>> Narrator: From theCUBE studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is theCUBE conversation. >> Everybody, welcome to this CUBE conversation. I'm John Furrier, host of theCUBE here in Palo Alto, California in our studios where we have a quarantine crew and we're doing remote interviews with thought leaders in the industry and people who have been around the block, beat it through three industry cycles but also can share their perspectives on the COVID-19 situation that we're in, the challenges and the opportunities. And I have with me, Jeremy Burton, a good friend of theCUBE. Have been a CUBE alumni now for 10 years, now the CEO of Observe, it's a stealth startup. I got a little taste of it, it's a Cloud thing. It's going to be part of this whole new guard. Jeremy, great to see you. You're sheltering in place, we're sheltering in the studio. Thanks for joining me. >> No, thanks for the offer. I mean, it's funny these days I welcome chance to actually speak to somebody and particularly, somebody that's not at Observe. So this is a rare treat in the last three weeks. >> Telling the wife and kids, "Hey, I'm going to go talk to theCUBE guy." So you know, I'm going to have some fun for a while. Look, I want to just have a candid fun conversation 'cause I think one of the things that's interesting to me in one, things that we're spending a lot of time doing media on is getting the word out about some of the things that are going on. People do have anxiety, they're sheltering in place for the folks that've been in the tech industry, working at home and being virtual has been part of the thing. It's not a big thing but from some of the people it's like a first time thing. And also it's also highlighting a disruption that kind of is off the books if you will, the classic continuous operations and disaster recovery was also confined to power outages or hurricanes or all those things that we people are protected against. But this is just a surge of the herd of the people going home. It's causing an at scale problem and showing these challenges, but there's also opportunities. What's your take on this? How do you see this evolving? What's your view of the current situation and some of the comments? >> Yeah, I think for most of us we're in a little bit unchartered territory. I don't really know a whole lot about medicine or the details of the virus or how pandemics happen. But we obviously have to, we deal with the consequences of it. And so I think right now although, I think it's a fairly bad situation for a lot of people, just having been through a couple of recessions where we all went through 9/11. The world does turn around and you come out the other side. And so the key thing is you start like a very much as a cliche, but you've got to live in the moment, "What can I do right now? "What can I affect right now? "How can I make sure that what I'm working on "is a value for when we come out the other side "and when more curveballs come along?" I think you've got a reason about that with the best information you have at the time. So I almost feel like you very much, you've got to just live solid like day to day, week to week, listen to the data and adapt based on that. But it's certainly starting to reinvent how work is done. I think we've all worked from home at some point. We've all worked using our equipment at home. But the prospect of working that way for months on end and it maybe been the new way of working, is a whole new ballgame. So I'm a big believer that this will fundamentally change the way we work. I don't think we're going to go 100% back to the way that we were, and there's going to be quite a lot of readjustments, and I think in that world, there's going to be some new companies come along that are big winners. And by definition, there's going to be some big losers as well. >> Well, people who know theCUBE know that I'm a big fan of you as an executive. I've seen the vision, you have also great technical shops and product shops, but also a good operational view. You've always been a fan of digital. And I think if you look at video conferencing, for instance, WebEx as a Cisco thing, great bulletproof of the enterprise, but Zoom has come across the scene. I've never seen so many Zoom parties. I did one with my family that they actually liked it. They were having fun. We had cocktails raising the wineglasses up. So people are Zooming their CUBE in, we're doing interviews. So video now is not just a corporate thing. You're seeing the engagement of digital taking on a new life and this is a whole new roles and responsibilities that we might reimagine how people do their business because with the events being canceled that are going on, whether they're concerts or just industry or tech events or any event, that physical space is gone, now it's going to digital. So how do you replicate the business value or personal value from physical face to face to digital? It's a whole new venue, there's new roles. It's complicated, it's a complex system. What's your thought on that? >> It is though, but what I have been pleasantly surprised by, I'd love it going in the office. I love the engagement with people and hanging out in the office. And so I was not really a big fan of remote working and virtually working, but I have to say, not only now where we virtually work in and we do the Zoom meetings and that's all well and good. It's a big cultural thing with at Observe to do a game night. And so we thought, "Well, why can't we do a virtual game night "and lending some trade secrets here? "But our favorite game was Secret Hitler." >> Yeah, that's a great game. One of my family's favorite. >> Turns out there's an online Secret Hitler. And you know what? The first time we played it, one of the nice thing is we've got less than 20 people in the company. So you got 12 or 14 people online. It's actually manageable. But I have to say, I'm almost embarrassed to say, it was almost as good sitting there with a drink playing virtual Secret Hitler as it was sitting around the desk. And so now I'm thinking when we go back to work, maybe we don't need to leave our desks and go have a drink together. We can just sit there on Zoom and play the secret Hitler online. Then you start looking around, "Well, what are the games can I play online?" Not like for one or two players or five players and I'm not talking about playing kind of Halo or something like that, but good collaborative games for tens of people to play at once. There's not as many as you think. So I feel like the social aspect of it, I mean, online gaming I think is huge. But even the video conferencing software, you would have thought that we would be done WebEx by now, right? I mean Skype and WebEx, we've had those for years, right? And so how does Zoom, which does guess what, video conferencing come along and start to clear up. And Zoom is not perfect by the way, but this is almost the crisis that they needed to make a fabulous business. I do believe as we start to come out the other side, I think there's going to be much, much investment in the VC world, on improving that remote work experience Because as much as me and you can talk to a video session, we can't collaborate and work together. The tools for doing that, I think still are relatively poor. >> I think you're onto something. Zoom by the way, had 10 million active dailies in December. This month was 200 million rocket ship. They got 90,000 universities. They essentially made some good moves. I think that's going to be good, but you bring up a good point about these new kinds of opportunities that are going to come out the other side, which is, think about Secret Hitler. For the folks who don't know, is a great game that you play with people, in your family or in friend group like Cards Against Me. And if you know that game, it's a similar thing concept, but you have different games. It's really fun, you should get it. Check it out online. But think about that online gaming or just what engagement means socially. I mean the old web days or just like a couple of months ago was individual engagement, "Did you like my tweet? "Did you like my Facebook post?" You're getting at something that's little bit more of a social organizational construct of group engagement, intimacy. >> Right, and the thing is we would