>> From the Silicon Angle Media Office in Boston Massachusetts, it's "The Cube." (groovy techno music) Now, here's your host, Dave Vellante. >> Hello, everyone. The rise of open source is really powering the digital economy. And in a world where every company is essentially under pressure to become a software firm, open source software really becomes the linchpin of digital services for both incumbents and, of course, digital natives. Here's the challenge, is when developers tap and apply open source, they're often bringing in hundreds, or even thousands of lines of code that reside in open sourced packages and libraries. And these code bases, they have dependencies, and essentially hidden traps. Now typically, security vulnerabilities in code, they're attacked after the software's developed. Or maybe thrown over the fence to the sec-ops team and SNYK is a company that set out to solve this problem within the application development life cycle, not after the fact as a built-on. Now, with us to talk about this mega-trend is Peter McKay, a friend of The Cube and CEO of SNYK. Peter, great to see you again. >> Good to see you, dude. >> So I got to start with the name. SNYK, what does it mean? >> SNYK, So Now You Know. You know, people it's sneakers sneak. And they tend to use the snick. So it's SNYK or snick. But it is SNYK and it stands for So Now You Know. Kind of a security, so now you know a lot more about your applications than you ever did before. So it's kind of a fitting name. >> So you heard my narrative upfront. Maybe you can add a little color to that and provide some additional background. >> Yeah, I mean, it's a, you know, when you think of the larger trends that are going on in the market, you know, every company is going through this digital transformation. You know, and every CEO, it's the number one priority. We've got to change our business from, you know, financial services, healthcare, insurance company, whatever, are all switching to digital, you know, more of a software company. And with that, more software equals more software risk and cybersecurity continues to be, you know, a major. I think 72% of CEOs worry about cybersecurity as a top issue in protecting companies' data. And so for us, we've been in the software in the security space for the four and a half years. I've been in the security space since, you know, Watchfire 20 years ago. And right now, with more and more, as you said, open source and containers, the challenge of being able to address the cybersecurity issues that have never been more challenging. And so especially when you add the gap between the need for security professionals and what they have. I think it's four million open positions for security people. So you know, with all this added risk, more and more open source, more and more digitization, it's created this opportunity in the market where you're traditional approaches to addressing security don't work today, you know? Like you said, throwing it over the fence and having someone in security, you know, check and make sure and finding all these vulnerabilities, and throw it back to developers to fix is very slow and something at this point is not driving to success. >> So talk a little bit more about what attracted you to SNYK early. I mean, you've been with the company, you're at least involved in the company for a couple years now. What were the trends that you saw, and what was it about SNYK that, you know, led you to become an investor and ultimately, CEO? >> Yeah, so four years involved in the business. So you know, I've always loved the security space. I've been in it for a number, almost 20 years. So I enjoy the space. You know, I've watched it. The founder, Guy Podjarny, one of the founders of SNYK, has been a friend of mine for 16 years from back in the Watchfire days. So we've always stayed connected. I've always worked well together with him. And so when you started, and I was on the board, the first board member of the company, so I could see what was going on, and it was this, you know, changing, kind of the right place at the right time in terms of developer first security. Really taking all the things that are going on in the security space that impacts a developer or can be addressed by the developer, and embedding it into the software into that developer community, in a way that developers use, the tools that they use. So it's a developer-first mindset with security expertise built-in. And so when you look at the market, the number of open source container evolution, you know, it's a huge market opportunity. Then you look at the business momentum, just took off over the past, you know, four years. That it was something that I was getting more and more involved in. And then when Guy asked me to join as the CEO, it was like, "Sure, what took you so long?" (Dave laughing) >> We had Guy on at Node JS Summit. I want to say it was a couple years ago now. And what he was describing is when you package, take the example of Node. When you package code in Node, you bring in all these dependencies, kind of what I was talking about there, but the challenge that he sort of described was really making it seamless as part of the development workflow. It seems like that's unique to SNYK. Maybe you could talk about-- >> Yeah, it is. And you know, we've built it from the ground up. You know, it's very difficult. If it was a security tool for security people, and then say, "Oh, let's adapt it for the developer," that is almost impossible. Why I think we've been so successful from the 400,000 developers in the community using Freemium to paid, was we built it from the ground up for developer, embedded into the application-development life cycle. Into their process, the look and feel, easy for them to use, easy for them to try it, and then we focused on just developer adoption. A great experience, developers will continue to use it and expand with it. And most of our opportunities that we've been successful at, the customers, we have over 400 customers. That had been this try, you know, start it with the community. They used the Freemium, they tried it for their new application, then they tried it for all their new, and then they go back and replace the old. So it was kind of this Freemium, land and expand has been a great way for developers to try it, use it. Does it work, yes, buy more. And that's the way we work. >> We're really happy, Peter, that you came on because you've got some news today that you're choosing to share with us in our Cube community. So it's around financing, bring us up to date. What's the news? >> Yeah so you know, I'd say four months ago, five months ago, we raised a $70 million round from great investors. And that was really led by one of our existing investors, who kind of knew us the best and it was you know, Excel Venture, and then Excel Growth came in and led the $70 million round. And part of that was a few new investors that came in and Stripes, which is you know a very large growth equity investor were part of that $70 million round said you know, preempted it and said, "Look it, we know you don't need the money, but we want to," you know, "We want to preempt. We believe your customer momentum," here we did, you know, five or six really large deals. You know, one, 700, seven million, 7.4 million, one's 3.5 million. So we started getting these bigger deals and we doubled since the $70 million round. And so we said, "Okay, we want to make money not the issue." So they led the next round, which is $150 million round, at a valuation of over a billion. That really allows us now to, with the number of other really top tier, (mumbles) and Tiger and Trend and others, who have been part of watching the space and understand the market. And are really helping us grow this business internationally. So it's an exciting time. So you know, again, we weren't looking to raise. This was something that kind of came to us and you know, when people are that excited about it like we are and they know us the best because they've been part of our board of directors since their round, it allows us to do the things that we want to do faster. >> So $150 million raise this round, brings you up to the 250, is that correct? >> Yes, 250. >> And obviously, an up-round. So congratulations, that's great. >> Yeah, you know, I think a big part of that is you know, we're not, I mean, we've always been very fiscally responsible. I mean, yes we have the money and most of it's still in the bank. We're growing at the pace that we think is right for us and right for the market. You know, we continue to invest product, product, product, is making sure we continue our product-led organization. You know, from that bottoms up, which is something we continue to do. This allows us to accelerate that more aggressively, but also the community, which is a big part of what makes that, you know, when you have a bottoms up, you need to have that community. And we've grown that and we're going to continue to invest aggressively and build in that community. And lastly, go to market. Not only invest, invest aggressively in the North America, but also Europe and APJ, which, you know, a lot of the things we've learned from my Veeam experience, you know how to grow fast, go big or go home. You know, are things that we're going to do but we're going to do it in the right way. >> So the Golden Rule is product and sales, right? >> Yes, you're either building it or selling it. >> Right, that's kind of where you're going to put your money. You know, you talk a lot about people, companies will do IPOs to get seen, but companies today, I mean, even software companies, which is a capital-efficient industry, they raise a lot of dough and they put it towards promotion to compete. What are your thoughts on that? >> You know, we've had, the model is very straightforward. It's bottoms up, you know? Developers, you know, there's 28 million developers in the world, you