Databricks intends to acquire Neon, a leader in serverless Postgres technology, to enhance its database and developer experience. The database market is valued at over [openai_gpt model="gpt-4o-mini" prompt="Summarize the content and extract only the fact described in the text bellow. The summary shall NOT include a title, introduction and conclusion. Text: Databricks, a prominent player in the Data and AI landscape, has announced its intention to acquire Neon, a leading innovator in serverless Postgres technology. This strategic move comes as the database market, valued at over 0 billion, stands on the brink of significant transformation driven by advancements in AI. Databricks aims to enhance Neon's database and developer experience, catering to both existing and prospective customers and partners.
Neon: An Open, Serverless Foundation for Developers and AI Agents
In the evolving landscape of software development, AI agents are becoming indispensable. Neon is specifically designed to facilitate the workflows of these agents. Recent telemetry data indicates that more than 80 percent of databases provisioned on Neon are generated automatically by AI agents, highlighting the rapid growth of agent-driven workloads. These workloads present distinct characteristics that set them apart from traditional human-driven processes:
Speed + flexibility: AI agents operate at machine speed, eliminating the bottlenecks often associated with traditional database provisioning. Neon's capability to launch a fully isolated Postgres instance in under 500 milliseconds, along with its support for instant branching and forking of database schemas and data, ensures that experiments can be conducted without disrupting production environments.
Cost proportionality: The demand for a cost structure that scales with usage is paramount for agents. Neon's architecture separates compute and storage, allowing for a total cost of ownership that aligns with the actual queries executed across thousands of ephemeral databases.
Open source ecosystem: AI agents thrive in an environment that leverages the extensive Postgres community. Neon is fully compatible with Postgres and integrates seamlessly with popular extensions.
Ali Ghodsi, Co-Founder and CEO of Databricks, remarked on the significance of this acquisition: "The era of AI-native, agent-driven applications is reshaping what a database must do. Neon exemplifies this shift, with four out of five databases on their platform being created by code rather than human intervention. By integrating Neon into Databricks, we are providing developers with a serverless Postgres solution that meets the demands of agentic speed, flexible economics, and the openness of the Postgres community."
Databricks and Neon's Shared Vision
The collaboration between Databricks and Neon aims to dismantle the conventional constraints of databases that require simultaneous scaling of compute and storage, a limitation that can impede AI workloads. The fusion of Neon's serverless Postgres architecture with the Databricks Data Intelligence Platform is set to empower developers and enterprise teams to efficiently construct and deploy AI agent systems. This integration not only mitigates performance bottlenecks associated with numerous concurrent agents but also streamlines infrastructure, reduces costs, and fosters innovation—all while maintaining Databricks' core principles of security, governance, and scalability.
Nikita Shamgunov, CEO of Neon, expressed optimism about the future: "Four years ago, we set out to build the best serverless Postgres for the cloud, highly scalable and open to all. With this acquisition, we aim to accelerate that mission, bolstered by the support and resources of an AI powerhouse. Databricks was founded by open-source pioneers dedicated to simplifying the interaction between developers and data at any scale. Together, we are embarking on a new chapter in our ambitious journey."
Following the completion of the transaction, Neon's skilled team is expected to join Databricks, bringing valuable expertise and continuity to Neon's thriving community. This partnership will enable organizations to break down data silos, streamline architecture, and develop AI agents that are more responsive, reliable, and secure.
Further insights will be shared at the upcoming Data + AI Summit, scheduled to take place in San Francisco from June 9 to 12.
Details Regarding the Proposed AcquisitionThe acquisition is subject to customary closing conditions, including necessary regulatory approvals.
About NeonFounded in 2021 by a team of seasoned database engineers and Postgres contributors, Neon aims to provide a serverless Postgres platform that accelerates the development of reliable and scalable applications, catering to projects ranging from personal endeavors to enterprise-level solutions.
About DatabricksDatabricks is a leader in Data and AI, trusted by over 10,000 organizations globally—including notable names like Block, Comcast, Condé Nast, Rivian, and Shell, as well as over 60% of the Fortune 500. The Databricks Data Intelligence Platform empowers organizations to harness their data effectively and leverage AI capabilities. Headquartered in San Francisco, Databricks was founded by the original creators of Lakehouse, Apache Spark™, Delta Lake, and MLflow. For more information, follow Databricks on X, LinkedIn, and Facebook." max_tokens="3500" temperature="0.3" top_p="1.0" best_of="1" presence_penalty="0.1" frequency_penalty="frequency_penalty"] billion and is undergoing transformation due to AI advancements. More than 80% of databases on Neon are provisioned automatically by AI agents, which operate at machine speed and require a cost structure that scales with usage. Neon's architecture separates compute and storage, aligning costs with actual queries. The integration of Neon's serverless Postgres with Databricks aims to improve AI workloads by dismantling traditional database constraints. Following the acquisition, Neon’s team will join Databricks, enhancing their community and capabilities. The acquisition is subject to customary closing conditions and regulatory approvals. Neon was founded in 2021 to provide a scalable serverless Postgres platform. Databricks serves over 10,000 organizations globally, including many Fortune 500 companies.
