Databricks reportedly paid nearly $2 billion to acquire Tabular in June, a startup with only $1 million in annual recurring revenue. This acquisition marked a significant exit multiple, driven by a fierce competition between Databricks and Snowflake.
Tabular’s Background
Tabular, founded just three years prior to the acquisition, had received over $30 million in funding from Altimeter Capital, Andreessen Horowitz, and Zetta Venture Partners. The startup’s valuation was closely tied to Apache Iceberg, an open-source table format developed by the founders during their time at Netflix.
Competition between Databricks and Snowflake
Tabular quickly became a valuable asset in the ongoing battle between Databricks and Snowflake. Some Databricks employees were even encouraged to engage with their CEO’s LinkedIn posts criticizing Snowflake. Snowflake, on the other hand, has seen a 36% drop in stock price this year, with a market cap of approximately $43 billion, similar to Databricks’ current valuation.
It was further complicated by Snowflake’s association with a significant data breach affecting a large portion of AT&T’s customers in July.
