>> Announcer: Live from Madrid, Spain. It's theCube covering HPE Discover Madrid 2017. Brought to you by Hewlett-Packard Enterprise. >> And we're back at HPE Discover Madrid 2018. This is theCube, the leader in live tech coverage. I'm Dave Vellante, with my co-host Peter Burris. This is day two of the event. Johannes Koch is here, he's the Vice President and Managing Director of Central Eastern Europe, Middle East and Africa for Hewlett-Packard Enterprise, and he's joined by Ali Saleh, he's the Senior Vice President and Chief Commercial Officer at GE Digital for Middle East and Africa. Gentlemen, thanks so much for coming to theCube. >> Appreciate it. Thank you. >> Thank you for having us. >> Johannes, let's start off with you. GE, HPE, what are you guys all about, what are you doing together? Talk about the partnership and the alliance. >> So, you know, it started actually one month ago, I suppose and it was meetings that we had with General Electric to understand the customer requirements in cybersecurity, and what we figured is in this world of IoT, Internet of Things there is an increased requirement for security. And there was, from our perspective, lots of solutions out there but it's quite difficult for customers to understand the landscape and who to turn to. And we also figured that in this world, nobody can serve every requirement of a customer, so this is how we figured out with GED that we have a joint interest here, to serve in the Central/Eastern European and then mainly in the Middle East and Africa part our customer base. And this is how it started and I think what I can say is it has accelerated incredibly during the last two months since we signed the joint agreement. We've been building a channel, we've been having lots of meetings with customers and built a really nice pipeline in the meantime, also I think here the show reflects an incredible interest by our customers. So I think we are in a very good state at the moment having a lot of interest, probably all the key customers in our region having this on their agenda. >> Ali, maybe you could just describe the situation, the industrial expansion if you will in Middle East and Africa, what you guys are seeing in terms of the big trends, and what the opportunity looks like. >> Well thank you. You know, GE has been in the Middle East, Africa, for over 80 years in some countries, and we have deep relationships on industrial side, whether it's power, oil and gas, aviation, healthcare and others. And our customers are thinking a lot about cost, quality, and access, and productivity is top of mind, and they've discovered that their industrial assets are smart and capable but the data are not being collected. So when we collaborate with ecosystem of partners, and we fetch the data and get connected, and get insights from the machine to make them able to make the right decision at the right time and then it drives optimization. This is top of mind. They want to see how they can do better for less. >> Okay, so the customers at GE Digital, the customers are going digital, they have all these devices, instruments, machines, and they're moving in a new direction you guys are trying to lead in. What are the challenges that they're facing, what are they asking your help on, what are the big problems that they're trying to solve? >> So, everyone wants to talk about productivity and calls out. The challenge is that not everyone is ready for digital transformation. Some do not feel there is a burning platform, and those that are ready when they feel there is a burning platform, they don't have a plan, they don't have a playbook. So it's important that we collaborate and help our partners and customers understand their current state and heat map and desired state and pinpoint to quick wins so that they get it and they see incremental improvement. And asset performance management has been an easy way for us to say, "Your asset is underutilized "compared to your industrial entitlement "you can do 10x better," and this gets their attention, and this is where we see the power of one in the industrial age is relevant, one percent. In our market, in the world free market, when we talk to them about one or two percent productivity they laugh at us. They say, "Talk to us about ten or twenty." Because there has been a lot of gap in productivity and efficiency. >> Are you able to, I mean, it's only been nine months, but are you able to start to see any kind of customer results at this point? Do you have some examples even early wins with customers? >> So to be exact, the start of the relationship in a formal way-- >> Was it, what'd you say? >> --is two months. >> I thought I heard nine months. >> No, no, we started our first conversations and until it was over, it came to the agreement-- >> So it was brand new, in terms of... >> It is really brand new and I think what we can say is, I think we have 180 partners already engaged. We have probably more than 500 customer contacts in the region already so with large accounts. And we have a pipeline that is multi-million dollar in size. So we're expecting the first close within our first quarter, which ends at January 2018. I think there's no question that there is a big market opportunity out there, right? And I think the show here, I think for me, even accelerated things, because I think in the past, digital transformation was sort of limited to a few industries, we always give travel industry, we take banking sometimes but here, I think what became transparent to many of the customers that we had here, that there is no industry that is sort of immune against what is happening out there and specifically also that the sensors and the devices