December 18, 2024 – AI unicorn Databricks has secured a 10billionfundinground,elevatingitsvaluationtoanimpressive62 billion, marking one of the largest venture capital investments in history.
According to recent reports, Databricks is on track to achieve positive free cash flow by the end of January 2024, with projections indicating an annualized revenue exceeding 3billionbythattime.Thecompanyfurtheranticipatesreaching3.8 billion in revenue for the upcoming fiscal year.
Ali Ghodsi, Databricks’ co-founder and CEO, revealed that the additional funds will be utilized for attracting leading AI talents, investing in innovative AI products, and financing potential mergers and acquisitions of startups. The company’s ability to maintain positive cash flow while experiencing rapid revenue growth is attributed to its strategic decision to slow down employee expansion and outsource certain positions to lower-cost regions.
Although Databricks is widely seen as a potential candidate for a future public listing, this latest funding round provides the company with greater flexibility, allowing it to postpone an Initial Public Offering (IPO). Ghodsi stated, “We believe that this company will eventually be publicly listed. The question of ‘when’ is more important than ‘if’. Theoretically, it could happen next year, but we now have some flexibility. For management, our top priority is providing liquidity opportunities for our employees.”
The funding raised by Databricks surpasses the $6.6 billion secured by OpenAI in October, reflecting the soaring demand for enterprises that simplify AI applications. This trend has propelled the valuations of startups like Microsoft-backed OpenAI and Elon Musk’s xAI.
Headquartered in San Francisco, Databricks provides data analytics services to 10,000 clients, including Jack Dorsey’s payment company Block, telecommunications giant Comcast, electric vehicle manufacturer Rivian, and energy company Shell. With a staff of 7,000, the company is now competing with Snowflake, which has a market capitalization of approximately $57 billion.
