Tembo Leverages Database Growth to Secure New Funding for Expansion

As the demand for artificial intelligence (AI) continues to rise, so does the need for expertise in database management — an essential component of any AI pipeline. Databases not only store the information used for training and fine-tuning AI systems, but effective data management plays a vital role in facilitating AI adoption within enterprises.

One startup benefiting from the growing database market is Tembo, which has developed a platform that allows developers to deploy various versions of Postgres, the widely used open-source database system, in both cloud and local environments. This Monday, Tembo announced it secured $14 million in a funding round led by GreatPoint Ventures, with contributions from Venrock, Grand Ventures, Wireframe Ventures, Defined VC, and Cintrifuse Capital.

“We’re making the power of Postgres accessible to everyone,” said Tembo founder and CEO Ry Walker. “With Tembo, enterprises can reduce costs by consolidating databases and enhance efficiency through simpler data pipelines.”

Walker, who studied computer science at the University of Cincinnati, left school to start a web agency called Sharkbytes in the ’90s. After selling that venture, he founded Differential, a venture studio that gave rise to Astronomer, a co-founded open-source data engineering pipeline.

Following the launch of Astronomer, Walker discovered his passion for early-stage startups, which inspired him to establish Tembo. “Working on Astronomer and various open-source projects made me realize the model we developed could have a significant impact in the database space,” he shared.

Tembo offers a managed, metered software-as-a-service Postgres solution, as well as self-hosted software for creating and managing Postgres databases. Clients can quickly spin up databases featuring auto-scaling capabilities, with plans for auto-tuning for self-maintenance in the near future.

Recently, Tembo introduced its Machine Learning Stack, enabling developers to construct and deploy AI models — including generative AI services provided by Tembo — while leveraging workflows alongside their databases.

“The skyrocketing volume of data has led to widespread inefficiencies and high costs,” Walker noted. “Tembo empowers enterprises to cut expenses by consolidating databases while boosting efficiency with streamlined data pipelines.”

With $20 million in funding and a team of around 25, Cincinnati-based Tembo is set to focus on product development, hiring, and marketing, according to Walker. The company faces challenges from competitors like DBOS, a new venture by Postgres creator Mike Stonebraker. However, Walker is confident in Tembo’s strategy.

“We’re at a pivotal moment, ready to assist enterprises in optimizing their strategy by fully leveraging Postgres for their expanding data capture and storage needs,” Walker stated. “The global database market is rapidly expanding at 15% year-over-year, with projections to reach $200 billion by 2027. This is merely the beginning of a decade-long opportunity. Our ambition aligns with this vast potential; we’re committed to democratizing the power of Postgres for all.”