out there require special attention. And I think with the, specifically on the OT side, we have a solution now with GED that we can basically roll out across our territory. >> So I wanna talk about three things very quickly, I'm gonna lay this out and ask you if in fact this is going to catalyze that much more attention. Number one is a lot of the industry in the Middle East and Africa are natural resource industries, where the historical ways of doing things have been relatively inefficient. So there's a lot of opportunity to use IoT and related things to bring more efficiency, better practices, overall resource management. Number two is, that the technology's now capable of doing that in places where you don't necessarily have the best infrastructure. Aruba technology, for wireless, some of the other things are now possible, that adds to it. And number three, we've seen some recent steps in liberalizing some of the countries that have the most opportunity to do some things differently. You know, Robert Mugabe, no longer in Zimbabwe, the new prince in Saudi Arabia talking about liberalizing things. Are you seeing these come together in a way that would encourage people to think new ways, do new things, use information perhaps differently than it did before? What do you think, is this a confluence, is this a moment? >> Well I agree with you, and absolutely. Today, our customers and partners in region are more ready than before, and they're pulling hard. And when we put our act together as an ecosystem of partners we make it easier on them to make the right decision. When we talk productivity, productivity comes from people, from process operation, from industrial entitlement. And when we talk about the digital thread that brings it all together whether we look at the culture and vision and mission and people utilization, look at the process defined or not, and how we can optimize it, look at the industrial entitlement, and tell them, "Compared to your peers, "this is where you can be." We have their attention. And with the push from the government for productivity and utilization and do more for less, this is becoming top of mind, everyone is talking about it. So, when we partner together and we say, "This is the playbook, this is how you can start, "and this is the edge to cloud solution in a secure way." And we link it to the industrial entitlement, and let's underline industrial, because when we speak the healthcare language and the power language and the oil and gas language we get their attention. >> Excellent, so there's an increasing interest, and you anticipate that there's going to be new action with their pocketbooks. >> Johannes: Yes. And I would add, I think we, this is not an easy marketplace but you can have some outstanding projects. And we have, in the region, you may have heard about, there was in the private investment fund, when the crown prince did announce the NEOM project. Or, we have in Dubai Smart City as a project, with the city of Dubai which are all projects that probably would not happen in Western Europe. So there is potential, there are bigger things happening, and I think there is also an understanding that this is a way how to leapfrog, to your point, to leapfrog technology. And I think that is what can happen. What we need to be careful of is where to invest, because there are lots of ideas out there, and to understand what are the real things, and what are the things that we need to make happen. This is, I think, the challenge. >> And they wouldn't happen in Western Europe because, what? The maturity of the infrastructure, the space limitations, the appetite? >> Johannes: I think, to give the example of Smart City. >> Dave: Yeah. >> So I think we have a lot of, in my remit we have lots of discussion on Smart City. But it's usually you have to find the city that is willing to pay a POC. >> Pete: 12 layers of bureaucracy. >> And exactly. And you need to talk to each and every city individually, whereas here, if you have a decision maker to say, "Yes, we do this." >> Pete: Yep. >> Dave: Right. >> And then we do it. >> Dave: You cut the line. >> And the answer is about readiness. When you go to a large enterprise that's very successful, you meet the CEO and you quickly conclude whether they're ready for digital transformation or not, are they gonna make this top of mind for them? Are they gonna give you time? Are they gonna talk about productivity? Or is this going to be an IT discussion, and they're gonna treat you as a supplier? Those that are ready, we roll up our sleeves, and we put in our dedicated resources to help them look at the transformation. When the government official is pushing and mandating for calls out, then obviously everyone wants to copy and talk about it. And this makes it easier for us to execute. >> You're talking, again, big numbers. Not one percent, ten percent, so that's the nirvana. How confident are you that you can actually have that type of impact? >> So we've got data points, right? If you look at healthcare in the Saudi Ministry of Health, we've been collaborating on looking at operating room optimization or emergency room optimization, without touching digitization. Looking at the process and utilization of appointments, no-show, and the way the clinical governance is taking place, we're showing 40 percent improvement. If you look at, the factory of the future with Obeikan in Saudi Arabia, we've got asset performance improvement project, and they already yielded a 12 percent improvement, and the entitlement is up to 20, that we're working on. When you transform something, it's iterative, right? When you transform something that you have not pushed for efficiency