>> From Sand Hill Road, in the heart of Silicon Valley, it's theCUBE, presenting the People First Network: Insights from Entrepreneurs and Tech Leaders. >> Hello everyone, I'm John Furrier with theCUBE. We are here for a special conversations part of Mayfield's 50th anniversary People First Network. This is a series of interviews from fault leaders around entrepreneurship, and insights. Manish Chandra, who's the CEO, Co-Founder and CEO of Poshmark, a very successful company. A serial entrepreneur that I've known for many, many years, going back to his early startups. Great to see you, thanks for spending the time today. >> Thanks for having me, John. And it's great, we were just talking about our early days when you were doing your podcast, and me, I was doing a social shopping company back then, was it, 2006? 2005 timeframe, a long time back. >> Pioneers have arrows on their back, as they always say in entrepreneurship, but if you look at the time when we were doing startups, over 14 years ago, social sharing, democratization; these were the buzzwords. This was the wave that we were all trying to ride. When 2008 hit, it kind of took the water down a little bit. But still the game didn't change, a rise comes Facebook, Twitter, social, multiple channels. The consumer's expectations changed a lot in that timeframe, and I want to get your thoughts because you've had two successful companies, Kaboodle and now PoshMark, with almost 40 million users, billion dollar valuation, hundreds and hundreds of employees, got like a hundred openings in your company. You're ramping up and you're scaling. But the expectations of users has changed. What are some of those dynamics in your business that you're seeing? >> I think the biggest sort of, uh, culmination or ignition point for social platforms came with the advent of mobile. And uh, early days of mobile were crude days, but you know, if you look back at the advent of Poshmark, sort of the idea of Poshmark reignited in my mind in 2010, and iPhone 4 had just come out. It was a couple of months after Instagram had started. And SnapChat had not even started yet. And what, I think, mobile platform did, especially with the high quality platform like iPhone 4 was, it made the process of content creation, consumption, and sharing so fast, and you finally had the device that could produce it, that uh, it just kept accelerating. And now, in the days of, you know, iPhone Excess Max and what have you, it's just so easy. At the same time, the speed expectation, the transparency expectation, and the velocity of expectation has gone up, and so what we've seen in Poshmark is, day one, our users were spending somewhere between 20-25 minutes in the app. And here today, we have billions of users, and they're still doing that same thing, so that level of deep immersion that you see is sort of unique to the mobile paradigm. >> I want to dig into the user expectation and the experiences that you're delivering. But before we start, take a minute to explain Poshmark; what you guys are doing as a core business, how it's evolved. >> So Poshmark, very simply, is a simple way to buy and sell fashion and other sort of style-based paradigm, we call it a social commerce platform because it really brings together users in a unique way. But it really allows anybody to build a business starting with their closet all the way to opening up a full-brand, wholesale engine on the platform. We provide all of the infrastructure, you know, shipping, payments, technology, and you have to bring in your inventory, so we don't touch inventory, but everything else we handle for you. >> So you're really helping people, enabling them to be successful with the ease of use; heavy lifting. >> Heavy lifting. >> It's kind of like Amazon. You don't need to provision anything, just kind of get started. E-Commerce in the era now of Google, Amazon, and Cloud technology, you see the rise of all the scale. How are you riding that trend, because that's a tailwind for you? And what is that doing for the user's expectations, I mean, I have four kids, I see them all online, they never use their laptops, except for homework, but they're on the mobile device, they're doing new things, this is the new expectation; what are some of those expectations? >> In our business, which is the business of fashion and style, what it means for people is, number one is, if they see something. Whether they see something on Instagram, or something on SnapChat, it needs to be instantly shoppable, right? And that obviously benefits a platform like us, which makes easy access to all of the different brands and things that are developing. At the same time, what social media's also doing is making the obsoleting of your products very fast, because once you've used it, you've, you know, posted a picture, you want to be able to not consume it again. >> You've been seen wearing the same outfit, I can't wear it twice! >> Exactly! And so we make that easy as well. And then the third thing is, uh, everyone is a content creator, everyone is a seller, everyone is sort of participating in this economy; people are hosting AirBnB guests in their home, people are selling on Poshmark, and the reason is because phone, and sort of this new mindset of collaboration and social makes it very easy for people to participate, so they want to be able to sell, but they don't want any hassle in that process. And so the new consumer expectation is instantaneous, deeply immersive, and constantly changing, and if you can't satisfy all of those things, then it becomes harder for you to scale. So you have to use technology, the physical world, and sort of the emotion all in the right mixture. >> One of the things I know that you're passionate about, and we've had this conversation, we feel the same way, certainly, at theCUBE is, role of community. And I see a lot of companies these days, whether they're saying we're doing an ICO using tokens to, um, getting a big bag of money from venture capitalists, oh yeah, our key strategy is to build a community. You can't buy a community. You've got to really win the hearts and minds and provide value, and you really can't, and build trust. Talk about the role of community for you guys, especially in the stylist world, where you have all this, where style's involved, a very robust community. How did you do it? How did you foster a community, and how did you nurture it? And how has that played out for you guys? >> So community is a foundation of Poshmark. And community's our value, not just our customer, but also what we are, and uh, community is what I'm more passionate about, even more passionate than fashion; and that was sort of, in my previous company, the thing that was really highlighted for me. And so we did it very slowly, actually. During the first year of our company, we only had a hundred users, but these hundred users were immersed. And then we went from a hundred to a thousand. Then thousand to five thousand. But very deliberately and slowly. So the end of the first 18 months of our company's life, we had maybe ten thousand users, right? And then we went from ten thousand to 300,000 in the next seven months, then we went from 300,000 to 12 million in the next two years. And today we went from 12 million to 40 million in the next few years, because, once you have sort of figured out how the community is created, it can scale very fast, but the early days if you compromise in how the community is being created, it's very powerful. For example, in the first, probably, eight or nine months in the company, I answered every single customer service email. And today, I probably interact with 80-100 customers directly everyday. Really keeping the pulse in sort of servicing. And service and love are sort of two of our core values, and it is very important that's built into the system. The second thing is, the community has to be authentic. You cannot fake a community. Which means, there is conversations that will happen in the community, there is, which may be antithetical to what you