Databricks, the fast-growing data analytics and artificial intelligence firm, is closing in on one of the largest venture capital funding rounds in history, with a raise led by Thrive Capital and Andreessen Horowitz that could exceed $9.5bn, according to a report by Reuters.
The report cites unnamed sources familiar with the matter as revealing that the fundraising for the San Francisco-based tech firm, which is oversubscribed and nearly double its original target, is is expected to be finalised this week. Investors anticipate Databricks will achieve a valuation of over $60bn, based on a share price of $92.50. The firm has projected revenues of $3.8bn for the next fiscal year.
Other lead investors include Insight Partners, and Singapore’s sovereign wealth fund GIC, according to the sources.
Alongside the equity raise, Databricks is in discussions to secure $4.5bn in debt financing, including a $2.5bn term loan from direct lenders.
Databricks was last valued at $43bn in September, according to a previous report by Bloomberg on the company’s private debt financing efforts.
The 11-year-old firm, which has yet to turn a profit, plans to use part of the funds to buy back expiring restricted stock units (RSUs) from early employees and cover associated tax costs. This mirrors a strategy employed by Stripe, the payment company, which raised $6.5bn last year at a $50bn valuation for similar purposes.
Investors participating in the round will receive preferred shares, according to the sources. Databricks declined to comment, and representatives from Thrive Capital, Insight Partners, Andreessen Horowitz, and GIC did not immediately respond to requests for comment.
Databricks, founded in 2013, provides a cloud-based platform for enterprises to build and manage data and AI applications. The company has benefited from the surge in AI adoption, offering tools that help clients deploy AI models using their existing data.
