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Databricks is raising a Series K Investment at >$100B valuation

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Re: Databricks is raising a Series K Investment at >$100B valuation

#201

Post by devoutsalsa »

jakozaur wrote: post #93

It doesn't look like a typical round for raising capital for investments. Instead: 1. Liquidity: Early investors could sell to late-stage investors, since they are not IPO. Their previous round looked like that. 2. Markup: The previous investors can increase their valuation by doing a round again. It also provides a paper valuation for acquiring new companies. That combined with preferred stock (always get 1x back) m…

I had no idea how preferred shares actually worked, so I went down a rabbit hole looking it up. That "always get 1x back" thing you mentioned is called a liquidation preference, which means preferred shareholders get their money back first before anyone else sees a dime.

Turns out there are different flavors too. "Non-participating" means preferred gets their original investment back, then common stock splits whatever's left. "Participating" means preferred gets their money back AND also gets to participate in splitting the leftovers with common shareholders. No wonder investors are willing to pay up for these late-stage rounds when they've got that safety net.

Re: Databricks is raising a Series K Investment at >$100B valuation

#202

Post by bix6 »

groaninvasion wrote: post #194
bix6 wrote: post #105

$2-3B in 2024 revenue based on estimates I can find. That’s a 33-50x revenue multiple lol. Also announcing the signed term sheet but not the close so this is a PR push to find more investors?

its 3.7 billion as of now as a google search will tell you

I prefer full year actuals but thanks!

Re: Databricks is raising a Series K Investment at >$100B valuation

#203

Post by bradhe »

devoutsalsa wrote: post #201
jakozaur wrote: post #93

It doesn't look like a typical round for raising capital for investments. Instead: 1. Liquidity: Early investors could sell to late-stage investors, since they are not IPO. Their previous round looked like that. 2. Markup: The previous investors can increase their valuation by doing a round again. It also provides a paper valuation for acquiring new companies. That combined with preferred stock (always get 1x back) m…

I had no idea how preferred shares actually worked, so I went down a rabbit hole looking it up. That "always get 1x back" thing you mentioned is called a liquidation preference, which means preferred shareholders get their money back first before anyone else sees a dime. Turns out there are different flavors too. "Non-participating" means preferred gets their original investment back, then common stock splits whateve…

You should read Venture Deals! Great book by Brad Feld and Jason Mendelson that's really comprehensive in this.

Re: Databricks is raising a Series K Investment at >$100B valuation

#204

Post by yencabulator »

tzury wrote: post #77

This curvature of spacetime is caused by the mass of the AI bubble. While many comments were focused on the "K" letter, I wanted to remind us all that OpenAI stretched their Series E from Jan 23, 2023 to Nov 22, 2024 -- 23 months, squeezing in 6 rounds source: https://tracxn.com/d/companies/openai/__kElhSG7uVGeFk1i71Co9...

New meaning for "AI singularity" there.

Re: Databricks is raising a Series K Investment at >$100B valuation

#205

Post by riku_iki »

Temporary_31337 wrote: post #151
Lionga wrote: post #8

Earlier quoted context omitted.

IPO needs real numbers, VCs just want buzzwords

it's funny how we're letting private companies get away with made up numbers. Rather than making IPOs easier, owning a private company above a certain valuation should come with at least an obligation for GAAP accounting, indepndent audits etc. This is really for the greater good - so what is we see 2-5 years of a beautiful AI bubble if it's going to come crashing down again. It's lawmakers and regulators role to smo…

the premise probably is that VCs are qualified/educated investors and know what they are doing.

Re: Databricks is raising a Series K Investment at >$100B valuation

#206

Post by devoutsalsa »

bradhe wrote: post #203
devoutsalsa wrote: post #201

Earlier quoted context omitted.

I had no idea how preferred shares actually worked, so I went down a rabbit hole looking it up. That "always get 1x back" thing you mentioned is called a liquidation preference, which means preferred shareholders get their money back first before anyone else sees a dime. Turns out there are different flavors too. "Non-participating" means preferred gets their original investment back, then common stock splits whateve…

You should read Venture Deals! Great book by Brad Feld and Jason Mendelson that's really comprehensive in this.

Also a good book for those interested in VC is The Venture Mindset by Ilya Strebulaev.

Re: Databricks is raising a Series K Investment at >$100B valuation

#207

Post by iamleppert »

Just finished ripping out Databricks at one of my clients, and have several more queued up. Folks can't wait to get as far away as they can, and as fast as they can from any of their offerings. Poor performance, bad product, bad UX: hard to get even decent logs out of the damn thing, and it's incredibly overpriced.

They told a good story and had a good sales team, but the writing is on the wall for them.

Re: Databricks is raising a Series K Investment at >$100B valuation

#208

Post by HSCandYH »

iamleppert wrote: post #207

Just finished ripping out Databricks at one of my clients, and have several more queued up. Folks can't wait to get as far away as they can, and as fast as they can from any of their offerings. Poor performance, bad product, bad UX: hard to get even decent logs out of the damn thing, and it's incredibly overpriced. They told a good story and had a good sales team, but the writing is on the wall for them.

what's the deal size you being able to rip out ?

Re: Databricks is raising a Series K Investment at >$100B valuation

#209

Post by iamleppert »

HSCandYH wrote: post #208
iamleppert wrote: post #207

Just finished ripping out Databricks at one of my clients, and have several more queued up. Folks can't wait to get as far away as they can, and as fast as they can from any of their offerings. Poor performance, bad product, bad UX: hard to get even decent logs out of the damn thing, and it's incredibly overpriced. They told a good story and had a good sales team, but the writing is on the wall for them.

what's the deal size you being able to rip out ?

$150k for the current client deal, but I've had projects as high as $300k converting their offerings to plain Kubernetes and Serverless.

Re: Databricks is raising a Series K Investment at >$100B valuation

#210

Post by elAhmo »

jasonhong wrote: post #106
quietthrow wrote: post #79

Earlier quoted context omitted.

This. To me if you are still unprofitable after 15 years you are not really a business. However genuinely curious about the thesis applied by the VC’s/Funds that invest in such a late stage round? Is it simply they are taking a chance that they won’t be the last person holding the potato? Like they will get out in series L or M rounds or the company may IPO by then. Either ways they will make a small return? Or is th…

The last person in usually gets the best deal, in that they can get preference and push everyone else (previous investors, founders, and employees) down. If things goes south, they get their money out before anyone else.

Isn’t everyone “the last” at the moment they are taking participation in the round? If someone thinks they’re gonna get preferential treatment in Series C or D, and then comes someone in E with preferential treatement, then
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