Microsoft joins $250M funding round for ‘boring AI’ company Databricks

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Scott Guthrie
Microsoft cloud chief Scott Guthrie at the GeekWire Cloud Tech Summit. (GeekWire Photo / Kevin Lisota)

A little more than a year ago, Microsoft teamed up with San Francisco-based Databricks to help its cloud customers quickly parse large amounts of data. Today, Microsoft is Databricks’ newest investor.

Microsoft participated in a new $250 million funding round for Databricks, which was founded by the team that developed the popular open-source Apache Spark data-processing framework at the University of California-Berkeley. The round was led by Andreessen Horowitz, and it brings Databricks to a total of $498.5 million raised and a valuation of $2.75 billion.

Databricks executives say the company handles “boring AI” needs for its customers. Its services aren’t as cool as self-driving cars or other flashy uses of AI, but the company helps big enterprises process, integrate and analyze huge swaths of data in a speedy manner. Its Unified Analytics platform aims to build digital pipelines between siloed data storage systems and help engineers and data scientists communicate better.

Databricks said in a press release that it hit $100 million in annual recurring revenue in 2018 and its subscription revenue tripled. Among Databricks’ 2,000 global corporate customers are Nielsen, Hotels.com, Overstock, Bechtel, Shell and HP.

A 2017 partnership with Microsoft played an important role in Databrick’s growth. That’s when the companies debuted Azure Databricks, a tool for processing and analyzing large streams of corporate data. Azure Databricks is integrated with a score of other Azure data-related services, including the Azure Cosmos DB database introduced earlier that same year, as well as Azure SQL Data Warehouse and Azure Active Directory.

“Databricks has shown tremendous leadership in big data, data science and is uniquely positioned with Microsoft to meet the customer needs across big data, data warehousing and machine learning,” Rohan Kumar, corporate vice president of Azure Data at Microsoft said in a statement. “This investment builds on our successful multi-year partnership around Azure Databricks, a first-party Azure service that in conjunction with other Azure Data services like Azure Data Warehouse is greatly simplifying big data analytics and artificial intelligence solutions for many Microsoft customers.”



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