Advanced analytics vendor Alteryx got a resounding vote of confidence from venture capital groups this week in the form of an $85 million investment round. The infusion of money is certainly good news for Alteryx, but may also require it to make thorny strategic decisions.

Here are the details from the press release:

Alteryx, Inc., the leader in data blending and advanced analytics, today announced an $85 Million investment round led by firms Iconiq Capital and Insight Venture Partners. Meritech Capital Partners also participated. This latest investment will accelerate the generational shift in analytics where the drive toward "Data Literacy," coupled with self-service analytic tools, is re-engaging a broader set of data workers. Alteryx will leverage this investment to enable the over 260 Million data workers with the perfect platform for self-service data blending and advanced analytics. Alteryx currently is serving over 1,000 customers across all major industry groups and ranging from Global 2000 enterprise to SMBs on all continents.

The company reached that 1,000 customer milestone quickly over the past two years, growing from about 200 with a "land and expand" sales strategy, as Constellation Research VP and principal analyst Doug Henschen wrote in a recent blog post on Alteryx's 10.0 release.

Version 10.0's major advancements including an improved UI and expanded in-database processing capabilities. As Henschen wrote at the time:

The idea with in-database approaches is to push the processing to the center of data gravity. The obvious advantage is avoiding data movement, taking advantage of the processing power of a big, honking database and avoiding investments in yet more infrastructure.

Money Changes Everything?

The $85 million round announced this week is a significant sum of money, and the big question for Alteryx is what to do with it, Henschen says. "They are really good at self-service data preparation but to me, that market is really saturated now."

Bigger analytics vendors such as Informatica, SAP and Oracle are responding to the likes of Alteryx with their own data preparation tooling. "I feel like it's a feature, not a product. Ultimately I think customers would rather have it as part of a bigger suite, rather than a separate product." [Read Henschen's deeper dive into this topic.]

Alteryx has close and mutually beneficial partnerships with Tableau and Microsoft on the data-visualization front, but those waters are shifting, Henschen notes. Tableau, for one, is "amping up their self-service data handling capabilities, and they're interested in advancing their advanced analytic capabilities," he says.

It may be incumbent on Alteryx to flesh out its own capabilities, such as for data visualization and reporting. "They're kind of at a crossroads here," Henschen says.

The Questions for Customers

Alteryx customers would be wise to question the company about its strategic roadmaps. "Existing customers bought them for what they are today," Henschen says. 

The company has said it wants to expand its server and big data analysis capabilities, Henschen says. "This kind of funding would help them to do that." It's also conceivable that Alteryx itself will be acquired, perhaps by a current partner such as Tableau.