do game night once a month and we'd get videos in and get the teamed together. Once a month was good when everybody had their own life to deal with. Now people are craving like, "Hey can we do this like every week?" And I wouldn't be surprised if the frequency increases from that, but I think that just almost speaks to human beings and that we crave social interaction. And even though most of the people at Observe are engineers and by definition should not enjoy as much social interaction, they do. They love it, right? And to me, that gaming and social direction, that's part of work. And so you have to have a virtual environment that can reproduce that. >> I mean, it's very interesting to see some of the entrepreneurial exercises or pitches that come out of this because I think it's going to be a Renaissance, it's not Renaissance 'cause it's going to come back. It's always been there. But the new kind of entrepreneurial products coming out are going to address these things. And the question I want to ask you, 'cause you've been on the big company, you've done extremely well in your career, than you get back down to your roots to doing startup, you're launching, you haven't yet launched. So you got hit right here, you're working at home sheltering in place. I was talking to a couple of VC buddies, venture capitalists, and they're saying, "I'm reading books and I'm doing research "but I really can't meet people." So their work has changed. How do you see the investment community reacting to this? Certainly valuations might come down. Obviously, their limited partners are being hit with the stock market. You're seeing a disruption. What do you see going on in the VC world around this cold hard time? >> I mean certainly all VCs are not created equal. So I think there's going to be different perspectives based on the background of the DNA of the VC involved. I think certainly at Observe, I feel very fortunate that we've got a sort of Hill Ventures. So these guys were the investors behind Snowflake and behind Pure Storage and many other good companies but they're very longterm investors and their advice to me has been, "Well look, "some of the most innovative times if you like, "have been during and after a major crisis. "And so if you make short term decisions "to get you through those crisis, "they're all terrible but they don't last forever "and there will be another side. "And so make good business decisions "and good investment decisions through this "because there will be winners "that emerge on the other side." And that's really what I try and get the team focused on is, "Guys for now, we're sort of hunkered down "and it feels bad, "but we're probably more privileged than most. "And we have an opportunity maybe on the other side, "to take advantage, we don't have a revenue stream, "we don't have existing customers. "We can sort of take this Greenfield business "that we've got and you go on the offensive "when things returned to assemblance of normal." So The Hill had been fantastic. And I would hope that most VCs retain that perspective, which is if it was a good company three weeks ago, it's probably still a good company today. And the best way to create value is to sort of empower I think the CEOs and executive teams to make the right sort of longer term decisions. Try and capitalize when you come out the other side because there will be losers as well. And I think the wrong decisions now can put you on the losing end of that equation in three, four, five months time. >> Yeah, that's a good point. If you are a good company just a few months ago or even weeks ago or a year ago, you're still a good company. That's really going to be a tell sign to what happens in some of these companies. If I got to ask you a more focused question on this whole, which side of the street are you on? Are you riding the wave or are you going to get taken away and washed away with it? Because there are bets and well, I want to get into Observe in a minute, but you mentioned Snowflake there in the Cloud wave. Obviously, that's pretty bullish. We're still bullish on that. Obviously, it's going to be game changer. But is there a tell sign for the kind of bets that those good management teams need to make now? Because I agree with you, when the Dot-com bubble burst in 2000 and really 2004 kicked back up again. 2008, we saw that post and a lot of great companies were created. So what's your advice on which side of history do you need to be on here? I'll say Cloud is one. What is your view on that? >> Yeah, I mean we felt for many years, it's not just since I went to the startup, but I am a huge believer in this transition to digital businesses. Frictionless interactions, automation, yes, obviously people are required to run a business, but if you could run a business remotely, or the businesses automated in a way such that it doesn't require hands-on operation, then that's a beautiful thing. And my belief is that, this terrible situation will force people to really think seriously about what the digital business looks like. If you don't have one, then that you may not be able to be in business in a year, two, three years down the line, right? There'll be some carryover, but I think the smart businesses are going to be able to function in an environment such as this. >> Yeah, I think that's great. >> That's going to be playing on everybody's minds. Now more than ever, I think that the digital business is a necessity. >> Yeah, I was just talking to a colleague and we were just talking about how all of the events got canceled and you've had the history running some of those best events ever in the industry at EMC. And we participated in those and you know your staff when it comes to events, there's economic value in these physical events as a venue, Science Convention Center in Moscone here in San Francisco. I mean there's a lot of things that go on, a lot of decision-making that's been standardized over the years and there's an economic value that comes out of those events. Now that's gone, and then these little digital teams, some companies have like five people, two people, sometimes maybe if you're lucky you have 10 or more or a department. And then you've got demand generation. All these guys are being told now, "You have to make up for the shortfall "in not just leads but value." And this just has been a big burden for some of my friends out there who are like, "Wait a minute, you want to take that and move it over here?" It's been kind of a challenge. What is your view on this? Because a lot of people are trying to figure this particular problem out on how to make digital work today and have some extensibility and get success. What's your take? >> Well, I'm still a huge believer I mean, whereas sort of like we just saw digital marketing content is still very much King, right? If you can produce a compelling piece of content online, TV quality with a depth of knowledge that you're going to attract an audience, now can you then make that experience interactive? Can you engage the audience in a deeper way? Yeah, you're probably not going to have something which lasts for a full day or for three days online, but I think it's really going to force the creativity on the content side to another level, right? It can't just be talking heads and PowerPoint pictures. So that rethinking from first principles, what an online conference or an online experience actually looks like in a way that it engages the people who are watching. To me, those folks are going to go do very, very well. And the economics, I know how much it costs to put on a conference for 10 or 15,000 people. And by the way, I know how much it costs to put on a virtual event for 10 or 15,000 people. And the economics are astounding in that difference. Now if you're physically somewhere, you can feel things that you can't feel online. Come on though, this is a problem that requires some innovation to solve, right? We've talked about virtual reality and augmented reality, but it's still pretty clunky and relegated to sort of niche use cases and bad games. But at some point, that technology has to reach the point where it can be useful and engage in a new. You can approximate to that physical experience. But I think that is going to be critical but many businesses even beyond sort of