Databricks in US$14b equity and debt raising, nears record
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The news: Software analytics firm Databricks is nearing one of the largest venture capital rounds ever, targeting a USD9.5 billion ($14.94 billion) raising led by Thrive Capital, Andreessen Horowitz, Insight Partners and GIC, Reuters reported.
The equity funding will fund buybacks of expiring employee stock units and cover associated tax costs, sources told the news agency.
The numbers: The raising at USD92.50 per share, which according to Reuters was almost twice oversubscribed, would value the 11-year-old company that is yet to turn a profit at over USD60 billion.
The San Francisco-based company competes with Snowflake and its projected revenue next fiscal year is USD3.8 billion, sources told Reuters.
In parallel, Databricks is reportedly also seeking USD4.5 billion in private debt, including a USD2.5 billion term loan and a USD2 billion revolving credit facility, arranged by JPMorgan through lenders like Blackstone.
The raising could be finalised next week and could still be upsized, Reuters said.
The context: Riding the AI boom, Databricks sells tools that help clients use their data to build and deploy AI applications.
Its USD9.5 billion funding round mirrors Stripe’s USD6.5 billion raise last year, both addressing expiring employee options rather than boosting balance sheets.
It comes as investors continue pouring funds into private AI firms like OpenAI and xAI, which raised USD6.5 billion and USD6 billion, respectively. The mega deals show the depth of venture capital coffers and a trend toward keeping top firms private longer.
The source: Reuters
