According to the sources, Snowflake Inc. is in negotiations to buy startup Reka AI for more than $1 billion, increasing the software maker’s endeavor to provide generative AI capabilities.
Large language models, or software trained on vast expanses of the internet, are produced by Reka AI and can be used for a variety of purposes, including image captioning and customer care chatbots. Researchers from Google and Meta Platforms Inc., two divisions of Alphabet Inc., formed the company in 2022. In a 2023 financing round that included money from Snowflake’s venture arm, it was valued at roughly $300 million.
Snowflake is a cloud-based data organization and analysis tool manufacturer. The company views generative AI—which generates text, speech or image content in response to user input—as a business accelerator. In April, it released Arctic, a big language model of its own. Additionally, the business permits users to apply outside AI models—like those from Reka—to their Snowflake data.
In 2024, Sridhar Ramaswamy, who spent fifteen years working at Google, assumed leadership of Snowflake as CEO. Before being appointed CEO, he served as senior vice president of AI at Snowflake and started working for the company after it bought the AI-powered search engine Neeva last year.
Tech giants have hustled to collaborate with or buy out companies operating in the competitive generative AI space. Microsoft has funded OpenAI’s initiatives and recently recruited a significant number of Inflection AI’s workforce. To develop processors with an AI focus, Qualcomm Inc. and semiconductor startup Ampere are collaborating.
In addition to releasing an open-source large language model, Databricks, a business widely regarded as Snowflake’s primary rival, also purchased AI startup MosaicML for $1.3 billion last year. In September, Databricks was valued at $43 billion, whereas Snowflake’s market value was over $55 billion.
