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Databricks Partners with OpenAI to Deliver Enterprise AI Models

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Databricks announced on Thursday a partnership with OpenAI to bring the ChatGPT maker’s artificial intelligence models directly into its platforms for enterprise clients.

Under the deal, OpenAI’s models will be integrated into Databricks’ cloud-based analytics platform as well as its flagship Agent Bricks product, which helps businesses design, test, and scale custom AI applications and agents. The agreement is expected to generate $100 million in revenue, according to Databricks.

The move marks another step in OpenAI’s expansion beyond its long-time cloud partner Microsoft Azure, as it seeks to accelerate adoption of its tools among corporate users. For Databricks, the deal strengthens its hand against rival Snowflake, which is still in early development of its AI services.

“We’re seeing overwhelming demand from enterprise customers looking to build AI apps and agents on their data, tailored to their unique business needs,” said Databricks CEO Ali Ghodsi.

OpenAI’s GPT-5 will serve as a flagship model for more than 20,000 Databricks enterprise customers, the company said.

The agreement builds on an existing partnership: OpenAI already uses Databricks to process AI data, which supports improvements in ChatGPT. Databricks was also among the first to host gpt-oss, OpenAI’s open-weight models that specialize in advanced reasoning.

The announcement comes shortly after Databricks closed a $1 billion funding round, pushing its valuation to $100 billion and securing its place among the world’s most valuable private tech firms.

Databricks Hits $100 Billion Valuation with $1 Billion Raise, Projects $4 Billion Revenue

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Databricks, the San Francisco-based data analytics and AI firm, announced on Monday that it has closed a $1 billion Series K funding round at a $100 billion valuation, cementing its position as one of the world’s most valuable private companies.

The round was co-led by Andreessen Horowitz, Insight Partners, MGX, Thrive Capital, and WCM Investment Management. The fresh capital will fuel Databricks’ AI strategy, supporting new product launches, acquisitions, and advanced research.

The company revealed it is now on track to hit $4 billion in annualized revenue, with AI-related products contributing $1 billion. Its customer base has grown to around 15,000 clients, including Shell and Rivian, while its Lakebase data warehouse has already reached tens of millions in annualized revenue just months after launch.

CEO Ali Ghodsi said Databricks will remain cash-flow positive, keeping the option of an IPO open but without a fixed timeline. The company is also investing in Agent Bricks, its new AI platform for building autonomous systems, and recently acquired Tecton, a machine learning startup.

With net revenue retention above 140%, over 650 customers spending more than $1 million annually, and positive free cash flow, Databricks is positioning itself as a leader in the AI and big data race—and a likely candidate for one of the most anticipated IPOs in the sector.

Databricks Hits $62 Billion Valuation with Record $10 Billion VC Round

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Databricks, a leading AI startup, has achieved a $62 billion valuation after successfully raising $10 billion in one of the largest venture capital funding rounds in history. This funding round highlights the growing demand for AI-focused startups and underscores the continued interest in companies at the forefront of AI innovation.

Major Investors

The round, led by Joshua Kushner’s Thrive Capital, attracted investments from top-tier firms including Andreessen Horowitz, DST Global, GIC, Insight Partners, and WCM Investment Management. Notably, Ontario Teachers’ Pension Plan, an existing investor, and ICONIQ Growth, MGX, Sands Capital, and Wellington Management joined the funding round.

This investment round surpasses the $6.6 billion raised by OpenAI in October, reinforcing the immense appetite for AI companies that simplify the integration of AI technologies. This surge in investment reflects the market’s growing interest in AI-driven solutions and startups such as OpenAI and Elon Musk’s xAI, which have seen their valuations soar in recent months.

Future Plans

Ali Ghodsi, co-founder and CEO of Databricks, commented that the round was “substantially oversubscribed”, signaling strong market confidence. Databricks plans to use the new funds to further develop AI products and pursue acquisitions. The company will also offer some employees the opportunity to cash out their stock, which forms a significant part of startup compensation.

Competition and Growth Prospects

Databricks is a direct competitor to Snowflake, which has a market capitalization of about $57 billion. The company, which serves over 10,000 customers including major companies like Block, Comcast, Rivian, and Shell, expects to achieve positive free cash flow for the first time in the quarter ending on January 31 and anticipates crossing a $3 billion revenue run rate in January.