marketing and virtual events and that kind of thing, many businesses are just going to have to reinvent how they engage and interact with their customers and the automation of their operations and how do you get by when you don't have as many people physically in an office or operating machines? Everybody's going to have to think through that. >> Yeah, I think that's great insight and that's going to be a great clip that I'll share and I think that's going to be inspirational for the folks trying to solve that problem. The things that we're focused in on, as you know, and this is something that we're doing a lot of work on, is the engagement with groups and you mentioned The Secret Hitler as the game, they're going to see some new clever things go on. And I think the group dynamic and having people in whether it's virtual and physical spaces exchanging credible things, ideas or jokes or whatever is going to be a new kind of dynamic. >> Yeah. >> Because that's going to have to fill the void. >> Yeah, I mean I've got a small company so we can play these individual games, but just think about some of these board type games where I want to have three teams and I want to divide the company up into three. The logistics of actually figuring that out is ridiculous and it shouldn't be that way, right? And so these are basics of human social interactions. We want to play a game together, we want to divide up into teams. But that sounds like a relatively trivial thing, but try and find the number of games available that allow you to easily do that and each team interaction independently of the others, it's almost impossible. >> It's going to be fun to watch and I think and I hope we're going to learn. Well, thanks for the device. Let's get back to your startup. Let's get a plug in for that, I want to get the plug in. I've seen you in stealth so you can't really go into great detail, but you have been talking to customers. You are obviously related, that's related to Snowflake, but you were going to do some things with Snowflake. You're in the Cloud. Can you just take a minute to give a plug for what you guys are doing for the people who want to know what you guys are leaning towards in terms of the value proposition? >> Yeah well, when I look back in my career, one of the times I enjoyed the most was the time at Oracle and working with data. And I've been fortunate enough for the last four and a half years or so to be on the board of Snowflake. Couple of ex Oracle guys, Benoit and Thierry founded the company and they've reinvented the database. And I felt like I've sat for 20 years looking for the second coming of the database and we all were sort of had fake thinking it was Hadoop. And turns out it wasn't. But I think Snowflake and the separation of storage and compute that allows them to sort of scale and have a usage-based pricing model, I just think is absolutely revolutionary and I think it's going to be one of the great companies of the new era. And so when I was there when I looked at Observe, really the thesis was that using a platform like Snowflake, you could potentially reason about unstructured log data. It's all like Splunk. You could reason about time series data, a little bit like Datadog or tracing data like AppDynamics or in fact any data, you could reason about it together. And today, if you look at the world, it's like if you want to do something with logs, you go get one product. If you want to do something with relational data, you get another, if you want to do time series data, you get another, you want to do tracing, you get an APM tool. And nobody has the big picture, right? Everybody's got their own little piece of data and their own perspective on where the issue might be in your company. But nobody really knows and it's usually put together in the brain of, of the smartest guy in the room. And so I thought it was quite simple. At Snowflake, you've got this commercial database that can do instruction data and time series data and relational data. And what if we could collect all data within an organization together, structure it, relate it, and then imagine what you could find out about your infrastructure, your applications, your business? >> Sort of unification? Does it have like unification kind of concept for users or IT? >> Yeah, I think the emerging category would be observability but it really is a collapsing of log analytics, metrics monitoring and tracing into this new category of observability. We don't necessarily just view that though as sort of data coming out of Kubernetes clusters or out of AWS or wherever. We actually could ingest security data. We could ingest data from people surfing using your app or surfing your website. We could take logs coming out of machines on a factory floor. So the way we built the product, it can be literally any kind of data. And we try and structure it and relate it and make sense of it and then make it very easy for people to navigate through it and determine issues and problems. So yeah, we're pretty excited about it. And like I said, we could not have built this even a couple of years ago because I don't think Snowflake would have been there. And in fact, that was one of the big risks when we started the company. Can we build it on Snowflake? And so here we are two years later and we think we can. Well, we're sure we can do it. >> Yeah, they've had a good run too. I mean, look at the growth of Snowflake. >> Yeah, it's crazy. I've never seen anything like it and in the last 20 years and B2B, I've never seen anything like it. So just like I felt in the mid 90s when I was at Oracle, people were making decisions to go with Oracle and then saying, "Hey, help me get all of my other data in that, "my mainframe data, my this, my that." I think Snowflake are going to go through the same sort of growth phase and hopefully with Observe, we can be like, "Hey, if you want to put "your unstructured data or time series data, "we can help you do that very easily." >> Well, this is exactly the current wave that you want to be on the right side of because like you said, just a year or so ago or a couple of years ago, it wasn't available. This is kind of the new capabilities. >> Yeah, I feel like there's going to be a lot of businesses, grow ridiculously. You talked about the Zoom numbers. These are ridiculous growth numbers and there are going to be companies come out the other side that take advantage of the new environment. And as they're growing, as they're scaling, as they build these new microservice-based applications, they're going to run into issues and we hope at least that it's products with our kind of architecture, that's going to be able to help these fast-growing businesses. So yeah, as I said, we're somewhat fortunate in that we don't have a product yet, but certainly on the other side of this, we think there's going to be plenty of opportunity to help a few folks. >> We know you got to do a launch and we're looking forward to hearing more and getting the briefing, and looking forward to hearing more about it when you go public. And yeah, thanks for coming on and taking the time today. I know you got your daughter's birthday party there and you're going to have some celebration. Thank you for sharing the insights on your vision of digital. I thought that was very compelling and great to see you and stay safe. >> Great to see you. Yeah, my 18-year-old, it's got a birthday party and she like always would worry, "What if no one shows up?" Well, today she knows no one's going to show up. >> Except for her family, yeah. >> It's going to be down in the family, yeah. So thanks for that and you guys stay safe and been great the last 10 years knowing theCUBE been that long but hopefully, here is the next 10 years after this current situation is over. >> Yeah, looking forward to it, it's going to be a lot of fun rye and get the content out there. And again, thanks for coming on during this important time and sharing your insights and also just making some entertainment here. We're getting some conversations so people can fill the void and play some games and have some fun. Jeremy, thanks. Great to see you. Jeremy Burton, senior executive in the industry. I've known him for years, been a CUBE alumni since theCUBE was formed. Now the CEO of Observe, sharing his insights on the industry but more importantly, how to be successful, how to come out the other side. Don't be too optimistic. Be focused on today and get through it. That's his advice. Of course, we're theCUBE bringing you all the data as we can now with remote interviews during this time. Thanks for watching, I'm John furrier. (soft music)