know? What we want is every one of those 28 million to be using our product. Whether it's free or paid, I want SNYK used in every application-development life cycle. If you're one developer, or you're a sales force with standardized on 12,000 developers, we want them using SNYK. So for us, it's get it in the hands. And that, you know, it's not like-- developers aren't going to look at Super Bowl ads, they're not going to be looking. It's you know, it's finding the ways, like the conference. We bought the DevSecCon, you know, the conference for developer security. Another way to promote kind of our, you know, security for developers and grow that developer community. That's not to say that there isn't a security part. Because, you know, what we do is help security organizations with visibility and finding a much more scalable way that gets them out of the, you know, the slows-down, the speed bump to the moving apps more aggressively into production. And so this is very much about helping security people. A lot of times the budgets do come from security or dev-ops. But it's because of our focus on the developer and the success of fixing, finding, fixing, and auto-remediating that developer environment is what makes us special. >> And it's sounds like a key to your success is you're not asking developer to context switch into a new environment, right? It's part of their existing workflow. >> It has to be, right? Don't change how they do their job, right? I mean, their job is to develop incredible applications that are better than the competitors, get them to market faster than they can, than they've ever been able to do before and faster than the competitor, but do it securely. Our goal is to do the third, but not sacrifice on one and two, right? Help you drive it, help you get your applications to market, help you beat your competition, but do it in a secure fashion. So don't slow them down. >> Well, the other thing I like about you guys is the emphasis is on fixing. It's not just alerting people that there's a problem. I mean, for instance, a company like Red Hat, is that they're going to put a lot of fixes in. But you, of course, have to go implement them. What you're doing is saying, "Hey, we're going to do that for you. Push the button and then we'll do it," right? So that, to me, that's important because it enables automation, it enables scale. >> Exactly, and I think this has been one of the challenges for kind of more of the traditional legacy, is they find a whole bunch of vulnerabilities, right? And we feel as though just that alone, we're the best in the world at. Finding vulnerabilities in applications in open source container. And so the other part of it is, okay, you find all them, but prioritizing what it is that I should fix first? And that's become really big issue because the vulnerabilities, as you can imagine, continue to grow. But focusing on hey, fix this top 10%, then the next, and to the extent you can, auto-fix. Auto-remediate those problems, that's ultimately, we're measured by how many vulnerabilities do we fix, right? I mean, finding them, that's one thing. But fixing them is how we judge a successful customer. And now it's possible. Before, it was like, "Oh, okay, you're just going to show me more things." No, when you talk about Google and Salesforce and Intuit, and all of our customers, they're actually getting far better. They're seeing what they have in terms of their exposure, and they're fixing the problems. And that's ultimately what we're focused on. >> So some of those big whales that you just mentioned, it seems to me that the value proposition for those guys, Peter, is the quality of the code that they can develop and obviously, the time that it takes to do that. But if you think about it more of a traditional enterprise, which I'm sure is part of your (mumbles), they'll tell you, the (mumbles) will tell you our biggest problem is we don't have enough people with the skills. Does this help? >> It absolutely-- >> And how so? >> Yeah, I mean, there's a massive gap in security expertise. And the current approach, the tools, are, you know, like you said at the very beginning, it's I'm doing too late in the process. I need to do it upstream. So you've got to leverage the 28 million developers that are developing the applications. It's the only way to solve the problem of, you know, this application security challenge. We call it Cloud Dative Application Security, which all these applications usually are new apps that they're moving into the Cloud. And so to really fix it, to solve the problem, you got to embed it, make it really easy for developers to leverage SNYK in their whole, we call it, you know, it's that concept of shift left, you know? Our view is that it needs to be embedded within the development process. And that's how you fix the problem. >> And talk about the business model again. You said it's Freemium model, you just talked about a big seven figure deals that you're doing and that starts with a Freemium, and then what? I upgrade to a subscription and then it's a land and expand? Describe that. >> Yeah we call it, it's you know, it's the community. Let's get every developer in a community. 28 million, we want to get into our community. From there, you know, leverage our Freemium, use it. You know, we encourage you to use it. Everybody to use our Freemium. And it's full functionality. It's not restricted in anyway. You can use it. And there's a subset of those that are ready to say, "Look it, I want to use the paid version," which allows me to get more visibility across more developers. So as you get larger organization, you want to leverage the power of kind of a bigger, managing multiple developers, like a lot of, in different teams. And so that kind of gets that shift to that paid. Then it goes into that Freemium, land, expand, we call it explode. Sales force, kind of explode. And then renew. That's been our model. Get in the door, get them using Freemium, we have a great experience, go to paid. And that's usually for an application, then it goes to 10 applications, and then 300 developers and then the way we price is by developer. So the more developers who use, the better your developer adoption, the bigger the ultimate opportunity is for us. >> There's a subscription service right? >> All subscription. >> Okay and then you guys have experts that are identifying vulnerabilities, right? You put them into a database, presumably, and then you sort of operationalize that into your software and your service. >> Yeah, we have 15 people in our security team that do nothing everyday but looking for the next vulnerability. That's our vulnerability database, in a large case, is a lot of our big companies start with the database. Because you think of like Netflix and you think of Facebook, all of these companies have large security organizations that are looking for issues, looking for vulnerabilities. And they're saying, "Well okay, if I can get that feed from you, why do I have my own?" And so a lot of companies start just with the database feed and say, "Look, I'll get rid of mine, and use yours." And then eventually, we'll use this scanning and we'll evolve down the process. But there's no doubt in the market people who use our solution or other solution will say our known the database of known vulnerabilities, is far better than anybody else in the market. >> And who do you sell to, again? Who are the constituencies? Is it sec-ops, is it, you know, software engineering? Is it developers, dev-ops? >> Users are always developers. In some cases dev-ops, or dev-sec. Apps-sec, you're starting to see kind of the world, the developer security becoming bigger. You know, as you get larger, you're definitely security becomes a bigger part of the journey and some of the budget comes from the security teams. Or the risk or dev-ops. But I think if we were to, you know, with the user and some of the influencers from developers, dev-ops, and security are kind of the key people in the equation. >> Is your, you have a lot of experience in the enterprise. How do you see your go to market in this world different, given that it's really a developer constituency that you're targeting? I mean, normally, you'd go out, hire a bunch of expensive sales guys, go to market, is that the model or is it a little different here because of the target? >> Yeah, you know, to be honest, a lot of the momentum that we've had at this point has been inbound. Like most of the opportunities that come in, come to us from the community, from this ground up. And so we have a very large inside sales team that just kind of follows up on the inbound interest. And that's still, you know, 65, 70% of the opportunities that come to us both here and Europe and APJ, are coming from the community inbound. Okay, I'm using 10 licenses of SNYK, you know, I want to get the enterprise version of it. And so that's been how we've grown. Very much of a very cost-effective inside sales. Now, when you get to the Googles and Salesforces and Nordstroms of the world, and they have already 500 licenses us, either paid or free, then we usually have more of a, you know, senior sales person that will be involved in those deals. >> To sort of mine those accounts. But it's really all about driving the efficiency of that inbound, and then at some point driving more inbound and sort of getting that flywheel effect. >> Developer adoption, developer adoption. That's the number one driver for everybody in our company. We have a customer success team, developer adoption. You know, just make the developer successful and good things happen to all the other parts of the organization. >> Okay, so that's a key performance indicator. What are the, let's wrap kind of the milestones and the things that you want to accomplish in the next, let's call it 12 months, 18 months? What should we be watching? >> Yeah, so I mean it continues to be the community, right? The