Databricks, the San Francisco-based company known for its efficient cloud-based Apache Spark big data platform, has raised $500 million in a growth round of funding. The funding round, known as Series I, included investments from GPU giant Nvidia and valued Databricks at an impressive $43 billion.
Although Databricks has expressed its desire to go public, volatile market conditions have prevented it from doing so. Databricks CEO Ali Ghodsi explained that the closure of the markets due to factors like inflation and bank runs has hindered their plans for an initial public offering (IPO). Ghodsi stated, If they had not been closed, we would have already been public.
Despite the challenges posed by the market, Databricks has continued to gain momentum. The company initially gained popularity for its ability to efficiently handle Spark workloads in the cloud, and has since expanded its offerings to include artificial intelligence (AI) applications. Databricks envisions the newly acquired MosaicML, a GenAI company, as an AI factory that can produce models in bulk at a fraction of the cost.
The Series I funding round was led by T. Rowe Price Associates and saw participation from existing investors such as Andreeson Horowitz, as well as new investors including Capital One Ventures. Notably, Nvidia’s involvement is significant as Databricks relies on Nvidia’s GPUs for training AI models. Jensen Huang, the founder and CEO of Nvidia, commended Databricks’ work with Nvidia technology in accelerating data processing and generative AI models.
Databricks also shared some impressive figures about its revenue growth. The company has crossed the $1.5 billion revenue run rate, a remarkable achievement considering its recent crossing of the $1 billion annual run rate. Additionally, Databricks boasts over 10,000 customers, including more than 300 who spend at least $1 million per year with the company.
While the $500 million investment in this funding round may seem substantial, it falls short of Databricks’ previous funding rounds. The company raised $1.6 billion in its last round in August 2021, and just six months prior to that, it secured $1 billion in funding in the Series G round.
With the latest funding round, Databricks’ valuation has reached an impressive $43 billion, up from $38 billion just a few months ago. Databricks has now established a price per share of $73.50 through the Series I round. These developments indicate the company’s strong growth trajectory and raise speculation about its future plans, including a potential public offering.
In conclusion, Databricks’ successful funding round and increased valuation reflect its growing prominence in the big data and AI space. Despite the current market challenges, Databricks continues to expand its customer base and revenue, thanks to its innovative solutions and strategic partnerships. As the company strives towards its eventual IPO, it remains a prominent player in the industry, attracting investments from major players like Nvidia and Capital One Ventures.