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Databricks’ $5B raise
Databricks closed a $5 billion strategic funding round at a $190 billion valuation, with the data and artificial intelligence software company saying it is using the capital to expand investments in products that help businesses build and manage AI applications.
“Databricks said on Thursday it had raised $5 billion at a $190 billion valuation”
The company said it surpassed a $7 billion annualized revenue run-rate and posted more than 80% year-over-year revenue growth in the second quarter, while remaining cash-flow positive on an adjusted basis over the last 12 months.
Databricks said the round was led by existing investors Coatue, Blackstone, MGX and accounts advised by T. Rowe Price, along with new investor Sixth Street Growth.
In a statement, CEO Ali Ghodsi said, “Enterprises don’t just want AI that talks. They want agents working across their business that remember context, deliver accurate answers, and execute work without blowing through their budgets.”
Databricks also said its Lakebase product has exceeded a $100 million revenue run-rate and its Lakehouse data warehousing business surpassed a $1.5 billion revenue run-rate.
Investors, products, momentum
The funding round follows Databricks’ earlier disclosures that it was raising at a $188 billion valuation and expected the round to close by the end of summer, with the company describing the move as part of continued development for Lakebase, Genie, and Unity AI Gateway.
Databricks said it will use the new funding to support continued development of its serverless Postgres database for AI agents, Lakebase; its AI coworker, Genie; and its gateway for multi-AI governance and cost controls, Unity AI Gateway.
In a separate account of the same deal, CNBC reported that Ghodsi told Jon Fortt on Thursday that “demand is crazy.” on “Squawk on the Street,” as Databricks framed the market shift toward AI agents.
Databricks also disclosed that it has more than 1,000 customers spending more than $1 million a year on its products and services and more than 100 customers doing so at more than $10 million a year.
The company’s product push is tied to enterprise governance and cost control, with Databricks describing Unity AI Gateway as a tool that helps control model use and costs.
Why it matters for business
Databricks’ latest funding and performance disclosures position the company as a platform for enterprise AI agents, with the company tying its strategy to real-time operational data with Lakebase, context from across the business with Genie, and multi-AI cost controls with Unity AI Gateway.
“The tremendous investor demand for this round shows that our AI strategy is winning the market”
In the same statement, Ghodsi said the “tremendous investor demand for this round shows that our AI strategy is winning the market and building what every business needs to maximize their impact with agents,” linking the financing directly to its enterprise push.
The company also said its Lakebase database has already exceeded a $100 million revenue run-rate and that Lakehouse has exceeded a $1.5 billion revenue run-rate, while reporting growth above 80% year-over-year in the second quarter.
TechCrunch reported that Ghodsi said Databricks wanted to raise $1 billion but that “The interest level was just insane,” adding that investors showed $15 billion of interest from a select group.
For Databricks, the business stakes include continued investment in AI infrastructure and product development, with the company stating it would use the proceeds to invest in products including its Lakebase database, Genie AI assistant and Unity AI Gateway platform.
