Key Takeaways
- Leading artificial intelligence firms like Anthropic and OpenAI are increasingly reliant on specialised data analytics platforms such as ClickHouse to manage observability at petabyte scale, a task for which legacy systems are ill-suited.
- Nebius Group (NBIS), a publicly traded technology entity, holds a substantial 28% stake in ClickHouse, presenting an indirect but significant way to gain exposure to the critical infrastructure underpinning the AI sector.
- Recent financial disclosures indicate a pivotal shift in Nebius Group’s operational performance, with the company achieving profitability in its latest reporting periods, challenging outdated perceptions of its financial health.
- The adoption of ClickHouse by AI leaders is not merely a technical preference but a strategic necessity driven by the need for real time, cost effective analysis of model performance, inference costs, and data integrity.
- The valuation of ClickHouse, implied by its recent funding rounds, suggests that the market may not have fully priced the value of this asset into the current market capitalisation of Nebius Group.
The operational demands of scaling large language models are creating a distinct class of winners in the technology infrastructure sector. While much attention is lavished on silicon designers and cloud hyperscalers, the critical function of observability, the ability to monitor and analyse vast streams of performance data in real time, is proving to be a formidable bottleneck. It is here that specialist platforms are gaining prominence, with both Anthropic and OpenAI reportedly leveraging the open source database ClickHouse to manage this challenge. This shift carries significant implications for Nebius Group (NBIS), the technology holding company that retains a 28% ownership stake in ClickHouse, offering a nuanced and perhaps undervalued route into the AI infrastructure ecosystem.
The Data Deluge and the Limits of Legacy Tools
The task of observing an AI model in production is fundamentally different from traditional software monitoring. It involves processing petabytes of telemetry data, logs, and metrics to track everything from inference latency and computational cost to subtle drifts in model behaviour and output quality. Legacy observability tools, often built for more predictable, structured environments, buckle under the sheer volume and velocity of this data. Their architectural limitations can lead to unacceptable delays in query responses, making real time analysis impossible and hindering a firm’s ability to optimise performance and control costs.
ClickHouse addresses this problem with its columnar storage architecture and massively parallel processing capabilities. By storing data in columns rather than rows, it can scan and aggregate the vast datasets required for AI observability with remarkable speed. This is not an incremental improvement; it is a step change in performance that enables AI developers to ask complex questions of their operational data and receive answers in seconds, not hours. For firms like Anthropic, whose models are at the frontier of AI development, this capability is less a convenience and more a prerequisite for effective scaling and risk management.
Quantifying the ClickHouse Asset
ClickHouse, Inc., the corporate entity behind the open source project, has successfully translated its technical advantages into commercial momentum and significant private market validation. The company’s growth trajectory is underscored by its ability to attract capital, with its valuation reflecting its strategic importance in the data analytics landscape.
| Funding Round | Date | Amount Raised (USD) | Implied Post Money Valuation (USD) |
|---|---|---|---|
| Series A | September 2021 | $50 Million | Not Publicly Disclosed |
| Series B | October 2021 | $250 Million | $2 Billion |
| Series C | September 2024 | $350 Million | $6 Billion |
Based on the most recent funding round, Nebius Group’s 28% stake in ClickHouse holds an implied value of approximately $1.68 billion. This figure is a material component of Nebius Group’s own market capitalisation and serves as a clear marker of the asset’s value. The recruitment of senior executives like Kevin Egan, who joined as Chief Product Officer after holding leadership roles at Twilio and Slack, further signals the company’s maturity and ambition to solidify its position in the enterprise software market.
Nebius Group: A Financial Reassessment
For some time, the investment case for Nebius Group has been viewed through the lens of a high potential but unprofitable technology holding company. However, a closer inspection of its recent financial performance reveals a significant operational turnaround. The company’s strategic initiatives and the growth of its portfolio assets have started to translate into bottom line results, a development that seems to have been overlooked by parts of the market.
Beyond its stake in ClickHouse, NBIS operates a portfolio of technology businesses, including Toloka, an AI data labelling and annotation platform that recently attracted investment from Bezos Expeditions. It also has growing segments in cloud services and data centres. This diversification provides multiple avenues for growth, but it is the recent shift to profitability that fundamentally alters the risk profile of the company. It suggests a maturation from a cash burning venture capital style portfolio to a more sustainable, self funding enterprise. This transition makes the argument that its shares are undervalued, particularly when considering the crystallised value of its ClickHouse holding, more compelling.
A Hypothesis on Value Realisation
The market often struggles to accurately price complex holding companies, especially those with significant stakes in private, high growth assets. The current valuation of Nebius Group may not fully reflect the strategic value of ClickHouse or the company’s recent operational improvements. A disconnect appears to exist between the public valuation of NBIS and the private valuation of its core holding.
As a concluding hypothesis, a future liquidity event for ClickHouse, most plausibly an Initial Public Offering (IPO), could serve as a powerful catalyst for a re-rating of Nebius Group’s shares. Such an event would replace the implied valuation of its stake with a transparent, public market price, forcing a direct comparison that could illuminate the current discount. Should the market for AI infrastructure remain robust, a ClickHouse IPO could compel investors to view Nebius Group not as a speculative holding company, but as a profitable technology enterprise with a cornerstone investment in one of the AI era’s most critical data platforms.
References
1. Reddit. (2024). *Why OpenAI chose ClickHouse for petabyte-scale observability*. Retrieved from https://www.reddit.com/r/NBIS_Stock/comments/1lopes6/why_openai_chose_clickhouse_for_petabytescale/
2. ClickHouse. (2024, September). *ClickHouse Raises $350 Million Series C to Power Analytics for the AI Era*. Retrieved from https://clickhouse.com/blog/clickhouse-raises-350-million-series-c-to-power-analytics-for-ai-era
3. Nebius Group. (2024). *Nebius Welcomes Bezos Expeditions as Lead Investor in AI Data Business Toloka*. Retrieved from https://group.nebius.com/newsroom/nebius-welcomes-bezos-expeditions-as-lead-investor-in-ai-data-business-toloka
4. StockTitan. (2024). *Nebius Participates in ClickHouse Series C, Crystallizes Value of its 28% Stake*. Retrieved from https://www.stocktitan.net/news/NBIS/nebius-participates-in-click-house-series-c-crystallizes-value-of-y47vggveul9h.html
5. Yahoo Finance. (2024). *Kevin Egan Joins ClickHouse as Chief Product Officer*. Retrieved from https://finance.yahoo.com/news/kevin-egan-joins-clickhouse-chief-130000881.html
6. AInvest. (2024). *Nebius Group (NBIS): A Mispriced Option on the AI Infrastructure Boom*. Retrieved from https://ainvest.com/news/nebius-group-nbis-mispriced-option-ai-infrastructure-boom-2506
7. @mvcinvesting. (2024, October). [Post detailing Anthropic’s use of ClickHouse]. Retrieved from https://x.com/mvcinvesting/status/1938177009496031279
