Data transformation startup Coalesce emerges from stealth

Coalesce, which is working with channel partners out of the gate, thinks that while problems around data migration have largely been solved, the major challenge today is solving bottlenecks to rebuilding and documenting data moving to the cloud.

Armon Petrossian, Coalesce’s co-founder and CEO

Today, San Francisco-based Coalesce is coming out of stealth with its new Coalesce Data Transformation platform. They are also announcing that they have raised a $5.92 million seed funding led by 11.2 Capital and GreatPoint Ventures.

Coalesce is emphasizing that their focus is not on data migration but on data analytics, including bringing a new approach to the modeling, cleansing, governance, and documentation of data.

“Data migration is not a small piece, but it is a largely solved piece,” said Armon Petrossian, Coalesce’s co-founder and CEO. “Organizations now go from enterprise data warehouse with the need to migrate hundreds of thousands of database objects on prem. Landing the data from Teradata to Snowflake is just one part, however. The rest is rebuilding it, and documenting it as you go. That’s what makes migrations take so long. It’s not a matter of getting data loaded. It’s a matter of solving bottlenecks to doing analytics properly.”

Petrossian said the challenge has been dealing with the pendulum between on-prem and cloud data warehousing.

“On-prem involved a lot of consolidation where point solutions dealt with every problem,” he said. “The modern data stack, with companies like Snowflake, use tools that weren’t really built with scale in mind. Snowflake brought a lot of attention to these problems. We at Coalesce have been exposed to the largest data warehouse case issues for decades around transforming data properly and documentation.”

Petrossian said that with the move from on-prem data warehousing point solutions to solutions in the data stack you have seen a shift in the ETL [Extract, Transform, Load] strategy to transformations in the database, which has led to a movement from ETL to EL as one process and T as another, separate process.

“Gartner hasn’t acknowledged that yet,” he stressed. “The transformations piece hasn’t been what they have focused on. They have been more focused on moving data, even though transformation is the largest problem for anyone doing analytics.”

Petrossian indicated that their solution has a secret sauce which is new to the industry.

“The key component that has never been done before is building a tool with a column-aware architecture from the ground up,” he said. “That’s what unlocks so many of the benefits.” These include providing an interface, and changing management, lineage, and deployment plans.

“That’s never been seen before in the cloud tooling space,” Petrossian added. “We also use more traditional things like SQL code and GUI base tools, and as a result, customers love how intuitive the interface is. Those things themselves aren’t the differentiating factors though. Those are the focus on column awareness and building tools around them.”

The platform is General Availability-ready on Snowflake today.

“We have a Global 500 organization already using us for their most complex data sets,” Petrossian said. “The focus from day one was the largest and most complex problems for the data-driven. Those are typically found in highly regulated industries, health care, financial services and insurance as well as manufacturing and large retail.”

Coalesce is already working with channel partners, including a Canadian partner in Calgary.

“We are unique because we have been around data automation for a long time,” Petrossian indicated. “People have been exposed to similar products. As we shoulder tap our close contacts, it leads to procurement and partnership conversations with system integrators, resellers and service providers. We have half a dozen out of the gate. They are predominantly regional integrators, but we do have two national providers. Our aim to focus on selling software and enable our partners to work with our customers on implementation. We don’t just hand it off though. We are there for support and architecture but would love the channel to be able to do implementations in larger customers, since we do deal with a lot of enterprise here.”

Coalesce does not currently have MSP partners, but Petrossian thinks that there could be an opportunity there.

“There would be opportunity for certain customers and organizations but that will be dictated by the market,” he said. “The use case would involve something like where companies have outsourced their analytics package to an MSP. I think it would be a great business strategy to use us to deliver analytics for a fraction of the cost, but that is something that hasn’t really happened yet.”