Snowflake’s $1 Billion Power Move: Buying the Data Stack It Helped Build

Snowflake just dropped a $1 billion bet on the future of data—itself, and the observability startup it’s been quietly nurturing since 2018.

Snowflake agreed to acquire Observe, a Snowflake-native observability platform, for ~$1 billion, making it its largest acquisition to date. Observe, founded in 2017 and incubated at Sutter Hill Ventures alongside Snowflake, raised $500 million from investors including Snowflake Ventures.

The deal creates a unified telemetry framework using Apache Iceberg and OpenTelemetry architectures.

"Integrating Observe into Snowflake allows users to proactively monitor their data stack and spot and fix issues 10x faster than before," according to a Snowflake blog post. Both companies share venture capital ties: Sutter Hill Ventures incubated both Snowflake and Observe, with Mike Speiser serving as Snowflake’s founding CEO.

Observe’s recent $848M valuation (as of July 2025) and Snowflake’s 2025 AI-focused acquisitions (Crunchy Data, Datavolo, Select Star) highlight its aggressive expansion strategy.

The $1 billion price tag surpasses prior deals like Streamlit’s $800M acquisition, underscoring Snowflake’s escalating spending in a year of data industry consolidation.