Databricks is closing in on a $55 billion valuation after its latest fundraising, a source said

(Reuters) – Databricks, the long-speculated data analytics company for an IPO, is close to raising $8 billion in deals that could value it at $55 billion, according to a source familiar with the matter.

Most of the new funding will be in the form of secondary share sales, where early investors and employees are allowed to sell some of their stocks, the source said.

Such deals can improve employee morale, as stock-based payments typically comprise a large portion of compensation initially, while allowing the company to avoid an initial public offering.

Few high-flying startups want to stay private for long to avoid the regulatory burden and market volatility that comes with going public. The flexibility of a second sale gives them more time to strengthen their finances.

Venture capital investors Thrive Capital and DST Global participated in Databricks’ fundraising, two sources said.

Databricks did not immediately respond to Reuters’ request for comment. The potential fundraising was previously reported by CNBC.

The company received a total of 43 billion dollars after funding of 500 million dollars last year.

(Reporting by Krystal Hu in New York and Niket Nishant in Bengaluru; Editing by Shilpi Majumdar)