think is your brand, but if you don't let that authenticity happen, then what ends up happening is the community sort of withers away, because people are not going to tolerate anything inauthentic. The third thing, as you mentioned, is trust. And so from day one, we created not just trust in the way platform was built, but also in the economics. So day one we said, hey, if you're going to be part of this platform, there's two things that you're going to pay for; one, is, as a buyer, you're going to pay for shipping, and as a seller, you're going to revenue share with us, and we're not going to charge you any other money. Nothing. And so we shared, started from day one, a 20-80 partnership with our sellers, and today, here we are six or seven years later, and we have the exact same partnership. On the buyers, we started by charging them $7 for shipping, today our shipping is $6.49, at that time our shipping was 3 pounds to 5 pounds. Everything was priority, today everything is priority. So in six to seven years, if you think of any other marketplace in the world, not just in the country, how many times have they raised their fees? How many times have they changed their paradigm, changed their shipping paradigm? For us, it was very important. In the early days, it felt, people were saying, why are you charging so heavily? I said, I don't want to charge anything different tomorrow that I'm charging today, and by the way, there's no additional fees we've ever imposed on the platform, so, we don't have any marketing fees, any promotion fees, any credit card fees, and so that trust that's created ultimately leads to a lot of loyalty. And so today, you see our consumers growing, our users growing, and every single cohort we have continues to grow in revenue more like SAAS businesses, as opposed to e-commerce businesses. And that, to me, is the power of community if you do it right. >> And that's an interesting point. There's a lot of things you said in there, I think, that are worth doubling down on. One, I just want to highlight it, if you're creating value, and you're certainly scaling, passing that down in cost savings, and reducing cost and adding value, that's a secret formula. You see, we know one company that does that really well: Amazon! And that's worked. And they recognize the value of keeping people in there engaged, and so I think that's almost a take away for anyone watching is that if you're not adding value and reducing the costs while you're scaling, you're probably doing your math right. >> Absolutely. >> The second thing I want to talk about, and get your reaction to is you know about community and slowing it down at first. That's almost counter-intuitive. The, almost the answer is put the pedal to the metal, let's get some numbers; you took a different approach. You decided to take your time. Was that to get a feeling for the community, build the trust, understand the dynamics? Talk about why you went slow at first. >> The key is that the first two, three years, you're perfecting a lot of things, right? You have to make sure things are getting right. And in the first year, it was all about getting the product right, right? Then we scaled. Then we quickly realized that that scaling was breaking everything, was breaking our shipping system, was breaking our technology's office; I actually, Mayfield, which was an early investor in Poshmark, was on the board, and I went to my board, and I said you know, I'm actually going to slow down growth by 60%. And if you can imagine a venture board hearing that from their CEO, in the early days, it's challenging. >> It's a tough conversation. >> Yes. But I think one of the things that I value about Mayfield and my early investors is their focus on partnership, at a people level, a human level, with me. And uh, trust, and so we actually cut down our marketing budget by 80%, filled out the systems, got the partnership with USPS where we created the country's first fashion shipping label called Poshpost, and built up our technology and infrastructure, built out our payment partnership with BrainTree and Paypal, and by sort of, early-to-mid 2014, we started scaling and have never stopped. And in fact, I had told my investors early on, that first two or three years of building this business will be challenging, so hopefully you are prepared to go on this journey with me; but once we build it, it will accelerate. And what you see with us is, the business continues to accelerate every quarter, and we are seeing hyper growth, six, seven years into the business, which is even faster than the growth we saw in the first few years. And part of it is that, network business, which are built around true sort of networks, continue accelerating and connects later on in the process, but if you haven't created the right foundation in the early days? They fall apart. >> I think that's a lesson that entrepreneurs can learn, because you got to go slow to go fast. In Cloud based businesses where you have network effects, if there's a crack in the foundation, it can come crumbling down. >> It can come completely crumbling down, and it did, I mean, there were times in 2013 when people were literally doing things and just, the data would get lost in other things. We had to fix many of those, the broken pieces. We had USPS come to our offices and say hey, either you pay us a multi-million dollar fine or we have the right to arrest you. We had to renegotiate our contract with them. There's a bunch of things that happen in that scaling, and you hear things like blitz scaling and stuff these days, and their great terms, but at the same time, if you don't fix what's broken, you can't build that super scalable business. >> You got to be ready to blitz scale. As you know, Reid Hoffmann's famous channel, Masters of Scale, points out, which, by the way, is a great program, but, if you're not ready, you can crash and burn big time. That's a good point. You know, I have conversations a lot with a lot of senior people, one of them Theresa Carlson, who runs Amazon Web Services Public Sector Cloud business, she talks about doing the hard work upfront. And, you know, she's using public sector, so you have to get those kind of certifications, it sounds like this is a lot of things that you had to do. How did that test your entrepreneurial spirit? I know you, and you're hard-charging, but you're pragmatic and we can see that. But taking the time to do the work can sometimes test the patience of the team and the entrepreneur themselves. What's your reaction to that? >> Um, I would say that, you know, when we started Poshmark, the mission was that can we serve a hundred million people. In the country, you know, not even around the world. In our way we have 40 million people. From day one what we saw was deep engagement in the platform, because of the level of usage we had, because of the level of, sort of, activation we had, we knew we were on to something. I'll share a small episode with you, which convinced us that we've touched a deep nerve within the community is, in May of 2012, we were barely, you know, six, seven months into our app being launched in the public space, and we had maybe five or ten thousand users. At that time, we were adjusting our shipping for the first time, and uh, literally we announced the, we had launched the product with a small discount on the shipping, we were going to take it back, and we just said, you know, we're going to take it back. We got 200 plus emails which ranged from, you know, you're going to take away my entire set of clothing, and my entire business and we barely thought we were even launched, and so we knew we were servicing something very deep. That commitment to servicing the community where you are, really helping people at a deep level, allowed us to ride through these crazy ups and downs. And there was a point of time we went along the valley, even though we had the initial funding, in the mid stages of it we got over 200 rejections in the paradigm; sometimes multiple by the same investors. And