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The rumors of a takeover turned out to be true. Snowflake announced Wednesday that it has agreed to the acquisition Neevaa search startup founded by former Google executives, for an undisclosed sum.
The deal, announced during Snowflake’s quarter profit reportis expected to enhance Snowflake’s ability to deliver intelligent and engaging search experiences to its customers who use its platform to store, analyze and share data.
“Engaging data through natural language is becoming increasingly popular with advancements in AI,” Snowflake Chairman and CEO Frank Slootman said during a company earnings call.
“This will enable Snowflake users and application developers to build rich search and conversational experiences,” he added, “and we believe that Neeva will increase our opportunity to enable non-technical users to gain value. gain from their data, in a broader sense.”
Neeva stops looking for consumers
Neeva was founded in 2019 by Sridhar Ramaswamy and Vivek Raghunathan, who both worked at Google’s advertising technology division. Neeva raised $77.5 million in funding before being acquired by Snowflake. Investors included Greylock Partners, Sequoia Capital and Ram Shriram, a board member of Alphabet, Google’s parent company.
Neeva initially wanted to create a subscription-based search engine that would respect user privacy and not show ads. In January, Ramaswamy wrote a guest post on VentureBeat describing how Neeva wanted to challenge Google’s search monopoly and provide a better alternative for consumers. It is an effort that ultimately failed.
Last week, Neva announced it shut down its consumer search product and pivoted to focus on enterprise use cases of large language models (LLMs) and generative AI.
Neeva brings a conversation interface to Snowflake
Christian Kleinerman, Snowflake’s SVP of product, said during the call that the Neeva technology will help bring a new kind of experience to Snowflake users.
Kleinerman said Snowflake is on a mission to expand its capabilities as it brings computation closer to data. Snowflake has evolved over the years into an application platform and a core application use case is for search experiences. He noted that generative AI brings the idea of conversational experiences, which is where Neeva technology fits in.
“The people at Neeva are the ones who have the power to help us accelerate efforts around Snowflake as a search and conversation experience platform,” said Kleinerman. “But the most important thing is within the security perimeter of Snowflake, with the customers’ data, so they can take advantage of all these new innovations and technology, but with safety, privacy and security of the data.”
Snowflake’s take on AI
The acquisition of Neeva fits Snowflake’s strategy to help organizations take advantage of LLMs and the power of generative AI.
“Generative AI as a style of interaction captures the imagination of society as a whole and it will lead to disruption, productivity and obsolescence of tasks and entire industries,” said Slootman.
Snowflake’s stance is that generative AI needs data, which is what Snowflake has always focused on. Slootman noted that many generative AI models have been trained with internet or public data, and he believes companies will benefit from customizing AI with their own data.
The Neeva acquisition isn’t the first AI vendor Snowflake has acquired. In August 2022, Snowflake has acquired Applicationa startup that built technology to help organizations use AI to extract insights from data.
“Snowflake’s mission is to steadily tear down all limits on data users’ workloads and applications,” said Slootman. “New forms of AI will therefore continue to see us evolve and expand our functions and feature sets.”
Snowflake reported revenue for the quarter $623.6 million, representing 48% year-on-year growth. However, the company reported second-quarter product earnings that missed consensus estimates. Shares of Snowflake fell 12% in after-hours trading following the earnings report.
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