6 things to know about Databricks, the AI ​​startup that just raised a record fundraising round

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Databricks just raised $10 billion, more than any other artificial intelligence (AI) startup. And if it is not really known to the general public, it is establishing itself as an increasingly essential player in the tech industry.

From a competition organized by Netflix

The Databricks co-founders’ journey began in 2012. At the time, Ali Ghodsi, Ion Stoica, Matei Zaharia, Patrick Wendell, Reynold Xin, Andy Konwinski and Arsalan Tavakoli-Shiraji, all PhD students at the University of California, Berkeley, had the ambition to combine data and artificial intelligence to solve global challenges.

In 2013, they entered a competition organized by Netflix, then much less renowned, to optimize its recommendation engine. It was a winning bet.

Data and AI

Databricks helps companies make the most of their data with advanced management and analysis tools. It provides a platform that structures companies’ data, adds AI capabilities to it, and allows their teams, even non-specialists, to extract useful information from it. The firm focuses on accessible and effective solutions, such as using small AI models to analyze data at a lower cost.

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A major partnership with Amazon

In October, Databricks expanded its five-year partnership with Amazon to reduce costs for companies looking to build their own AI capabilities. To do this, Databricks is using Amazon’s Trainium AI chips to power a service that helps companies customize an AI model or build their own.

A success with large enterprises

As of June 2024, Databricks had 11,500 customers worldwide. Many giants use its services, such as Netflix, Toyota, AstraZeneca, Michelin, Comcast and H&M.

A record fundraising

Databricks has just raised $10 billion, a first in the already very generous AI sector, beating the $6.6 billion raised by OpenAI last October.

Led by Thrive Capital, the operation includes other high-profile investors such as Andreessen Horowitz, DST Global, GIC, Insight Partners and WCM. It values ​​Databricks at $62 billion, an increase of nearly $20 billion in a year and a half.

« Databricks intends to invest the capital in new AI products, acquisitions and a significant expansion of its international go-to-market operations. In addition to fueling its growth, this capital is expected to be used to provide liquidity to current and former employees ,” the company said in a press release.

Impressive Growth

This latest funding round caps Databricks’ impressive growth, which is up 60% year-over-year and now exceeds $3 billion in revenue. Its acquisition of AI startup MosaicLM last year for $1.3 billion partly explains this rise.

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