AI database startup Pinecone weighs sale amid rising competition

Pinecone, the Israeli-founded startup that became a central player in the infrastructure behind artificial intelligence systems, is exploring a potential sale, according to a report by The Information. The move comes as competition intensifies in the fast-growing database sector and after the company lost one of its most prominent customers, Notion.

The report said Pinecone, founded by Israeli entrepreneur Edo Liberty, has held early discussions with investment bankers to evaluate strategic options. Potential buyers could include major technology firms such as Oracle, IBM, MongoDB and Snowflake.

Pinecone develops a vector database designed to help engineers store and search data used by large language models (LLMs) and other AI systems. That technology has positioned the company as a critical link in the AI ecosystem, providing infrastructure to make generative models faster and more accurate.

The company’s rapid rise drew significant backing from Silicon Valley investors. In April 2023, Pinecone raised $100 million at a $750 million valuation in a funding round led by Andreessen Horowitz, with participation from ICONIQ Growth, Menlo Ventures and Wing Venture Capital. Liberty said at the time that Pinecone’s valuation had grown more than four-fold in just a year.

Pinecone operates from offices in Tel Aviv, New York and San Francisco, with a large research and development hub in Israel.