Databricks to buy AI startup MosaicML for $1.6bn

Will help users to build and train models using their own data, Databricks says

Data infrastructure vendor Databricks has struck a deal to acquire generative AI platform vendor MosaicML for approximately $1.3 billion, Databricks said on Monday.

With the acquisition, Databricks will provide customers with the ability to "build, own and secure generative AI models with their own data," according to a company statement.

"Every organisation should be able to benefit from the AI revolution with more control over how their data is used. Databricks and MosaicML have an incredible opportunity to democratise AI and make the lakehouse the best place to build generative AI and LLMs [large language models]," said Ali Ghodsi, Databricks co-founder and CEO, in the statement.

"Databricks and MosaicML's shared vision, rooted in transparency and a history of open-source contributions, will deliver value to our customers as they navigate the biggest computing revolution of our time," Ghodsi said.

Databricks is holding its Data + AI Summit conference in San Francisco this week, where the MosaicML acquisition is sure to be a hot topic of discussion.

Databricks has become one of the leading companies in the big data space with its Databricks Lakehouse Platform that provides businesses and organisations with a foundation for data lake, data warehouse and machine learning systems, offering a range of capabilities spanning data governance, data engineering, data science, data sharing and data streaming.

Databricks is already in the process of acquiring Okera, a developer of data governance technology, for an undisclosed sum. The two companies announced the deal on 3rd May.

MosaicML was founded in 2021 and, like Databricks, is headquartered in San Francisco. The startup is known for its MPT (multitask prompt tuning) large language models that organisations use to quickly build and train state-of-the-art models while cost-effectively using their own data, according to Databricks.

MosaicML says that automatic optimisation of model training provides two to seven-times faster training compared to standard approaches. The combination of Databricks and MosaicML will help customers retain control, security and ownership of their data, according to Databricks.

"At MosaicML, we believe in a world where everyone is empowered to build and train their own models, imbued with their own opinions and viewpoints — and joining forces with Databricks will help us make that belief a reality," said Naveen Rao, MosaicML co-founder and CEO, in a statement.

"We started MosaicML to solve the hard engineering and research problems necessary to make large scale training more accessible to everyone. With the recent generative AI wave, this mission has taken centre stage."

Databricks said MosaicML's platform will be "supported, scaled and integrated over time to offer customers a seamless unified platform" they can use to build, own and secure their generative AI models.

Databricks said the entire MosaicML team, including its machine learning and neural networks specialists, is expected to join Databricks once the acquisition closes. The $1.3 billion price tag is inclusive of retention packages, the companies said.

The companies said the acquisition, which is subject to customary closing conditions and regulatory clearances, should be completed by the end of July.

This article was first published in CRN.