On Monday, Databricks announced the acquisition of Arcion, an enterprise data company, for a total of $100 million, including incentives, as confirmed by CEO Ali Ghodsi in an interview with CNBC. This news follows shortly after Databricks' September funding round of $500 million, which included major investments from Nvidia and Capital One. Arcion is the first company that Databricks has acquired since MosaicML, an AI infrastructure startup focused on training massive language models.
Databricks has announced an agreement to buy enterprise data company Arcion for approximately $100 million, including bonuses, according to CEO Ali Ghodsi prior to a Monday announcement. Databricks' main product is a data analytics tool, facilitated largely by a technology known as deep learning, but this is unable to be utilized unless customers import their data from software platforms such as Salesforce, Workday, and Oracle. Before the acquisition, Databricks had participated in a $13 million Series A round for Arcion in February 2022.The acquisition follows Databricks receiving a $500 million funding round in September and its valuation being determined at $43 billion. Arcion is the first acquisition made by Databricks since it acquired MosaicML, an AI support startup that mainly handles training large language models, for $1.3 billion. Databricks is looking to coalesce Arcion's technology with MosaicML, transforming it into "the data source that feeds Mosaic" when a customer wants to generate their own AI models, Ghodsi said.It is predicted that Databricks will become a successful publicly traded company shortly. “The goal of our business is to continue building a successful, reliable company in the long run," Ghodsi notified CNBC. "An IPO will be an essential step, but our principal focus is meeting the demand of our customers and making sure they stay successful.”The idea for the acquisition was motivated from the Databricks CIO Summit in March. This is part of Databricks’ initiative to strengthen its AI applications, with the tech industry's concentrated attention to generative AI, which generally demands massive amounts of training data.Ghodsi inquired “What do you want us to work on? What is your highest priority?” and reported that “Everybody said, 'Just tackle the [data] ingestion issues — can you just address the ingestion issue for us?'”Arcion originated in 2016 by Rajkumar Sen, a former Oracle employee, and Miryana Joksovic, a former startup advisor. It has raised more than $18 million, its most recent known valuation being $65 million, according to Pitchbook. As part of the acquisition, Databricks plans to increase Arcion's employment."We think we can create a lot of income from this particular acquisition," Ghodsi mentioned. "This is one where we expect it to be income-positive."
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