Databricks, the data and AI company founded by the original creators of Apache Spark, Delta Lake, and MLflow, has raised over $500 million in Series I funding. The massive round values Databricks at $43 billion and saw participation from new investors including Capital One Ventures, Ontario Teachers’ Pension Plan, and NVIDIA.
Led by T. Rowe Price Associates, the funding comes on the heels of a milestone second quarter for Databricks, which crossed $1.5 billion in annual recurring revenue. Databricks also reported 50% year-over-year growth, its strongest quarterly incremental revenue growth to date.
The substantial investment signals continued momentum for Databricks as it aims to cement its position as a leader in the data lakehouse space. It also points to major growth opportunities in applying its technology to power enterprise AI and generative AI applications.
“The commitment from long-term focused strategic and financial partners reflects Databricks’ continued momentum, the rapid customer adoption of the Databricks Lakehouse, and the success customers are seeing from moving to a unified data and AI platform,” said Databricks CEO Ali Ghodsi.
The Databricks Lakehouse platform combines data management, analytics, and AI capabilities into a single cloud-based service. This allows organizations to manage data of any variety in one location and then leverage it for tasks like BI analytics, data science, and machine learning.
Databricks is now building on the Lakehouse with capabilities for no-code AI and generative AI. Its acquisition of MosaicML earlier this year gave it technology to boost training and deployment of deep learning models. Meanwhile, its partnership with NVIDIA aims to optimize Databricks for generative AI use cases.
“Enterprise data is a goldmine for generative AI,” noted NVIDIA founder and CEO Jensen Huang. “Databricks is doing incredible work with NVIDIA technology to accelerate data processing and generative AI models.”
The successful funding round indicates investor confidence in Databricks’ strategic direction. With over 10,000 customers already on board, including more than 300 large enterprises, Databricks is cementing its position as a core data and AI provider.
Its Lakehouse offering simplifies data and analytics architectures that traditionally involved multiple disconnected tools. Meanwhile, its investments in AI aim to help customers build next-generation services powered by techniques like neural networks and deep learning.
The substantial late-stage funding secured by Databricks could likely serve as both a pre-IPO round to boost its valuation ahead of a planned public offering, as well as a strategic investment by key partners. The participation of NVIDIA points to close product integration and collaboration between the two companies, while T. Rowe Price and Ontario Teacher's deep pockets signal confidence in Databricks' financial future.
Speaking with Forbes, Ghodsi was quick to point out that the company is "paying close attention to the September IPOs of Arm and Instacart" but that Databricks "won’t be among the first movers in the newly resurrected IPO market".
As organizations increasingly realize the potential of their data, Databricks appears poised to play a central role in extracting value through analytics and AI. With strong revenue growth and $1.5 billion in recurring revenue already achieved, the latest funding round will provide fuel for Databricks to continue its rapid ascent.