Databricks, a leading enterprise AI firm specializing in data analytics and AI software, has secured $8.6 billion in funding as part of a larger $10 billion round. The funding round, led by Thrive Capital, values the company at $62 billion and highlights the growing demand for AI-driven business solutions. The investment comes at a time when businesses across various industries, from healthcare to financial services, are increasingly looking to integrate AI capabilities into their operations while maintaining control over their data infrastructure.
The round also saw participation from several existing investors, including Andreessen Horowitz, DST Global, GIC, Insight Partners, and WCM Investment Management, as well as new investors like ICONIQ Growth, MGX, Sands Capital, and Wellington Management. Notably, Ontario Teachers’ Pension Plan also continued its investment in the company. The capital raised will support Databricks’ ongoing product development, acquisitions, and international expansion, while also providing liquidity for current and former employees, including covering related tax obligations.
Databricks is focused on providing data solutions to enterprises through its Data Intelligence Platform, which combines data warehousing with machine learning capabilities. The platform enables companies to build AI applications by organizing and processing large volumes of data. Its open-source foundation allows developers to modify the underlying code, giving customers more control over their data and processes. This flexibility has made Databricks a preferred choice for companies across sectors, including healthcare, financial services, and climate technology. The platform is used by organizations such as Block, Comcast, Condé Nast, Rivian, and Shell, helping them innovate in areas such as disease detection, pharmaceutical development, fraud prevention, and climate change solutions.
The company reported significant growth, including a 60% year-on-year revenue increase for Q3 2024. Its data warehousing product, Databricks SQL, reached a $600 million revenue run rate, marking a 150% growth from the previous year. These financial metrics reflect the company’s strong market position, with Databricks now serving over 500 customers who each spend more than $1 million annually. Additionally, the company maintains subscription gross margins above 80%, highlighting its profitability and operational efficiency.
As part of its global expansion, Databricks has opened regional offices in London to serve European customers and Singapore to cater to the Asia Pacific market. The latest funding round will enable the company to further expand into Latin America and the Middle East, as demand for enterprise AI infrastructure continues to grow globally. Databricks expects to achieve positive free cash flow by the end of Q4 2024, as it works to build long-term value for its customers.
Founded by the creators of several open-source data projects, including Lakehouse, Apache Spark, Delta Lake, and MLflow, Databricks has become a key player in modern data infrastructure. Its technologies help companies process vast amounts of data, ensure reliable data storage, and manage the entire machine learning development cycle, from training to deployment. With its vision of democratizing data and AI, Databricks is well-positioned for continued growth in the enterprise AI space.