3 ms·
> Neon is valued at $1B; Neon is still early‑stage and, AFAIK, not profitable. It’s a perfect snapshot of 2025: anything that’s (1) serverless, and (2) even va
by dan_goosewin 1y ago
> Neon is valued at $1B;
Neon is still early‑stage and, AFAIK, not profitable. It’s a perfect snapshot of 2025: anything that’s (1) serverless, and (2) even vaguely AI‑adjacent is trading at a multiple nobody would have believed two years ago. Also supports my hypothesis that the next 12 months will be filled with cash acquisitions.
> Databricks will ruin Neon;
I certainly hope not. Focus on DX, friendly free tier, and community support is what made it special. If that vanishes behind Databricks’ enterprise guardrails, the goodwill will vanish with it.
- bobxmax 1y agoAre people still making comments like these in 2025? What the hell do profits have to do with valuing tech startups?
- dan_goosewin 1y agoProfitability might not be as relevant as it used to be in M&A discussions, but it matters when you’re paying $1B. Valuations like this only make sense if there’s a clear path to significant strategic leverage or future cash flow.
- bobxmax 1y agoNo, it doesn't matter when you're paying $1B. Why would it? Tech companies don't care about profits. It's easy to become profitable - tech margins are obnoxiously high. They're bought and valued for their ability to scale and rapidly absorb market share.
- dan_goosewin 1y agoFair point. I submit that I'm probably overestimating how much profitability matters here. I've been hearing that Neon is burning through cash pretty aggressively, which raised eyebrows for me. But you're right: high margins and scalability mean profits can be deferred.