Neon Postgres
| Subsidiary | |
| ISIN | 🆔 |
| Industry | Database software |
| Founded 📆 | 2021 |
| Founders 👔 | Nikita Shamgunov; Stas Kelvich; Heikki Linnakangas |
| Headquarters 🏙️ | , , United States |
Area served 🗺️ | |
| Products 📟 | Serverless PostgreSQL platform |
| Members | |
Number of employees | |
| Parent | Databricks (2025–present) |
| 🌐 Website | [Lua error in Module:WikidataIB at line 665: attempt to index field 'wikibase' (a nil value). ] |
| 📇 Address | |
| 📞 telephone | |
Neon is an American cloud database company based in San Francisco, California, that develops a serverless PostgreSQL platform.[1] Founded in 2021 by Nikita Shamgunov, Stas Kelvich, and Heikki Linnakangas, the company built a cloud-native architecture that separates storage from compute and adds features such as database branching, autoscaling, and point-in-time recovery.[2][3][4][5][6] In May 2025, Databricks announced that it had agreed to acquire Neon; by 2026, Neon described itself as a Databricks company and Databricks described Neon as the core technology behind its Lakebase PostgreSQL service.[7][8][9]
History
Neon was founded in 2021 by Nikita Shamgunov, Stas Kelvich, and Heikki Linnakangas.[1] Kelvich later wrote that the company began as an incubation at Khosla Ventures.[2] Neon's public company timeline places its first commit in March 2021.[8]
The company released a technical preview on June 15, 2022, opened access more broadly in December 2022, and announced general availability on April 15, 2024.[8][10] In July 2022, Neon said that it had completed a $30 million Series A-1 round, bringing total disclosed funding to $54.3 million.[2] In August 2023, it announced another $46 million funding round.[11]
In August 2024, Neon announced a $25 million strategic investment led by Microsoft's M12 to support expansion into Azure.[12] TechCrunch reported that the company had raised $130.6 million in total and planned to expand its workforce from about 100 to 120 employees.[1]
Products and technology
Neon's main product is a managed, usage-based PostgreSQL service with free and paid plans.[1][13] The company has described the service as a serverless, cloud-native reworking of Postgres in which storage and compute are separated while maintaining compatibility with upstream PostgreSQL.[3][10] Neon documentation highlights branching, autoscaling, scale to zero, and instant restore as core platform features.[4][5][14][6]
In Neon, a branch is a copy-on-write clone of data that can be created from a current or past state.[4] Autoscaling adjusts compute resources in response to load, while scale to zero suspends inactive compute after five minutes and resumes it automatically when queried again.[5][14] Instant restore, which Neon also describes as point-in-time restore, allows a root branch to be restored to an earlier point in time within its restore window.[6]
| Platform | Primary description in cited sources | Features highlighted in cited sources |
|---|---|---|
| Neon | Serverless managed PostgreSQL platform with storage and compute separated.[3][1] | Branching, autoscaling, scale to zero, and point-in-time restore.[4][5][14][6] |
| PostgreSQL | Open-source object-relational database system.[15] | SQL extensibility, ACID compliance, and point-in-time recovery through continuous archiving.[15][16] |
| Databricks lakehouse | Data management architecture combining elements of data lakes and data warehouses for analytics and AI.[17][18] | Unified governance, scalable storage and processing, and support for business intelligence, machine learning, and AI workloads.[17][18] |
Acquisition
On May 14, 2025, Databricks announced that it had agreed to acquire Neon.[7] Databricks said the deal was intended to give developers and AI systems a serverless Postgres foundation that could better support agent-created databases and other high-frequency workloads.[7][13] Neon said the transaction would give it the scale and backing to accelerate its mission.[19]
Databricks' official press release said the proposed acquisition was subject to customary closing conditions and any required regulatory clearances, but it did not state a purchase price.[7] Reuters and TechCrunch reported the deal at about US$1 billion.[20][13]
Databricks and Neon both emphasized the platform's role in AI-agent workflows. Databricks said internal telemetry showed that more than 80% of databases provisioned on Neon were being created automatically by AI agents rather than by humans; Neon made a similar claim in its own announcement.[7][19] At Databricks' Data + AI Summit in June 2025, the company introduced Lakebase, a fully managed PostgreSQL database for data applications and AI.[21] By December 2025, Databricks said Lakebase's autoscaling, branching, and recovery features were enabled by combining technology from the Neon acquisition with Databricks infrastructure.[22]
Reception and impact
Coverage of Neon in the technology press often framed it as part of a resurgence of Postgres-focused developer tooling. TechCrunch described Neon as an open-source alternative to Amazon Aurora PostgreSQL and reported in 2024 that hundreds of thousands of developers used its free tier, with thousands of startups and small and medium-sized businesses paying for premium services.[1] Reuters reported in 2025 that Neon had partnered with Vercel, Replit, Cloudflare, GitHub, and Microsoft to integrate its serverless PostgreSQL service into widely used developer tools and platforms.[20]
Coverage of the Databricks transaction linked it to a broader convergence of operational databases, analytics, and AI infrastructure. Reuters said Databricks wanted Neon to help enterprises develop and use AI agents more easily.[20] The Register later wrote that Databricks and Snowflake had both moved to bring PostgreSQL-based transactional systems onto their platforms, and in 2026 it quoted IDC analyst Devin Pratt as describing this as a broader trend in which vendors pair operational databases with analytics to support real-time and agentic AI workflows.[23][24] In January 2026, Databricks said that on Neon, AI agents were creating 80% of databases and 97% of database branches, and described Neon as the core technology behind Lakebase.[9]
References
- ↑ 1.0 1.1 1.2 1.3 1.4 1.5 Wiggers, Kyle (2024-08-07). "Database startup Neon nabs a Microsoft investment". TechCrunch. Retrieved 2026-05-19.