>> Narrator: From theCUBE studios in Palo Alto and Boston, connecting with thought leaders all around the world, this is theCUBE conversation. >> Everybody, welcome to this CUBE conversation. I'm John Furrier, host of theCUBE here in Palo Alto, California in our studios where we have a quarantine crew and we're doing remote interviews with thought leaders in the industry and people who have been around the block, beat it through three industry cycles but also can share their perspectives on the COVID-19 situation that we're in, the challenges and the opportunities. And I have with me, Jeremy Burton, a good friend of theCUBE. Have been a CUBE alumni now for 10 years, now the CEO of Observe, it's a stealth startup. I got a little taste of it, it's a Cloud thing. It's going to be part of this whole new guard. Jeremy, great to see you. You're sheltering in place, we're sheltering in the studio. Thanks for joining me. >> No, thanks for the offer. I mean, it's funny these days I welcome chance to actually speak to somebody and particularly, somebody that's not at Observe. So this is a rare treat in the last three weeks. >> Telling the wife and kids, "Hey, I'm going to go talk to theCUBE guy." So you know, I'm going to have some fun for a while. Look, I want to just have a candid fun conversation 'cause I think one of the things that's interesting to me in one, things that we're spending a lot of time doing media on is getting the word out about some of the things that are going on. People do have anxiety, they're sheltering in place for the folks that've been in the tech industry, working at home and being virtual has been part of the thing. It's not a big thing but from some of the people it's like a first time thing. And also it's also highlighting a disruption that kind of is off the books if you will, the classic continuous operations and disaster recovery was also confined to power outages or hurricanes or all those things that we people are protected against. But this is just a surge of the herd of the people going home. It's causing an at scale problem and showing these challenges, but there's also opportunities. What's your take on this? How do you see this evolving? What's your view of the current situation and some of the comments? >> Yeah, I think for most of us we're in a little bit unchartered territory. I don't really know a whole lot about medicine or the details of the virus or how pandemics happen. But we obviously have to, we deal with the consequences of it. And so I think right now although, I think it's a fairly bad situation for a lot of people, just having been through a couple of recessions where we all went through 9/11. The world does turn around and you come out the other side. And so the key thing is you start like a very much as a cliche, but you've got to live in the moment, "What can I do right now? "What can I affect right now? "How can I make sure that what I'm working on "is a value for when we come out the other side "and when more curveballs come along?" I think you've got a reason about that with the best information you have at the time. So I almost feel like you very much, you've got to just live solid like day to day, week to week, listen to the data and adapt based on that. But it's certainly starting to reinvent how work is done. I think we've all worked from home at some point. We've all worked using our equipment at home. But the prospect of working that way for months on end and it maybe been the new way of working, is a whole new ballgame. So I'm a big believer that this will fundamentally change the way we work. I don't think we're going to go 100% back to the way that we were, and there's going to be quite a lot of readjustments, and I think in that world, there's going to be some new companies come along that are big winners. And by definition, there's going to be some big losers as well. >> Well, people who know theCUBE know that I'm a big fan of you as an executive. I've seen the vision, you have also great technical shops and product shops, but also a good operational view. You've always been a fan of digital. And I think if you look at video conferencing, for instance, WebEx as a Cisco thing, great bulletproof of the enterprise, but Zoom has come across the scene. I've never seen so many Zoom parties. I did one with my family that they actually liked it. They were having fun. We had cocktails raising the wineglasses up. So people are Zooming their CUBE in, we're doing interviews. So video now is not just a corporate thing. You're seeing the engagement of digital taking on a new life and this is a whole new roles and responsibilities that we might reimagine how people do their business because with the events being canceled that are going on, whether they're concerts or just industry or tech events or any event, that physical space is gone, now it's going to digital. So how do you replicate the business value or personal value from physical face to face to digital? It's a whole new venue, there's new roles. It's complicated, it's a complex system. What's your thought on that? >> It is though, but what I have been pleasantly surprised by, I'd love it going in the office. I love the engagement with people and hanging out in the office. And so I was not really a big fan of remote working and virtually working, but I have to say, not only now where we virtually work in and we do the Zoom meetings and that's all well and good. It's a big cultural thing with at Observe to do a game night. And so we thought, "Well, why can't we do a virtual game night "and lending some trade secrets here? "But our favorite game was Secret Hitler." >> Yeah, that's a great game. One of my family's favorite. >> Turns out there's an online Secret Hitler. And you know what? The first time we played it, one of the nice thing is we've got less than 20 people in the company. So you got 12 or 14 people online. It's actually manageable. But I have to say, I'm almost embarrassed to say, it was almost as good sitting there with a drink playing virtual Secret Hitler as it was sitting around the desk. And so now I'm thinking when we go back to work, maybe we don't need to leave our desks and go have a drink together. We can just sit there on Zoom and play the secret Hitler online. Then you start looking around, "Well, what are the games can I play online?" Not like for one or two players or five players and I'm not talking about playing kind of Halo or something like that, but good collaborative games for tens of people to play at once. There's not as many as you think. So I feel like the social aspect of it, I mean, online gaming I think is huge. But even the video conferencing software, you would have thought that we would be done WebEx by now, right? I mean Skype and WebEx, we've had those for years, right? And so how does Zoom, which does guess what, video conferencing come along and start to clear up. And Zoom is not perfect by the way, but this is almost the crisis that they needed to make a fabulous business. I do believe as we start to come out the other side, I think there's going to be much, much investment in the VC world, on improving that remote work experience Because as much as me and you can talk to a video session, we can't collaborate and work together. The tools for doing that, I think still are relatively poor. >> I think you're onto something. Zoom by the way, had 10 million active dailies in December. This month was 200 million rocket ship. They got 90,000 universities. They essentially made some good moves. I think that's going to be good, but you bring up a good point about these new kinds of opportunities that are going to come out the other side, which is, think about Secret Hitler. For the folks who don't know, is a great game that you play with people, in your family or in friend group like Cards Against Me. And if you know that game, it's a similar thing concept, but you have different games. It's really fun, you should get it. Check it out online. But