Data Analytics Unicorn Databricks Makes Another Big Startup Acquisition

Analytics unicorn Databricks is making its second large acquisition in four months. The San Francisco-based company plans to buy enterprise data startup Arcion for $100 million, CNBC first reported Monday.

Databricks is one of the most valuable private companies in the world, even more so after it was valued at $43 billion in a $500 million-plus Series I raise last month. In June, it purchased OpenAI competitor MosaicML for $1.3 billion.

San Mateo, California-based Arcion was founded in 2016 and has raised $18.2 million from private investors, including Databricks Ventures, according to Crunchbase data.

“To build analytical dashboards, data applications, and AI models, data needs to be replicated from the systems of record like CRM, ERP, and enterprise apps to the Lakehouse,” Databricks CEO and co-founder Ali Ghodsi said in a statement announcing the deal. “Arcion’s highly reliable and easy-to-use solution will enable our customers to make that data available almost instantly for faster and more informed decision-making.”

M&A market remains subdued

The deal marks a fairly significant transaction for a subdued M&A market. Despite a difficult fundraising environment for startups and still-quiet IPO market, acquisition activity has not perked up either, due to high interest rates and economic uncertainty.

Through the first nine months of the year, only 629 deals involving U.S.-based, VC-backed startups being acquired were announced, per Crunchbase data. That compares to 919 deals for the first nine months of last year.

Databricks IPO plans?

Databricks, which has raised $4 billion from private investors since its founding, is widely viewed as a top IPO candidate, though its CEO has stopped short of giving a timeline for a potential run at the public markets.

“We are focused on continuing to build a successful, sustainable business for the long run,” Ghodsi told CNBC. “An IPO will be a milestone, but we’re focused on satisfying the intense demand from customers, and ensuring their long term success.”