Databricks Seeks $5 Billion Funding Round at $134 Billion Valuation Amid AI Boom

Databricks reportedly in talks to raise $5B at $134B valuation - SiliconANGLE

Data analytics and artificial intelligence company Databricks Inc. is reportedly in talks to raise $5 billion in new funding on a $134 billion valuation. The new funding, if it should happen, would come after Databricks previously raised funding on a $100 billion valuation in August. The valuation of the round is roughly 32 times the company's expected sales of $4.1 billion next year, according to Reuters and comes at a time when enterprise demand for Databricks' platform continues to grow as organizations expand their use of generative AI, machine learning and real-time analytics. Founded in 2013, Databricks offers cloud-based data and artificial intelligence software that gives organizations a unified platform for data engineering, analytics and machine learning. The company's core platform is designed to replace fragmented data stacks with a single environment where data teams can work from raw ingestion through to advanced analytics. Databricks' "Lakehouse" architecture combines the low-cost storage of data lakes with the performance and management features of traditional data warehouses. The approach allows organizations to store structured and unstructured data in one place while supporting SQL analytics, real-time streaming and large-scale batch processing. Besides analytics, Databricks also offers a platform for enterprise AI and machine learning, with tools that support full lifecycle AI development, including feature engineering, model training, evaluation and deployment. As noted when Databricks previously raised funding in August, the company has been locked in a duel with rival Snowflake Inc. for supremacy in AI development, but unlike Snowflake, has resisted pressure to go public. If it did eventually go public, the offering would be likely well received, as long as the current argued AI-driven boom in equity markets doesn't bust. While best known for its analytics, Databricks' topline growth is being driven by organizations expanding their use of generative AI and machine learning. While AI may be the key driver of growth at Databricks, it's also putting pressure on its margins, with the company reportedly having told investors its gross margin is falling faster than anticipated, to 74% compared to an earlier plan for 77%, due to increasing usage of its AI products. Databricks has more than 20,000 customers. Notable Databricks customers include OpenAI Group PBC, Block Inc., Shell plc, Siemens AG, Toyota Motor Corp., AT&T Inc., Walgreens Boots Alliance Inc. and Rivian Automotive Inc.. Coming into the potential new funding, Databricks has previously raised approximately $15.7 billion over 15 rounds, according to data from Tracxn. Investors in the company include Andreessen Horowitz, Insight Partners LP, MGX Capital, Thrive Capital Management, WCM Investment Management, The Blackstone Group Inc., Apollo Global Management Inc., Blue Owl Capital Inc., J P Morgan Chase & Co., Barclays plc, Citigroup Inc., Goldman Sachs Group Inc. and Morgan Stanley.

What AI Bubble? Databricks Is in Talks to Fundraise at a $134 Billion Valuation

According to a report in The Information, the software company Databricks is currently in talks with investors to raise $5 billion at a $134 valuation. The San Francisco-based firm launched in 2013 as a data analytics platform and more recently has focused on developing AI agents that can streamline companies' internal processes. It has more than 15,000 clients, including government agencies, the NBA, and major firms such as AT&T and Shell. Databricks is hardly the only AI firm posting eye-popping valuation numbers. Snowflake (NYSE: SNOW) has a market capitalization of about $85 billion. CoreWeave's (Nasdaq: CRWV) market cap sits at about $38 billion. As of this summer, Databricks had raised $19.66 billion, according to PitchBook. In August, the company announced it was raising a series K round that would push its valuation over $100 billion. New reports of an even higher valuation have added to buzz that the company could be preparing for an IPO in 2026.

Databricks In Talks To Raise $5 Billion At A Massive $134 Billion Valuation Amid Explosive Sales Growth - NVIDIA (NASDAQ:NVDA), Palantir Technologies (NASDAQ:PLTR)

Databricks is turning heads amid reports of a major new funding round following strong sales growth over the course of this year. Massive Valuation Surge The fast-growing AI and data analytics firm is looking to raise $5 billion in its latest funding round, at a massive valuation of $134 billion, according to a report by The Information. This comes just a few months after the company closed its Series K round, raising $1 billion, at a $100 billion valuation in September. With the company on track to hit $4 billion in annualized revenue this year, the latest round values it 32 times sales. See Also: OpenAI's Partners Rake Up $96 Billion Debt as AI Industry's Borrowing Trend Escalates The new round would catapult Databricks' valuation by 116% this year, up from, $62 billion during its Series J round in December last year. The company has revised its sales outlook for the year from $3.8 billion to $4.0 billion, before raising it again. As a result, it is set to post a 55% year-over-year increase in sales, underscoring the unrelenting demand for AI and automation. It currently counts over 20,000 customers using its platform. Databricks The New 'GOAT' of AI? Recently, short seller Citron Research has pointed out that Databricks is running circles around Palantir Technologies Inc. (NASDAQ:PLTR), which was dubbed "the Messi of AI" by analyst Dan Ives, of Wedbush Securities. This comes as the company outperforms Palantir across several key metrics such as growth, customer count and more. Earlier this year, Palantir itself inked a strategic partnership with Databricks to merge its AI operating platform with the latter's AI, data warehousing, and data engineering solutions. While this new funding round pushes the company's much-awaited IPO further down the road, it already has the backing of several prominent investors, including Cathie Wood's Ark Venture Fund, NVIDIA Corp. (NASDAQ:NVDA) and former Speaker of the House Nancy Pelosi (D-Calif.), who are all now sitting on significant gains. Databricks did not immediately respond to Benzinga's requests for a comment on this matter. This story will be updated as soon as we receive a response. Photo Courtesy: bluestork on Shutterstock.com Read More: Elon Musk Predicts 'People Don't Have To Work At All' In 20 Years As AI and Robotics Advance: It Will Be Like A 'Hobby' NVDANVIDIA Corp$176.63-0.21%OverviewPLTRPalantir Technologies Inc$169.030.34%Market News and Data brought to you by Benzinga APIs