Upwind Raises $400M at $3.8B Valuation After Rejecting Datadog Acquisition Offer

Upwind, a San Francisco-based AI cloud security startup, raised a $400 million Series C at a $3.8 billion valuation led by Bessemer Ventures, with Greylock Partners and Craft Ventures participating. The round closed nine months after a $250 million raise at a $1.5 billion valuation. The financing nearly collapsed after Datadog, the publicly traded observability platform, sought to acquire Upwind. Datadog did not offer a premium above the $3.8 billion VC-set valuation, prompting the company to remain independent, a person familiar said. The four-year-old startup, founded by Amiram Shachar, adds $20 million to $30 million in annualized recurring revenue per quarter and is projected to end the year at roughly $90 million. That implies a valuation above 40 times forecast ARR—below the 80x ARR fetched by cybersecurity peer Cyera earlier this year. Upwind continues to draw acquisition interest, the person said.