Snowflake Raises $45M Series C Round For Its Data Warehousing Service, Comes Out Of Beta

Snowflake, a novel data warehousing service that’s run by former Microsoft server and tools executive Bob Muglia, is coming out of beta today. In addition, the company today announced that it has raised a $45 million Series C round led by Altimeter Capital, with participation from previous investors Redpoint Ventures, Sutter Hill Ventures and Wing VC.

At first glance, data warehousing may seem like it’s a solved problem. Amazon, after all, offers Redshift, Microsoft’s Azure platform offers SQL Data Warehouse, and various other startups and legacy players offer a number of different warehousing solutions. Snowflake, however, argues that most of these other solutions weren’t build for the cloud. Instead, they were retrofitted for it. The team also argues that noSQL services — despite the hype around them — can’t replace traditional data warehouses.

So with Snowflake, the team built a SQL data warehouse that currently runs on top of AWS. Virtually all of the technology for Snowflake was developed in-house, including the database engine.

Snowflake CEO Bob Muglia and VP of products and marketing Jon Bock argue that data warehousing as we know it is in a crisis thanks to the advent of big data. But still, there are only a few thousand enterprises around the world today that actually use data warehousing services. Bock argues that this is simply because today’s products don’t meet people’s needs — so the team started from scratch and made it easy for new customers to get started. Because the service runs in the cloud, there’s no need for setting up appliances and software. Instead of having somebody on staff to tune and optimize the database, Snowflake’s technology automatically optimizes the database as a new user starts using it. “In our system, we take care of all of the things that aren’t about getting data into the system and querying it,” Bock said.

Today’s funding round brings Snowflake’s total funding to $71 million. The team plans to use this money to expand the company (it currently has 80 employees). While Snowflake will likely hire a few engineers, the focus of will be on expanding the salesforce in the U.S. — with an international push coming at a later date. Muglia and Bock tell me that Altimeter pursued the company “very heavily” and actually asked them for an account and currently uses the product in a production way itself (that’s not something you often hear about VC firms).