Photo Credit: Pete Linforth from Pixabay

According to a recent report, the global Cloud Database and Database-as-a-Service (DBaaS) market was valued at $10.37 billion in 2019 and is expected to grow at 15.7% CAGR through 2026. DBaaS is a high-growth industry and boasts of players like Oracle, MongoDB, AWS, Google, and SAP. DataStax is a niche player in the industry that is trying to find its positioning.

DataStax’s History

San Francisco-based DataStax was founded in 2010 by Jonathan Ellis and Matt Pfiel to help companies rethink the technology infrastructure on which they are building and deploying mission-critical cloud applications to transition to a distributed database platform built for hybrid cloud. It provides a suite of distributed data management products and cloud services to enable enterprises to deliver apps that help manage the competition.

The founders had initially worked at Rackspace on the Apache open source project, Cassandra. Jonathan was working at Rackspace to build a scalable database for their internal infrastructure and started working on Cassandra. He met Matt at Rackspace and together they worked there to deploy Cassandra internally. In 2010, they left Rackspace to set up Riptano, which later came to be known as Datastax.

Cassandra was built at Facebook and later made available for open source projects. It is used to build applications that serve the user bases of millions of users. Unlike traditional database technology, Cassandra provides linear scalability and reliability in case of both hardware and software failure. Cassandra provided organizations with a reusable technology that eliminated one-off solutions. Since Cassandra itself was a relatively new solution in the market in 2010, Datastax stepped in to provide expertise on managing it.

Today, DataStax offers a series of products and services built around Cassandra. It helps developers and its customers accelerate the development and deployment of apps on Cassandra along with providing them access to subscription-based support services and the ability to run NoSQL workloads including Graph, Search, and Analytics.

Netflix was one of DataStax’s initial customers. Today, it powers data apps for 500 of the world’s enterprises including The Home Depot, T-Mobile, Intuit, and half of the Fortune 100.

DataStax’s Recent Acquisitions

Earlier this year, DataStax announced its acquisition of Ontario-based Kesque for an undisclosed amount. Kesque is a cloud messaging service powered by Apache Pulsar. DataStax is leveraging the acquisition to launch DataStax Luna Streaming, its Pulsar-based streaming platform. Apache Pulsar is becoming the distributed messaging and streaming platform of choice for enterprises and cloud-native developers because of its scalability and resilience. Luna Streaming is a free, production-ready distribution of Apache Pulsar, tools, and optional enterprise-class support. DataStax will provide a paid subscription service of support for Luna Streaming as part of its product portfolio.

Last year, DataStax had announced the acquisition of New Zealand-based The Last Pickle, a Cassandra consulting and services firm. The Last Pickle’s team is known for its work on Cassandra-based open source solutions for the likes of Spotify, T Mobile, and AT&T. DataStax is leveraging The Last Pickle’s consulting skills and their experience in building systems with tens of thousands of nodes within its product offerings. Terms of the acquisition were not disclosed.

DataStax’s Financials

DataStax operates on a freemium model where basic products and services are available for free, but extended support and premium products can be purchased through subscription-based or pay-as-you-go terms. Being privately held, DataStax does not disclose its financials. However, a recent report suggested that it was operating at over $150 million in annual revenue rates, was cash-flow positive and profitable.

DataStax has raised over $190 million in funding from eight rounds of funding. Its initial seed round had come from the founders’ former employer, Rackspace itself. Its investors include SchindlerAM Ventures, Comcast Ventures, Lightspeed Venture Partners, DFJ Growth, Cross Creek, PremjiInvest, Wasatch Advisors, Kleiner Perkins, ClearBridge Investments, and Scale Venture Partners. A $106 million round held in 2014 had valued the company at $724 million.

DataStax’s Growing Offerings

Recently, DataStax announced a new API stack for modern data apps, Stargate API. Stargate is an open-source API framework for data that enables millions of developers to build modern data apps through the API of their choice. The new open-source API stack for modern data apps is available for free on GitHub and in the cloud. Modern data apps require a new tech stack that can manage massive amounts of data, can be delivered via APIs, and can deliver rich experiences. The Stargate API framework for data will broaden the tools available to the developers and applications for the Cassandra database and will simplify the effort required to build cloud-based data apps on Cassandra.

Last month, DataStax also announced the general availability of Astra Serverless, an open, multi-cloud serverless DBaaS that will help transform the database industry by delivering a combination of pay-as-you-go data along with the freedom and agility of multi-cloud and open source. DataStax Astra will introduce a modern, microservices-based architecture to separate compute from storage, enabling database resources to scale based on demand.

DataStax’s Competition

DataStax faces stiff competition in the market from other big vendors including Oracle, Amazon, and MongoDB. Back in 2014, it excelled in heavy-duty transaction processing and was seen as a promising alternative to Oracle. DataStax was placed as a niche player in the 2019 Magic Quadrant for Operational Database Management Systems along with Neo4j while Microsoft, Oracle, Amazon, Google, InterSystems, and SAP were placed in the Leaders quadrant. There’s likely a positioning for DataStax that leverages its unique set of capabilities. However, DataStax has not yet been able to clarify what that positioning is and what customer use cases the best leverage their unique selling proposition.