Databricks’ Acquisition of MosaicML – Matt Turck

(This put up is a part of my “This Week in AI” collection, which is common off-the-cuff market commentary. I’m not an investor in both MosaicML or Databricks)

$21M per worker. That’s the value Databricks is paying for MosaicML — a complete of $1.3B for 62 staff (in Databricks inventory, and likewise consists of worker retention packages).

One factor is evident – in case you’re going to be aggressively buying Generative AI startups, you’re going to must pay up

However it could grow to be low-cost in the long run given the scale of the chance.

That’s as a result of, past any Generative AI capabilities, Databricks’ transfer must be understood within the broader context of its fierce rivalry with Snowflake.

(Some points of that rivalry are just a little foolish – they (mysteriously) scheduled their large conferences on the identical actual dates this week.)

Each are vying to be the brand new knowledge clouds, essentially the most gigantic enterprise market.

It’s grow to be apparent that successful that market means being one of the best knowledge repository (warehouse, knowledge lake, knowledge lakehouse) AND the place the place enterprises do all their knowledge science and ML/AI work.

Each Databricks and Snowflake have been beefing up their ML/AI capabilities, in 3 ways:

Homegrown: Databricks traditionally has had an ML/AI providing. It additionally not too long ago launched Dolly, its personal LLM.

Partnerships: for instance, Dataiku, the main pure play enterprise AI platform for International 2000 firms, is a prime ML/AI accomplice for each firms.

Acquisitions: Snowflake acquired Streamlit for $800M final 12 months and AI search firm Neeva for $150M this 12 months (excluding retention packages). Databricks has made a number of acquisitions as properly, MosaicML being the largest one to this point.

The chess (and thoughts) video games between Snowflake and Databricks are fascinating – and there’s much more coming! Within the meantime, large congrats to MosaicML and Databricks.

Notice: I’m simply utilizing the value per worker as a proxy to point this can be a large acquisition for a nonetheless small firm. I don’t have direct data of what Mosaic had constructed so far apart from what’s within the press, nevertheless it appeared promising. [Update: it was subsequently reported, after the time of writing, that Mosaic was at $20M ARR]

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