so, it was definitely not a smooth ride in the middle of building this company. But that sort of passion for community and what they were experiencing kept us going. >> Let's talk about People First and venture capital. And one of the things I'm impressed on with this program we're doing with Mayfield is, and theCUBE has newer effect as well in the community, it's a people-centric culture. We lived through the social media early days when social and democratization was happening. More than ever now, you're seeing the role of people, because we're all connected. So there's rapid communications, there's frictionless, for people to yell and/or raise their hand and give accolades as well. So you have now a social dynamic with the fabric around the world. People can transact and communicate, complain, you know, applaud. This is changing everything. How is that change your outlook on life, because you have to recruit people, they want to work for a company that's people-centric, they want to work for a mission-driven company. These are the new dynamics we're starting to see in this generation; how has People First impacted your core mission? >> So for me, life is all about people. This company's all about people. We serve people, people is one of our core values. And my connection with Mayfield, which is through Navid, started back, actually, in my previous company. At the very beginning of that journey, '04/'05, uh, and we tried to partner up but the timing was never right, so when we were starting Poshmark, Navin was the first one with a term sheet, even before he'd sort of seen the business idea. And to me, that was a huge belief in me and the team I could put together. And I have the same sort of feelings about the people we bring on into the company, where uh, many of my team members here, including two of my co-founders, were involved with me in Kaboodle. One of them was a co-founder in Kaboodle. The first 20, 30, 40 people, I think, in the company, are still here seven or eight years later. They were people who are now playing very senior roles in the company, where they've gone through their ups and downs and we are always behind, two or three people left and we recruited them back into the company. So I think at the end, life, anywhere, but particularly in today's world, is so much about people and relationships. And it's the same thing we did to our community. I mean, uh, we just finished our sixth annual user conference, which was six times bigger than our first one. What was amazing was, they were so many people who were there in the first conference who had been coming to all the six conferences, and they are now like mini-celebrities in the community. And so, it's just amazing to see how a focus on people can be both rewarding at a business level, but also very gratifying at a personal level. >> It's nice to see you hit that tipping point. Congratulations on your success, it's great to see. You're a great entrepreneur. I want to ask you the question around funding, because I know, we've both been through venture capital fundings, we've been through this point building this great company you run now, and you've actually hit massive growth to a whole other level, your challenge today and going forward. This is, given it's Mayfield's 50th anniversary, you've seen a lot of changes in venture capital. A rounds used to be A rounds, now there's B and pre-C, there's all kinds of nuance, and now you have alternative funding now and global landscape you're seeing block chain and cryptocurrency, although ICO's have taken a bath because of the regulatory issue. Issues around regulation, some scams out there, actually. But venture capital's been tried and true. What's changed in venture capital the past 25 years in your view? >> I think, two things, which have happened, particularly in the last seven or eight years is there's a lot of it. And secondly, it favors the mighty more than the weak. And so, those are sort of the two big changes that have happened in the venture capital business. I think you were just mentioning is the people I used to work with, a whole range of investors, are now investing in post-growth stage funds. I mean, the same company. So everyone is sort of leveled up and leveled up and then leveled up, you know? You see venture capitalists raising two, three, four billion dollar funds; I mean, that's not venture capital, there's no way you can deploy that at the venture stage. A company is staying private much longer at different scales, which I think is probably more sort of a sign of the times. And finally, I think, it is the metrics and the scale that your business can achieve, that these are obviously very aware of, is an order of magnitude bigger than it has ever been. In fact, sort of, in some ways, unicorn, being the unicorn is uh, as sometimes as people joke, sometimes an insult. You need to be a deca-unicorn these days. So the feeling of not being enough is constant. >> And that's challenging, too, for the venture industry, because, you know, there's still the classic building blocks of entrepreneurship and venture architecture, which is, you start with an idea and you get a prototype, and certainly it's easy to get on the Cloud computing certainly, a great win for the entrepreneur; so I can see maybe some acceleration. But at the end of the day, it's still the classic blocking and tackling with building your company. >> Yes. >> Building a durable company. >> Absolutely. And you and I have both seen the '98, '99, 2000 timeframe, you know, everyone believes nothing repeats, and, you know, we certainly see, maybe not exactly the same thing, maybe it's an order of magnitude less, but there's definitely some level of exuberance we see today. But if you're building a fundamentally good business, that has robust economics, that can scale, and is based on foundational principles, with a large sort of market, I don't think that we are wrong in terms of deploying massive amounts of capital up against it. But at the same time, um, I think it also creates certain socioeconomic, as well as responsibility challenges, that I don't think we are fully facing up to, as an economy, and as a Valley. >> You've raised over a hundred million plus, so you have done some funding. A lot of funding, you have a lot of cash you've raised. When you had to go through those exercises of looking at the fundraising, 'cos, you don't want it to die on the mind, you're building a durable business, you have to go through multiple rounds of fundings. What were the key decision points for you as you started to look at this fundraising process to build your business? >> See, in the early days it was literally just about survival, I mean, there were times where I ran the business on negative balance sheets, right? So it isn't that it's been easy. I was only, I would say, the last funding round was the one that was easy, where we got multiple term sheets proactively, and the first couple of them. In between--. >> When things are scaling things are great, you know? >> In the middle of it, every single round was effectively zero to one term sheets. Every single time. We were lucky to have Mayfield as a partner, and some of our early investors like Inventus and Menlo who sort of supported us through each of these pieces of the journey. Mayfield as an anchor point. But it was really, really hard. And part of it is that, what we were doing was challenging, so many things still are, that even to process our cohort data is hard. Do you think of it as used, do you think of it as buying, do you think of it as selling, what is it? It looks like a bird, but it moves like a plane, you know? What is it? It's Superman or Superwoman, right? So that being a challenge, uh, only in the last round did we have the freedom, we could raise no money, some money, all of the money, and um, most of the focus for us, for that capital, was really to have the deep pockets that would be required for global expansion. We had actually scaled the business, at that point in time, that we didn't need too much