And Couchbase, which already has received $251 million in venture funding, announced plans on June 21 to file an initial public offering. Couchbase could be valued at up to $3 billion, according to Reuters.
The flurry of investment activity reflects optimistic growth forecasts for cloud databases, driven by the surge in data being created globally and the trend among businesses to store and analyze many petabytes of data in the cloud. Gartner estimates that 75 percent of databases will be moved to the cloud, or created in the cloud, by the end of next year.
“This is a magical time in the database space,” wrote Emil Eifrem, Neo4j’s co-founder and CEO, in a blog post announcing $325 million in Series F funding. “Over the next few years, a handful of companies will emerge as the new leaders in the database market, and they will last for generations.”
Neo4j described its latest round of funding as the largest investment ever in a private database company. Neo4j’s graph database is used for recommendations, fraud detection, and other applications based on relationships and connections within data. Neo4j’s valuation is estimated at more than $2 billion.
Companies spent more than $50 billion on database software last year, according to Eifrem. That number is expected to double by 2025.
Speed and efficiency
Another company aiming to join the ranks of cloud database leaders is Firebolt, which on June 24 revealed $127 million in Series B funding. Based in Tel Aviv, Firebolt is expanding its presence globally and has doubled its headcount over the past six months to 100 employees, with plans to double again over the next 12 months.
Firebolt, which runs exclusively on AWS and Amazon’s S3 storage, bills itself as “the world’s fastest data warehouse.” The company is focused on providing speed and efficiency to data engineers, according to co-founder and CEO Eldad Farkash.
“The biggest mission for Firebolt is to enable a new generation of data engineers to build data-driven features without having to wait months” for data warehouse projects to reach operational readiness, said Farkash.
Firebolt, launched in December, is not yet available as a self-service data warehouse. Customer onboarding requires support by Firebolt solution architects. As a next step, Firebolt is working toward providing self-service capability by the end of the year.
The latest round of investments brings overall funding in eight of the leading cloud database companies to over $4 billion. Following is the total funding to date for those companies, as tracked by Crunchbase.
- Databricks – $1.9 billion
- Redis Labs – $555 million
- Neo4j – $515 million
- Cockroach Labs – $355 million
- Couchbase – $251 million
- DataStax – $227 million
- Firebolt – $164 million
- MariaDB – $123 million
The above companies, with the exception of Firebolt, are among the Cloud Database Report’s Cloud Database Top 20. Firebolt, with its continuing growth and product development, is well positioned to break into the Top 20.
Cloud database companies are not all cut from the same mold. The market is becoming specialized with purpose-built databases that excel at different kinds of workloads. For example, Couchbase develops a NoSQL database that competes with MongoDB; Neo4j’s graph database is optimized for data relationships; and Firebolt emphasizes query speed for analytics.
What they all have in common is that they are available via one or more public cloud services.
The new generation of cloud-native database providers are looking to mimic the success of Snowflake and its “data cloud” model. Snowflake’s IPO last September raised $3.4 billion, giving the company a market value of $70 billion at the time.
This news analysis is provided by the Cloud Database Report. As the pace of change in data management accelerates, business and IT decision makers are keenly aware that “big data” represents tremendous value if they are able to capitalize on it. Cloud databases are increasingly perceived as a faster, better, cheaper way to gain insights and drive innovation.
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