Databricks seeks new funding that could push its value to $43b

Databricks is one of the fastest growing companies in Silicon Valley

Databricks is in discussions with T Rowe Price, a global investment management company, about a new round of funding that could boost the valuation of the data lakehouse and AI platform developer to $43 billion, according to a published report.

A spokesperson for Databricks declined to comment on the Bloomberg report, which described the talks as "preliminary" and said the parties could still fail to reach a deal.

San Francisco-based Databricks is one of the fastest growing companies in the Silicon Valley/Bay Area region and one of the fastest growing in the history of the IT industry.

Databricks raised $1 billion in a series G funding round in February 2021 that put the company's valuation at $28 billion and then raised another $1.6 billion in a series H round in August 2021 that further boosted the company's valuation to $38 billion.

Altogether, Databricks has raised some $3.5 billion in funding. T Rowe Price was a participant in earlier Databricks' funding rounds including the blockbuster Series G and H rounds.

While many observers in 2020 and 2021 anticipated an initial public offering from Databricks - possibly in 2022 or this year - those plans were put on hold in the wake of the stock market slide last year, the worst year for US stocks since 2008.

Databricks CEO Ali Ghodsi told Bloomberg that the company was "well-capitalised" and didn't require additional funding, but could consider a new funding round "for strategic reasons."

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Through its Databricks Ventures arm, Databricks has itself been an investor in more than a dozen startups including data security tech developer Immuta; data transformation platform provider dbt Labs; behavioural data analytics software developer Snowplow; and machine learning feature platform company Tectonics.

The company also has made several acquisitions recently, including its May acquisition of data governance tech developer Okera for an undisclosed sum and its $1.3 billion acquisition of generative AI platform vendor MosaicML in July.

In June, Bloomberg reported that Databricks' revenue surpassed $1 billion in its fiscal year ended 31st January - up 60% from the previous year. As a privately held company Databricks does not disclose detailed sales and profit numbers.

This story was first published in CRN.