think about that online gaming or just what engagement means socially. I mean the old web days or just like a couple of months ago was individual engagement, "Did you like my tweet? "Did you like my Facebook post?" You're getting at something that's little bit more of a social organizational construct of group engagement, intimacy. >> Right, and the thing is we would do game night once a month and we'd get videos in and get the teamed together. Once a month was good when everybody had their own life to deal with. Now people are craving like, "Hey can we do this like every week?" And I wouldn't be surprised if the frequency increases from that, but I think that just almost speaks to human beings and that we crave social interaction. And even though most of the people at Observe are engineers and by definition should not enjoy as much social interaction, they do. They love it, right? And to me, that gaming and social direction, that's part of work. And so you have to have a virtual environment that can reproduce that. >> I mean, it's very interesting to see some of the entrepreneurial exercises or pitches that come out of this because I think it's going to be a Renaissance, it's not Renaissance 'cause it's going to come back. It's always been there. But the new kind of entrepreneurial products coming out are going to address these things. And the question I want to ask you, 'cause you've been on the big company, you've done extremely well in your career, than you get back down to your roots to doing startup, you're launching, you haven't yet launched. So you got hit right here, you're working at home sheltering in place. I was talking to a couple of VC buddies, venture capitalists, and they're saying, "I'm reading books and I'm doing research "but I really can't meet people." So their work has changed. How do you see the investment community reacting to this? Certainly valuations might come down. Obviously, their limited partners are being hit with the stock market. You're seeing a disruption. What do you see going on in the VC world around this cold hard time? >> I mean certainly all VCs are not created equal. So I think there's going to be different perspectives based on the background of the DNA of the VC involved. I think certainly at Observe, I feel very fortunate that we've got a sort of Hill Ventures. So these guys were the investors behind Snowflake and behind Pure Storage and many other good companies but they're very longterm investors and their advice to me has been, "Well look, "some of the most innovative times if you like, "have been during and after a major crisis. "And so if you make short term decisions "to get you through those crisis, "they're all terrible but they don't last forever "and there will be another side. "And so make good business decisions "and good investment decisions through this "because there will be winners "that emerge on the other side." And that's really what I try and get the team focused on is, "Guys for now, we're sort of hunkered down "and it feels bad, "but we're probably more privileged than most. "And we have an opportunity maybe on the other side, "to take advantage, we don't have a revenue stream, "we don't have existing customers. "We can sort of take this Greenfield business "that we've got and you go on the offensive "when things returned to assemblance of normal." So The Hill had been fantastic. And I would hope that most VCs retain that perspective, which is if it was a good company three weeks ago, it's probably still a good company today. And the best way to create value is to sort of empower I think the CEOs and executive teams to make the right sort of longer term decisions. Try and capitalize when you come out the other side because there will be losers as well. And I think the wrong decisions now can put you on the losing end of that equation in three, four, five months time. >> Yeah, that's a good point. If you are a good company just a few months ago or even weeks ago or a year ago, you're still a good company. That's really going to be a tell sign to what happens in some of these companies. If I got to ask you a more focused question on this whole, which side of the street are you on? Are you riding the wave or are you going to get taken away and washed away with it? Because there are bets and well, I want to get into Observe in a minute, but you mentioned Snowflake there in the Cloud wave. Obviously, that's pretty bullish. We're still bullish on that. Obviously, it's going to be game changer. But is there a tell sign for the kind of bets that those good management teams need to make now? Because I agree with you, when the Dot-com bubble burst in 2000 and really 2004 kicked back up again. 2008, we saw that post and a lot of great companies were created. So what's your advice on which side of history do you need to be on here? I'll say Cloud is one. What is your view on that? >> Yeah, I mean we felt for many years, it's not just since I went to the startup, but I am a huge believer in this transition to digital businesses. Frictionless interactions, automation, yes, obviously people are required to run a business, but if you could run a business remotely, or the businesses automated in a way such that it doesn't require hands-on operation, then that's a beautiful thing. And my belief is that, this terrible situation will force people to really think seriously about what the digital business looks like. If you don't have one, then that you may not be able to be in business in a year, two, three years down the line, right? There'll be some carryover, but I think the smart businesses are going to be able to function in an environment such as this. >> Yeah, I think that's great. >> That's going to be playing on everybody's minds. Now more than ever, I think that the digital business is a necessity. >> Yeah, I was just talking to a colleague and we were just talking about how all of the events got canceled and you've had the history running some of those best events ever in the industry at EMC. And we participated in those and you know your staff when it comes to events, there's economic value in these physical events as a venue, Science Convention Center in Moscone here in San Francisco. I mean there's a lot of things that go on, a lot of decision-making that's been standardized over the years and there's an economic value that comes out of those events. Now that's gone, and then these little digital teams, some companies have like five people, two people, sometimes maybe if you're lucky you have 10 or more or a department. And then you've got demand generation. All these guys are being told now, "You have to make up for the shortfall "in not just leads but value." And this just has been a big burden for some of my friends out there who are like, "Wait a minute, you want to take that and move it over here?" It's been kind of a challenge. What is your view on this? Because a lot of people are trying to figure this particular problem out on how to make digital work today and have some extensibility and get success. What's your take? >> Well, I'm still a huge believer I mean, whereas sort of like we just saw digital marketing content is still very much King, right? If you can produce a compelling piece of content online, TV quality with a depth of knowledge that you're going to attract an audience, now can you then make that experience interactive? Can you engage the audience in a deeper way? Yeah, you're probably not going to have something which lasts for a full day or for three days online, but I think it's really going to force the creativity on the content side to another level, right? It can't just be talking heads and PowerPoint pictures. So that rethinking from first principles, what an online conference or an online experience actually looks like in a way that it engages the people who are watching. To me, those folks are going to go do very, very well. And the economics, I know how much it costs to put on a conference for 10 or 15,000 people. And by the way, I know how much it costs to put on a virtual event for 10 or 15,000 people. And the economics are astounding in that difference. Now if you're physically somewhere, you can feel things that you can't feel online. Come on though, this is a problem that requires some innovation to solve, right? We've