Databricks raises USD $10 billion, valued at USD $62 billion now

Databricks has announced its Series J funding round, securing an anticipated total of USD $10 billion in non-dilutive financing with USD $8.6 billion already completed.

The funding round values the data and AI company at USD $62 billion and is led by Thrive Capital. Co-leading the round are Andreessen Horowitz, DST Global, GIC, Insight Partners, and WCM Investment Management, among other notable participants like Ontario Teachers' Pension Plan, ICONIQ Growth, MGX, Sands Capital, and Wellington Management.

Databricks plans to utilise the investment for developing new AI products, executing acquisitions, and significantly expanding its international go-to-market operations. Part of the funds is also earmarked for providing liquidity to current and former employees and covering related tax obligations. Importantly, this quarter, for the first time, the company is expected to achieve positive free cash flow.

Ali Ghodsi, Co-Founder and CEO of Databricks, commented, "We were substantially oversubscribed with this round and are super excited to bring on some of the world's most well-known investors who have a deep conviction in our vision. These are still the early days of AI. We are positioning the Databricks Data Intelligence Platform to deliver long-term value for our customers and our team is committed to helping companies across every industry build data intelligence. We're building transformative data and AI infrastructure and excited to move aggressively in service of our customers and their success."

The Databricks Data Intelligence Platform is designed to make data and AI accessible, enabling organisations to utilise data more effectively for analytics, machine learning, and AI applications. Its open-source foundation assists companies in driving innovation to increase revenue, lower costs, and reduce risks. Organisations use the platform in various ways, such as advancing medical research, combating climate change, detecting financial fraud, speeding up pharmaceutical development, and addressing financial inequalities.

Joshua Kushner, CEO of Thrive Capital, expressed positive sentiments regarding the partnership: "Databricks, driven by its mission to democratise data and AI, has emerged as the platform of choice. We have witnessed the team's unrelenting execution, and consider it an honour to be partners with the company for the long term."

Recent developments highlight Databricks' growth trajectory, including an over 60% year-over-year increase in the third quarter ending 31 October 2024. The company expects to surpass a USD $3 billion revenue run-rate and achieve non-GAAP subscription gross margins above 80% while maintaining over 500 customers contributing more than USD $1 million in annual revenue run-rate. Additionally, its Databricks SQL product has reached a USD $600 million revenue run rate, marking a 150% year-over-year growth.

To support its expanding global operations, Databricks has launched a new European hub in London and an Asia Pacific and Japan regional hub in Singapore, along with an expanded presence in Latin America and the Middle East.