community, recruiting more developers around the globe. We're expanding, you know, APJ's becoming a bigger part. And a lot of it is through just our efforts and just building out this community. We now have 20 people, their sole job is to build out, is to continue to build our developer community. Which is, you know, content, you know, information, how to learn, you know, webinars, all these things that are very separate and apart from the commercial side of the business and the community side of the business. So community adoption is a critical measurement for us, you know, yeah, you look at Freemium adoption. And then, you know, new customers. How are we adding new customers and retaining our existing customers? And you know, we have a 95% retention rate. So it's very sticky because you're getting the data feed, is a daily data feed. So it's like, you know, it's not one that you're going to hook on and then stop at any time soon. So you know, those are the measurements. You look at your community, you look at your Freemium, you look at your customer growth, your retention rates, those are all the things that we measure our business by. >> And your big pockets of brain power here, obviously in Boston, kind of CEO's prerogative, you got a big presence in London, right? And also in Israel, is that correct? >> Yeah, I would say we have four hubs and then we have a lot of remote employees. So, you know, Tel Aviv, where a lot of our security expertise is, in London, a lot of engineering. So between London and Tel Aviv is kind of the security teams, the developers are all in the community is kind of there. You know, Boston, is kind of more go to market side of things, and then we have Ottawa, which is kind of where Watchfire started, so a lot of good security experience there. And then, you know, we've, like a lot of modern companies, we hired the best people wherever we can find them. You know, we have some in Sydney, we've got some all around the world. Especially security, where finding really good security talent is a challenge. And so we're always looking for the best and brightest wherever they are. >> Well, Peter, congratulations on the raise, the new role, really, thank you for coming in and sharing with The Cube community. Really appreciate it. >> Well, it's great to be here. Always enjoy the conversations, especially the Patriots, Red Sox, kind of banter back and forth. It's always good. >> Well, how do you feel about that? >> Which one? >> Well, the Patriots, you know, sort of strange that they're not deep into the playoffs, I mean, for us. But how about the Red Sox now? Is it a team of shame? All my friends who were sort of jealous of Boston sports are saying you should be embarrassed, what are your thoughts? >> It's all about Houston, you know? Alex Cora, was one of the assistant coaches at Houston where all the issues are, I'm not sure those issues apply to Boston, but we'll see, TBD. TBD, I am optimistic as usual. I'm a Boston fan making sure that there isn't any spillover from the Houston world. >> Well we just got our Sox tickets, so you know, hopefully, they'll recover quickly, you know, from this. >> They will, they got to get a coach first. >> Yeah, they got to get a coach first. >> We need something to distract us from the Patriots. >> So you're not ready to attach an asterisk yet to 2018? >> No, no. No, no, no. >> All right, I like the optimism. Maybe you made the right call on Tom Brady. >> Did I? >> Yeah a couple years ago. >> Still since we talked what, two in one. And they won one. >> So they were in two, won one, and he threw for what, 600 yards in the first one so you can't, it wasn't his fault. >> And they'll sign him again, he'll be back. >> Is that your prediction? I hope so. >> I do, I do. >> All right, Peter. Always a pleasure, man. >> Great to see you. >> Thank you so much, and thank you for watching everybody, we'll see you next time. (groovy techno music)

>> from our studios in the heart of Silicon Valley, Palo Alto, California It is a cute conversation >> live in. Welcome to a special cube conversation here in Palo Alto. The Cube Studios. Jon, for your host. We're here with a special panel. Talk about the new brand of tech leaders in this era of cloud computing data. Aye, aye. And engineering excellence with us. We have Christine Heckart to CEO of Scaler J. P. Krishna of Marthe Moorthy. These s VP of engineering a Copa software and Patna saying, VP of engineering a glass door. Guys, welcome to come the Cube conversation. Welcome, engineer. And you guys are all running engineering organizations. You've been a former engineer now running a big company CEO, engineering led company. This is a big trend that's clearly defined. No one needs any validation. Cloud computing has certainly changed the game, eh? I certainly the hottest trend with respect, the data machine learning and the benefits. They're changing the cultures of companies changing how things were built, how people are hired. You're starting to see a complete shift towards old way and new ways. I want to get your thoughts about the engineering opportunities. What is engineering excellence today mean in this modern error? >> Well, for us it we talk a lot about mastery and setting up an environment where engineers have a chance to build their own mastery. But they can also have the necessary tools and technologies to be master of their domain. And these domains, especially if it's cloud base. They're very distributed. They're very, very fast moving. There's a lot of continual risk s so you have to set them up in the right way so they could be successful. >> What's your thoughts? I mean, you guys air cutting edge startup? >> Yes. For us, it's very important that the environment, the working moment for engineers, is organically inspiring. And what I mean by that is when every engineer no, why are there what are they doing? Well, how their work is impacting the company in the business initiators. At the same time, we are making sure that their interests are aligned with Albert projects and work in a way that we are also in a healthy, very extending and stretching their skills when their work has a purpose. And that's what our mission is, which is we want to make sure that everybody finds an opportunity where they feel there's a purpose that its purpose driven, that's when we feel like it. That's a great environment where they will be inspired to come every day and deliver their 110% >> J p excellence and engineering. I mean, this is what people strive for. >> So excellent points from both off them and I. I think I have a slightly different take on it as well. Today's business is we are asked to respond really, really fast, maybe hear the tongue a gel everywhere, John, right? So it's about how do we respond to the needs of the business as quickly as you can On dhe, it becomes the mantra for the organization. Having said that, there is another side to it. The dark side is technical debt. That's something we all have toe grapple with because you're moving fast, you're making decisions. You're hoping things all right, You want to prove your thesis out there, but at the same time, you don't wantto put yourself behind so that it might come and bite you later. So it's finding that balance is really, really important, and that becomes the focal point of the organization. How do you move fast, but at the same time Hold it. Oh, do you not slow yourself down in the >> future? That's a great point. I want to get probably your thoughts. That's because open source has been really a different game changer from the old way to the new way. Because you could work with people from different companies. You can work on projects that a better man for other people as well. So it's got a communal aspect to it. But also there is an element of speed the same time agile forces, this kind of concept. So technical debt. You want to move fast, we gotta recover. You kind of know how to get there. How is open source? Change that in Europe in >> well, number one thing that opens and allows all smaller company especially but more companies is that now you you can take on an open source project and start rather starting from ground zero. You can start somewhere where you know it's already helped, and you have a framework ready to start working on. So you're not every two single time we're building our thinking off a new idea you're not starting. Okay, Now let me school start from ground up, right? So you already are at a certain level, the second area where, like you said, you know, we're a Joe. Uh, we have open source, but we also have certain level of customization that the customers needed our application needs. And that's what inspires engineers as well, which is taking the challenger for K. We have a code based. Now let me build something more interesting, more innovative. And then what they also love is giving back to the community. It's we're not. The companies are not just tech community engineering team. We are have a bigger engineering community now, the whole tackle, and that's what makes a big difference for us working in Silicon Valley to even be part of that and contributing factor. >> J P Talk about technical debt when it comes back to the modern era because you can go back to It's been around for a while. Technical dead concerts, not new, but it's always been kind of the water cooler come with core lead engineer and the team. The Aussies have a term called feature creeping. You know, the old days. I don't get it. The feature creep. Actually, it kind of takes it away because of you. If you're applying technical debt properly, you're managing the velocity of the project. So the question is, how is technical debt evolved to the management levels of senior engineering managers? Because that seems to be a key variable in managing the speed and quality of the teams with managing the table. Done. Now, management is what some other conversations. >> So the game