talked about virtual reality and augmented reality, but it's still pretty clunky and relegated to sort of niche use cases and bad games. But at some point, that technology has to reach the point where it can be useful and engage in a new. You can approximate to that physical experience. But I think that is going to be critical but many businesses even beyond sort of marketing and virtual events and that kind of thing, many businesses are just going to have to reinvent how they engage and interact with their customers and the automation of their operations and how do you get by when you don't have as many people physically in an office or operating machines? Everybody's going to have to think through that. >> Yeah, I think that's great insight and that's going to be a great clip that I'll share and I think that's going to be inspirational for the folks trying to solve that problem. The things that we're focused in on, as you know, and this is something that we're doing a lot of work on, is the engagement with groups and you mentioned The Secret Hitler as the game, they're going to see some new clever things go on. And I think the group dynamic and having people in whether it's virtual and physical spaces exchanging credible things, ideas or jokes or whatever is going to be a new kind of dynamic. >> Yeah. >> Because that's going to have to fill the void. >> Yeah, I mean I've got a small company so we can play these individual games, but just think about some of these board type games where I want to have three teams and I want to divide the company up into three. The logistics of actually figuring that out is ridiculous and it shouldn't be that way, right? And so these are basics of human social interactions. We want to play a game together, we want to divide up into teams. But that sounds like a relatively trivial thing, but try and find the number of games available that allow you to easily do that and each team interaction independently of the others, it's almost impossible. >> It's going to be fun to watch and I think and I hope we're going to learn. Well, thanks for the device. Let's get back to your startup. Let's get a plug in for that, I want to get the plug in. I've seen you in stealth so you can't really go into great detail, but you have been talking to customers. You are obviously related, that's related to Snowflake, but you were going to do some things with Snowflake. You're in the Cloud. Can you just take a minute to give a plug for what you guys are doing for the people who want to know what you guys are leaning towards in terms of the value proposition? >> Yeah well, when I look back in my career, one of the times I enjoyed the most was the time at Oracle and working with data. And I've been fortunate enough for the last four and a half years or so to be on the board of Snowflake. Couple of ex Oracle guys, Benoit and Thierry founded the company and they've reinvented the database. And I felt like I've sat for 20 years looking for the second coming of the database and we all were sort of had fake thinking it was Hadoop. And turns out it wasn't. But I think Snowflake and the separation of storage and compute that allows them to sort of scale and have a usage-based pricing model, I just think is absolutely revolutionary and I think it's going to be one of the great companies of the new era. And so when I was there when I looked at Observe, really the thesis was that using a platform like Snowflake, you could potentially reason about unstructured log data. It's all like Splunk. You could reason about time series data, a little bit like Datadog or tracing data like AppDynamics or in fact any data, you could reason about it together. And today, if you look at the world, it's like if you want to do something with logs, you go get one product. If you want to do something with relational data, you get another, if you want to do time series data, you get another, you want to do tracing, you get an APM tool. And nobody has the big picture, right? Everybody's got their own little piece of data and their own perspective on where the issue might be in your company. But nobody really knows and it's usually put together in the brain of, of the smartest guy in the room. And so I thought it was quite simple. At Snowflake, you've got this commercial database that can do instruction data and time series data and relational data. And what if we could collect all data within an organization together, structure it, relate it, and then imagine what you could find out about your infrastructure, your applications, your business? >> Sort of unification? Does it have like unification kind of concept for users or IT? >> Yeah, I think the emerging category would be observability but it really is a collapsing of log analytics, metrics monitoring and tracing into this new category of observability. We don't necessarily just view that though as sort of data coming out of Kubernetes clusters or out of AWS or wherever. We actually could ingest security data. We could ingest data from people surfing using your app or surfing your website. We could take logs coming out of machines on a factory floor. So the way we built the product, it can be literally any kind of data. And we try and structure it and relate it and make sense of it and then make it very easy for people to navigate through it and determine issues and problems. So yeah, we're pretty excited about it. And like I said, we could not have built this even a couple of years ago because I don't think Snowflake would have been there. And in fact, that was one of the big risks when we started the company. Can we build it on Snowflake? And so here we are two years later and we think we can. Well, we're sure we can do it. >> Yeah, they've had a good run too. I mean, look at the growth of Snowflake. >> Yeah, it's crazy. I've never seen anything like it and in the last 20 years and B2B, I've never seen anything like it. So just like I felt in the mid 90s when I was at Oracle, people were making decisions to go with Oracle and then saying, "Hey, help me get all of my other data in that, "my mainframe data, my this, my that." I think Snowflake are going to go through the same sort of growth phase and hopefully with Observe, we can be like, "Hey, if you want to put "your unstructured data or time series data, "we can help you do that very easily." >> Well, this is exactly the current wave that you want to be on the right side of because like you said, just a year or so ago or a couple of years ago, it wasn't available. This is kind of the new capabilities. >> Yeah, I feel like there's going to be a lot of businesses, grow ridiculously. You talked about the Zoom numbers. These are ridiculous growth numbers and there are going to be companies come out the other side that take advantage of the new environment. And as they're growing, as they're scaling, as they build these new microservice-based applications, they're going to run into issues and we hope at least that it's products with our kind of architecture, that's going to be able to help these fast-growing businesses. So yeah, as I said, we're somewhat fortunate in that we don't have a product yet, but certainly on the other side of this, we think there's going to be plenty of opportunity to help a few folks. >> We know you got to do a launch and we're looking forward to hearing more and getting the briefing, and looking forward to hearing more about it when you go public. And yeah, thanks for coming on and taking the time today. I know you got your daughter's birthday party there and you're going to have some celebration. Thank you for sharing the insights on your vision of digital. I thought that was very compelling and great to see you and stay safe. >> Great to see you. Yeah, my 18-year-old, it's got a birthday party and she like always would worry, "What if no one shows up?" Well, today she knows no one's going to show up. >> Except for her family, yeah. >> It's going to be down in the family, yeah. So thanks for that and you guys stay safe and been great the last 10 years knowing theCUBE been that long but hopefully, here is the next 10 years after this current situation is over. >> Yeah, looking forward to it, it's going to be a lot of fun rye and get the content out there. And again, thanks for coming on during this important time and sharing your insights and also just making some entertainment here. We're getting some conversations so people can fill the void and play some games and have some fun. Jeremy, thanks. Great to see you. Jeremy Burton, senior executive in the industry. I've known him for years, been a CUBE alumni since theCUBE was formed. Now the CEO of Observe, sharing his insights on the industry but more importantly, how to be successful, how to come out the other side. Don't be too optimistic. Be focused on today and get through it. That's his advice. Of course, we're theCUBE bringing you all the data as we can now with remote interviews during this time. Thanks for watching, I'm John furrier. (soft music)