money for domestic expansion. And in fact, not only have we not touched any money from that round, we have not touched any money from the previous round, so far; most of the money from the previous round. And so, again, part of it is you need muscle to compete in a bigger world, but at the same time, if you build a fundamentally sound business, then over time you can scale with or without money. >> And you got SAAS, sellers and service, and network effects booming and great community. That's a great tailwind for you guys, for sure. >> It is a phenomenal tailwind, and in fact, um, I was just in my management team meeting this morning, and I said, you know, we are growing, but we can grow even faster at this point, because the level of network effect we are seeing in the community is an extraordinary effect, where there's sort of second order; our community is opening up Instagram accounts to promote Poshmark to sort of go out to YouTube, so there's sort of this wild, organic movement that's happening across the country, which is just bringing out a whole different level of growth that we've ever seen. >> Yeah, there's a whole new dynamic it seems. It's interesting, I'm seeing, and not a lot of people writing stories about it are documenting it, but Masters of Scale has a whole different perspective, but no one's really talking about something that you guys are touching upon, and we're seeing it in our business. Creating an environment that has network effects, and community, and good content in this case, product for your end. Um, creates a flywheel. And what's interesting is, in this new era of people who can create value, with the ability to capture it, is really a unique formula, and I think this is the new kind of management discussion. Certainly lower prices, increased value, that's an Amazon effect. That's a, lacking the words, good example, well-documented, you do that, you're good, you're doing it, but now you have the ability for people to create value. Who can then capture it. This is almost a whole 'nother big wave. Your reaction? >> I think the power of people today is at a very unique level, right? And it can go in the negative direction, but when you harness it from a positive perspective, it's phenomenal. And to me, you know, we've started added a fifth core value recently, is that at the end, the true happiness comes from service of others, right? And if you service everyone, in our job, you're servicing our community, who's then servicing other people, and that creates an amazing sort of paradigm. And if you remove the conversation of money, because it's taken care of, it's built into the platform, then it just keeps sort of circulating. And I think that's something that people underestimate. And one of the things that you, you know, you see is that, for example, open source software, right? You start by focusing on community and then it becomes all about money, and then you forget about the community and you see many of the larger open source companies slow down, because they forget the fact that what brought them there was the community. And to me, I think--. >> If they get greedy, the project's fail. >> Exactly, exactly. And so, the hardest thing at scale to balance is how do you make sure that you're still focused on the community? >> Great stuff! Final question for you. You know, these days, with venture capital, the question always is, where's the value at? Talk about your experiences with Mayfield, and what differentiates a value add versus a value subtract investor? When should an entrepreneur feel it? What's the tell signs of someone's got a value add, and partner is not? >> I think, I think Mayfield is so aligned in so many ways with our core values, which is focus on people and focus on service, that it's just been an amazing partnership with them. You know, even in our lowest moments, I knew that we would get funded; I didn't know how it is, because I knew that Navid and Mayfield would figure out a way, so I never sort of worried about the capital after I brought in Navid and saw him in action for a year and a half. And if you're a venture capitalist, you need to provide capital! And forget about any of the services, many VCs fail that one task, which is to provide capital when you most need it, right? But beyond that, it's been a great resource. I mean, I met my co-founder through Mayfield. Tracy and I were first introduced via Mayfield. Many of our recruiting of the top executives have come from Mayfield, but they're always available as a sounding board across the pieces, so I do think that they take their service paradigm to a whole new level. >> And they support you, too, right? The support's there? >> Support and they have an HR partner who's helped, I think, with some of the recruiting issues, hiring the recruiting partnerships, et cetera. PR, other areas as we needed it. Somebody that you could call on, too, even if it was just talking about searching for a general counsel, and Mayfield has been great, even in that. Help, at this late stage of a company, so it's fantastic. >> It's a great network; people, value, paying it forward. Manish, thanks for coming on, sharing your insights, here as part of theCUBE's 50th People Network with Mayfield. Thanks for sharing your experience. >> Thanks for having me! It's been a pleasure and joy to see you after so many years as well! >> This is theCUBE here on Sand Hill Road at Mayfield for their 50th Anniversary as a Venture Capital Firm, sharing insights and ideas from entrepreneurs, and tech executives. I'm John Furrier, thanks for watching! (electronic music)

>> Narrator: theCUBE covering, DataWorks Summit Europe 2017. Brought to you by Hortonworks. >> Welcome back to the DataWorks Summit in Munich everybody. This is The Cube, the leader in live tech coverage. Chandra Mukhyala is here. He's the offering manager for IBM Storage. Chandra, good to see you. It always comes back to storage. >> It does, it's the foundation. We're here at a Data Show, and you got to put the data somewhere. How's the show going? What are you guys doing here? >> The show's going good. We have lots of participation. I didn't expect this big a crowd, but there is good crowd. Storage, people don't look at it as the most sexy thing but I still see a lot of people coming and asking. "What do you have to do with Hadoop?" kind of questions which is exactly the kind of question I expect. So, going good, we're able to-- >> It's interesting, in the early days of Hadoop and big data, I remember we interviewed, John and I interviewed Jeff Hammerbacher, founder of Cloudera and he was at Facebook and he said, "My whole goal at Facebook "when we're working with Hadoop was to "eliminate the storage container "and the expensive storage container." They succeeded, but now you see guys like you coming in and saying, "Hey, we have better storage." Why does the world need anything different than HDFS? >> This has been happening for the last two decades, right? In storage, every few years a startup comes, they address one problem very well. They address one problem and create a whole storage solution around that. Everybody understands the benefit of it and that becomes part of the main storage. When I say main storage, because these new point solutions address one problem but what about all the rest of the features storage has been developing for decades. Same thing happened with other solutions, for example, deduplication. Very popular, right at one point, dedupe appliances. Nowadays, every storage solution has dedupe in. I think same thing with HDFS right? HDFS's purpose is built for Hadoop. It solves that problem in terms of giving local access storage, scalable storage, big plural storage. But, it's missing out many things you know. One of the biggest problems they have with HDFS is it's siloed storage, meaning that data is only available, the data in HDFS is only for Hadoop. You can't, what about the rest of the applications in the organizations, who may need it through traditional protocols like NFS, or SMB or they