before it's easy for the first iteration to show an incremental change. >> Pete: Yup. >> That challenge will be for the change to last. And this is where digitization makes it last and makes it impactful. And when we look at the HPE relationship with the MOH on the electronic medical record, we've got right now two active projects with two hospitals, and it's all powered by Predix, and HP peripherals are being deployed to the site. And if we go to the Saudi Electricity Company, we've got a project now on asset performance management across all their assets and again HPE peripherals are also deployed and it's all about GE ecosystem of Predix-enabled solutions. >> So I've had the pleasure and honor of speaking in front of a relatively large group of CIOs a couple times in Africa in the past few years. And I always was surprised by the degree to which they suggested that the necessity of change in this region, and the fact that a little bit of technology can have an enormous impact, the degree to which we might actually see some leadership technology come out of this region. What do you think, are the types of issues, the types of problems that could be solved with this technology in Africa, the types of problems that solving them there could actually start driving the industry in different directions? Solving new classes, whole new classes of problems. Do you think that this type of technology can have a transformative effect, not only in Africa but more broadly? >> Absolutely, this is a way for systems to leapfrog. If you look at Kenya right now, they've got a transformation project for 98 hospitals. And they've got massive shortage of radiologists. So right now, we're replacing equipment in 98 hospitals but tele-radiology is the answer for the shortage of radiologists. If you look to South African Discovery, what Discovery is doing is best in class, and I haven't seen any other insurance company looking at the ecosystem the way they do it. So, absolutely, we're seeing pockets of excellence in Africa, and this can be a way to leapfrog. >> You said you started the conversations around security. >> Johannes: Cybersecurity. >> What was that conversation like? Why was that the starting point? I mean, obviously it's important, but why? >> To be honest, I would have to leave this to you, but I think it was because mainly there was we saw the customer interest. >> Yeah. >> And I would say, probably a year or two years ago, you would have not seen this as a very typical HPE alliance. We were technology people. We were software or hardware people. What you see in, and I mentioned in the beginning, in the world of IoT, things are blurring a bit. What is happening on the edge is very much in the business of General Electric. So I think this builds automatically the new ecosystem. When you look here at Discovery, the alliance has become more and more industrial companies. It's linked to industrial 4.0, car industries and all that. Everywhere where data is being created, we need to have the partnership because and that is because the data that is being created at the edge also needs to be computed at the edge. If we want to be successful, we gotta say, "We cannot limit ourselves to the "data centers the rest is the others." And this is where I think we find the very good connection point because now we have software that actually can operate at the edge. I think you have good examples on that. >> Yeah absolutely, if you look at the pain point in Middle East, Africa, majority of our partners and customers are government entities and for them top of mind securing their large industrial assets is important. And in the operations space there hasn't been much done on security, where you can go into a hospital and simulate light flickering with a voltmeter. And you can take over the temperature and play with it. Today there's a lot of smart sensors out there, but we're securing the IT firewall, but within the hospital, or within the plant, we can do a lot of crazy stuff. And we owe it to our partners to show our capability. That's what we do within our factories, and our platform is designed around security for operations. So the easier interlock with HPE is our ability to get closer to the edge and peripherals, and ensure the operation is secure and that's the first experiment but then, obviously, we're expanding beyond that to other opportunities. >> Dave: Excellent. Alright, gentlemen, we have to leave it there. Thanks so much for coming to theCube. >> Johannes: Thank you very much. >> Sharing your story, good luck with the partnership. >> Thank you. >> Dave: Hope you can come back, maybe in Las Vegas or maybe next year at this event, give us the update. >> For sure. Thank you very much. >> Thank you. Appreciate it. >> Dave: Okay. Keep it right there, everybody. We'll be back with our next guest. Dave Vellante, Peter Burris, this is theCube live from Madrid HPE Discover 2017. (upbeat music)

