Databricks Seeks $43 Billion Valuation, Riding AI Trend for Funding Boost

Data and AI company Databricks is in early-stage funding discussions with T. Rowe Price, targeting a valuation of $43 billion, a substantial increase from its $38 billion valuation two years ago.
Databricks plans to secure new funding that would drive its valuation to $43 billion, up from the $38 billion valuation achieved two years ago with Counterpoint Global's lead investment. The company's focus lies in offering data, analytics, and AI services to businesses.
Although Databricks CEO Ali Ghodsi recently affirmed the company's sound financial position, he mentioned strategic consideration for potential funding. He stated, "Our discussions with investors have been ongoing, and we have received numerous investment requests." However, he clarified that there's no set IPO schedule.
Databricks has been a rival to $Snowflake(SNOW.US)$ and has contemplated an IPO. The company secured $1.6 billion in a Series H investment in August 2021, valuing it at $38 billion. In an earlier Series G round, Databricks raised $1 billion, attracting support from $Amazon(AMZN.US)$ , $Alphabet-A(GOOGL.US)$ , and $Salesforce(CRM.US)$ .
$Microsoft(MSFT.US)$ invested in Databricks in 2019, fostering a partnership for Azure Databricks and enhancing Microsoft's cloud strategy. This transformed Microsoft's cloud product positioning, boosting Databricks' growth trajectory.
Databricks' future looks promising with plans to launch the Dolly language model and its $1 billion annual revenue milestone. The company's acquisition of generative AI platform MosaicML further underscores its growth strategy.
The IPO timing aligns well, riding the wave of strong sentiment around AI leader $NVIDIA(NVDA.US)$ 's quarterly performance. The anticipation of Arm's listing, coupled with Databricks' AI focus, positions both companies to attract significant investor interest, despite differing valuations.