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Cloud data warehouse vendor Snowflake is looking to accelerate its growth, with a new $479 million round of funding, including money from Salesforce Ventures, as part of a larger partnership Snowflake says it will form with the CRM giant.
The cloud data warehouse market is becoming increasingly crowded, with multiple offerings including Amazon Redshift, Google BigQuery, Microsoft Azure SQL Data Warehouse and SAP Data Warehouse, among others.
Snowflake has carved out its own niche in the competitive market with a multi-cloud platform that aims to make it easier to collect and share data for analytics. Snowflake released its first platform in 2015 and has grown to over 3,400 customers since.
The cloud data warehouse vendor, based in San Mateo, Calif., claimed Feb. 10 that the new funding round raised the company's valuation to more than $12.4 billion. The round was co-led by Dragoneer Investment Group and Salesforce Ventures and included the participation of existing investors Altimeter Capital, ICONIQ Capital, Madrona Venture Group, Redpoint Ventures, Sequoia and Sutter Hill Ventures.
The participation of the Salesforce venture capital arm goes beyond this investment and is part of a broader engagement with Salesforce that Snowflake plans to detail in June.
"The funding was part of a strategic alliance with Salesforce that we initiated," said Frank Slootman, CEO at Snowflake. "We need core data assets, or content, put onto the Snowflake platform and that is why we decided to move forward with the funding round."
Frank SlootmanCEO, Snowflake
A former ServiceNow chairman and CEO, Slootman took over as CEO of Snowflake in May 2019, replacing outgoing CEO Bob Muglia. Under Slootman's tenure, the company unveiled a shared data exchange marketplace in June 2019, and integration with Google Cloud. Snowflake also runs on AWS as well as Microsoft's Azure cloud platform.
Cloud data warehouse market potential
Snowflake has emerged in recent years as one of the top vendors in the cloud data warehouse market, a position the vendor appears to be able to consolidate with the sizeable new funding.
The new valuation for Snowflake is remarkably high, given the difficulty of establishing significant technical and enduring differentiation in the market, said Curt Monash, president of IT consultancy firm Monash Research.
The high valuation and new funding for Snowflake should also serve to further validate interest and demand in the overall cloud data warehouse market.
"I thought a couple years ago that Amazon had settled the debate as to whether data warehousing would work in the cloud; but if anybody was still skeptical, Snowflake has settled it further," Monash said.