Databricks raises USD $4bn, valued at USD $134bn

Databricks has secured more than USD $4 billion in new funding at a valuation of USD $134 billion, in one of the largest late-stage financings for an artificial intelligence and data infrastructure company.

The Series L round comes as the San Francisco-based group reports a revenue run-rate of USD $4.8 billion and says it has grown revenue by more than 55% year on year. The company reported positive free cash flow over the past 12 months.

Databricks said the new capital would back its push around three core products. These are its Lakebase database, its Databricks Apps user interface layer, and its Agent Bricks product for building software agents.

The investment values Databricks at a higher level than many listed software peers and reflects continuing investor demand for companies linked to generative AI infrastructure and tools.

The round is led by Insight Partners, Fidelity Management & Research Company, and J.P. Morgan Asset Management. Other investors include Andreessen Horowitz, funds and accounts managed by BlackRock, funds managed by Blackstone, Coatue, GIC, MGX, NEA, Ontario Teachers Pension Plan, Robinhood Ventures, accounts advised by T. Rowe Price Associates, Temasek, Thrive Capital and Winslow Capital.

Databricks said the funding would also provide liquidity for employees. It also plans to allocate capital for potential AI-focused acquisitions and expanded AI research.

Financial trajectory

The company said its data warehousing business has reached a revenue run-rate of more than USD $1 billion. Its AI products have also reached a revenue run-rate of more than USD $1 billion.

Databricks said Lakebase has thousands of customers within its first six months. It said revenue from Lakebase is growing at twice the pace of its data warehousing product.

The company said its data warehousing product reached a revenue run-rate of more than USD $1 billion in less than four years from general availability. It reported a net retention rate above 140% and said more than 700 customers now each generate over USD $1 million in annual revenue run-rate.

Databricks positions itself as a data and AI platform provider for large enterprises and digital-native businesses. It said more than 20,000 organisations use its products, including over 60% of the Fortune 500.

AI product focus

Databricks plans to expand development across three strategic products that underpin its approach to what it calls data intelligent applications. These are Lakebase, Databricks Apps and Agent Bricks.

Lakebase is a serverless Postgres database that Databricks describes as purpose-built for the age of AI. Databricks Apps is a product for building and deploying data and AI applications. Agent Bricks is a product for building and scaling software agents that run on customer data.

The company said trends such as generative AI and new coding approaches are driving demand for these data intelligent applications inside enterprises.

Ali Ghodsi, Co-founder and Chief Executive of Databricks, said customers are changing how they design and deploy applications.

"Enterprises are rapidly reimagining how they build intelligent applications, and the convergence of generative AI with new coding paradigms is opening the door to entirely new workloads. With this investment, we're deepening our commitment to help every organisation innovate with AI on their own data," said Ali Ghodsi, co-founder and CEO of Databricks. "By anchoring transactional data in Lakebase, delivering intuitive experiences through Databricks Apps, and enabling advanced multi-agent systems with Agent Bricks, we're giving customers a unified foundation to build trusted, high-performance data intelligent applications at scale."

Databricks said the additional funding builds on its financial performance and aligns with its aim of making data and AI accessible to a broad range of organisations.

Investor backing

Insight Partners is one of the lead investors in the round and is a long-standing backer of Databricks.

"Our continued investment in Databricks reflects our deep conviction in their extraordinary momentum today and their ambitious vision for the future," said John Wolff, Managing Director at Insight Partners. "Databricks leads the way in turning AI innovation into enterprise impact. We're thrilled to deepen our investment in a team that continues to pair strong financial performance with real customer results, setting the standard for how AI creates value for businesses. Databricks is just getting started."

Databricks said it would continue to expand its unified data intelligence platform, which includes Agent Bricks, Lakeflow, Lakehouse, Lakebase and Unity Catalog, as it targets wider adoption of AI applications, analytics and agents among global enterprises.