Goldman Sachs backs DataStax to power through downturn
Investment comes as DataStax broadens offering to include data streaming
Open data stack specialist DataStax has raised $115 million in a funding round led by Goldman Sachs Asset Management. The company said it would use the fund to turbocharge global expansion and development of its Astra DB multi-cloud database and its new Astra Streaming streaming service.
The raise is a calculated bet that despite a market downturn that has seen some technology vendors slash staff numbers and batten down the hatches, digital transformation is going to continue as companies look to sharpen their competitive edge with data insights that will require hugely flexible infrastructure for their applications; whether those are providing trading insights, game streaming, or telemetry from a wind farm.
"Today’s market leaders run their business with real-time data to create instant intelligence and drive actions,” said Holger Staude, MD at Goldman Sachs. "That's exactly what DataStax empowers companies to do, and why we are excited to support the next generation of digital applications with our investment.”
It is the second investment Goldman Sachs has made in DataStax in just 14 months after investing an undisclosed sum that also saw Staude join the DataStax board. This round also saw participation from RCM Private Markets fund advised by Rokos Capital Management (US) LP, Singapore's EDB Investments and DataStax's existing investors including Crosslink Capital, Meritech Capital Partners, OnePrime Capital and other current investors.
DataStax' Goldman Sachs funding comes as ambitions grow
In recent years DataStax has pivoted from being a specialist shop for managed Apache Cassandra database services to offering a sophisticated full open data stack that can support data at rest and data streaming at massive scale (the latter built heavily on Apache Pulsar) -- whilst innovating aggressively to ensure developers at startups as well as multinationals can adopt its services cost-effectively through serverless technologies.
It aims to do this on heavily open source foundations and helping customers avoid cloud lock-in
As Chief Product Officer Ed Anuff told The Stack late last year: "Cassandra can handle massive levels of scale. A lot of big retailers like Netflix and Apple, have thousands and thousands of Cassandra servers running. DataStax customers like T-Mobile, Home Depot and countless others — have a whole bunch of servers running all the time. The reason they chose Cassandra is typically because it can handle global scale; it literally is ‘thousands of interactions driving thousands of transactions’ per second. In a lot of these use cases the scale can be tremendous: the swings can save companies millions of dollars. With AstraDB (DataStax's enterprise DBaaS, built on Cassandra) now serverless, you can auto scale based on traffic and app requirements, scale down to zero automatically when the database is not in use, and deploy apps that can scale infinitely from day one."
See: In the Goldman Sachs IT engine room, Sybase, HAProxy rub shoulders
"Lots of people say ‘if I get that big, I’ll switch to Cassandra,’ because Cassandra is great for running large workloads. But before we introduced the serverless capability, it could be a little complicated for running smaller workloads. With Astra serverless, it’s easy for developers to deploy Cassandra faster, and in a much more lightweight way: they can avoid infrastructure configuration changes, eliminate capacity planning, and get rid of any guesswork on storage and compute needs of future apps" he added in an 2021 interview.
"We see the transformative power of real-time applications across industries on a daily basis and among customers such as The Home Depot, Verizon, and Capital One," said Chet Kapoor, chairman and CEO of DataStax on June 15. "What's clear is that we're only in the early stages of what's possible with new data-driven experiences that will serve a wide range of human needs, create virtuous cycles between companies and their customers, and move markets. We appreciate that our investors believe in our vision – even in this economy, we were able to raise significant capital at a substantial premium over the round we completed just a year ago."
Goldman invested an undisclosed sum in DataStax in May 2021 also. The investment bank is itself a big user of open source technologies. One of its IT teams has described Apache Kafka, for example, as the “backbone of its architecture”; DataStax will no doubt be hoping that this team is open to a shift to Astra Streaming.