depends on the stage of the company Onda stage of the projects you are. If you're in a really mature suffer environment, very you're not making a lot of change. It's OK. It's not the primary conversation off the topic. But if you're trying to you capture a market or promote an idea, it becomes the fundamental thesis, forgetting things out there quickly Now, getting things out there quickly doesn't mean you get to let users suffer. You had to build it in the right way, needs toe work, but at the same time it needs to be just enough so that we can We can get the feedback from from the user's on. At the same time, you probably would have left out potentially features on. Maybe you didn't even make certain decisions on Let's say, hi availability or our scalability. Maybe you wanna prove it out in only one region of the world and so on. So you have to find those balances, and it becomes part of the planning conversations right in the front. And as you go into the further iterations of the product, it becomes part of the prioritization conversation of the product managers because it's not just about getting one part done and getting it out there. But as it reached the full level of maturity that you would want, >> I'm sure there's a lot of debates about an engineer organizations because, you know, engineers a very vocal you. Yeah, so you could fall in love with your product of your time to market, maybe taking some technical debt to get product market fit. And that's my baby, though, when you got a re platform or re scale it to make it scale, bringing with your point you mentioned. How do you guys manage? Because this becomes a talent management. People say, Oh, you gotta manage the ECOWAS. But if some people are managing the project in there. They're going to fire over their skis on technical debt. You gotta kind of rain that in. How do you guys manage the people side of the equation? That because it's an art and a science at the same time? What's your thoughts? >> Well, I'll say this, um, supporting al aspects of change, right? That's also is an injury leader. It's a core responsibility and call it a priority for us, not just the technical debt, but also the market shifts. Technology shifts. We have new tech coming in. We have involving in evolving every technology. So how do via dear to and make sure that it's very important that engineering is supporting and kind of coming up with these technologies a tte the same time? We are not just pulling down to their version of grades and all of them, so in a jest, it's it's a core aspect of leadership to make sure that you, as we are supporting these changes, were also making sure that these changes are not pulling us down. So that should be proper quality checks. There should be a proper conversation and roadmap items which is saying that it's not attack debt. It's more of a tech investment, and we are talking about so that we're in lock steps with our business partner and not behind, so that now we're saying Okay, we need a whole quarter to develop new things. So it's an aspect of filmmaking. Sure, team this motivated >> This comes back to culture. Next question. I want to get you guys thoughts on this building. A positive work culture given engineering led organization. Christine, you're leading that now to start up because your own real fast a lot. A lot of engineers. They're probably a lot of opinions on what that looks like. What is the cultural quick? Because this sets the DNA early on for startup. But as you're maturing organization, you gotta track the best talent. And some say, Well, we work on We saw hard problems. That's kind of cliche, but ultimately you do have to kind of have that problem solving aspect. You gotta have a culture what is a successful work culture for engineering. >> So every everybody talks about engineers wanna solve hard problems. I think that's true. But as Pablo said earlier, if you can help every engineer connect what they're doing, every day to the higher purpose. The organization to the problem that you're solving and how that makes the customers like better in our case, were accompanied by engineers for engineer. So our engineers get really excited about giving other engineers in the world a better day. We have taken it one step further recently by starting a peer network because one of my observations coming into this organization is there are so many peer networks in I t. Because it's been a 30 year industry. There are tons of pure organizations for CEOs. There are tons appear organizations for C. M. O's, but there really aren't for engineers. And if we want to help engineers really develop their career and their full skill set and therefore develop into their full potential, it's about more than just training them. It's about giving them context and full social skills and giving them places where they can learn not just from the other engineers in their company, but from engineers across the organization or across the industry at their same level, and maybe from very different industries and maybe in very different environments. So I think in our case, you know, really trying to bring these peer networks together has been one way that we can not only pay it forward for our own engineers, but also help a lot of other engineers around of the industry >> how you guys handling the engineering talent pertaining, attracting and keeping the best now. >> So I think that's where the whole company comes together, in my view. So as an injuring leader, it's not just that I said the tune of my engineering or as to what? That hiring his top priority. It's where the whole company comes together. You're recruiting team to build the stellar interview process. You are, you know, heads of other orcs to make sure that across the board you're helping define a mission for your company that resonates with your candidates who would want to work with you. So it's a collective effort of building a stellar environment for us glass door when one of the few values is transparency and we live and die by it, which means that when someone is higher, they need to see that be within the company. We are transparent, so we'd share a lot of data. A lot of information, good and bad with every single person in the company. It's never, um, hidden at the same time. We build and set up trust in them to say, Hey, it's confidential. Make sure that it doesn't leave the company and it's been 11 years and it hasn't It has never been the case. >> What class door you don't want have a glass door entry on black. Gotta be transparent. That's the culture. Culture matters minutes. Your culture is all about sharing and being open. >> You will see it. So that's what this is, what God goes down spike for as well, right? Building transparency within the company culture and more and more as we see many stories that we have seen for various companies. And sometimes I get a bad story, too, and I get an invitation. Oh, you're from class door, you know. But that helps overall Rios living and working for user's and professionals. >> Cross is big for you guys, >> absolutely professionals who are in this world looking for a job and life because you're spending a lot of time at work. So we want you to get up every day and be inspired and happy about where you're going to work and for that. That's why we have sharing a lot of the insights about the company's from reviews and ratings and CEO data to make sure that when you make your decision of the next move, you are you can be fully trust. You could be fully confident that the date of your sharing the new with that you're making a good decision. >> J. P. Your thoughts. You guys are on a tear. We've got a great coverage of your the annual conference in Vegas. Recent cube coverage. Your company on paper looks like you're targeting one segment, but you have a lot of range and you're technical platform with data. Um, how you guys articulating to engineering? How do you keep them? What if some of the stories you tell them to attract them to join you guys? >> So number one thing is about the talent that we already have in hopes. So people want to come to work at a place where they can learn, contribute on dhe, also for their Carrie Carrie Respert, both inside Cooper and as the lead on coming into Cooper. They look at it and they say, Oh, you have ah, wide variety of things going on here. You're solving a business problem. But at the same time, the technology stocks are different. You're on all the best clothes are there, so that's an easy attraction for them to come in. But also, it's not just about getting people, and how do you retain them on? We've been lucky. That had very low tuition for many years. Right now in the engineering organization, especially in the value, it is a big deal. Andi. I think part of the things that that is the collaboration and cooperation that they get from everybody on. You know, it's an age old saying diversity and thought, unity in action, right? So I really promote people thinking about radius ideas and alternatives. But there is a time for that debate. And once we agree on a solution, we all pulled in and try to make that successful. And then you repeat that often, and it becomes part of part of the culture and the way the organization operates as >> a follow up to culture. One thing that's become pretty clear is that's global engineering. You mention the valley very competitive, some start ups that they get on that rocket ship can get all the great talent. If you will public everyone. Everyone gets rich of one's happy, a good mission behind it, you know, win win outside. Some stars have to attract talent. You've got to start going on here. You might have a good colonel of great engineers, but you have development environments all over the world, so remote is a big thing. How do you manage the engineer remote? It's a time zone base. Does it put leaders in charge? Is there a philosophy in the Amazon? Has a two pizza team is