Dremio Preps for Growth with $70M in the Bank
In the midst of an unprecedented viral pandemic and the threat of a major economic recession, data middleman Dremio provided the rare bit of good news when it announced today that it raised $70 million in venture capital to fund its ongoing growth. We caught up with Dremio’s new CEO Billy Bosworth to get the lowdown on the company’s current strategy in lieu of the latest round.
Dremio has not been spared the disruption wrought by the novel coronavirus and the veritable shutdown of regular business that has followed. Employees of the Santa Clara, California company–whose Apache Arrow-based software simplifies and speeds access to big data sources like S3 and HDFS from BI tools like Looker and Tableau–are forced to work from home, like the rest of us, and are waiting until the quarantine order is lifted so they can get back to normal.
In a month that’s been anything but normal, the news that Dremio raised $70 million in a Series C round led by New York City venture capital firm Insight Partners was a rare and comforting bit of normalcy. According to Bosworth, who became the CEO of Dremio last month after spending the past eight years as CEO of NoSQL database vendor DataStax, the timing of the round was excellent.
“We got to a point where the company was in a strong position, with the tripling of ARR [annualized recurring revenue] growth and the product market that was emerging. That drew a lot of inbound interest from investors,” Bosworth tells Datanami. “So because of that, we felt it was the perfect time to look at next couple of years and our strategic investment plan and say ‘What do we want?’”
$70 million, it turned out. “We got exactly what we wanted out of the round for our strategic investment for the years to come,” he says. “Now we can invest with a very high degree of confidence for our overall mission.”
The coronavirus pandemic had zero impact on the timing of the round, Bosworth says, but it will affect how Dremio spends the money going forward.
“It [the COVID-19 pandemic] didn’t really change the decision on the timing because we were already well in progress before any of this came about,” he says. “Now that we have the money, and we look about where we’re going to apply those funds, you do have to look at it through two lenses just based upon what’s happening in the world.”
The COVID-19 crises shouldn’t have much impact on the Dremio product development team, which is used to working in a distributed manner, Bosworth says. However, the clampdown on travel and in-person events puts a big crimp in the plans for go-to-market team, which typically consists of the sales and marketing folks,
“In the short-term lens, there is a real opportunity to double-down on our engineering investments, because for engineers, working from home isn’t nearly as disruptive as [it is for] the go-to-market side of the house,” the Dremio CEO says. “In the situation we’re in today, with restrictive travel for some unknown duration of time, it doesn’t make sense to add roles to the organization that are reliant upon being able to travel and be in front of customers or host events.”
Dremio will continue to invest in digital aspects of its go-to-market strategy, which includes digital infrastructure, inside sales, customer success, and supporting customer journeys. “All of those are very much investment strategies for us,” Bosworht says.
At the end of the day, Bosworth is confident that Dremio has a product that resonates with today’s data demands. The Dremio Data Lake Engine software builds upon Apache Arrow–the in-memory columnar data format that it makes available as open source–with a collection of software designed to make it much easier for data users to access today’s big data sets.
There are two major market forces that are aligning to push the fortunes of the Dremio Data Lake Engine in the years to come, Bosworth says.
The first is the emergence of cloud data lakes as the defacto system of record for enterprise data. Cloud data stores like S3 and ADLS are “the default Bitbuckets…where everybody is putting all their data,” he says. The second major market force is the emergence of a cloud architecture where compute and storage are separated, and users can pick from a panoply of loosely coupled services that can act upon those resources.
“Dremio sits now in the middle of that architecture,” Bosworth says. “It’s loosely coupled to your data lake storage and is the interface through which your end user tools can now come. So whether it’s Tableau or PowerBI or Qlik or Looker or any of those, now they come through your Dremio engine, but they’re all loosely coupled. So it causes no dislocation to the rest of architecture stack, but it delivers all the query performance and security that you need for that interactive BI at the end-user side. The confluence of those two events are what got me so excited about what Dremio is doing.”
Looking forward, Bosworth wants to streamline the user experience for Dremio and reduce the friction to get customers familiar with the software. “We want it to become more self-evident, through self-exploration,” he says. “It isn’t something you need to see PowerPoint slides or watch videos. We want you to be able to get up and running in the first five minutes and start to see the value of the product without ever having to talk to a human.” (Or sit down next to one, as the current case may be.)
The latest round brings Dremio’s total funding to $115 million, after $45 million spread across previous rounds in 2015 and 2018. The company was valued between $100 million and $500 million in 2018, and it’s likely now much higher.
Teddie Wardi, managing director at Insight Partners, says Dremio addresses the key challenges enterprises face with data moving to the cloud at high volume. “The open architecture, high performance, and low cost are benefits that all resonate strongly with customers,” he says in a press release. “Catering to the needs of data teams, business users and IT alike, we believe Dremio is a foundational piece in building modern data platforms.”