>>Hi, welcome to this cube conversation here in Palo Alto, California. I'm John fur, host of the cube here at our headquarters on the west coast in Palo Alto, California. Got a great news guest here. Matt McGill, Wayne managing director of Madrona venture group is here with me on the big news and drone raising their record 690 million fund and partnering with their innovative founders. Matt, thanks for coming on and, and talking about the news and congratulations on the dry powder. >>Well, Hey, thanks so much, John. Appreciate you having me on the show. >>Well, great news here. Oley validation. We're in a new market. Everyone's talking about the new normal, we're talking about a recession inflation, but yet we've been reporting that this is kind of the first generation that cloud hyperscale economic scale and technical benefits have kind of hit any kind of economic downturn. If you go back to to 2008, our last downturn, the cloud really hasn't hit that tipping point. Now the innovation, as we've been reporting with our startup showcases and looking at the results from the hyperscalers, this funding news is kind of validation that the tech society intersection is working. You guys just get to the news 430 million in the Madrona fund nine and 200. And I think 60 million acceleration fund three, which means you're gonna go stay with your roots with seed early stage and then have some rocket fuel for kind of the accelerated expansion growth side of it. Not like late stage growth, but like scaling growth. This is kind of the news. Is that right? >>That's right. You know, we, we've had a long time strategy over 25 years here in Seattle of being early, early stage. You know, it's like our friends at Amazon like to say is, well, we're there at day one and we wanna help build companies for the long run for over 25 years. We've been doing that in Seattle. And I think one of the things we've realized, I mean, this is, these funds are the largest funds ever raised by a Seattle based venture capital firm and that's notable in and of itself. But we think that's the reason is because Seattle has continued to innovate in areas like consumer internet software cloud, of course, where the cloud capital of the world and increasingly the applications of machine learning. And so with all that combination, we believe there's a ton more companies to be built here in the Pacific Northwest and in Seattle in particular. And then through our acceleration fund where we're investing in companies anywhere in the country, in fact, anywhere in the world, those are the kinds of companies that want to have the Seattle point of view. They don't understand how to work with Amazon and AWS. They don't understand how to work with Microsoft and we have some unique relationships in those places and we think we can help them succeed in doing that. >>You know, it's notable that you guys in particular have been very close with Jeff Bayo Andy Jesse, and the success of ABUS as well as Microsoft. So, you know, Seattle has become cloud city. Everyone kind of knows that from a cloud perspective, obviously Microsoft's roots have been there for a long, long time. You go back, I mean, August capital, early days, funding Microsoft. You remember those days not to date myself, but you know, Microsoft kind of went up there and kind of established it a Amazon there as well. Now you got Google here, you got Facebook in the valley. You guys are now also coming down. This funding comes on the heels of you appointing a new managing director here in Palo Alto. This is now the migration of Madrona coming into the valley. Is that right? Is that what we're seeing? >>Well, I think what we're trying to do is bring the things that we know uniquely from Seattle and the companies here down to Silicon valley. We've got a terrific partner in Karama Hend, Andrew he's somebody that we have worked together with over the years, co-investing in companies. So we knew him really well. It was a bit opportunistic for us, but what we're hearing over and over again is a lot of these companies based in the valley, based in other parts of the country, they don't know really how to best work with the Microsoft and Amazons are understand the services that they offer. And, you know, we have that capability. We have those relationships. We wanna bring that to bear and helping build great companies. >>What is your expectation on the Silicon valley presence here? You can kind of give a hint here kind of a gateway to Seattle, but you got a lot of developers here. We just reported this morning that MEA just open source pie, torch to the Linux foundation again, and Mary material kind of trend we are seeing open source now has become there's no debate anymore has become the software industry. There's no more issue around that. This is real. I >>Think that's right. I mean, you know, once, you know, Satya became CEO, Microsoft, and they started embracing open source, you know, that was gonna be the last big tech holdout. We think open source is very interesting in terms of what it can produce and create in terms of next generation, innovative innovation. It's great to see companies like Facebook like Uber and others that have had a long track record of open source capabilities. But what we're also seeing is you need to build businesses around that, that a lot of enterprises don't wanna buy just the open source and stitch it together themselves. They want somebody to do it with them. And whether that's the way that, you know, companies like MongoDB have built that out over time or that's, you know, or elastic or, you know, companies like opt ML and our portfolio, or even the big cloud, you know, hyperscalers, you know, they are increasingly embracing open source and building finished services, managed services on top of it. So that's a big wave that we've been investing in for a number of years now and are highly confident gonna >>Continue. You know, I've been a big fan of Pacific Northwest for a while. You know, love going up there and talking to the folks at Microsoft and Amazon and AWS, but there's been a big trend in venture capital where a lot of the, the later stage folks, including private equity have come in, you seen tiger global even tiger global alumni, that the Cubs they call them, you know, they're coming down and playing in the early state and the results haven't been that good. You guys have had a track record in your success. Again, a hundred percent of