maybe need it through new applications like S3 interfaces or Swift interfaces. So, you don't want that siloed storage. That's one of the biggest problems we have. >> So, you're putting forth a vision of some kind horizontal infrastructure that can be leveraged across your application portfolio... >> Chandra: Yes. >> How common is that? And what's the value of that? >> It's not really common, that's one of the stories, messages we're trying to get out. And I've been talking to data scientists in the last one year, a lot of them. One of the first things they do when they are implementing a Hadoop project is, they have to copy a lot data into HDFS Because before they could enter it just as HDFS they can't on any set. That copy process takes days. >> Dave: That's a big move, yeah. >> It's not only wasting time from a data scientist, but it also makes the data stale. I tell them you don't have to do that if your data was on something like IBM Spectrum Scale. You can run Hadoop straight off that, why do you even have to copy into HDFS. You can use the same existing applications map, and just applications with zero change to it and pour in them at Spectrum Scale it can still use the HSFS API. You don't have to copy that. And every data scientists I talk to is like, "Really?" "I don't know how to do this, I'm wasting time?" Yes. So, it's not very well known that, you know, most people think that there's only one way to do Hadoop applications, in sometimes HDFS. You don't have to. And advantages there is, one, you don't have to copy, you can share the data with the rest of the applications but its no more stale data. But also, one other big difference between the HDFS type of storage versus shared storages. In the shared, which is what HDFS is, the various scale is by adding new nodes, which adds both compute and storage. What if our applications, which don't necessarily need need more compute, all they need is more throughput. You're wasting computer resources, right? So there are certain applications where a share nothing is a better architecture. Now the solution which IBM has, will allow you to deploy it in either way. Share nothing or shared storage but that's one of the main reasons, people want to, data scientists especially, want to look at these alternative solutions for storage. >> So when I go back to my Hammerbacher example, it worked for a Facebook of the early days because they didn't have a bunch of legacy data hanging around, they could start with, pretty much, a blank piece of paper. >> Yes. >> Re-architect, plus they had such scale, they probably said, "Okay, we don't want to go to EMC "and NetApp or IBM, or whomever and buy storage, "we want to use commodity components." Not every enterprise can do that, is what you're saying. >> Yes, exactly. It's probably okay for somebody like a very large search engine, when all they're doing is analytics, nothing else. But if you to any large commercial enterprise, they have lots of, the whole point around analytics is they want to pool all of the data and look at that. So, find the correlations, right? It's not about analyzing one small, one dataset from one business function. It's about pooling everything together and see what insights can I get out of it. So that's one of the reasons it's very important to have support to access the data for your legacy enterprise applications, too, right? Yeah, so NFS and SMB are pretty important, so are S3 and Swift, but also for these analytics applications, one of the advantage of IBM Solution here is we provide local access for file system. Not necessarily through mass protocols like an access, we do that, but we also have PO SIX access to have data local access to the file system. With that, HDFS you have to first copy the file into HDFS, you had to bring it back to do anything with that. All those copy operations go away. And this is important, again in enterprise, not just for data sharing but also to get local access. >> You're saying your system is Hadoop ready. >> Chandra: It is. >> Okay. And then, the other thing you hear a lot from IT practitioners anyway, not so much from from the line of businesses, that when people spin up these Hadoop projects, big data projects, they go outside of the edicts of the organization in terms of governance and compliance, and often, security. How do you solve, do you solve that problem? >> Yeah, that's one of the reason to consider again, the enterprise storage, right? It's not just because you have, you're able to share the data with rest of applications, but also the whole bunch of data management features, including data governance features. You can talk about encryption there, you can talk about auditing there, you can talk about features like WAN, right, WAN, so data is, especially archival data, once you write you can't modify that. There are a whole bunch of features around data retention, data governance, those are all part of the data management stack we have. You get that for free. You not only get universal access, unified access, but you also get data governance. >> So is this one of the situations where, on the face of it, when you look at the CapEx, you say, "Oh, wow, I cause use commodity components, save a bunch of money." You know, you remember the client server days. "Oh, wow, cheap, cheap, cheep, "microprocessor based solution," and then all the sudden, people realize we have to manage this. Have we seen a similar sort of trend with Hadoop, with the ability to or the complexity of managing all of this infrastructure? It's so high than it actually drives costs up. >> Actually there are two parts to it, right? There is actually value in utilizing commodity hardware, industry standards. That does reduce your costs right? If you can just buy a standard XL6 server we can, a storage server and utilize that, why not. That is kind of just because. But the real value in any kind of a storage data manage solution is in the software stack. Now you can reduce CapEx by using industry standards. It's a good thing to do and we should, and we support that but in the end, the data management is there in the software stack. What I'm saying is HDFS is solving one problem by dismissing the whole data management problems, which we just touched on. And that all comes in software which goes down under service. >> Well, and you know, it's funny, I've been saying for years, that if you peel back the onion on any storage device, the vast majority anyway, they're all based on standard components. It's the software that you're paying for. So it's sort of artificial in that a company like IBM will say, "Okay, we've got all this value in here, "but it's on top of commodity components, "we're going to charge for the value." >> Right. >> And so if you strip that out, sure, you do it yourself. >> Yeah, exactly. And it's all standard service. It's been like that always. Now one difference is ten years ago people used propriety array controllers. Now all of the functionalities coming into software-- >> ASICs, >> Recording. >> Yeah, 3PAR still has an ASIC, but most don't. >> Right, that's funny, they only come in like.. Almost everybody has some kind of a software-based recording and they're able to utilize sharing server. Now the reason advantage in appliance more over, because, yes it can run on industry's standard, but this is storage, this is where, that's a foundation of all of your inter sectors. And you want RAS, or you want reliability and availability. The only way to get that is a fully integrated, tight solution, where you're doing a lot of testing on the software and the hardware. Yes, it's supposed to work, but what really happens when it fails, how does the sub react. And that's where I think there is still a value for integrated systems. If you're a large customer, you have a lot of storage saving, source of the administrators and they know to build solutions and validate it. Yes, software based storage is the right answer for you. And you're the offering manager for Spectrum Scale, which is the file offering, right, that's