Nebulagraph taps into China’s growing appetite for graph databases • TechCrunch

Graph databases, which store data in nodes and relationships instead of tables like Excel sheets, have grown in popularity in the information explosion that has exploded across industries. While TigerGraph and Neo4j dominate the Western market, China is seeing its own homegrown pioneers in the space.

Nebulagraph is a fast-growing startup from China that offers graph databases in open source and enterprise subscription options. The company announced this week that it has closed a Series A round led by Generation Capital, two years after funding its $8 million round. The company didn’t say how much it raised, saying it was in the “low tens of millions” of dollars.

Other investors in the round include Matrix Partners China, Redpoint China Ventures and Source Code Capital.

Nebulagraph has seen some encouraging growth over the past two years, with its user base rising from just 60 to 900, including both freemium and paid. The types of users have also expanded. Two years ago, customers were primarily using Nebulagraph to navigate information communications across social media, e-commerce and fintech platforms. Since then, the startup has attracted companies from the manufacturing sector, the most interesting of which are electric vehicle and aircraft makers.

The EV supply chain is so sophisticated that every car sale from the design stage to delivery can generate reams of data, said co-founder and CEO Sherman Yu, who previously worked at Ant Group and Meta. Even a small defect on a nail can have a big ripple effect on the vehicle, so manufacturers have mounts that show the condition of different parts in detail, for example, the supplier and the worker is responsible for them.

Data collection is not the end. Today’s highly customizable, Internet-connected vehicles are learning driver and passenger behavior. That means car companies need more robust tools to process their own data oceans, which is where graph databases come in.

“You can still find relationships in data before, but as the data set grows, relational databases become very slow,” Yu explained. Much of what Nebulagraph does for its customers is real-time, like buying recommendations, so speed is critical.

Other emerging user cases for Nebulagraph include AI-based drug discovery and chip design, Yu added.

About 90% of the company’s users are in China, but like many mature open source SaaS companies, Nebulagraph has visions of entering the West and building a global developer community. The company’s plans to open an office in the US have been “stalled” by the Covid-19 pandemic, but it says it is realigning resources to achieve global expansion by 2023.

While many Chinese consumer-focused startups are going global amid rising regulatory concerns at home, Nebulagraph is looking to the Western SaaS market because it is “more mature.”

China, which has the world’s largest Internet population, has a lot of information for me. The problem is that willingness to pay for SaaS remains low, from scrappy startups to deep-pocketed corporations. This is partly due to China’s long history of software piracy and relatively low labor costs, which make workplace automation less urgent than in the West.

There’s also the matter of old math, Yu explained. To this day, China still does not formally classify computer software – it must be classified as assets or expenses, making it difficult for companies to do their books.

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