your institutional investors have honed up with you on this two fund strategy of close to 700 million. What's this formula says, why aren't they winning what's is it, they don't have the ecosystem? Is it they're spraying and praying without a lot of discipline? What's the dynamic between the folks like Madrona, the Neas of the world who kind of come in and Sequoia who kind of do it right, right. Come in. And they get it done in the right way. The early stage. I just say the private equity folks, >>You know, I think that early stage venture is a local business. It is a geographically proximate business when you're helping incredible founders, try to really dial in that early founder market fit. This is before you even get to product market fit. And, and so the, the team building that goes on the talking to potential customers, the ITER iterating on business strategy, this is a roll up your sleeves kind of thing. It's not a financial transaction. And so what you're trying to do is have a presence and an understanding, a prepared mind of one of the big themes and the kinds of founders that with, you know, our encouragement and our help can go build lasting companies. Now, when you get to a, a, a later stage, you know, you get to that growth stage. It is generally more of a financial, you know, kind of engineering sort of proposition. And there's some folks that are great at that. What we do is we support these companies all the way through. We reserve enough capital to be with them at the seed stage, the series B stage the, you know, the crossover round before you go public, all of those sorts of things. And we love partnering with some of these other people, but there's a lot of heavy lifting at the early, early stages of a business. And it's, it's not, I think a model that everybody's architected to do >>Well, you know, trust becomes a big factor in all this. You kind of, when you talk about like that, I hear you speaking. It makes me think of like trusted advisor meets money, not so much telling people what to do. You guys have had a good track record and, and being added value, not values from track. And sometimes that values from track is getting in the way of the entrepreneur by, you know, running the certain meetings, driving board meetings and driving the agenda that you see to see that trend where people try too hard and that a force function, the entrepreneur we're living in a world now where everyone's talking to each other, you got, you know, there's no more glass door it's everyone's on Twitter, right? So you can see some move, someone trying to control the supply chain of talent by term sheet, overvaluing them. >>You guys are, have a different strategy. You guys have a network I've noticed that Madrona has attracted them high end talent coming outta Microsoft outta AWS season, season, senior talent. I won't say, you know, senior citizens, but you know, people have done things scaled up businesses, as well as attract young talent. Can you share with our audience that dynamic of the, the seasoned veterans, the systems thinkers, the ones who have been there done that built software, built teams to the new young entrepreneurs coming in, what's the dynamic, like, how do you guys look at at those networks? How do you nurture them? Could you share your, your strategy on how you're gonna pull all this together, going forward? >>You know, we, we think a lot about building the innovation ecosystem, like a phrase around here that you hear a lot is the bigger pie theory. How do we build the bigger pie? If we're focusing on building the bigger pie, there'll be plenty of that pie for Madrona Madrona companies. And in that mindset says, okay, how are we gonna invest in the innovation ecosystem? And then actually to use a term, you know, one of our founders who unfortunately passed away this year, Tom Aber, he had just written a book called flywheel. And I think it embodies this mindset that we have of how do you create that flywheel within a community? And of course, interestingly enough, I think Tom both learned and contributed to that. He was on the board of Amazon for almost 20 years in helping build some of the flywheels at Amazon. >>So that's what we carry forward. And we know that there's a lot of value in experiential learning. And so we've been fortunate to have some folks, you know, that have worked at some of those, you know, kind iconic companies, join us and find that they really love this company building journey. We've also got some terrific younger folks that have, you know, some very fresh perspectives and a lot of, a lot of creativity. And they're bringing that together with our team overall. And you know, what we really are trying to do at the end of the day is find incredible founders who wanna build something lasting, insignificant, and provide our kind of our time, our best ideas, our, our perspective. And of course our capital to help them be >>Successful. I love the ecosystem play. I think that's a human capital game too. I like the way you guys are thinking about that. I do wanna get your reaction, cause I know you're close to Amazon and Microsoft, but mainly Jeff Bezos as well. You mentioned your, your partner who passed away was on the board. A lot of great props on and tributes online. I saw that, I know I didn't know him at all. So I really can't comment, but I did notice that Bezos and, and jazz in particular were complimentary. And recently I just saw Bezos comment on Twitter about the, you know, the Lord of the rings movie. They're putting out the series and he says, you gotta have a team. That's kinda like rebels. I'm paraphrasing, cuz these folks never done a movie like this before. So they're, they're