What’s the obvious rationale for going through the whole alphabet of funding rounds, instead of going public / IPO after «the usual» number of raising money.

Wouldn’t the current strategy result in some serious stock dilution for the early investors?

Investors put 10 billion in in a previous round; that's a lot. Somehow, more is needed now. 100M is just 1% of that. So it's not going to massively move the needle. But it does raise the question where all that cash is going.

My guess is that they might be about to embark on a shopping spree and acquire some more VC backed companies. They've actually bought quite a few companies already in the past few years. And they would need cash to buy more. The company itself seems healthy and generating revenue. So, it shouldn't strictly need a lot of extra capital. Acquisitions would be the exception. You can either do that via share swaps or cash. And of course cash would mostly go to the VCs backing the acquired companies. Which is an interesting way to liquidate investments. I would not be surprised to learn that there's a large overlap with the groups of VCs of those companies and those backing databricks. 100M$ on top of 10B sounds like somebody wants in on that action.

As a financial construction it's a bit shady of course. VCs are using money from big institutional investors to artificially inflate one of their companies so that it can create exits for some of their other investments via acquisitions financed with more investment. It creates a steady stream of "successes". But it sounds a bit like a pyramid game. At some point the big company will have to deliver some value. I assume the hope is some gigantic IPO here to offload the whole construction to the stock market.

Because they don't want the public market to put a real valuation on the company, when they can still raise money with a made up valuation.

Stock dilution doesn't work like that. If a seed investor invests for 5% at a $10mil valuation, and the company goes 10x (ie. a valuation of $100mil), if the company now raises a $100mil Series K, that means the Series K investor owns 50% of the company, and the seed investor got diluted down to 2.5%. However, the new valuation of the company is now $200mil with the cash that the new investor brought in, effectively making the seed investor's investment worth the same.

It's a smaller piece of a bigger pie.

To answer your question, the right question to ask is why go public when you can remain private? Public means more paperwork, more legalese, more scrutiny, and less control for the founder, and all of that only to get a bit more liquidity for your stock. If you can remain private, there really isn't much of a reason to not do that.

Both have benefits. Staying private means a lot less distractions, less investor scrutiny (good and bad), and the general ability to do whatever you want (good and bad).

It's a lot easier to stay long-term focused without investors breathing down your neck. As a private company you're not dealing with shortsellers, retail memers, institutional capital that wants good earnings now, etc..

Of course, the bad side is that if the company gets mismanaged, there's far less accountability and thus it could continue until it's too late. In the public markets it's far easier to oust the C-suite if things go south.

It's a shame that the trend of staying private longer means retail gets shut out from companies like this.

An order of magnitude less scrutiny, but also an order of magnitude in size of investor base. The private markets trade at Palantir levels so why go public. Also the private markets are now routinely doing secondary transactions so even less reason to go public.

A new round is easier than IPO. Especially when the IPO outcome is not necessarily positive.

IPO needs real numbers, VCs just want buzzwords

If the private markets can offer you the liquidity you need on your terms, then why subject yourself to the scrutiny of the public markets?

Plus the markets are in a weird state right now.