Databricks Inc. has announced its acquisition of Neon Inc., a serverless database startup, for a reported $1 billion. The primary goal of this acquisition is to enhance Databricks’ cloud data platform, particularly for artificial intelligence (AI) workloads.
Neon specializes in a managed cloud database built on the popular open-source PostgreSQL system. It features a custom-developed storage engine that leverages a distributed write-ahead log (WAL) for improved data integrity, manageability, and performance. A key capability of Neon’s technology is its ability to launch new database instances in under a second.
This rapid deployment is highly beneficial for AI agents, which often require quick access to databases to perform tasks and generate responses. Neon’s platform also allows developers to easily create separate database copies for multiple AI agents, preventing performance degradation. Databricks CEO Ali Ghodsi stated that integrating Neon will provide developers with a “serverless Postgres that can keep up with agentic speed, pay-as-you-go economics and the openness of the Postgres community.”
The acquisition is expected to be finalized by July 31, further strengthening Databricks’ offerings for AI development.
Source: https://siliconangle.com/2025/05/14/databricks-buys-serverless-database-startup-neon-reported-1b/
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