Key facts
- Databricks raised $5 billion in its latest funding round.
- The company's valuation reached $190 billion.
- Investor demand for the round exceeded $15 billion.
- Databricks reported $7 billion in annualized run rate revenue, growing at 80%.
- The company's core cloud data warehouse product has a $1.5 billion run-rate, growing at 100% year-over-year.
- Databricks' Lakebase product has hit a $100 million revenue run-rate.
AI big-data company Databricks has secured $5 billion in funding at a $190 billion valuation, significantly surpassing its initial $1 billion target due to overwhelming investor interest. CEO Ali Ghodsi stated that a published report about the fundraising led to a surge of calls from investors, resulting in $15 billion in demand.
Databricks decided to issue more stock to accommodate its long-term backers, ultimately closing the round at a $190 billion valuation, up from a previously announced $188 billion. The round was led by Coatue and included participation from Blackstone, MGX, various T. Rowe Price accounts, and new investor Sixth Street Growth.
Ghodsi attributed the strong investor appetite to Databricks' financial performance, with $7 billion in annualized run rate revenue growing at 80%, and its core cloud data warehouse product generating $1.5 billion in run-rate revenue with 100% year-over-year growth. The company's AI initiatives, including its Lakebase product and AI chatbot Genie, are also contributing to its success.
Despite strong business performance, Databricks raised substantial capital due to the high costs associated with AI research and significant cloud commitments with major hyperscalers. The company also continues to pursue mergers and acquisitions, having recently acquired Electric and Panther, among other startups. While Databricks has raised over $20 billion in the past 20 months, Ghodsi still intends to take the company public eventually.