Snowflake to acquire database startup Crunchy Data for $250m

Snowflake, a data analytics software company, announced on June 2, 2025 that it has agreed to acquire Crunchy Data, a startup specializing in cloud-hosted database software.

The deal is valued at US$250 million, according to a source familiar with the transaction.

Crunchy Data offers a cloud-based version of the PostgreSQL open-source database, featuring security and performance enhancements.

PostgreSQL was recognized as the most popular database in Stack Overflow’s 2023 developer survey, surpassing MySQL.

🔗 Source: CNBC

🧠 Food for thought

1️⃣ PostgreSQL’s rising dominance drives strategic acquisitions

The rush to acquire PostgreSQL-based companies reflects a fundamental shift in the database market landscape.

PostgreSQL has risen to become the most popular database according to Stack Overflow’s 2023 developer survey, overtaking MySQL and establishing itself as the preferred open-source database solution.

This dominance explains why both Snowflake and Databricks are willing to make significant investments, with Databricks paying approximately $1 billion for Neon while Snowflake acquires Crunchy Data for $250 million.

These acquisitions follow a pattern established by Microsoft’s 2019 purchase of Citus Data, which enhanced PostgreSQL’s capabilities by allowing it to scale horizontally across multiple servers.

The value proposition of companies like Crunchy Data lies in their ability to enhance open-source PostgreSQL with enterprise features, particularly security and performance improvements, making them attractive acquisition targets for platforms looking to strengthen their data management capabilities.

2️⃣ Data analytics platforms expand into operational databases to capture AI workloads

Snowflake and Databricks are expanding beyond their traditional analytics domains into operational database territory through these PostgreSQL acquisitions.

By integrating PostgreSQL capabilities, Snowflake aims to “simplify the process of moving data” and help “clients more easily run queries on a larger supply of data,” critical functionality for AI applications that require seamless access to diverse data sources.

The competitive tension between Snowflake and Databricks is evident in their parallel PostgreSQL acquisitions, with Snowflake’s CEO specifically highlighting their focus on helping “customers build a strong foundation to lead in the era of agentic AI.”