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Credit: Databricks
Databricks, a leading platform for data and AI solutions, has announced plans to acquire Neon, a serverless Postgres database startup, in a transaction valued at around $1 billion, according to the company’s announcement.
The acquisition aims to strengthen Databricks’ position in the rapidly growing AI-driven database market, where automated AI agents increasingly manage data workloads. According to Databricks, the acquisition will enable the company to offer a more flexible, scalable database platform designed to meet the demands of modern AI agents.
Neon’s AI-friendly database attracts Databricks
Neon, founded in 2021 by Nikita Shamgunov, Heikki Linnakangas, and Stas Kelvich, provides a cloud-native, open-source Postgres database designed to meet modern applications demands. Its serverless architecture has been steadily gaining favor among developers.
Databricks pointed to recent internal data saying that “over 80 percent of the databases provisioned on Neon were created automatically by AI agents rather than by humans.” These types of agent-driven tasks require database systems capable of rapid deployment, flexible scaling, and consumption-based pricing models.
“The era of AI-native, agent-driven applications is reshaping what a database must do,” said Ali Ghodsi, co-founder and chief executive officer of Databricks, in a press release. “Neon proves it: four out of every five databases on their platform are spun up by code, not humans.”
Through the acquisition, Databricks intends to bring Neon’s architecture into its Data Intelligence Platform. The goal is to give developers and enterprises the ability to build and deploy AI agents at scale, without traditional database constraints.
“By bringing Neon into Databricks, we’re giving developers a serverless Postgres that can keep up with agentic speed,” Ghodsi added.
On LinkedIn, Ghodsi wrote, “Together, we’ll deliver an open, serverless database foundation for developers and AI agents.”
Neon CEO Nikita Shamgunov echoed that sentiment: “Four years ago, we set out to build the best Postgres for the cloud that was serverless, highly scalable, and open to everyone. With this acquisition, we plan to accelerate that mission with the support and resources of an AI giant.”
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Part of a bigger M&A push
This acquisition is the latest in a string of major moves by Databricks as it expands aggressively into the AI and data infrastructure space. The company previously bought MosaicML for $1.3 billion and Tabular for nearly $2 billion.
Backed by over $19 billion in funding and recently valued at $62 billion, Databricks is putting its capital to work in shaping the future of intelligent data platforms. Meanwhile, Neon has raised $129.6 million from investors including Microsoft’s M12, Menlo Ventures, General Catalyst, and Notable Capital.
The deal is expected to close after regulatory approvals. Once finalized, Neon’s team will join Databricks, and the companies plan to share more updates at the Data + AI Summit in San Francisco, happening June 9–12.
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