What Snowflake’s CEO Shake-Up Means

Big news tonight in the enterprise software sector—and we’re not talking about Salesforce introducing a dividend (although that’s notable). No, the real headline is an AI-inspired changing of the guard at Snowflake, until recently a fast-growing enterprise software hotshot whose 2020 IPO turned into a blockbuster. Snowflake CEO Frank Slootman is retiring, to be succeeded by Sridhar Ramaswamy, a former longtime Google executive who joined Snowflake last year through the purchase of his search startup, Neeva. That deal was designed to jump-start Snowflake in AI, where it hadn’t previously been too aggressive. Ramaswamy didn’t take long to have an impact—Snowflake unveiled a new AI service in November—although the jury is out on how much traction that service will get with customers.

Putting Ramaswamy in charge should add even more impetus to the company’s efforts in the AI sector. Slootman is a veteran software executive, a respected manager who has overseen Snowflake since 2019 and previously ran ServiceNow, among other companies. But he is a businessperson, not an engineer. And even he acknowledged on a call with investors tonight that the emergence of generative AI meant Snowflake “needs a hard-driving technologist” to navigate future challenges. Ramaswamy “is the right executive at the right time,” he said. That line might seem like a cliche, but plenty of other retiring CEOs haven’t been quite as generous about their successors when they stepped down. (For more on Ramaswamy, see this article).