Databricks picks up MosaicML, an OpenAI competitor, for $1.3B
Summary
Today, Databricks announced it will pay $1.3 billion to acquire MosaicML, an open source startup with neural networks expertise that has built a platform for organizations to train large language models and deploy generative AI tools based on them.Prior to this, MosaicML had raised just under $64 million from investors that included DCVC, AME Cloud Ventures, Lux, Frontline, Atlas, Playground Global and Samsung Next.Notably, its last investor-round valuation was just $222 million meaning its leaped 6x with this exit, a remarkable price that really does underscore just how frothy the AI market is right now, as well as the demand for talent and tech in the space.Frothy, but only relatively speaking, considering that competitor OpenAI was valued at upwards of $40 billion in its last round from Microsoft. But inevitably the Microsoft-backed parent of ChatGPT is not working in a vacuum, and others are emerging and growing to capitalize on the surge of interest in the space.MosaicML is no slouch in that regard. Databricks and MosaicMLs shared vision, rooted in transparency and a history of open source contributions, will deliver value to our customers as they navigate the biggest computing revolution of our time.Databricks said that the entire MosaicML team will join Databricks after the deal closes a retention deal that likely could be one reason for the large price tag here.CEO and co-founder Naveen Rao, an Intel alum, will be part of the team staying on.At MosaicML, we believe in a world where everyone is empowered to build and train their own models, imbued with their own opinions and viewpoints and joining forces with Databricks will help us make that belief a reality, he said in a statement. We started MosaicML to solve the hard engineering and research problems necessary to make large scale training more accessible to everyone. Together with Databricks, we will tip the scales in the favor of many and well do it as kindred spirits: researchers turned entrepreneurs sharing a similar mission.
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