but cute at servicenow knowledge 14 is sponsored by service now here are your hosts Dave vellante and Jeff trick okay we're back this is Dave vellante with Jeff Frick were here live at moscone south and this is the knowledge 14 conference 6600 people here growing was about 4,000 last year you seen this conference grow and about the same pace as a services service now stop line they're growing at sixty percent plus on pace to do over 600 million in revenue this year on pace to be a billion-dollar company and we have the CFO here Mike Scarpelli cube alum Mike great to see you again thank you so this is amazing I mean Moscone is a great venue of the aria last year's kind of intimate you know and now you're really sort of blowing it out I would expect next year you're going to be in the into the big time of conferences well I got a budget for that Tiffany I'm a budget I know it's going to cost more just like the attendance is going up fifty sixty percent the costs are going up as well too but our partners are really important and our partners offset a lot of those costs will get over eight million in sponsorship revenue to offset that so when we expect next year will see a corresponding increase in the sponsorship revenue as well well it's impressive you have a lot of strong partners particularly the system integrator consultancy types you know we saw I hope it will miss somebody definitely saw sent you there last night we start Ernie young giving a presentation k p.m. ET le is about so cloud sherpas yeah the cloud shippers and so we had them on earlier she have a lot of these facilitators which is a great sign for you and they're realizing okay there's there's money to be made around the ServiceNow ecosystem helping customers implement so that's going to make you really happy no you know one of the things that's really important for us with the system integrators is today they haven't really brought us any deals but they've been very influential in accelerating deals and we think that theme is going to continue and based upon what they're seeing they're able to do in the ServiceNow ecosystem in terms of professional service consulting engagement we think that's going to start to motivate them to now bring us into deals that we were never in before but what they have been able to do as well besides just accelerate is have the deals grow beyond IT and we see that numerous on global 2000 accounts for us and you're not trying to land grab the professional services business that's clear effect when you talk to some of your customers when I've ever last year when your customer scoop is complaining that your your price is real high on the surface of suck which it probably makes you happy because it leaves more room for you for your partners and that's really not a long-term piece of your revenue II think you've said publicly you want to be less than fifteen percent of your business right yes yes we have a little bit of a ongoing debate internally my preference is not to see the professional service organization grow in terms of headcount with the pure implementation people the area that I would like to see it grow is more on the training side unfortunately some of our customers they insist that we are part of the professional service engagement so those are more the ones that we're going to be involved and if a customer is looking for a lower-cost alternative we want to make it fair for our partner so that we're not competing with them so they can come up with a lower price to offer a good quality service is important though that it's not going for the lowest price our partners need to make investment so it can be a quality implementations this is a number of early implementations that were done by partners that were some of our smaller partners where they really didn't meet the the expectations of those customers that we've had to go in and fix some of those engagements so the number one goal for our professional service is to ensure we have happy customers because happy customers renew and buy more which are two of the key drivers for our growth so you keep growing like crazy blew it out last quarter to get a 181 million in Billings revenues up 60-plus percent you're throwing off cash hitting all your metrics of course the stock went down oh there you go not much more you could do but you got to really be pleased with the consistent performance and really predictability it seems of the company yeah no I'm since I've been the CFO company it's going to be coming on three years suit in the summer the one thing that I will say about this business model is it's extremely predictable in terms of the the forecasting and what helps with that is the fact that we have such high renewal rates that really helps because we really since I've been here we've never lost any major accounts I think our renewal rate has been averaging north of ninety-five percent and in terms of our upsells or up sells have been very consistent on average they run about a third of our business every quarter and that was Frank has made comments before too that if we don't sign on another customer we can still grow twenty-five percent per year plus just based upon the upsell business opportunity that we have within our existing installed base of customers that's penetrating accounts deeper more seats more licenses more processes and applications yeah the main grower of our upsells are the main contributor to our upsells within our customers really has been additional seat licenses because many of our customers we still have even fully penetrated IT and as we roll out more applications or make our applications more feature-rich as we talked about as Frank his keynote he talked a little bit today aitee costing we've always had that as an application but that's going to be coming out as a much more feature-rich application it's going to be a lot more usable to some of our customers when that goes live that's going to drive more licenses because many times it's different people with an IT that are the process users behind that and then it's going outside of IT as well with the adoption of people enterprise service management concept that Frank's been talking about that will drive incremental users as well too we do have some additional products such as orchestration discovery with a vast majority of our growth and customers is additional licensing so very consistent performance like I say the stock pull back a little bits interesting you guys worked a Splunk tableau smoking hot stocks of all pullback obviously it's almost like you trade as a groupie even though completely different companies completely different business models you don't compete really at all but so you kind of got to be flattering to be in that yeah obviously but it's I looked at as X this is good in a way this is a healthy you know pull back it's maybe a buying opportunity for people that wanted to get in and there are a lot of folks that I'm sure they're looking at that do you I mean how much attention do you even pay for it i know most CFOs i took a say look we can't control it all we can control is you know what we can control and that's what we focus on but you even look at things like that you order your thoughts on you know and unfortunately there is a little bit of a psychology going on here with some of our employees and they're always asking and my comment to them is the only price that matters is the day you sell and this pullback that we've seen recently this is not uncommon was I expecting it to happen right now you know I don't if I if I could predict those things a lot of different line of