Starburst Data Inc., which sells a commercial distribution of the Trino distributed SQL query engine, today kicks off its Datanova conference with the announcement that it has raised a $250 million late-stage funding round that values the company at $3.35 billion.

Starburst, which is profitable, hasn’t yet spent any of the $100 million it raised just over a year ago, but Chief Executive Justin Borgman (pictured) said he hopes the new Series D funding will accelerate it toward a goal of an initial public offering within three years. Starburst has raised a total of $414 million.

The company has allied itself closely with the concept of a “data mesh,” in which business units within enterprises that are closest to data take ownership of it, curate it and expose it as a product to internal and external constituents. That requires additional tooling, and Starburst is using the funding announcement to introduce updates to its enterprise product that simplify the curation process.

Record funding

The funding continues the feeding frenzy among venture capitalists for all things cloud and data analytics. CB Information Services Inc. recently reported that global venture investments reached record highs in 2021 growing 111% over the previous year.

The trend has been helped by low interest rates that keep down capital costs and limit investors’ options for other places else to put their money. Signs that interest rates may soon increase were among the factors that prompted Starburst to seek the funding now, Borgman said.

The whole process took only three weeks, the CEO said. “There’s an appetite for those that investors perceive to be leaders in their category,” he said. At the same time, “there’s been a correction in multiples on the public side. Companies like Databricks and ourselves will have continued success fundraising but it will get harder for those that don’t have as much traction.”

That’s one reason Starburst will be looking harder at using its cash hoard for acquisitions. “That was one of the motivations of raising the capital,” Borgman said. Asked what gaps the company needs to fill he said, “We’re big believers in data mesh, so anything that helps facilitate that model.”

The funding will also be split between sales and engineering and fund an initiative to enter the Asia-Pacific market this year. Starburst said it grew both its headcount and customer base threefold last year.

Data as a product

On the product front, the company said its enterprise software now includes features that allow data owners to build and share data products along with native access controls for building a data mesh. Governance features have been enhanced with additional access controls.

Such features are needed in a data mesh environment because users work directly on each other’s data and create products such as joins and queries that require security controls, Borgman said. Data producers and data engineers can define relevant metadata needed to understand usage metrics, and create, publish, find and manage curated data products based on multiple data sets.

Enhanced metadata features give data owners visibility into how their product is being used. “Think reviews on Amazon,” Borgman said. “Consumers are giving interactive feedback. It mimics a storefront internally.”

The financing round was led by Alkeon Capital Management LLC, with participation from Altimeter Capital Management LP and B Capital Group US LLC.  Existing investors Andreessen Horowitz LLC, Coatue Management LLC, Index Ventures SA and Salesforce Ventures LLC also participated.

Photo: SiliconANGLE