Snowflake Computing is now worth $3.5 billion, a triumph for Bob Muglia

Snowflake Computing CEO
Bob Muglia
Snowflake
Computing

• Computer storage startup Snowflake Computing has raised
  a $450 million round of investment that values the company at
  $3.5 billion.
• That’s more than double the valuation it held nine
  months ago, when it last raised funding.
• It is a sweet moment of  triumph for its CEO Bob
  Muglia, who rose to fame as a top Microsoft exec before
  suffering a humiliating dismissal by Steve Ballmer when the two
  disagreed about cloud strategy.

A hot computer storage startup called Snowflake Computing has
raised a monster new round of venture investment: $450 million.
This round has given the company a pre-money valuation of $3.5
billion,
the company said.

This investment comes just nine months after the company’s last
round of $264 million, which valued it a $1.5 billion pre-money,
meaning it more than doubled its valuation just this year. 

One reason: Snowflake is run by well-known former Microsoft exec
Bob Muglia, who was hired by Bill Gates, helped build the
company’s first database product — still a huge business for
Microsoft today — worked on Office, MSN, and Windows, and then
ran Servers and Tools, a major Microsoft business unit that was
valued in its day at $15 billion and employed about 10,000
people.

Snowflake is similar to a cloud-based database. It’s a type of
database known as a data warehouse, which takes the vast amounts
of data a company is storing in a favorite cloud service, like
Amazon S3, and allows companies to sift through it all to find
answers to business questions. Snowflake’s claim to fame is that
it can ingest all types of data in its native form, reducing the
amount of work it takes to process data for analysis. It competes
with a lot of different technologies doing similar work in the
cloud, including Amazon’s own data warehouse service
Redshift. 

But Snowflake’s advantage over Amazon is that it also supports
data from Microsoft Azure, the biggest competitor to the Amazon
Web Services cloud. On top of that, Snowflake has been busy
striking up partnerships, like one with another hot big data
startup, Databricks. The founders of Databricks invented a
technology called Spark, which processes data super fast, and is
a favorite among science and technical teams — making it a good
partner for Snowflake as it moves to expand. 

Muglia’s big comeback 

Muglia isn’t a Snowflake founder, but he is a key reason for its
growth. He was hired as CEO in 2014, making him employee number
34.

Snowflake’s success is a particularly sweet triumph for Muglia.

As he previously told us, he suffered not just one, but two
publicly humiliating career set backs under Steve
Ballmer.  

“I was sort of let go by Microsoft twice,” he had
previously described to Business Insider. “Steve and I had our
disagreements in a major way two times at Microsoft.”

The first was shortly after Ballmer took over from Gates.
Ballmer reorganized the company and passed over Muglia.

“And in a period of one day, I went from 3,000 people
working for me to one,” he said. “I was demoted publicly. I went
from executive vice president to senior vice president.”

Ballmer assigned him a task of starting a new computer
storage group. The public demotion turned him into something like
a pariah for a while inside the highly-political Microsoft.
But Muglia fought back, turned the project into a success and
rose through the ranks again until he was running the hugely
important Servers and Tools division, responsible for about
one quarter of the company over.

That demotion taught him a huge career lesson, he told us
at the time. “We all have situations where we are not
successful, but it’s how we handle it.”

And then Ballmer and Muglia butted heads again, over the
direction Microsoft should go in cloud computing. Ballmer
basically fired him this time, and very publicly, too, publishing
an email that announced is departure that was picked up by all
the press. Ballmer promoted Satya Nadella to take Muglia’s place,
putting Nadella on the career track to become CEO.

The dismissal was not only embarrassing, it was damaging, he
says. Muglia had a non-compete agreement that prevented him from
jump-starting his career elsewhere. He spent two years at Juniper
Networks during a rough period there.

All of it taught him how to be a better boss, as well as how to
structure a company that can execute well, he says. 

“We all have situations where we are not successful, but it’s how
we handle it,” he previously told Business Insider.

After Juniper, he took the CEO job at a tiny startup called
Snowflake. In his four years there, has grown it from a company
valued at about $20 million to one now worth $3.5 billion.
Snowflake has raised a total of $923 million, most of it under
Muglia.

And his come-back might be even sweeter because Snowflake didn’t
support Microsoft’s cloud, Azure, until
just a month ago. That means Muglia built this $3.5
billion cloud company mostly on Amazon Web Services, which is
Microsoft’s biggest, most dangerous competitor. But that’s all
water under the bridge now, with the two companies forming at
least some kind of partnership.