their big thing. You get small groups. How did you guys view the engineering makeup? Because this becomes a part of the operational tension but operating model of engineering thoughts >> I can go first. I think there is a tension between keeping teams working on one problem on not distributing it across the world for efficiency reasons. But at the same time, how do you all owe for continuity, especially if you have a problem in one area? Can somebody else from another region step in in a different time zone continuing? That's always a problem, and then the other one is in a landscape like ours, in which is not uncommon for many, many companies. It is not that they built a lot of fragmented things. They all need to work together. So having a level of continuity within the radius remote centers is really critical on everybody has their own recipe for this one. But the ones that works for us and I've seen that played out many times, is if you can get a set off teams, toe, focus on certain problem areas and become experts in those >> cohesive within their >> within the physical, and then also have enough critical mass within a center that gives you the good balance between working on. One thing. Worse is knowing everything. So so that works for us, and I I think that's that's the way to get out >> of the operating system. It is a couple highly cohesive, >> and you need to have the right technical leaders on both sides and be willing to collaborate with each other >> partner thoughts >> I want to emphasize on the last statement you really need strong good, really, you know, trusted leaders in the location to Canada, then inculcated more bigger team everything Glassdoor groove from one location to four locations in last three years. And one thing that we learned after our first remote location that we started was that when we seeded our new remote location with few people from the original location that hoped start, you know, the similar aspects of what glassware stands for and over core at those and values. And then, as we added, new people, they just can easily just transfer to them so that hope does in a big way. And then he moved to Chicago with the same idea and, of course, Brazil. Now with the same >> knowledge transfer culture transfer, >> it all makes it easy. Even you have few people seating from the original location that was court for us. >> Pop in actually started their first remote office in San Francisco, which has now become their headquarters. So she has a lot of experience. Everyone of scale er's customers globally. You know, we sell the engineer, so we're dealing with with our customers who are dealing with this problem all the time. And in addition to culture, one thing that seems to bubble up regularly is can do you know when they need a common tool set and where they can do their own thing. How do you, you know, balance that and where do you need a single source of truth that people can agree on? And again, where can people have different points of view? >> You're talking sing associates from code base to what could >> be whatever, Like in our case, it's yeah, if you're going to troubleshoot something, you know, where the logs, the truth in the logs, Are you gonna have a single source for that? But for other people, it could be the data that they're bringing in or how they analyze the business. But if you can be proactive about understanding, when is commonality of tools of approach, of philosophy, of data, whatever, when it's commonality going to be what we drive and when are we going to allow people to do their own thing? And if you can put that framework in place than people know when they have the latitude and when they got a snap to grit and you could move a lot more quickly and there's kind of a technical debt that isn't code based? It's more about this kind of stuff, right? It's tool based its process and culture based. And if you can be more proactive about avoiding that debt, then you're gonna move more quickly. >> Videoconferencing. Very, very important. You should be able to jump on a video Constance very easily to be able to connect with someone driving just a phone calls all of these face time, different areas of face time Technology plays a big role >> technology. This is This is a modern management challenge for the new way to leave because it used to be just outsource. Here's the specs member, the old P. R. D S and M R D's. There's the specs, and you just kind of build it. Now it's much more collaborative to your point. There's really product and engineering going on, and it's gotta be. It's evolving. This is a key new ingredient >> because the expectation on the quality of product is so much more higher than competition is so much more. >> And when you know these engineers build in a lot of cases, they have to operate it now. So, like you say, whether it's a free service to a consumer, Aurens in enterprise, the expectation is perfect. No downtime, no hiccups >> and the reward incentives now become a big part of this now. New way of doing things. So I gotta ask the natural question. What's the reward system? Because Google really kind of pioneered the idea of a host 20% of your time work on your own project. That was about a decade or so ago. Now it's evolved beyond that to free lunches and all these other perks, but this has got to appeal to the human being behind it. What are some of the reward mechanisms? You guys see his management that's that's helpful in growing, nurturing and scaling up engineering organizations. >> Well, engineers are human, and as every human autonomy is critical for any aspects of moderation. And that's what please the core level. Then, of course, lunches, matter and other perks and benefits matter. Snacks of pours. Good coffee machine definitely is the core of it, but autonomy of what you want to do and is that the line. But what we want or what we are trying to deliver, and the aspect and the information of I did and rolled this out, what was the impact of it? That new should go back to that engineer who built that. So threading it through to the end and from the start is its very core for everybody to know because I want to know what I'm as I'm going every day. How is it helping >> and we really try. I personally try Thio. Make sure that each human on the team, regardless of their function, that we understand their potential and their career aspirations because a lot of times the the normal ladder, whatever that lander is, might not be right for every person. And people can pivot and use their skills in very, very different ways, and we need to invest in their ability to try new things. If it doesn't work out, let him come back. So you know, we try to spend time as a company for engineers not just in our company, but beyond. To really help them build out their own career, build out their own brands. Engineers more and more could be, you know, on TV shows and doing blog's and building out their own personal brand in their point of view. And that gives them impact. That goes beyond the one piece of code that they're writing for a company in a given day or a week. >> J. P you guys went public stock options. All these things going on as well. Your thoughts? Yeah, >> I just came back from a trip to my newest Dev center in Hyderabad, India. It's funny. I had sessions with every team over there. The number one topic was full >> s >> so excited about food. So there is something primal about food. Having said that, I think, uh, praise and recognition the age old things. They matter so much. That's what I've seen You acknowledge what somebody has done and kind of feedback to elect partner was saying, The impact that it creates, you know, it's it's a lot more fulfilling than monetary incentives. Not that they're not useful. Occasionally they are. But I think repeating that on doing it more often creates a sense off. Okay, here's what we can accomplish as a team. It is how I can contribute to it, and that creates a normal sense of purpose. >> Austin, you guys talked about tools of commonality is kind of key. It's always gonna be debates about which tools, much codes, languages to use, encoding, etcetera. But this brings up the notion of application development as you get continuous development. This is the operating model for modern engineering. What's the state of the art? What do you guys seeing as a best practice as managers to keep the machinery humming and moving along? And what what's on the horizon? What's next? >> Yeah, in my view, I would just say So what's humming and what state of the art I think I is core thio. Most of the systems and applications, the, uh, the core aspect of pretty much every company as you see, and that's the buzz word, even in Silicon Valley for the right reasons, is how we have built our platforms, insistence and ideas. But now let's make it smarter, and every company now has a lot of data. We are swimming in data, but it's very important that we can pick and pull the the core insides from that data to then power the same product and same system to make it more smarter, right? The whole goal for us ourselves is where they're making our platform or smarter, with the goal of making it more personalized and making sure that as users are navigating a project, pages they are seeing more personalized information so that they're not wasting their time there. We can make faster decisions in more rich data set, which is very catered towards them. So smart, so building that intelligence is core. >> And with continues, integration comes, continues risk. All right, so no risk, no reward. And so we live in an era of freemium. Free service is so you know why not take the risk? You don't have to do an A B test. You got digital. You do a B, C D and use all kinds of analytics. So this is actually a creative opportunity for engineering as they get to the front lines you mentioned earlier getting part of the empowerment. How is the risk taking changing the