In just the past few weeks, two titans of the data world, Databricks and Snowflake, made blockbuster moves in the Postgres ecosystem:
- Databricks agreed to acquire Neon, a serverless Postgres startup, in a deal reportedly valued around $1 billion.
- Snowflake announced plans to acquire Crunchy Data for approximately $250 million.
This completes a pattern of M&A interest around Postgres:
- In January 2019, Microsoft acquired Citus Data to power Azure’s scalable Postgres offerings.
- In July 2015, IBM bought Compose, which included a managed Postgres service.
image source: reddit.com
Why the rush?
Postgres isn’t just a relational database anymore. It's becoming the foundation for full-stack data+AI platforms, and here’s why:
- Open-source and infinitely extensible
Its vibrant ecosystem, extensions like PostGIS, pgvector, and Citus, makes it the Swiss Army knife of data platforms. - Flexible runtime architecture
Whether deployed in serverless systems, containers, or traditional environments, Postgres adapts seamlessly. - Bridges OLTP, OLAP, and AI workloads
Companies are using it for transactional apps and analytics pipelines, cutting toolchain complexity. - Developer-first lock-in
Teams already love Postgres for reliability, tools, and ORM support. Controlling it = controlling a developer mindshare moat.
What each acquisition unlocks ⚙️
| Buyer | Target | What it Brings |
|---|---|---|
| Databricks | Neon | Serverless Postgres with storage/compute separation, AI-agent provisioning, branching designed for ephemeral AI workflows |
| Snowflake | Crunchy Data | Enterprise-grade, compliant Postgres stack, with government and enterprise traction |
| Microsoft | Citus Data | Scale-out Postgres extension turned core of Azure DB postgres |
| IBM | Compose | Multi-DB-a-service stack, including Postgres, play for dev centricity |
What this means for the platform wars
The narrative is shifting. Data giants aren't just building warehouses. They’re cornering the full lifecycle:
Operational database (Postgres) for app and AI workloads.
Analytical engine for pipelines and insights.
AI workspace for training, serving, and agents is tightly integrated to cut friction at every layer.
Owning Postgres means controlling the plumbing that connects app logic, data stores, and AI agents. Winners in this space will combine developer ergonomics with platform lock-in.
Developer and industry implications
- Startups: Expect elevated expectations around built-in AI-agent readiness, serverless-first APIs, and real-time provisioning.
- Infra teams: Postgres will no longer be a commodity component. You’ll be asked to support branching, multi-tenant, serverless deployments.
- Ecosystem flight: Open-source Postgres forks and extensions are up for grabs—or at risk of being subsumed into corporate platforms.
TL;DR
Postgres has evolved from “open-source database” to mission-critical runtime for developer-centric, AI-enabled platforms. Databricks and Snowflake’s acquisitions of Neon and Crunchy Data aren’t just database plays, they’re strategic moves to own the stack and retain developer mindshare.
FAQs
1. Why are companies like Databricks and Snowflake acquiring Postgres startups?
2. What makes Postgres attractive for modern workloads?
3. How will these acquisitions impact developers?
About the author
Dani is a data professional with a rich background in data engineering and real-time data platforms. At Estuary, Daniel focuses on promoting cutting-edge streaming solutions, helping to bridge the gap between technical innovation and developer adoption. With deep expertise in cloud-native and streaming technologies, Dani has successfully supported startups and enterprises in building robust data solutions.
