round at a valuation of $188 billion in July before raising it further to $190 billion.
The latest funding round was led by Coatue, with participation from Blackstone, MGX, T. Rowe Price-related accounts and new investor Sixth Street Growth. Around two dozen investors took part in the round.
Databricks has attracted investors with rapid growth in its core business and expanding AI operations. Ghodsi said the company has reached a $7 billion annualised revenue run rate, growing 80% year-on-year, while remaining cash-flow positive. Its cloud data warehouse business accounts for $1.5 billion and is growing 100% annually.
The company’s AI products are also gaining traction. Lakebase, its database platform for AI agents, has reached a $100 million annualised revenue run rate. Databricks is also expanding through acquisitions, including Electric and AI cybersecurity company Panther.
The company has raised about $20 billion over the past 20 months. Ghodsi said high AI research costs, large cloud commitments and acquisitions are driving the need for more capital. While Databricks still plans to go public eventually, it is currently focused on investing heavily in AI.
