Databricks has acquired Neon, a cloud-based database startup specializing in serverless PostgreSQL, in a billion-dollar deal. This acquisition aims to enhance Databricks' role in the AI tooling landscape and reflects a shift in the database market to meet the needs of AI-native applications. Neon, founded in 2021 and based in Menlo Park, California, had raised nearly million before this acquisition. Databricks CEO Ali Ghodsi noted that 80% of databases on their platform are created by code rather than humans, indicating a shift in database management driven by autonomous AI agents. Databricks has been actively acquiring companies to strengthen its AI development capabilities, having previously acquired firms like MosaicML and Arcion. Ghodsi emphasized that as a private entity, Databricks can make long-term strategic decisions without public market pressures. The acquisition reflects a broader trend of increased deal-making in the AI sector and highlights the growing importance of robust data infrastructure in the context of sovereign AI initiatives.