management? >> You know, I deal with class off users were willing to pay money, so I don't know if I can talk a lot about the freedom aspect of the problem. But now there's always desire for new functionality. If you want it, otherwise you don't want it. There's a lot of risk of worsens that's still floating around, especially in the interprets there today. On it is a big tension that you have to deal with. If you're not careful, then you can introduce problems on believing you're operating on the cloud and you're servicing thousands of customers. A small change can bring down the entire ecosystem, so you'll take it very seriously. You're helping others run their business, and that means you had invest in the right tools and processes. >> So you guys are actually Freemium business model, but still engineers. I got a test that they want to take the rhythms. So is it a cloud sand boxing? How is the risk taking managed? How you guys encouraging risk without having people hurt? You don't >> wantto overburden engineers to the point. They feel stifled and they cannot do anything. So there is a right balance. So you know, there are many techniques we follow the. For example, we roll out the software, tow US staging environment so customers can play around and make sure things are not breaking for their comfort more so than for us. But it is an important part of the equation, and then internally, you have to invest a lot of planning. Appropriately, there are the high risk content on the features, and then there are the low risk ones. You want to think about experimentation frameworks in no way be testing and so on and more importantly, about automation and testing. I don't think if a customer logs a bug and finds the problem, they don't want to see it one more time. Ever really have to make sure that those things don't happen when you're investing robust automation around testing processes because there isn't enough time for the complexity of these applications for destiny thing, man, >> this whale automation with cloud comes in containers kubernetes. All of >> those things, you know you heard will enable engineers with the technology said so that they contested scale. You have to provide access to production like data because you have to worry about no privacy, security and all those aspects. But at the same time, they need to have access to the variety off configurations that are out there so that they contested meaningful so to invest in all of those things. >> But I'll take it back to kind of where we started. This, which is the human factor with continuous delivery, is this continuous risk, and it doesn't matter if this engineer is supporting a free consumer application or the highest end of enterprise. When something goes wrong, this, their stress level goes through the roof and you know, how can we equipped? These people, too, solve problems in real time to have that visibility, to have whatever tool said or date or whatever they need? Because at the end of the day, a bad day for an engineer is a day when something is breaking and they're the ones that have to stay up all night and fix it and a good day for an engineer. A human being is the day they get to go home and have dinner with the family or not be woken up in the night. And there is >> for kite surfing or whatever, you >> know, whatever they dio, there's, you know, there is truly a human way. We think about engineers and engineers get up every day, and they want to change the world and they want to make an impact. And thank God we have, you know, teams of engineers that do that for all of us, and they're human beings, and there's a level of continuous stress that we've injected into their lives every day and to the extent that we, as companies and managers and leaders, can help take some of that burden off of them. The world becomes >> the whole being seeing the results of their work to is rewarding as well. >> Scaler does a lot of stuff there, so I have to call that are at the same time in a lot of very good nuggets, J P. Brother. But one more thing that has shifted in terms of how process of practice works is more of more. Engineers now participate very early on in product development is in the day. They try to understand what is the context and why are we doing. And we do a lot of users research to understand that that process, so that they have full context, that they are building in developing eso they're more of a partner now and not an afterthought. >> Think agile And Dev ops to me has proven that the notion of silos and waterfall practices has democratizing flatten. The organization's out where interdisciplinary crossovers are happening. >> Oh, yes, >> and this has been an interesting art of management is encouraging the right person that crust over the right line was you give people little taste, but sometimes they may not belong there kind of called herding cats in the old days. But now it's more of managing kind of interests and growth there. >> That original Dev ops model, though if you have anybody read the Phoenix project like years ago, but it it was really about bringing different points of view. It's a diversity thing. It's bringing different points of view around the table before the first line. It is written so that you're thinking about every angle on the problem and on the ongoing operation of whatever you're building >> Well, it's all about diversity and inclusion and diversity. I was with states, inclusion and diversity, diversity, inclusion Because male and females are involved. We have two females in tech here. This has been a discussion. We still don't have the numbers up to the senior levels within engineering in general. What has to happen to move the needle for women in tech and or inclusionary people involved in engineering to get the right perspective? What's what's >> not? Start with J P because he's actually a huge champion, and without the men involved, we don't have a solutions, >> inclusion and diversity, J. P your thoughts on this was super important. >> Yeah, Number one is recognition. I was stealing Christine yesterday. I just came back from India. That's like told you I took a picture there of my management team. Came back here, looked at it. There is no female, No right, it's crazy. I mean, it's not that we're not trying on gum it. We had the same problem and we started our center in 2015 right? There was a group picture off the team. There was like they were like two women on the thing. We put a lot of effort into it on. Two years later, a significant chunk of the organization has got women embedded in the team's came because we tried. We went out. Look, for those who are good in this area is not that we compromised on the qualifications. It's really about putting some energy in tow, getting the right resumes and then looking at it. The other thing. We're also doing his cultivation. You have to go to the grassroots because there are just enough women engineers. It's unfortunate, for whatever reasons, they're not taking up that professional military enough studies written on it So last two years we weigh, have conducted something called rails. Girls in India, 150 school age children, Women. I mean, girls come in and then we have supported them, run their classes, hold a class. And that helps, you know, even if 10% off them, you know, choose to take up this profession. It's gonna be a big boost. And we have to do a lot more of those in my opinion. >> Europe T rex President Leading Engineering. What's your view? >> Well, I'll say this, you know, for the people who are participating in helping drive this mission just like J. P. I say thank you, especially for men who are participating in it. We cannot do this without you, but for all the people who, if they're not participate in participating in helping drive this mission, I have all share this one data, uh, one of the initiative that glass or drives this gender pay gap, which is also an outcome off, not having diverse outlook at all levels into in the workplace. And we in our economic research team. They did a study and they shared a projection off when will be closed. The gender pay gap. It's 2017. That's depressing. So for for me, when I hear people who say you know, they, they don't want to participate or they don't think this is the right approach of solving for diversity in workplace, I say Okay, but that's not the reason for you to not participate and stay out. If it join it, join it in your own way. But it's only when l offers. Can I see it as a real problem and participate just like Gibby, as you said grassroot level as well as outside One of the example that I told my team when they say, You know, we don't want to drop the bar, the quality bar, I say Sure, don't drive it, but don't drop it. But if you have two candidates, one with a diverse background, Um, who who might be after cable to the same job in 2 to 3 months over someone who slam dunk today, let's invest in the person who is bringing the diverse background for 2 to 3 months and then make them successful. That's not dropping the bar that's still supporting and investing in helping diversity. >> My good friend and heat you saw at IBM. They put out a survey said Diversity, inclusion, diversity. First companies have a bit of advantage, so the investment is so much lower in the bars, more bringing perspective because if we tell about software here has male and female and that's being 17% female, it's >> not just, you know, I had two things to the comments, all of which I agree with one. It's not just a pipeline problem. It is a a culture problem where people have to feel welcome and it has to be a comfortable environment, and they have to believe that their diverse point of view matters and doesn't matter if they're men or women. But there are lots of times when we all make it hard for somebody with a different point of view to enter the conversation. So we have to do a better job of creating the culture, and