getting good props and reviews in this new world order where entrepreneurs gotta do things different. >>What's the one thing that you think entrepreneurs need to do different to make this next startup journey different and successful because the world is different. There's not a lot of press to relate to Andy Jassey even on stage last week in, in, in LA was kind of, he's not really revealing. He's on his talking points, message, the press aren't out there and big numbers anymore. And you got a lot of different go-to market strategies, omnichannel, social different ways to communicate to customers. Yeah. So product market fit is becomes big. So how do you see this new flywheel emerging for those entrepreneurs have to go out there, roll up their sleeves and make it happen. And what kind of resources do you think they need to be successful? What are you guys advocating? >>Well, you know, what's really interesting about that question is I've heard Jeff say many times that when people ask him, what's gotta be different. He, he reminds them to think about what's not gonna change. And he usually starts to then talk about things like price, convenience, and selection. Customer's never gonna want a higher price, less convenience, smaller selection. And so when you build on some of those principles of, what's not gonna change, it's easier for you to understand what could be changing as it relates to the differences. One of the biggest differences, I don't think any of us have fully figured out yet is what does it mean to be productive in a hybrid work mode? We happen to believe that it's still gonna have a kernel of people that are geographically close, that are part of the founding and building in the early stages of a company. >>And, and it's an and equation that they're going to also have people that are distributed around the country, perhaps around the world that are some of the best talent that they attract to their team. The other thing that I think coming back to what remains the same is being hyper focused on a certain customer and a certain problem that you're passionate about solving. And that's really what we look for when we look for this founder market fit. And it can be a lot of different things from the next generation water bottle to a better way to handle deep learning models and get 'em deployed in the cloud. If you've got that passion and you've got some inkling of the skill of how to build a better solution, that's never gonna go away. That's gonna be enduring, but exactly how you do that as a team in a hybrid world, I think that's gonna be different. >>Yeah. One thing that's not changing is that your investor, makeup's not changing a hundred percent of your existing institutional investors have signed back on with you guys and your oversubscribed, lot of demand. What is your flywheel success formula? Why is Tron is so successful? Can you share some feedback from your investors? What are they saying? Why are they re-upping share some inside baseball or anecdotal praise? >>Well, I think it's very kind to you to frame it that way. I mean, you know, it does for investors come back to performance. You know, these are university endowments and foundations that have a responsibility to, to generate great returns. And we understand that and we're very aligned with that. I think to be specific in the last couple years, they appreciated that we were also not holding onto our, our stocks forever, that we actually made some thoughtful decisions to sell some shares of companies like Smartsheet and snowflake and accolade in others, and actually distribute capital back to them when things were looking really, really good. But I think the thing, other thing that's very important here is that we've created a flywheel with our core strategy being Seattle based and then going out from there to try to find the best founders, build great companies with them, roll up our sleeves in a productive way and help them for the long term, which now leads to multiple generations of people, you know, at those companies. And beyond that we wanna be, you know, partner with and back again. And so you create this flywheel by having success with people in doing it in a respectful. And as you said earlier, a trusted way, >>What's the message for the Silicon valley crowd, obviously bay area, Silicon valley, Palo Alto office, and the center of it. Obviously you got them hybrid workforce hybrid venture model developing what's the goals. What's the message for Silicon valley? >>Well, our message for folks in Silicon valley is the same. It's always been, we we're excited to partner with them largely up here again, cause this is still our home base, but there'll be a, you know, select number of opportunities where we'll get a chance to partner together down in Silicon valley. And we think we bring something different with that deep understanding of cloud computing, that deep understanding of applied machine learning. And of course, some of our unique relationships up here that can be additive to what the they've already done. And some of them are just great partners and have built, you know, help build some really incredible companies over >>The years. Matt, I really appreciate you taking the time for this interview, given them big news. I guess the question on everyone's mind, certainly the entrepreneur's mind is how do I get some of that cash you have and put it into work for my opportunity. One what's the investment thesis can take a minute to put the plug in for the firm. What are you looking to invest in? What's the thesis? What kind of entrepreneurs you're looking for? I know fund one is seed fund nine is seed to, to a and B and the second one is