atabricks recently secured the largest venture capital funding round in history, $10 billion, raising the Databricks valuation to $62 billion. This Databricks achievement
indicates that the fest-growing private companies powered by artificial intelligence technology have become increasingly popular for investors.
Thrive Capital has guided this overloaded funding round and successfully captivated various elite investors such as Andreessen Horowitz, DST Global, GIC, Insight Partners, and others. It should be mentioned that along with these investors, ICONIQ Growth, MGC, Sands Capital, and Wellington Management, which are relatively new investors have also participated in the recent VC funding round focused on AI development.
According to various sources, Databricks AI company is expected to accomplish for the first a positive free cash flow in the first quarter which is planned to end on January 31st. Also, the AI company anticipates that it will successfully achieve a $3 billion revenue run rate in early next year. However, for the following fiscal year, the goal is to generate about $3.8 billion in revenue.
The majority of the recent founding round that raised the Databricks valuation will be distributed in order to allow employees to consume their stocks, which represents an important component of the startup compensation that expires after a fixed period.
However, according to the co-founder and CEO of Databricks AI, Ali Ghodsi, the remaining funds from the VC funding round are going to be used to recruit top talents in artificial intelligence technology, develop new AI products, and also explore potential acquisitions. After becoming the CEO of Databricks back in 2016, Ali Ghodsi tried to transform the entire business by introducing a paid version of the existing software which has been offered for free initially.
Also about two years ago, in order to respond to inventors' demands for better efficiency, he reduced the hiring and supported its engineers to create a new artificial intelligence-powered robot to enhance the productivity of the AI company.
The CEO of Databricks AI accredited the company with a milestone of achieving a positive cash flow, which is part of its strategy of slowing headcount growth while revenue surged. Databricks AI is currently seen as a strong candidate for the public market, but this VC funding round manages to relieve the pressure for a quick liquidity event, which could delay the much-anticipated IPO.
"The company, I believe, will be a public company for the majority of its lifetime. And it's not if, it's a when. The absolute theoretically earliest we could do it would be next year, but we have some flexibility now. The thing that is top of mind for management and me is providing liquidity opportunities to the employees,", the CEO, Ali Ghodsi stated for Reuters.
The largest VC funding round in history managed to exceed the recent OpenAI funding round of $6.6 billion in October. These can reflect the fact that the market holds a significant desire for companies that are focused on streamlining artificial intelligence integration.
With about 7,000 employees, Databricks AI company was founded in 2013 by the Swedish American Ali Ghodi, the current CEO, two Romanians Matei Zaharia and Ion Stoica along with the computer scientist Reynold Xin. Databricks AI represents a leading company in artificial intelligence technology and data analytics, which provides an integrated platform for machine learning, data engineering, and analytics.
Subscribe to our newsletter
Currently, the top competitor of Databricks AI company is Snowflake, since these two companies are offering similar features and capabilities. It should be mentioned that Databricks company is not owned by Microsoft as some believe states, and it represents an independent company that only shares a close collaboration with the giant Microsoft.
"Databricks is one of the iconic private tech companies that we think are poised to become the next platforms. And in technology, the platforms have shown that as they get bigger, they get better, and there are more advantages to scale,", the partner at Thrive Capital, Vince Hankes stated.
Also, according to Inside Partners, which represents the returning investors that contributed to one of the largest investments this year about $1 billion, the generative AI adoption remains a key accelerator of Databricks AI's next phase of growth.
"The world is now needing to be able to process more unstructured data than we've ever had to prior. The exponential demand for enterprise-grade data management, analytics, and AI systems underpins the seminal role Databricks plays in empowering organizations to unlock the full potential of their data,", the managing director at Insight Partners, George Matthew stated about Databricks AI.
By
Adam Brown
•
December 18, 2024 9:40 AM
.webp)
.webp)
