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NVIDIA-backed Databricks raises huge $500M in pre-IPO round at $43B valuation

Databricks team
Picture credits: Databricks

Enterprise data and AI have gained significant prominence in numerous business strategies. San Francisco-based company Databricks recently disclosed a substantial funding round, exceeding $500 million in value, identified as Series I. This valuation places the company at an impressive worth of $43 billion. This funding follows a substantial $1.6 billion round raised in 2021.

T. Rowe Price spearheaded this latest investment, joined by existing investors such as NVIDIA (known for recent backing of AI21 Labs and Serve Robotics), Capital One Ventures, Ontario Teachers, Andreessen Horowitz, Baillie Gifford, ClearBridge Investments, Counterpoint Global (Morgan Stanley), Fidelity, Franklin Templeton, GIC, Octahedron Capital, and Tiger Global.

The Series I funding round for Databricks not only infuses capital for strategic moves but also positions itself as both a pre-IPO financing round and a strategic investment, setting a share price of $73.50 for the IPO in a subsequent stage.

“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 Ali Ghodsi, Co-Founder and CEO of Databricks. “Databricks and NVIDIA are building transformative AI technology, and we’re excited about the business value and innovation we can bring to our customers.”

“Enterprise data is a goldmine for generative AI,” said Jensen Huang, founder and CEO of NVIDIA. “Databricks is doing incredible work with NVIDIA technology to accelerate data processing and generative AI models.”

“Data and AI have rapidly become the centerpiece of many business strategies. Databricks has not only pioneered the Lakehouse category with a world-class team and product, but it is now also at the forefront of Generative AI for the enterprise. We’re proud to extend our investment at such a pivotal time for the company, its customers, and the data and AI industry,” said Alan Tu, Lead Private Equity Analyst, T. Rowe Price Associates, Inc.

Unified data and AI workflows

Many organisations grapple with a common challenge: effectively managing vast amounts of sensitive data to derive meaningful insights securely. Data engineers and security teams often encounter difficulties in providing data scientists and analysts with timely data access to advance AI initiatives, all whilst ensuring consistent policy management, data governance, and adherence to security measures.

In 2013, Databricks was established in San Francisco by co-founders Ali Ghodsi, Andy Konwinski, Ion Stoica, Patrick Wendell, Reynold Xin, and Matei Zaharia—an entrepreneur from Romania. Databricks is on a mission to assist data teams in addressing the security challenges that AI and data initiatives face on a global scale.

The focal point of their efforts is the Unified Analytics Platform, designed with a security-first approach, seamlessly integrating data and machine learning while prioritising top-notch security on trusted clouds. This integration accelerates innovation while mitigating risks associated with data handling.

Databricks Lakehouse consolidates data, analytics, and AI on a single platform, enabling customers to effectively govern, manage, and draw insights from enterprise data. This consolidated approach expedites the development of generative AI solutions for customers.

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