business but what I will say history is the best indicator of the future and even a company like salesforce com one of our large investors last week he sent me an email and said you do realize that in the first five years of sales force being a public it had forgot if it was four or five fifty percent pullbacks in the stock price so this this happens it will happen I guarantee it will happen again sometime in the future but not just with us with all the other companies I'd be more concerned if it was we were the only company that traded down and everyone stayed up but we're all trading down we all came back today it's interesting and you kind of burned the shorts last year and they've made some money now but but you know Peter Lynch they don't ever short great companies and it's very hard to too short great companies your timing has to be perfect so and your core business you know like for instance a workday is is fundamentally very profitable or you know it should be right and because you're spending like crazy on sales and marketing you're expanding into into AP you're expanding your total available market and you're still throwing off cash what if you can talk about that a little bit you had said off camera your goal is to really be you know so throw off little cash basically be cash flow breakeven yes yes so you know you can only grow at a certain pace last quarter we added 150 new people into our sales and marketing organization that was the the largest number that we've ever added in one quarter we actually added 273 net new employees in q1 that was the most we've ever added in a quarter and even with all those ads we still had very good positive cash flow so it's pretty hard to add at any faster pace than what we're doing right now and so you know I just I don't see us being cashflow negative anytime in the future right now unless something happened and write it have to be a pretty major catastrophe thing and it's not going to be specific to service now it will be kind of across the board we're all CIOs stop spending and the other thing I learned here I thought maybe I just wasn't paying attention to earlier conference calls but the AP focus a large percentage of the global 2000 is in asia-pacific so you're out nation-building right I won't if he could talk about that sure so in two thousand and from March 31st 2013 till March 31st 2014 we open up in 10 new countries most of those were in asia-pacific there's still more countries we're going to be going into an asia-pacific and why are we going into these countries we're going into these countries because that's where the global 2000 accounts are that is our strategy because we focus on quality of customers not quantity of customers what I mean by quality of quality customers one that can grow over time to be a very large customer and even in 2013 we went into Italy and people said at the time well why are you going into Italy we went to Italy because they have global 2000 have 30-something global 2000 accounts even though the Italian economy wasn't doing well global 2000 customers still spend it's not specific to that country their global we signed to global 2000 counts in Italy last quarter so we have a history of showing that if we go into those countries we will be successful in winning those global 2000 and will continue there are some global 2000 so in geographies where it's going to take some time before we actually have a physical presence such as mainland China we do not have any sales people in mainland China today Russia we did not have any people in Russia today how about Ukraine you know we have no one in Ukraine today good thing about Hitler you get to go visit there that's your country I wanted to talk about the TAM yesterday last year we had I kind of watched it but but I was asking Colombo questions about the team because it was you know very interesting I saw a lot of potential want to try to understand how big it could be you and I talked about you had said its north eight billion of course the the stock took off i think it probably 10 billion from a value standpoint I didn't my own tam of mid year I did a blog post I had it up to 30 billion so I started to understand it was a top down it wasn't a bottom up but you guys are starting to sort of communicate to him a little bit differently you got had the help desk and then beyond that the IT Service Management and then you you've essentially got the operations strike the operations management and even now sort of enterprise and business management so I wonder if you could talk about how you look at the the tam and any attempts that you've made to quantify it sure so there's really four markets we play in that really intersect with one another in the core of our market is the IT Service Management that's kind of our beachhead and how we go into accounts in that market right now when historically when we went public gartner groups of the world they looked at it as a helpdesk replacement market they were saying as a 1.4 to 1.6 billion dollar market what they were missing is there's many other things in that space IT service management such as ppm such as our cmdb such as asset management a lot of these things aren't in your traditional help desk we think based upon the rate at which we've been extracting from the market that somewhere we can afford a six billion dollar market opportunity just IT Service Management and then IT Service Management is a subset of the overall enterprise service management market that Frank has been talking about we talked about in our analyst state we think that is potentially as high as 10x the size of our IT Service Management so that can get you up to say that 40 billion dollar plus and then you as well have the IT operations management space IT Service Management you just have the legacy vendors down there nothing innovative happening down there service relationship a lot of white space a lot of stuff that's being done in email lotus notes microsoft access sharepoint those are the markets were going after there really are no true systems in and that's in that space it's those one-off custom apps IT operations management there is a lot of innovation happening down that in that space it is very crowded with some new vendors as well as the legacy vendors the area that will plan might be the whole 18 billion dollar market at IDC talks about you know it's still early innings but it's at least two billion of that market 24 billion will be going after and then Frank brought up this concept of the whole business analytics as well too we talked about we did our acquisition in mirror 42 in 2013 and the business analytics kind of sits at the top of enterprise service relationship management the market we can go after in there that's a that's a whole market into itself at least as big as the enterprise service management but we're not going after that whole market it's just the business analytics to the extent it relates to enterprise service management so that's at least a couple billion more unfortunately this is what we believe there is no published reports out there and times going to is going to tell it similar to when Salesforce went public no one believed the opportunity in front of it and now look how big that come have a 30 billion dollar plus company valuations are depends on what time of year it is what the markets doing but over the long term you know you can sort of do valuation analysis it in the CFO world is there some kind of thought in terms of the ratio between an organization's tan and it's in its valuation you know I mean these other things raid obviously the leadership etc but but for the top companies there a relationship I personally don't get wrapped up in valuation you know I can't control that I can't control public company multiples the only thing we have control over is running our own business and we're going to stay very focused on running our business and let other we'll take care of the valuation good business you picked a good one yes no I I'm very pleased with this one excellent all right Mike well listen thanks very much for coming on the cube we're up against the clock and I always appreciate you thank you Dave time up alrighty bryce bravely request with our next guest we're live from tony south this is dave vellante with jeff record right back