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Snowflake has hit the headlines due to a stellar move that has tripled its valuation from $3.95 billion to a whopping $12.4 billion. The latest funding round raised $497 million, contingent on the company’s strategic partnership with Salesforce. Salesforce Venture was the co-lead investor in the G-series funding, joining hands with Dragoneer Investment Group. Given that the company’s revenue grew to $1 billion in the last year, a jump of 174%, the company has done itself wonders and has proven its mettle as a leader in the cloud infrastructure segment.
Historically, the company had raised $263 million at a $1.5 million valuation from Sequoia Capital, IONIQ Capital, and Altimeter Capital. It raised an extra $450 million led by Sequoia, just a few months later. To date, the company has raised over$1.4 billion. According to CEO Frank Slootman, the company is “the fast-growing out there” and is slated to turn cash-flow positive this year.
8 years ago, when the data boom was at its peak, start-up Snowflake saw the vision of the future and embarked on a venture to redefine data warehousing, Based in San Mateo, California, the company was formed by Benoit Dagetville, Thierry Cruanes, and Marcin Zukowski. Benoit and Thierry were seasoned Oracle data architects and Zukowski was the cofounder of Dutch startup Vectorwise. The service operated in stealth mode for two years and rolled out to the public in 2014.
Calling itself a “data-warehouse-as-a-service” company, the company offers cloud-based data warehousing, analytics, and data app development solutions. The platform runs in the public cloud and offers secure and easy data access with incredible scalability. The platform uses multi-cluster shared data architecture across any cloud and boasts of a near-zero maintenance data platform. A delight to data analysts, engineers, scientists as well as app-developers, Snowflake’s features can compute, store and layers in a logically integrated manner that are independent of one another. The company encourages users to discover, exchange and securely share data.
Metadata processing in Snowflake is also automatic and does not compete with resources while running queries. This makes Snowflake infinitely scalable. The architecture is patented and revolutionizes lakes and analytics, apart from other use cases. Snowflake is a layered platform that uses the computer layer as the braun and the services layer as the brain, with the storage solution at the core.
Snowflake allows queries for both structures and machine-generated semi-structured data using relational operators. The architecture is fully distributed across multiple Amazon, Azure and Google zones, which make up almost 70% of the global market, according to Synergy Research group.
Snowflake customers work on per-second usage-based pricing, where one would only pay for the amount of data stored and the amount of computing done. There are no upfront costs or idle clusters.
On a mission to enable every organization to be data-driven, the company is spearheaded by the founders and CEO SLootman. Other board members include Kelly Kramer, CFO of Cisco, and Teresa Briggs, former Deloitte executive. Also on board are Venture Capitalists Mike Speiser, John Walecka, Carl Eschenbach, Mark Garrett, and Kevin Wang each representing various firms. The company currently has about 3400 active customers, of which 500 were added last quarter. Big names on the customer’s list include Pointdrive, Sharethrough, Akamai, Adobe, Celtra, AthenaHealth, Blackboard, CapitalOne, Sony, Doordash, EA and Logitech among others.
Why does partnership matter?
Salesforce executives have embarked on a journey to double fiscal revenues by 2025 and strategic partnerships such as that with Snowflake are important milestones on the roadmap. As Snowflake is a neutral party among competing cloud giants, the two companies have mutual aims that run on parallel roads essentially. Software-as-a-service and Data-as-a-service working hand-in-hand – what gets better than that?
Salesforce Customer 360 Truth announcement is in complete alignment with the partnership venture. Customer 360 truth aims to help companies authenticate and govern customer data across all Salesforce services. This move is designed to help Salesforce clients have a deeper understanding of each of its customers, to drive a heavily personalized pitching experience.
The move is also ideal to drive Einstein usage. Einstein is a CRM assistant that uses AI to improve employee performance. Einstein gives employees smart insights that allow them to dig deeper to know the reason behind outlier data. It is meant to help understand customers in a whole new way by learning channels, messages, and content. Eventually Snowflake, Einstein and Tableau might work in congruence to deliver unprecedented insights to customers. Nathan McMurtney of Eide Bailly Technology Consulting is already on board the idea and says “Data sharing is the future of business success, and Snowflake has created the ultimate platform for monetizing your data. Combined with what Salesforce is already doing with Tableau, Einstein, and MuleSoft technologies, this partnership will take business intelligence to whole new levels.”
Although never admitted openly, Salesforce does compete with Google, Microsoft, and Amazon in the cloud-based analytics space. Having a platform indifferent partner is one step towards climbing over the competitors’ shoulders.
Salesforce customers will find immense ease in sharing data with partners and enterprises, by physically separating potentially sensitive data using virtual ops.
There is no doubt that a native product for data-warehousing would catapult down the line and this would be the biggest announcement that SaaS will see by miles.
While it comes as no surprise that Salesforce has picked up the leader in data-warehousing as the path forward for its venture, the partnership promises a great deal for the CRM firm. The future looks bright for both Salesforce and Snowflake. Existing mutual customers are already bracing themselves for the one-click data solution that the partnering could provide for the. It should be noted that the news is still fresh and Slootman has mentioned that further details on the relationship will be announced in June. Until then, it’s fingers crossed.