Snowflake has agreed to acquire database startup Crunchy Data, aiming to win over customers seeking to build their own artificial intelligence agents. The deal is valued at roughly $250 million, according to a person familiar with the matter. The deal comes less than a month after Snowflake rival Databricks said it was purchasing Neon, a similar database startup, in a deal valued at about $1 billion.
Snowflake, a cloud-based data-warehousing company, and Databricks, a data analytics firm, are going head-to-head as they both chase businesses who want to build AI agents and other applications with their own data. Crunchy Data’s roughly 100 employees will join the company once the deal closes, which is expected in the next couple of weeks, and Crunchy Data will be part of an offering called Snowflake Postgres, Snowflake said.
The vision here is that Snowflake Postgres will simplify how developers build, deploy and scale agents and apps, said Vivek Raghunathan, senior vice president of engineering at Snowflake. With that in mind, it was important to acquire a company that was not just engineered for quick experimentation. Crunchy Data is a cloud-based database platform that helps large businesses and government agencies use PostgreSQL without needing to manage the infrastructure themselves. PostgreSQL is a popular open-source, relational database that dates to the late 1980s.
Part of the reason Snowflake and Databricks are interested in database companies is because PostgreSQL can serve as the underlying database for customers to create AI agents with data they store in the companies’ respective platforms. With its deal for Crunchy Data, Snowflake joins not only Databricks in pursuing clients who want to build their own AI agents, but also tech giants including Nvidia and OpenAI. Tech vendors have been vying to capture their share of the market for business-related AI tools as the technology moves from AI chatbots to AI agents.
More on Snowflake acquiring Crunchy Data on The Wall Street Journal
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