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Rumors of a takeover turned out to be true. Snowflake announced on Wednesday that it had agreed to acquire snowa search startup founded by former Google executives, for an undisclosed amount.
The deal, announced during Snowflake’s quarterly earnings reportIt is expected to enhance Snowflake’s ability to deliver intelligent and conversational search experiences to its customers who use its platform to store, analyze and share data.
“Engaging with data through natural language is becoming popular with advances in AI,” Snowflake President and CEO Frank Slootman said during a company earnings call.
“This will enable Snowflake users and app developers to create rich search and conversational experiences,” he added, “and we believe Neeva will increase our opportunity to enable non-technical users to extract value from their data, more broadly.” .
Neeva closes its consumer search
Founded in 2019 by Sridhar Ramaswamy and Vivek Raghunathan, who both worked in Google’s ad tech division, Neeva raised $77.5 million in funding before it was acquired by Snowflake. Investors included Greylock Partners, Sequoia Capital and Ram Shriram, a board member at Alphabet, Google’s parent company.
Neeva initially aimed to create a subscription-based search engine that would respect users’ privacy and not display ads. In January, Ramaswamy wrote a guest post on VentureBeat describing how Neeva wanted to challenge Google’s search monopoly and offer a better alternative for consumers. It is an effort that ultimately did not work.
Last week, Neeva Announced it was winding down its consumer search product and pivoting to focus on enterprise use cases of large language models (LLMs) and generative AI.
Neeva brings a conversational interface to Snowflake
Christian Kleinerman, Snowflake’s senior vice president of product, said during the earnings call that Neeva’s technology will help bring a new type of experience to Snowflake users.
Kleinerman said Snowflake is on a mission to expand its capabilities as it moves computing closer to data. Over the years, Snowflake has evolved into an app platform, and a core use case for apps is for search-enabled experiences. He noted that generative AI brings with it the notion of conversational experiences, which is where Neeva’s technology will fit.
“The people at Neeva have the power to help us accelerate efforts around Snowflake as a platform for search and conversation experiences,” Kleinerman said. “But most importantly within the Snowflake security perimeter, with customer data so they can take advantage of all these new innovations and technology, but with security, privacy and data security.”
Snowflake’s take on AI
The Neeva acquisition will fit into Snowflake’s strategy to help organizations benefit from LLMs and the power of generative AI.
“Generative AI as a style of interaction has captured the imagination of society at large and will bring disruption, productivity, and obsolescence to entire tasks and industries alike,” Slootman said.
Snowflake’s position is that generative AI requires data, which is what Snowflake has always been focused on. Slootman noted that many generative AI models have been trained on the internet or public data, and he believes that companies will benefit from personalizing AI on their own data.
The Neeva acquisition is not the first AI vendor to acquire Snowflake. In August 2022, Snowflake acquired Applicaa startup creating technology to help organizations use AI to gain insight from data.
“Snowflake’s mission is to constantly demolish any and all limits to data user workloads and applications,” said Slootman. “So new forms of AI will continue to see us evolve and expand our capabilities and feature sets.”
Snowflake’s reported revenue for the quarter was $623.6 million, which represents a year-on-year growth of 48%. However, the company gave second-quarter product revenue guidance that missed consensus estimates. Snowflake shares fell 12% in after-hours trading following the earnings report.
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