right? >> Yes, right yes. >> And it includes object as well, or-- >> Spectrum Sale is a file and object storage pack. It supports both file and protocols. It also supports object protocols. The thing about object storage is it means different things to different people. To some people, it's the object interface. >> Yeah, to me it means get put. >> Yeah, that's what the definition is, then it is objectivity. But the fact is that everybody's supposed to stay in now. But to some of the people, it's not about the protocol, because they're going to still access by finding those protocols, but to them, it's about the object store, which means it's a flat name space and there's no hierarchical name structure, and you can get into billions of finites without having any scalable issues. That's an object store. But to some other people it's neither of those, it's about a range of coding which object storage, so it's cheap storage. It allows you to run on storage and service, and you get cheap storage. So it's three different things. So if you're talking about protocols yes, but their skill is by their definition is object storage, also. >> So in thinking about, well let's start with Spectrum Scale generally. But specifically, your angle in big data and Hadoop, and we talked about that a little bit, but what are you guys doing here, what are you showing, what's your partership with Hortonworks. Maybe talk about that a little bit. >> So we've been supporting this, what we call as Hadoop connector on Spectrum Scale for almost a year now, which is allowing our existing Spectrum Scale customers to run Hadoop straight on it. But if you look at the Hadoop distributions, there are two or three major ones, right? Cloudera, Hortonworks, maybe MapArt. One of the first questions we get is, we tell our customers you can run Hadoop on this. "Oh, is this supported by my distribution?" So that has been a problem. So what we announced is, we found a partnership with Hortonworks, so now Hortonwords is certifying IBM Spectrum Scale. It's not new code changes, it's not new features, but it's a validation and a stamp from Hortonworks, that's in the process. The result of is, Hortonworks certified reference architecture, which is what we announced. We announced it about a month ago. We should be publishing that soon. Now customers can have more confidence in the joint solutions. It's not just IBM saying that it's Hadoop ready, but it's Hortonworks backing that up. >> Okay, and your scope, correct me if I'm wrong, is sort of on prem and hybrid, >> Chandra: Yes. >> Not cloud services. That's kind of you might sell your technology internally, but-- >> Correct so IBM storage is primarily focused on on prem storage. We do have a separate cloud division, but almost every IBM storage production, especially Spectrum Scale, is what I can speak of, we treat them as hybrid cloud storage. What we mean that is we have built in capabilities, we have feature. Most of our products call transfer in cloud tiering, it allows you to set a policy on when data should be automatically tiered to the cloud. Everybody wants public, everybody wants on prem. Obviously there are pros and cons of on primary storage, versus off primary storage, but basially, it boils down to, if you want performance and security, you want to be on premises. But there's always some which is better to be in the cloud, and we try to automate that with our feature called transfer and cloud data. You set a policy based on age, based on the type of data, based on the ownership. The system will automatically tier the data to the cloud, and when a user access that cloud, it comes back automatically, too. It's all transferred to the end. So yes, we're a non primary storage business but our solutions are hybrid cloud storage. >> So, as somebody who knows the file business pretty well, let's talk about kind of the business file and sort of where it's headed. There's some mega trends and dislocations. There's obviously software defined. You guys have made a big investment in software defined a year and a half, two years ago. There's cloud, Amazon with S3 sort of shook up the world. I mean, at first it was sort of small, but then now, it's really catching on. Object obviously fits in there. What do you see as the future of file. >> That's a great question. When it comes to data layout, there's really a block file of object. Software defined and cloud are various ways of consuming storage. If you're large service probably, you would prefer a software based solution so you can run it on your existing service. But who are your preferred solutions? Depending on the organization's preferences for security, and how concerned they are about security and performance needs, they will prefer to run some of the applications on cloud. These are different ways of consuming storage. But coming back to file, an object right? So object is perfect if you are not going to modify the data. You're done writing that data, and you're not going to change. It just belongs an object store, right? It's more scalable storage, I say scalable because file systems are hierarchical in nature. Because it's a file system tree, you have travels through the various subtype trees. Beyond a few million subtype trees, it slows you down. But file systems have a strength. When you want to modify the file, any application which is going to edit the file, which is going to modify the file, that application belongs on file storage, not on object. But let's say you are dealing with medical images. You're not going to modify an x-ray once it's done. That's better suited on an object storage. So file storage will always have a place. Take video editing and all these videos they are doing, you know video, we do a lot of video editing. That belongs on file storage, not on object. If you care about file modifications and file performance, file is your answer, but if you're done and you just want to archive it, you know, you want a scalable storage, billions of objects, then object is answer. Now either of these can be software based storage or it could be appliance. That's again an organization's preference for do you want to integrate a robust ready, ready made solution, then appliance is an answer. "Ah, no I'm a large organization. "I have a lot of storage administered," as they can build something on their own, then software based is answer. Having most windows will give you a choice. >> What brought you to IBM. You used to be at NetApp. IBM's buying the weather company. Dell's buying EMC. What attracted you to IBM? Storage is the foundation which we have, but it's really about data, and it's really about making sense of it, right? And everybody saying data is the new oil, right? And IBM is probably the only company I can think of, which has the tools and the IT to make sense of all this. NetApp, it was great in early 2000s. Even as a storage foundation, they have issues, with scale out and a true scale out, not just a single name space. EMC is pure storage company. In the future it's all about, the reason we are here at this conference is about analyzing the data. What tools do you have to make sense of that. And that's where machine learning, then deep learning comes. Watson is very well-known for that. IBM has the IT and it has a rightful research going on behind that, and I think storage will make more sense here. And also, IBM is doing the right thing by investing almost a billion dollars in software defined storage. They are one of the first companies who did not hesitate to take the software from the integrated systems, for example, XIV, and made the software available as software only. We did the same thing with Store-Wise. We took the software off it and made available as Spectrum Virtualize. We did not hesitate at all to take the same software which was available, to some other vendors, "I can't do that. "I'm going to lose all my margins." We didn't hesitate. We made it available as software. 'Cause we believe that's an important need for our customers. >> So the vision of the company, cognitive, the halo effect of that business, that's the future, is going to bring a lot of storage action, is sort of the premise there. >> Chandra: Yes. >> Excellent, well Chandra, thanks very much for coming to theCUBE. It was great to have you, and good luck with attacking the big data world. >> Thank you, thanks for having me. >> You're welcome. Keep it right there everybody. We'll be back with our next guest. We're live from Munich. This is DataWorks 2017. Right back. (techno music)

