Neon Joins Databricks in AI Infrastructure Development
Deal News | May 14, 2025 | Menlo Ventures
Databricks has acquired Neon, a cloud-native OLTP database company, to advance AI infrastructure. Menlo Ventures spotted Neon two years ago, noting its innovative database technology, which is highly suitable for interactive transactions. Menlo's Series B investment in Neon was driven by their conviction in the demand for a Snowflake-like database in the OLTP space. With features like serverless Postgres and auto-scaling, Neon's architecture catered perfectly to modern app developers and AI workloads. Databricks' acquisition marks a significant shift towards using Postgres as a fundamental component in AI applications. Menlo Ventures acknowledges the remarkable progress Neon has made and supports its journey in collaboration with Databricks. This partnership aims to refine the infrastructure needed to accommodate the growing complexity of AI applications.
Sectors
- Artificial Intelligence
- Cloud Infrastructure
- Venture Capital
- Database Technology
Geography
- United States – Menlo Ventures and Neon are based in the U.S., and Databricks is also an American company, indicating the primary geographical focus.
Industry
- Artificial Intelligence – The article discusses the acquisition of Neon by Databricks to develop infrastructure for AI applications.
- Cloud Infrastructure – Neon's technology involves cloud-native OLTP databases, essential for modern cloud computing solutions.
- Venture Capital – Menlo Ventures' role as an investor in Neon's growth highlights the significance of VC in tech advancements.
- Database Technology – The focus on Neon's OLTP database technology places the article within this industry sector.
Financials
- Series B – Indicates the level of investment made by Menlo Ventures in Neon during its Series B round.
Participants
| Name | Role | Type | Description |
|---|---|---|---|
| Neon | Target Company | Company | A cloud-native OLTP database company acquired by Databricks. |
| Databricks | Bidding Company | Company | AI infrastructure company acquiring Neon. |
| Menlo Ventures | Venture Capital Firm | Company | VC firm that invested in Neon and is celebrating its acquisition. |
| Tim Tully | Partner at Menlo Ventures | Person | Partner focused on early-stage AI/ML and cloud investments. |
| Derek Xiao | Investor at Menlo Ventures | Person | Investor focused on AI and enterprise SaaS opportunities. |
| Nikita Shamgunov | Co-Founder of Neon | Person | Co-founder of the target company, Neon. |