secondly, there's a saying you have to see it to be it. We have to see people of diversity, gender and of every other type, cognitive diversity of all types at every level in the company. And, you know, we had the same thing, so I'm lucky enough to send a Fortune 500 public board. And I spend a lot of my time helping women and people of color and diversity get on public boards. But if you go back seven years ago, we were 14% women on public boards and it did not move and it did not move and it did not move and in one year popped over 20%. And that's before the loss. So you know, you make these linear projections we can with effort, yes, actually make >> a >> difference. It just takes a very concerted effort. And in this case, particularly for engineering and for leadership, it is making a concerted effort at every level, from board to CEO to executive team to all levels down. Making sure we have inclusion and diversity in >> this is a modern management challenge in the new way of leading managing >> this process. These things, This >> is the big challenge, folks, thanks so much for coming on. Really appreciate. Final question for you guys is what if you could summarize the new way to lead and his modern error from an engineering standpoint, building out of companies building along durable value creation with its company a product or service. What is the key keys to success >> as a leader >> as a leader has a new brand of leaders. >> I would say, You know, this lot goes into, I'm sure you need to know engineering and all the strategic aspect of your job. But the core aspect I feel, is as a leader, my success depends on the quality of relationships I'm building with my team and members that I work with. So that goes into the people aspect, the people connection that goes into it, >> J p. >> Absolutely People are are a big portion of the story. I also feel understanding the problem and driving for results. You know, it's not just about building something. It's about building for a purpose. What is it that you're you're tryingto accomplish and continuing to find that? And working with the teams is so critical for success, especially in a fast moving in Christine. >> Yeah, I agree. It is all about the people, and I think old and new. This hasn't changed. People need to feel like they belong and they're being appreciated, and they're being heard >> scaler. Glass door Copa software. You guys do a great work. Thanks for sharing the engineering inputs, Thio. Leading successful companies. >> Thank you for >> your leadership. Thank you. >> Thank you so much. >> I'm shot for the Q. Thanks for watching. >> Well.

>> Announcer: Live, from Las Vegas, it's theCUBE, covering InterConnect 2017, brought to you by IBM. >> OK, welcome back everyone, live here in Las Vegas for IBM InterConnect 2017. This is theCUBE's coverage of InterConnect. I'm John Furrier, Dave Vellante, my co-host. Our next guest is Deon Newman, CMO of IBM Watson IoT, and Slava Rubin, the founder and Chief Business Officer of Indiegogo. Great keynote today, you're on stage, welcome to theCUBE. Deon, great to see you. >> Thanks for havin' me. >> I got to first set the context. Indiegogo, very successful crowdfunder you guys pioneered. It's pretty obvious now, looking back, this creates so much opportunity for people starting companies, whether it's a labor of love or growing into a great business, so congratulations on your success. What's the IBM connection? Because there was some stuff on the tweets, I don't want to break the news, but you guys are here, share the connection. What's the packaging? Why is IBM and Indiegogo working together? >> Yes, so back up to 2008, we launched to be able to get people access to funding and over the last several years, we've done a pretty good job of that, sending over a billion dollars to over a half a million entrepreneurs around the world, and more recently, we've had a lot more requests of Indiegogo, can you do more? And we knew we couldn't do it all on our own, so we partnered first with Arrow, to be able to bring these ideas more into reality around components and engineering and supply chain, and we knew we needed more in terms of these IoT products, so they need to be smart and they need software, so we were really excited to be able to announce today the partnership with IBM, around everything IoT, clouds, security, and being able to provide all the block chain and any other elements that we need. >> Deon, I want to ask you or get your thoughts on, we have the Watson data platform guys on earlier in the segments, and the composability is now the normal around data, brings the hacker-maker culture to IoT, which, if you think about it, is a sweet spot for some of the innovations. They can start small and grow big. Is that part of the plan? >> I mean, if you look at what's going on, we have about 6,000 clients already working with us in the IoT space. They tend to be the big end of town, whether it be a Daimler or a Airbus, whether it be a KONE, the world's biggest elevator company, or ISS, the world's biggest facilities management company, so we were doin' a lot of work up there, really around optimizing their operations, connecting products, wrapping services around them so that they can create new revenue streams, but where we didn't have an offering that was being used extensively was in the start-ups place, and when we saw what Indiegogo had been doing in the marketplace, and when our partner, Arrow, who, as Slava said, has really built up an engineering capability and a component capability to support these makers, it was just a match made in heaven. For an entrepreneur who needs to find a way to capture data, make that data valuable, we can do that. We have the cloud platform, we have the AI, et cetera. >> It's interesting, we just had the Strata Hadoop, we have our own big data Silicon Valley event last week and the big thing that came out of that event, finally, the revelation, this is probably not new to Slava, what you're doin' is that the production under the hood hard stuff that's being done is, in some ways stunting the creativity around some of the cooler stuff, like whether it's data analytics, or in this case, the startin' a company, so, Slava, I want to get your thoughts on your views on how the world is becoming democratized, because if you think about the entrepreneurship trend that you're riding, there's a democratization of invention. This is the creative, it's the innovation, but yet, there's all this hard stuff, that's called, like, production, or under-the-hood, that IBM's bringin'. What do you expect that to feel up? What's your vision of this democratization culture? >> It's my favorite thing that's happening. I think, whether it's YouTube democratizing access to content, or Indiegogo democratizing access to capital, the idea of democratizing access to entrepreneurship between our partnership, just really makes me smile. I think that capital is just one of those first points and now they're starting to get the money, but lots of other things are hard. When you can actually get artificial intelligence, get cloud capabilities, get security capabilities, put it into a service, so you don't need to figure all those things out on your own, so you can go from a small little idea to actually start scaling pretty rapidly, that's super exciting. When you can be on Indiegogo, and in four weeks, get 30,000 backers of demand across 100 countries, and people are saying, "We want this," it's good to know that you don't need to start ramping up your own dev team to figure out how to create a cloud on your own, or create your own AI, you can tap right into a server that's provided, which has really revolutionizing how quickly a small company can scale, so it proliferates more entrepreneurs starting, 'cause they know there's more accessibility, plus it improves their potential for success, which in the long run, just means there's more swings at the bat to be able to have an entrepreneur succeed, which I think all of us want. >> Explain for the audience how it works a little bit. You got the global platform that you built out, Arrow brings its resources and ideation, IBM brings the IoT, the cognitive platform. Talk about how that all comes together and how people take advantage of it. >> Sure, I mean you can look at it as, one example like WaterBot. So WaterBot is an actual sensor that you can deploy against your water system to be able to detect whether or not your water that you're drinking is healthy. You're getting real-time data across your system and for some reason, it's telling you you have issues, you can react accordingly. So that was an idea. You go on Indiegogo, they post that idea, and they're able to get the world to start funding it. You get customer engagement, you get actual market validation, and you get funding. Well now you actually need to make these sensors, you need to make these products, so now you get the partnership with Arrow, which is really helpful, 'cause they're helping you with the engineering, the design, the components. Now you want to be able to figure out how you can store all that data, so it's not just your own house, maybe you're evaluating across an entire neighborhood, or as a state, you want to see how the water is for the whole entire state. You put all that data up into the cloud, you want to be able to analyze the data rapidly through AI, and similarly, this is highly sensitive data, so you want it to be secure. If WaterBot, on their own, had to build out all this infrastructure, we're talking about dozens, hundreds, who knows how many people they would need, but here, through the partnership, you get the benefit of Indiegogo to get the brilliant idea to actually get validated, Arrow, to bring your idea from back of the napkin into reality, and then you get IBM Watson to help with all of the software components and cloud that we just talked about. >> Great, and how did this get