Databricks CEO Unveils $1B Investment to Capture Emerging AI Database Market

TechCrunch has reported that Databricks is close to finalizing a new funding round that is projected to reach a valuation of $100 billion. This news was originally disclosed by the Wall Street Journal.

A source revealed to TechCrunch that this funding round is around $1 billion and has attracted significant oversubscription. Databricks, recognized for its data analytics technologies, chose not to issue more equity since it does not need additional operational funding following its unprecedented $10 billion raise at a $62 billion valuation earlier this year. This record was subsequently eclipsed by OpenAI’s $40 billion fundraising in March.

Reports indicate that this fundraising round was co-led by Thrive and Insight Partners, both of which are among Databricks’ early investors. These firms also spearheaded the previous funding round. Since its establishment in 2013, Databricks has garnered approximately $20 billion in funding.

This latest funding is categorized as a primary round and did not include share sales by employees. Nonetheless, insiders disclosed that Databricks conducted two secondary sales for employees in 2025, allowing them to sell 40%, 50%, or 60% of their stock, depending on their holdings.

In both secondary rounds, it was noted that not all available funds were utilized, which suggests that employees opted to keep more shares than they were entitled to sell. While there’s no urgency for an IPO, employees have had two chances to liquidate some of their shares.

The funding is primarily allocated for two specific initiatives: a database for AI agents and its AI agent platform, as highlighted by Databricks co-founder and CEO Ali Ghodsi in a recent interview with TechCrunch.

The company aims to heavily invest in the AI agent database, making it broadly accessible to all customers. This product, showcased as Lakebase during the annual tech conference in June, is developed on the open-source Postgres database and is designed to meet enterprise-level demands, placing it in competition with alternatives like Supabase.

Ghodsi pointed out that “the database market has a total addressable market of $105 billion,” observing that companies like Oracle have long dominated this sector.

“Interestingly, we found that 30% of new databases were AI-generated last year, a figure that has now risen to 80%,” he noted, predicting it could reach 99% in the coming year.

“The new user base is comprised of AI agents, not humans. Ensuring this new persona’s success is crucial for market disruption,” he explained.

To set Lakebase apart from Supabase and other Postgres-based database providers, Ghodsi stressed the significance of “separating compute and storage.”

By disentangling costly compute resources from more affordable storage, Databricks enables users to create multiple databases in a cost-effective manner. “These agents can swiftly produce numerous databases, and we aim to ensure that this process remains economical,” he elaborated.

Furthermore, Databricks will significantly enhance its AI agent platform, Agent Bricks, which was also launched in June. Ghodsi remarked, “While many are focused on superintelligence, that’s not the immediate priority for businesses.”

Instead of pursuing general-purpose intellects, corporations need agents that can autonomously manage routine tasks such as onboarding or answering HR queries.

“I believe this opportunity holds much larger implications for global GDP and businesses,” he concluded, asserting that this focus will give Agent Bricks a strategic advantage.

Additionally, this new funding will enable Databricks to contend in the competitive arena of AI talent acquisition, with Ghodsi acknowledging the high expenses associated with attracting top talent.

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