Databricks Secures $5 Billion in Funding, Increasing Valuation to $190 Billion

AI big-data firm Databricks has announced a $5 billion funding round, raising its valuation to $190 billion. Co-founder and CEO Ali Ghodsi shared details of the funding process during an interview with TechCrunch.

Initially aiming for $1 billion, Databricks experienced a surge in investor interest following a report by The Information during a June conference. “We were heads down with our conference, and we were not actually at all focused on fundraising,” Ghodsi recalled. He described how investor calls increased after the article was published, stating, “My phone blew up. It was like the worst timing for us because we were busy with our conference.”

The heightened interest turned into what Ghodsi termed a “self-fulfilling prophecy,” with $15 billion in interest from a select group of investors. The need to accommodate such demand led Databricks to issue additional shares. In July, the company announced the closure of its funding round with an updated valuation of $188 billion, although the specific amount raised at that time was not disclosed.

The recent round was led by Coatue, with participation from major firms like Blackstone, MGX, and various T. Rowe Price accounts, alongside new investor Sixth Street Growth. About two dozen venture capitalists took part in the financing.

Ghodsi highlighted Databricks’ impressive growth, noting that the company has achieved an annualized run rate revenue of $7 billion, with an 80% growth rate and positive cash flow. Its core product, a cloud data warehouse, contributes $1.5 billion to this figure and is growing at 100% year-over-year.

The company is also tapping into the AI market, having launched its Lakebase database for agents in June 2025, which is now generating a revenue run rate of $100 million. Its AI chatbot tool, Genie, is proving to be “insanely popular,” according to Ghodsi.

Despite the strong financial performance, Ghodsi noted the rationale behind seeking additional capital, explaining that investments in AI can be costly. Databricks has multibillion-dollar cloud commitments across all three major hyperscalers and maintains a dedicated AI research team of 100 people, a highly competitive sector.

Moreover, Ghodsi stated that Databricks is actively engaged in mergers and acquisitions, mentioning the recent acquisition of Electric, which develops the lightweight Postgres database PGlite. The company has also acquired AI cybersecurity firm Panther and two startups earlier this year.

In the current climate of AI investments, where raising $1 billion is becoming common for seed and Series A rounds, a billion-dollar funding goal has diminished in significance. Nonetheless, Databricks has turned its fundraising approach into something of a subject of humor within the venture capital community, with jokes circulating that the company is “running out of letters of the alphabet.”

Ghodsi expressed an interest in eventually taking Databricks public, but he currently prefers to concentrate on AI investments. Given the ongoing expenses in this area, operating away from public scrutiny may be a strategic choice. “When you can command an instant $15 billion of interest, and on your own terms, what’s the rush?” he concluded.