(Reuters) – Databricks, the data analytics firm which has long been the subject of IPO speculation, is close to raising $8 billion via deals that would value it at $55 billion, according to a source familiar with the matter.
Most of the new funding would be in the form of a secondary share sale, where early investors and employees are allowed to cash out some of their stock holdings, the source said.
Such deals can boost employee morale, since stock-based payouts typically comprise a big chunk of the compensation at startups, while allowing the company to sidestep an initial public offering.
Several high-flying startups are seeking to stay private for longer to avoid the regulatory burden and market volatility associated with being public. The flexibility via secondary sales also gives them more time to strengthen their finances.
Major venture capital investors Thrive Capital and DST Global are participating in the fundraising by Databricks, two sources said.
Databricks did not immediately respond to a Reuters request for comment. The potential fundraising was earlier reported by CNBC.
The company had notched up a valuation of $43 billion after a $500 million funding round last year.
(Reporting by Krystal Hu in New York and Niket Nishant in Bengaluru; Editing by Shilpi Majumdar)
