Something happened last week on the same day that my colleague Mike Boland and I were recording episode 23 of Localogy’s This Week in Local podcast.
It’s one of those things that the host of any news-driven podcast expects but doesn’t exactly welcome.
On the episode, I talk briefly about Neeva’s plans to shut down its search engine in a tone that straddles “RIP” and “WTF” with a dash of Omar from The Wire. E.g., “If you go after the King, you best not miss.” You get the idea. I was having a bit of fun.
Neeva, for those of you who don’t know, was a richly funded startup that thought what the world needed was a Google alternative that was subscription-based and ad-free. In other words, it was doomed to fail. Or so thought many if not most of the observers who looked at it.
Founders Know Google Well
Neeva’s founders were in a position to know a thing or two about Google’s weaknesses (perceived or real). CEO and co-founder Sridhar Ramaswamy once ran Google Ads. AndCo-founder Vivek Raghunathan once led the monetization team at YouTube.
Neeva also had some well-placed (and well-heeled) fans. These included blue chip VCs Sequoia and Greylock, LinkedIn founder Reid Hoffman, podcaster/business guru Prof G (Scott Galloway), and others.
When it announced plans to shut down the search engine (i.e., its reason to exist), Neeva said it had much less trouble selling subscriptions than it had convincing users to try searching on something other than Google. Dislodging ingrained behavior is about as easy as pushing a boulder up a hill. And Google is the mother of all boulders.
So as I was talking about Neeva’s demise during the pod recording, the cloud data platform Snowflake was announcing that it had swooped in to buy up Neeva in order to boost its AI plans. Neeva had leaned heavily into AI’s role in building the next generation of search. And in the end, this meant Neeva had something to sell other than a search engine that apparently no one wanted.
So this story ends up having a slightly different ending than what we talked about on the pod.
So What Actually Happened?
Here is how Snowflake Co-founder and President of Product Benoit Dageville explained the decision to scoop up Neeva. [Too bad Snowflake’s founders didn’t choose the name “Ice Cream”.]
“Search is fundamental to how businesses interact with data, and the search experience is evolving rapidly with new conversational paradigms emerging in the way we ask questions and retrieve information, enabled by generative AI. The ability for teams to discover precisely the right data point, data asset, or data insight is critical to maximizing the value of data,” Dageville wrote.
“That’s why Snowflake is acquiring Neeva, a search company founded to make search even more intelligent at scale. Neeva created a unique and transformative search experience that leverages generative AI and other innovations to allow users to query and discover data in new ways.”
We have been unable to find any reporting on the price Snowflake paid for Neeva. We do know that Neeva raised at least $37.5 million back in 2020 when we first wrote about the company.
Neeva was early in seeing the connection between AI and search. It added LLM capability to its search experience before this became the only thing anyone would talk about.
Episode 23 of This Week in Local Looks at AI Search and WeWork’s Latest Play
Why Buy?
Dageville wasn’t terribly specific in his post announcing the deal. Snowflake seems to think its cloud data capabilities and Neeva’s work on AI and search are a match that will deliver a much better experience for Snowflake’s customers.
“We plan to infuse and leverage these innovations across the Data Cloud to the benefit of our customers, partners, and developers. Neeva allows us to tap into some of the most cutting-edge search technologies available to bring search and conversation in Snowflake to a new level,” he wrote.
And of course, there seems to be a little bit of an “acqui-hire” vibe to the deal.
“As part of the acquisition, we are joined by some of the brightest minds working in search today. Neeva’s leadership and team members have been instrumental in the creation of numerous successful products like Google’s search advertising and YouTube monetization,” Dageville wrote.
Ramaswamy hasn’t given up on the intersection of cutting-edge technology and search. He is a co-founder and board member of nxyz, which is a web3 search firm that offers “fast, reliable web3 indexing.” The company has reportedly raised $40 million.
Apparently, the initial product was built by a group of Neeva engineers. Perhaps the writing on the walls was very large and visible within Neeva?