beyond B and beyond for growth. What's the pitch. What's the pitch. >>Yeah. Well you can, you can think of us as you know, any stage from pre-seed to series seed. You know, we'll make a new investment in companies in all of those stages. You know, I think that, you know, the, the core pitch, you know, to us is, you know, your passion for the, for the problem that you're trying to, trying to get solved. And we're of course, very excited about that. And you know, at, at, at the end of the day, you know, if you want somebody that has a distinct point of view on the market that is based up here and can roll up their sleeves and work alongside you. We're, we're, we're the ones that are more than happy to do that. Proven track record of doing that for 25 plus years. And there's so much innovation ahead. There's so many opportunities to disrupt to pioneer, and we're excited to be a part of working with great founders to do that. >>Well, great stuff. We'll see you ATS reinvent coming up shortly and your annual get together. You always have your crew down there and, and team engaging with some of the cloud players as well. And looking forward to seeing how the Palo Alto team expands out. And Matt, thanks for coming on the cube. Appreciate your time. >>Thanks very much, John. Appreciate you having me look forward to seeing you at reinvent. >>Okay. Matt, Matt here with Madrona venture group, he's the partner managing partner Madrona group raises 690 million to fund nine and, and, and again, and big funds for accelerated growth fund. Three lot of dry powder. Again, entrepreneurship in technology is scaling. It's not going down. It's continuing to accelerate into this next generation super cloud multi-cloud hybrid cloud world steady state. This is the cubes coverage. I'm John for Silicon angle and host of the cube. Thanks for watching.

(gentle music) >> From around the globe, it's the Cube! With digital coverage of IBM Think 2021, brought to you by IBM. >> Well, welcome back to the Cube and our IBM Think initiative and today a fascinating subject with a dramatic shift that's going on in the Middle East and specifically in the kingdom of Saudi Arabia. There is a significant partnership that has just recently been launched called SARIE, which is the Saudi Arabian real interbank express. And it basically is a, a dramatic move to make the kingdom cashless - and IBM is very much at the center of that. With me to talk about that role is Elhadji Cisse who at IBM is the MEA head of payments which of course is middle East and Africa. Elhadji, good to have you with us all the way from Dubai. Good to see you today. >> The pleasure's all mine. >> Good. Well, thank you for joining us. And let's, let's talk about this initiative. First off, the problem or at least the challenge that IBM and its partners are trying to solve and now how you're going about it. So let's just paint that 30,000 foot level, if you will, then we'll dive in a little deeper. >> All right. So if you look at the countries in the kingdom of Saudi Arabia, and in much of the region, Middle East and Africa, we have very cash driven society. And this provides lots of challenges in terms of government point of view, businesses' point of view. And even the consumer point of view. The cash transaction is becoming less and less traceable. You are less likely to see where the cash is going, where the cash is coming from. Maintaining the cash also is becoming more and more expensive in terms of security, in terms of recycling the cash, holding the cash, transacting the cash, all of that has to be taken into consideration. And the kingdom of Saudi Arabia, with the help of the crown Prince Mohammad bin Salman, has a visionary vision 2030 to be put in place that will enable them to revolutionize the entire financial sector. There's a segment within that called the FSDB, the financial sector development program. And that program, within that program, they have a goal to develop a digital platform that will enhance and enable the society to go to a more cashless society and also help define a full end to end digital environment for the, for the kingdom. >> So when you think about the scale of this, I mean it's almost mindblowing in a way, because in many cases we've been talking about with various of your colleagues at IBM, different initiatives that involve an organization or involve maybe a more regional partnership or something like that. This is national, right? This is every banking institution in the kingdom of Saudi Arabia. Businesses, government entities. I mean, if you would, share with me some of the complexity of this in terms of a project of that scale and, and trying to bring together these disparate systems that all have a different kind of legacy overhang, if you will, right. And now you're trying to modernize everybody moving towards the same goal in 2030, I think it's mind blowing. >> Yeah, it is. It is, John. And if you look at the complexity, if I may speak a little bit about how complex it is, let's start with the team. The team has been a full diverse team. We have 10 different nationalities. We have team from America, Canada, Egypt, Saudi Arabia, UAE, China, UK, Pakistan, India. I mean, you name it. We have the whole globe pretty much. Every single region, Australia also was there. We had the team of that magnitude. In addition to that, as you rightfully stated, we're not building a system for a particular company or particular industry. It is for the entire country, all the banks of Saudi Arabia: the 11 national banks and the 12 additional international banks that are there. The global corporates, such as the Telco corporation, the oil corporation that are there. All of them