- ↑ 2.0 2.1 2.2 Kelvich, Stas (2022-07-26). "Neon doubles funding to $54M". Neon. Retrieved 2026-05-19.
- ↑ 3.0 3.1 3.2 Linnakangas, Heikki (2022-07-08). "Architecture decisions in Neon". Neon. Retrieved 2026-05-19.
- ↑ 4.0 4.1 4.2 4.3 "Branching". Neon Docs. Retrieved 2026-05-19.
- ↑ 5.0 5.1 5.2 5.3 "Autoscaling". Neon Docs. Retrieved 2026-05-19.
- ↑ 6.0 6.1 6.2 6.3 "Instant restore". Neon Docs. Retrieved 2026-05-19.
- ↑ 7.0 7.1 7.2 7.3 7.4 "Databricks Agrees to Acquire Neon to Deliver Serverless Postgres for Developers + AI Agents". Databricks. 2025-05-14. Retrieved 2026-05-19.
- ↑ 8.0 8.1 8.2 "About Us". Neon. Retrieved 2026-05-19.
- ↑ 9.0 9.1 Marwah, Kunal; Force, Mason; Murali, Ram (2026-01-27). "Enterprise AI agent trends: Top use cases, governance + evaluations and more". Databricks. Retrieved 2026-05-19.
- ↑ 10.0 10.1 Shamgunov, Nikita (2024-04-15). "Neon: A New Approach to Database Development". Neon. Retrieved 2026-05-19.
- ↑ Shamgunov, Nikita (2023-08-02). "We Raised another $46M – What's Next?". Neon. Retrieved 2026-05-19.
- ↑ Shamgunov, Nikita (2024-08-07). "Neon is coming to Azure". Neon. Retrieved 2026-05-19.
- ↑ 13.0 13.1 13.2 Iyer, Ram (2025-05-14). "Databricks to buy open source database startup Neon for $1B". TechCrunch. Retrieved 2026-05-19.
- ↑ 14.0 14.1 14.2 "Scale to Zero". Neon Docs. Retrieved 2026-05-19.
- ↑ 15.0 15.1 "PostgreSQL: About". PostgreSQL. Retrieved 2026-05-19.
- ↑ "PostgreSQL: Documentation: 18: 25.3. Continuous Archiving and Point-in-Time Recovery (PITR)". PostgreSQL. Retrieved 2026-05-19.
- ↑ 17.0 17.1 "Data Lakehouse Architecture". Databricks. Retrieved 2026-05-19.
- ↑ 18.0 18.1 "What is a data lakehouse?". Databricks Docs. Retrieved 2026-05-19.
- ↑ 19.0 19.1 Shamgunov, Nikita (2025-05-14). "Neon and Databricks". Neon. Retrieved 2026-05-19.
- ↑ 20.0 20.1 20.2 Singh, Jaspreet; Hu, Krystal (2025-05-14). "Databricks continues M&A spree, will buy Neon for $1 billion in AI-agent push". Reuters. Retrieved 2026-05-19.
- ↑ Dange, Jasraj; Dragus, Andrei; Nettleton, Dave; Norheim, Hans; Pierce, Susan; Xin, Reynold (2025-06-11). "Announcing Lakebase Public Preview". Databricks. Retrieved 2026-05-19.
- ↑ "Lakebase Holiday Update". Databricks. 2025-12-16. Retrieved 2026-05-19.
- ↑ "Snowflake and Databricks bank PostgreSQL acquisitions". The Register. 2025-06-10. Retrieved 2026-05-19.
- ↑ "Snowflake plugs PostgreSQL into its AI Data Cloud". The Register. 2026-02-03. Retrieved 2026-05-19.
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