Databricks CEO says fresh $1B will help him attack a new AI database market

Databricks is nearing the completion of a significant funding round, reportedly valued at $100 billion. This new round, which amounts to approximately $1 billion, has been described as greatly oversubscribed, according to exclusive insights shared with TechCrunch. The company, recognized for its data analytics solutions, opted against selling additional equity, as they do not require extra cash following their substantial $10 billion funding round earlier this year at a $62 billion valuation. This record was later surpassed by OpenAI's impressive $40 billion raise in March. The current funding round is co-led by Thrive and Insight Partners, one of Databricks' early backers, both of whom were also at the helm during the last fundraising effort. Since its inception in 2013, Databricks has successfully raised around $20 billion. This latest funding round is designated for two ambitious projects: an AI agent database and the company's AI agent platform. Co-founder and CEO Ali Ghodsi elaborated on these initiatives during an interview, emphasizing the company’s commitment to developing a database tailored for AI agents, which will be made widely available. The product, named Lakebase, was introduced at their annual technology conference in June and is built on the open-source Postgres database, positioning it as a competitor to Supabase. Ghodsi highlighted the immense potential within the database market, valued at $105 billion, which has remained relatively unchanged for the past four decades. He pointed out a remarkable trend, revealing that one year ago, 30% of new databases were generated by AI agents, and this year, that figure has skyrocketed to 80%. He anticipates that within a year, this percentage could reach 99%. "The new user is an AI agent, not a human," he stated, underscoring the transformative shift in database creation. To differentiate Lakebase from competitors, Ghodsi noted the importance of decoupling compute from storage, allowing users to create numerous databases affordably. Given the rapid pace at which AI agents can generate databases, this strategy is essential for sustainability. In addition to Lakebase, Databricks will invest significantly in its AI agent platform, Agent Bricks, also unveiled in June. Ghodsi remarked that while many focus on developing superintelligent systems, the real need for organizations lies in reliable agents capable of handling routine tasks, such as employee onboarding and HR inquiries. He believes this niche presents a substantial opportunity for enhancing global GDP and organizational efficiency. As Databricks gears up to compete in the AI talent acquisition arena, Ghodsi acknowledged the rising costs associated with hiring skilled professionals in this field, indicating a strategic move to secure top talent as they advance their innovative projects.