>> Live from Orlando, Florida, it's theCube, covering Cisco Live 2018. Brought to you by Cisco, NetApp, and theCube's ecosystem partners. >> Welcome back, I'm Stu Miniman, and this theCube's coverage of Cisco Live 2018 in Orlando, Florida. We've got three days of programming we've been doing. We're heading towards the end, but still going strong. Happy to welcome to the program, first time guest, John Apostolopousos, who's the vice president and CTO of Enterprise Networking and lab director of the Innovation's Lab with Cisco. It all rolls right off the tongue, right John. >> Yes, yes. >> But welcome to the program, thanks so much for joining us. >> Thank you for joining me, it's a pleasure being here. >> Alright so you and I were rapping, we both have some background in networking in innovation labs. So, you know, it's one of the things I love to talk about, who doesn't love to talk about innovation. Tell us a little bit about your background and what are the innovation labs inside of Cisco? >> Okay, so I've been working in various areas of R and D and innovation for many years. And I joined Cisco about five years ago, both to be CTO and also to create a group, a lab, a group of people to help identify and try to solve problems of a strategic importance to Cisco's future. And by doing these, we believe that we can have a significant effect on our customers and bring great value to them and differentiation for Cisco. Yeah, it's a lot of fun. >> It's kind of a, you know what, one of the things I poked at, I worked in a CTO office at one of the big vendors for a few years, and it's like we need the place where people can play and learn and try and fail, it's okay. There's always a push from this, well it needs to lead to product that leads to revenue. How does that work inside of Cisco? >> So it actually works quite well because there's strong push from the top from Chuck Robbins, Dave Decker, from my boss, Scott Harrel, my junior colleagues, Robby Chandra and so forth, to identify these key problems, invest, try to solve them and so forth. Because they know if we can succeed, it's going to be huge revenues. >> Okay, yeah. John, the level we get a CTO on, there's no shortage of cool and interesting things to look at. What are some of the main areas that you and your team look at? >> Sure, so one of the things which actually I with Robby Chandra and other very talented colleagues across Cisco started about five years ago now, was looking at what are some of the key use cases that customers need to have addressed three to five years down the road? And what architectures do they need to solve it? And we started that work four or five years ago, that leads to what we call the digital network architecture DNA that we are hearing all about today. So that work actually started in December 2013, it would really ramp up in 2014 and 2015. And it takes so long because it takes a long time to figure out what are the real problems customers need to address and then how can you build the ASICs and the operating system and the software on top and the platforms and DNA center and now DNA center platform that's needed. And we have a whole bunch of additional things in the pipe. >> Yeah, so bring us back, because you know in technology three to five years, that's a really long time. >> That's a long time. >> So what were some of the original kind of customer needs that you saw and what was on target and what's changed in that time period? >> Sure, so some of the things the customer needs, is they need to be able to role out new services really fast, okay. Today it takes and it historically takes a long time to role out a new service. Let's say we want to have a tele-present system or let's say you want to bring a new IOT device on the network, and you want to segment it relative to all the other devices so there can't be any security threats. And you want to apply all the best practices for networking and security. Typically that's been really, really hard. It's been really hard because you have to figure out for the new application what network and security requirements do you need. Then how should that, how should the network be architected, how should each device in the network be programmed for QOS or anything else. And then go out and do it. Device by device typically. And then be able to look to say hey, is that actually working the way that I intended? Or is there a problem, if so, where's the problem. How can I fix it? How can I change it? Historically that process has taken a long time. Now what we've done is by taking a more wholeistic view, and with things like DNA center, we have a full understanding of what's happening end to end. So we can role out a new service, we can identify both the network policies that are required, the security policies, figure out what's needed in each element in the network, go out and employ it. Then look to see what's happening, verify if it's doing what's needed, and if not, make recommended fixes and so forth. So this is one of the major fundamental shifts that is occurring and it's something we're very excited about and our customers are also really excited, which is, because it brings them great value. It increases their speed. It increases their security, lowers their costs. It's pretty exciting stuff. >> Yeah, John, if I wind the clock back 10 or 15 years ago, intelligence in the network, using data and analytics in the network, we were talking about it back then. >> We were, we were. >> So tell me why it's different now. Why, you know, I know all the people that work on this, we're quite excited for the things that we can actually accomplish today. Not like we were just talking about it, we were building real solutions, but what's different today? >> It's different at every single level. For example, 10 years ago we did not really have ASICs to be programmable. Today with a lot of the ASICs we have with UADP, unified access data platform ASIC. As new protocols become important, we can go and change more for to support it. Our new Cat9ks actually we have x86's built in, so you have an x86, which you can have a containerized environment there, so third parties can take their applications in a container, deploy it and run it across switches. That was never possible before. So these are some of the major advances that happened that just makes it so much easier to deploy these. >> Yeah, well one of the things that we've been really interested to dig into is some of the new applications that aren't just running on the network but the network is involved in how we build those environments. So when I think about you know just the theme of the show, it's you know, imagine what we can do, and here in the dev net zone, it's customers talking about helping to build those applications. Talk a little bit about that. How does that tie in to some of these mega trends like machine learning, AI, you know, choose your favorite buzz word of choice there. >> Yeah, so what happens is now when you role out a new application, one of the key things you want is visibility and know how it's working. In the past you've had visibility at the server. You may have visibility in the client. You haven't had visibility end to end, and you often haven't had it real time. But now you can actually have end to end visibility and you can be able to automatically self optimize the network to be able to do what needs to be done. For example, here we have thousands of people just on this floor here, and you want to optimize which APs they're talking to and what paths they're