started? How did you guys fall into this and how did it manifest itself? >> Take it, I tell the story? >> Go for it. >> So, I love this story. So, Slava's explained that the front end of this, it was really a partnership of Arrow and Indiegogo that came out of the need of entrepreneurs to actually build their stuff. You know, you get it funded, and then you say, "Oh boy," now I've got a bunch of orders, how do I now make this stuff? And so, Arrow had a capability; of looking at the way you designed, looking deeply with their engineers, sourcing the components, putting together, maybe whiteboxing it even for you, and so, they put that together. Now, we'll all seeing that IoT and the connected products are moving for disconnection, it's actually generating data and that data having value. And so Arrow didn't have that capability, we were great partners with Arrow, you know, when we all looked at it, you know, the need for AI coming into all these products, the need for security around the connection platform, that can actually do that connection, we were a logical map here, so we're another set of components, not the physical. We're the cloud-based components and services that enable these connected devices to sync. >> If you think about the impact, it's mind-boggling with the alternative. You mentioned, the example you gave, they probably might have abandoned the project, so if you think about the scale of these opportunities, what the alternative would have been without an Indiegogo, you probably have some anecdotal feeling on this. Any thoughts on what data you can share, do you have any kind of reference point of like, OK, we funded all this and 90% wouldn't have been done, or 70% wouldn't have been done, do you have any flavor for what's... >> Hard to know exactly. Obviously, many of these folks that came to Indiegogo, if they could have gotten funded on another path, earlier in the process, they would have. Indiegogo became really a great choice. Now you're seeing, instead of being the last resort, Indiegogo's becoming the first resort because they're getting so much validation and market data. The incredible thing is not the thing that adds scale, when you think about 500 or 700,000 entrepreneurs or over a billion dollars and it's in virtually every country in the world, if you really just look at it as one product. So, like, Flow Hive is just one example. They've revolutionized how honey gets harvested. That product was bought in almost 170 countries around the world, and it's something that hasn't been changed in over 150 years, and it's just so interesting to see that, if it wasn't for Indiegogo, that idea would not go from the back of the napkin to getting funded, and now, through these partnerships, they're able to really realize so much more of their potential. >> So, it's interesting, the machine learning piece is interesting to me, because you take the seed funding, which is great, and product market fit as they say in the entrepreneurial culture, is validated, so that's cool, but it could be, in some cases, small amounts of cash before the next milestone, but if you think about the creativity impact that machine learning can give the entrepreneur. >> Slava: Right. >> On their discovery process, early stage, that's an added benefit to the entrepreneur. >> Absolutely. Yeah, a great example bears against SmartPlate. SmartPlate is trying to use the combination of weight sensing plate, as well with photo detection, image detection, and software. The more data it can feed its image detection, the more qualified it can know, "Is that a strawberry or a cherry or is that beef?" Right? And we take that for granted that our eyes can detect all that, but it's really remarkable to think about that instead of having to journal everything by hand or make sure you pick with your finger what's the right product, how many ounces, you can take a photo of something and now it'll know what you're eating, how much you're eating and what is the food composition? And this all requires significant data, significant processing. >> Well, I'm really pumped about that, congratulations, Deon, on a great deal. I love the creativity. I think the impact to the globe is just phenomenal. I mean, by what the game-changing things that are coming out. Slava, I got to ask you, and Deon, if you could weigh in, too, maybe you have some, your favorites, the craziest thing you've seen funded, and the coolest thing you've seen funded. >> Cool is hard, because it's kind of like asking, "Well, who's your favorite child?" I have like 700,000 children, not even Wilt Chamberlain, (laughing) and I like them all. But, you know, it's everything from an activity tracker to security devices, to be able to see what the trend is 24, 36 months ahead. Before things become mainstream today, we're seeing these things three, five years ago. Things are showing up at CES, and these are things we get to see in advance. In terms of something crazy, it's not quite IoT, but I remember when a young woman tried to raise $200,000 to be able to get enough money for her and Justin Bieber to fly to the moon. (laughter) >> That's crazy. >> That didn't get quite enough funding, but something's that flush right now is Nimuno Loops is getting funded right now on Indiegogo Live, and they just posted less than seven days ago and they have Lego-compatible tape, so it's something that you can tape onto any surface, and then the other side is actually Lego-compatible, so you're actually putting Legos onto that tape. So, imagine, instead of only a flat surface to do Legos, you could do Legos on any surfacing, even your jacket. It's not the most IoT-esque product right now, but you just asked for something creative, there you go. >> That's a creative. >> I think once you got Wilt Chamberlain and Justin Bieber in conversation, I am out. (laughter) >> Keepin' it fresh. (voices overlapping) >> Slava, how does Indiegogo sustain itself? Does it take a piece of the action? Does it have other funding mechanisms for... >> The beautiful thing about Indiegogo is, it's a platform and it's all about supply-and-demand, so supply is the ideas and the entrepreneurs, and demand is the funders. It's totally free to use the website and as long as you're able to get money in your pocket, then we take a percentage. If you're not taking any money into your pocket, then we get no money. As part of the process, you might benefit from actually not receiving money. You might try to raise 100 grand, only raise 31, and learn that your price point is wrong, your target audience is wrong, your color is wrong, your bond cost is too high. All this feedback is super value. You just saved yourself a lot of pain, so really it's about building the marketplace. We're a platform, we started out just with funding, we're really becoming now a springboard for entrepreneurs, we can't do it all ourselves, which is why we're bringing on these great partners. >> And you know, we've done, just to add to that, I think it's a relevant part here, too. We've actually announced a freemium-based service for the entrepreneurs to get onto the cloud access, the AI, or to access the services as a starting point, it's a complete freemium model, so that they can get started, very low barrier to entry and obviously, scale as they grow. >> What do you call that? Is it IBM IoT Freemium or is it? >> Hasn't been a name specifically to the Freemium element of it, it's what in IoT platform, available on Bluemix. >> So, it's like a community addition of lots of, so Deon, a new chapter for you, >> Yeah. >> I saw a good quarter for mainframes last quarter, still drafting off your great work, and now you've shifted to this whole new IoT role. What's that been like, relatively new initiative for IBM, building up on some historical expertise, but give us the update on your business. >> It's about 15 months ago, we announced a global headquarters that we're going to open in Munich and we announced the Watson IoT business, which brought together a lot of IBM's expertise and a lot of our experience over the years through Smarter Cities, through the Smarter Planet Initiative, we'd been working the Internet of Things. We'd made a three billion dollar commitment to that marketplace, though we were going to go big and go strong. We've built out a horizontal platform, the Watson IoT platform. On top of that, we've got market-leading enterprise SF management software, the Maximo portfolio, TRIRIGA for facilities management, and then we have a whole set of engineering software for designing connected products as well. So we've built out a very comprehensive industry, vertical-aligned IoT business. We added, last year, we went from about 4,000 to about 6,000 plants, so we had a very good year, in terms of real enterprises getting real outcomes. We continued to bring out new industry solutions around both connected products and then, operations like retail, manufacturing, building management, Tokyo, transportation. We're building out solutions and use-cases to leverage all that software, so business is going well, we officially opened the Watson IoT headquarters three weeks ago in Munich, and we're jampacked with clients coming through that building, building with us. We've got a lot of clients who've actually taken space in the building, and they're using the co-laboratory with us to work on PSEs and see the outcomes they can drive. >> Deon Newman, with Watson IoT platforms. Slava Rubin, founder of Indiegogo. Collective intelligence as cultural shift happening. Congratulations. Crowdsourcing and using all that crowdfunding. It's really good data, not just getting the entrepreneur innovations funded, but really using that data and way in your wheelhouse, IoT. >> Yeah. >> John: Thanks for joining us in theCUBE, appreciate it. More live coverage after this short break. It's theCUBE, live in Las Vegas, for IBM InterConnect. We'll be right back. Stay with us. (theCUBE jingle)