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dbt Labs raised a Series D of $222 million in a funding round a year ago.
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The startup initially aimed for a higher valuation of $6.2 billion, but settled for a lower figure of $4.2 billion.
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dbt Labs has acquired Transform, a fellow analytics engineering firm, as part of its expansion plans.
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Transform specializes in semantic tools for data science insights.
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The acquisition will enhance dbt Labs' Semantic Layer product by making it more robust.
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The valuation of the deal has not been disclosed.
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Transform has raised $29 million from investors in the past.
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The decision to sell was based on a conversation between the two CEO's and a recognition of complementary work in the data science space.
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Dbt Labs works with raw data repositories in multiple platforms, including Snowflake, Databricks, and Bigquery.
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Dbt Labs started as a by-product from consultancy work and gained traction with enterprises after being open-sourced.