Databricks Reaches $28B Valuation After Oversubscribed $1B Raise
Data and AI company Databricks raises $1 billion in a Series G round, pushing its valuation to $28 billion as it surpasses $425 million in annual recurring revenue.
Databricks raises $1 billion in a Series G round that pushes its private valuation to an impressive $28 billion. The funding round, led by Franklin Templeton, features a massive roster of participants including new investors like Fidelity and Whale Rock, alongside major cloud vendors such as AWS, Alphabet's CapitalG, and Salesforce Ventures. The company initially targets a modest $200 million raise but expands the round due to overwhelming investor demand, ultimately turning away additional capital after capping the round at $1 billion.
This massive valuation milestone occurs as Databricks surpasses $425 million in annual recurring revenue by offering its open-source data products as cloud services. The company makes its mark with a core data lake product called Delta Lake and is currently promoting a broader Lakehouse concept. With this new private valuation, Databricks easily exceeds the public market valuation of its competitor Snowflake, demonstrating the immense value investors place on modern data infrastructure.
Databricks plans to use the extra $800 million it raised for strategic mergers and acquisitions with a focus on acquiring talent, advancing its Lakehouse concept, and funding international expansion. The investor group for this round is a deliberate mix of cloud partners, public market investors preparing for the company's eventual IPO, and private equity firms seeking significant markups from earlier investment stages.