Databricks bets big on activating data for marketers with Hightouch investment

We’re living in a time where just about every company is overflowing with data, but when it comes to getting meaningful insights from it — that’s where organizations are often coming up short.

Enter Databricks, a San Francisco-based heavyweight in the data and AI space. They’re the team behind the lakehouse concept and they’re on a mission: To monetize data by making insights more accessible.

Today, Databricks has announced it’s putting its money where its mouth is. The company’s venture capital arm, Databricks Ventures, revealed in an exclusive VentureBeat report that it has made a strategic investment in promising San Francisco-based startup Hightouch, a software platform that helps businesses synchronize and activate all of their customer data.

Harnessing the power of vast data resources

The strategic investment is a part of a recent $38 million funding announcement aimed squarely at a core challenge that has troubled businesses: How to effectively harness the power of their vast data resources. The combined offering of Databricks’ robust data platform and Hightouch’s efficient data extraction capabilities is set to provide businesses with the tools needed to fully exploit their data, particularly in the field of marketing.

Steve Sobel, who leads communications, media and entertainment at Databricks, explained the essence of the partnership in an interview with VentureBeat. “What we’re delivering with Hightouch is all around making data usable,” he said. “It’s about helping organizations through their enterprise data challenges and strategy.”

Sobel’s comments underscore Databricks’ game plan to position itself as a vertical player in the sector, focusing on speaking the language of the customer and the industry. “We live in an era where every industry is moving toward direct-to-consumer,” he said. “Optimizing marketing and delivering a superior, personalized experience across any channel, anywhere, anytime is essential.”

Syncing customer data across systems

Hightouch cofounder and co-CEO Kashish Gupta offered a complementary perspective, explaining the “match booster” concept, a feature built into Hightouch that harmonizes first-party data with third-party datasets. “This approach allows businesses to reach their customers across a multitude of different channels,” said Gupta.

He further explained the convergence of data and marketing strategies, saying: “A data strategy and marketing strategy have actually become one in the current business landscape. Personalization based on factors such as zip code, last login time and myriad other activities now decisively influences these strategies.”

Reflecting on the surge in digital data, Gupta pointed out: “Companies have more data than ever due to digital transformation. Extracting value out of that data by optimizing marketing using the data is truly where this partner strategy delivers.”

(Editor note: To help enterprise executives learn more about how to manage their data to prepare for generative AI applications, VentureBeat is hosting its Data Summit 2023 on November 15. The event will feature networking opportunities and sessions on topics such as data lakes, data fabrics, data governance and data ethics. Pre-registration for a 50% discount is open now.)

Rapid growth by empowering marketing teams

Founded in 2020 by Gupta, a former Bessemer Venture Partners investor, and former Segment engineers Tejas Manohar and Josh Curl, Hightouch helps customers leverage their data warehouse as a single source of truth for their business teams.

By using Hightouch’s reverse ETL (extract, transform and load) technology, customers can access, explore and sync data from their data warehouse to more than 200 SaaS tools such as Salesforce, HubSpot, Facebook and TikTok, without relying on engineering resources.

Hightouch claims to have hundreds of customers already across various verticals and industries, including the NBA, Grammarly, PetSmart, Imperfect Foods and Betterment. For context on its rapid growth, the company says it increased its revenue three times in the first half of 2022 alone and has grown its team from 40 employees in 2021 to 93 this year.

Fueling product development, go-to-market, new talent

The new funding will be used to invest in product development, especially in the areas of customer understanding and out-of-the-box machine learning (ML) models, according to Gupta. Hightouch also plans to expand its go-to-market activities and hire more talent across different functions.

Gupta said that the company’s rapid growth has been driven by customer demand and product market fit. He said that Hightouch’s vision is to democratize data for all business teams by enabling them to use data from their data warehouse without code or engineers.

Hightouch is one of the pioneers of the reverse ETL category, which is rapidly growing as more businesses adopt data warehouses as their source of truth. According to Gartner, the number of enterprises implementing AI grew by 270% in the past four years and tripled in the past year, driving an increase in streaming data and analytics infrastructures with it. This creates a huge opportunity for platforms like Hightouch that can help businesses activate their data and apply AI to it.