Snowflake signs Goldman as customer in push for banking deals

[SAN FRANCISCO] Snowflake, a software maker whose stock debuted with the biggest US initial public offering (IPO) in 2020, signed a deal worth millions of dollars with Goldman Sachs Group earlier this year, people familiar with the matter said.

The renewal contract was signed in Snowflake's second fiscal quarter, which ended in July, said the people, who asked not to be identified discussing a deal that hasn't been publicly disclosed. Representatives for Snowflake and Goldman Sachs declined to comment. Goldman began using Snowflake's technology more than two years ago for its Marcus unit and transaction-banking platform, one of the people said.

Snowflake's data-warehouse software is like a vacuum sucking up information strewn across different systems, so that businesses can analyse it all together. The company competes against the cloud-computing divisions of Amazon.com, Microsoft and Alphabet, as well as open-source vendor Cloudera and database stalwart Oracle.

San Mateo, California-based Snowflake listed on the New York Stock Exchange in September in the largest IPO ever for a software maker. Goldman Sachs acted as one of the lead underwriters for that listing. Since the IPO pricing, the stock has almost doubled to US$238, pushing the company's market value to about US$67 billion.

Snowflake has sought to sign more large enterprise clients and sees the financial-services industry as a key part of that effort. Capital One Financial, which is known for being early to adopt cloud technology, became a Snowflake client in July 2017. That contract is now valued around US$100 million, a person familiar with the situation told Bloomberg in September. Capital One was the first customer for Virtual Private Snowflake, a product for highly regulated industries that handle particularly sensitive data. Capital One also invested in a Snowflake funding round in 2017.

BLOOMBERG