taking through their networks. So that whatever they're doing, could it be a Face Time or anything else could be done with very high end to end quality. And all that you want to happen automatically. >> Yeah, the place I've actually been a little critical of Cisco is when we first started talking about IOT, it was like well everything needs a networking part of it. I'm like well a lot of these devices aren't going to have connectivity or have limited connectivity. Transport isn't, you know, the piece of it, but when I take that, when I look at solutions like NFV that are coming out, all of these coming together, this great new term we're talking about, edge computing. So what are you seeing, what's happening today, what are you looking at from a research standpoint? And, you know, where does the edge start? >> Yes, so the edge is a really fun topic. And it's something Cisco cares a lot about because it's often for many applications you have to run them at the edge, especially for IoT. For instance today, you mentioned IoT, you mentioned machine learning. Each of those applications, it's typically a lot of the process ended, the analytics for IoT, the machine learning AI for other sort of applications, that's usually done in the Cloud. However, many times you can't do it in the Cloud or you don't want to do it in the Cloud, because it's too expensive or you just can't get things to the Cloud. >> Yeah, if I'm driving an autonomous vehicle, I can't wait for it to do the round trip before I hit you know whatever that was. >> Yes, and that's a great point. Because what happens is there's a latency issue. There's also scalability. Scalability in the amount of data that's coming for a single IoT device or in a place like this you may have thousands of IoT devices. So it's huge scalability issues. Also reliability. You want your systems, your IOo applications, everything to work. And usually you're counted on being connected to Cloud, but in case you're not connected, in case something breaks down, a storm, a backhoe takes out your internet connection, you still want it to work. So for reliability, you also want to do things at the edge. Also for privacy. You see for privacy, what happens is you want to limit the information that you send to the Cloud. And if it's possible not to send anything, or just to summarize and send only a very small part of information. That could lead to major gains in privacy. So doing processing at the edge, especially with machine learning, AI, can lead to improvements in scalability, lower latency, improved reliability, lower costs, and improvements in privacy. So lots of gains by doing things at the edge of the network. >> Okay, and were does Cisco play in some of these edge solutions? >> Yes, first of all, Cisco has been building computer at the edge with ISRs for many years, okay. I view this as one of the hidden gems that Cisco has. Also we've been working on, what we call, fog commuting for many years. Actually I joined Cisco five years ago, but even before that, my colleagues realized that hey, for some IoT applications, you can't do it in the Cloud. You actually have to do it in the edge. And so they coined the term fog, which basically means taking a part of the Cloud, bringing it to the edge of the network, and a cloud on the ground is called fog, hence the term. And then we've been developing it ever since. And so this is what led to us including for example x86s and containerized frame works on switches and so forth so it makes it much easier for developers to deploy things at the edge of the network. >> Yeah, we just have to make sure enterprises don't choke on it because then it would just be smog. (laughter) >> Luckily we're working really hard on that, and also to make it very secure. Because that's another key component. High scalability, privacy, reliability, low costs, and security. >> Okay, so. >> And no smog. >> No smog. What are some of the things, you know, give us a little inside into the innovation labs, what are some of the things as you look out that maybe we're not yet talking about on the show floor here? >> Sure, for example, some of the major things upcoming is 802.11ax, it's the next generation of wifi. So it gives significant improvements in wifi performance. We've been working on that for a number of years. When I say we, it's myself and other colleagues throughout Cisco. And often colleagues and universities and standards organizations and other companies, wherever it makes sense, because we're trying to push the industry forward. So 802.11ax is a major effort we're working on. Also 5G cellular, you may have heard a lot about it because it's getting a huge amount of attention. And we're also trying to connect these two. Because, for example, in indoor environments like this, wifi is going to be, wifi is the best solution. On the other hand, as you take your mobile device and you go outside, you have 5G, or you will have 5G. As a concrete example, you're familiar with network segmentation, okay, this is incredibly powerful. It's very good for security, for giving the applications the bandwidth allegiance they need and so forth, so very, very powerful. DNA provides that capability within the campus branch, across wired and wireless. And that's what we're shipping today. What happens is with 5G as defined by 3GPP standards, when they come out, you're going to have something very similar, it'll be called network slices, instead of network segmentation. But exact same concept. And it'll be provided on service provider networks. And now what you can do is you can use DNA center to set up the policies in the network segment to go across the enterprise campus and also on the service provider network. So when you go outside with your mobile devices, wherever you are, you'll still have your network segment with your security, you QOS and so forth that they need for applications. >> John I'm just sitting here smiling because I worked in telecom back in the nineties. And there were the trucking companies that was like my phone was a walkie talkie, and then it was also a cell phone, which was pretty cool back in the nineties. When we talk about data, that's been the ultimate promise. It should be ubiquitous, 5G, working with the wireless has been an interesting thing to kind of dig into. So how long until, you know, that becomes reality? >> Well in the enterprise, indoors, campus branch, so forth, end up going to data center. We're working with our data center team very closely to build network segments across both. That's, in some cases it's already available today, in other cases it'll be coming in six months and so forth. With 5G, it depends on the deployment of 5G. And so that's 2020, 2021. But we're already working to make that possible. >> Alright, John, I want to give you the final word. I've worked on some of those projects when it's kind of years in the making, and something comes out the door and then that's what you have with the DNA solution. You know, tell us a little bit about the celebration, the pride, the excitement, that the team is seeing. >> Yeah, it's a lot, right now, it's a great time because as you mentioned, we started some of this work four years ago. We brought some of it out, SDA and DNA center, last summer. Assurance in January. IoT, DNA IoT recently. We just brought out the world's best AP with a 4800. So it's all these sequence of things that finally came out that we've been working on for years, so it's really an awesome feeling. And there's a lot more in the pipe. And so it's going to be a fun, fun future ahead. And our customers are going to get a lot of value. >> John Apostolopousos, really a pleasure. Thank you for joining. You're now a part of theCube alumni here where we always love talking about innovation, driving that pipeline to help customers through all of these new technologies. Stay with us, we got a couple more interviews left. Three days, wall to wall coverage here in Orlando, Florida. I'm Stu Miniman, and as always thank you for watching theCube. (techno sounds)