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Databricks valued at $38b – but at first its founder couldn’t even *give* his software away

A fresh $1.6 billion funding round by Databricks values the data management company at a massive $38 billion. But back in 2009 co-founder Ali Ghodsi was struggling to even give the software he’d built away. Nobody would download it and technology companies told him what he’d built was “academic mumbo-jumbo”.

Fast-forward 11 years and Databricks is the fourth-largest privately held, venture-bacled US company according to PitchBook, with all three cloud hyperscalers — AWS, Azure, Google — all investing in the round.

(Databricks, which was founded by the creators of open source software Apache Spark, provides a cloud-native data platform with numerous tools integrated for data engineering and data science teams.)

But as founder Ali Ghodsi put it to The Stack’s Ed Targett back in 2018: “[Back in 2009] we could see that Google and Facebook were doing something very different to the open source community: they were doing machine learning on massive amounts of data. But most of their projects were pretty secretive.

“Our mission was: ‘Let’s build and open source this stuff and give it to everyone!’ We built the software, put it on a few web pages and said: ‘Hey download this!’ No one downloaded it. So we went to existing Hadoop vendors and many tech companies and said: ‘Hey can you adopt this technology?’ They all told us ‘no: this is academic mumbo-jumbo. We need enterprise software.’ We literally wanted to give it away and no one would take it.”

By 2013, with still too few people paying attention, Ghodsi and team decided to try and start a company around the software. As he put it: “This being Silicon Valley the venture capitalist Ben Horowitz happened to be close, so we asked him for $200,000 to go away, code for a year and build this thing. He offered $14 million.”

The rest, as they say, is history.

In 2021 with a fresh $1.6 billion in the bank, Databricks will use the capital to “accelerate the company’s lead in the massive and rapidly growing data lakehouse market.” (The company’s term for its data lake-meets-data warehouse offering.) Databricks says it intends to “build on its lead by investing in innovations that further simplify AI, preserve choice and flexibility across all major public clouds, and establish the lakehouse as a modern replacement to the legacy data warehouse,” noting that more than 5,000 organisations worldwide — including Comcast, Condé Nast, H&M, and over 40% of the Fortune 500 —now rely on the Databricks Lakehouse Platform to unify their data, analytics and AI. How’s that for mumbo-jumbo?

See also James Gfrerer: former VA CIO on stewarding taxpayer’s dollars in complex IT environments.

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Ed Targett

Ed Targett is founder of The Stack. He has previously served as editor at Tech Monitor, Computer Business Review, and Roubini Global Economics.

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