needs to be onboarded into this including the 17 million or 20 some million population that are there. Now, the keys to this that we have is that our partners, MasterCard and Saudi payments, we have mandated ourself not to divide ourselves into three teams. We have to go with this as one single team. This was the motto of the project. This is what made us successful. We didn't differentiate between IBM, MasterCard, or Saudi payment. We all went together and addressed every single challenge as a team with the three different layers. And that's what helped us become successful with this engagement. >> So let's look at the initiatives specifically then in terms of the technology that's driving this. We talk a lot about the digital transformation that's occurring in the world. And again, it's kind of a catch all phrase, but this truly is a almost a magical transformation that you're going through. So how did you address the various workloads, what's going to be done where and how, and by whom. And then this integration that has to go on with that, not only are you centralizing a lot of these functions but you also have to distribute them to institutions across the kingdom. So if you would share a little bit of insight on that. >> Yeah. So if you look, if you look at the architecture that we have put in place, it's really a very agile and flexible architecture in a way that we have put in a central entity, which is the payment hub that is, that will handle all the payments solution that is there. And we put the flexibility for all the consumers because we have different banks. If you look at the banks industry, we have banks that are very mature, banks that have a medium level of maturity, and some that are absolutely not mature at all. And with this solution that we have to get involved, we have to be Azure 222 enabled, which is the new language that we will be using. Now, the infrastructure that we put in place have enabled that flexibility, otherwise we will never going to be successful. You cannot come to a country and say everybody needs to be onboarded into this language. Everybody needs to be operating this way. No, that will never going to work. We have taken that into consideration from the beginning. We knew this would be a challenge and we put different tools within IBM that we have put in place in order to go to mitigate those, such as the WTX, which is the Webster transformation exchanger that enables us to transform messages from and to Azure 222 or to Azure 222 or to any type of format that the customer have, any of the customer would be the banks. So we encapsulate that. Another challenge that we have is on the on boarding aspect. A lot of banks, again depending on their maturity level, we have to be ready with different environment for them to be, to catch up with us. Not everybody will be able to onboard on the same time. So by leveraging our RTVS solution, the rational testable service virtualization, it enables us to mitigate, to virtualize an entire ecosystem, make it look like it is a physical environment for the banks to use as a test as opposed to in the normal circumstances, purchasing additional hardware additional software, additional components and doing that, we're just virtualizing it for those who are ready for a system testing, those who are ready for a performance test, those who're ready for any type of non-functional requirements testing aspect. So these tools and this mechanism have helped us with our complex system integration methodology to mitigate this complexity and make it easy for the ecosystem to be onboarded and make us successful in this deal. >> And you raised a really interesting point in terms of the maturity of different levels of technology within the banking institutions there. You've got, you know, I'm sure, as you pointed out, some very small enterprises, right? Very small towns, very small institutions whose systems might not be as sophisticated or as mature, basically. So ultimately, how do you tie all that in together so that there might be a very large institution that has a very robust set of infrastructure and processes in place. And then you've got it communicating with a very small institution. You've got to be a great translator, right? I mean, IBM does here. Because you don't have them sometimes basically talking the same language, literally in this case. >> Yes, absolutely. And this is really our forte. We are the system integrators of choice in this region. And this goes without saying, because of our platform and our processes and our people that we put together. If you look at this, this example again, on the integration layer, we've enabled two lines of communication, two channels for the community. They could either go for API if they are very mature or they could go to MQ which is a low level of, I won't say a low level, but a very old fashioned way of communicating. On that aspect, they not only they have two protocols to get to us, they can use any message format that they want as long as we agree and we have an end check on the language that they're going to be using. And this integration layer or the system of integration that we have built that enables us to add that flexibility on both entities. >> So this was just launched. I mean literally just launched. What's your timeline in order to have full or I guess, reasonable implementation. >> That's a great question. Actually, the average is 24 to 30 months. We have broken the world record. We have implemented this magnificent solution within 18 months. It's actually a 17 month and a half of implementation. With the scope that we have, that is onboarding all the banks, having deferred net settlement, having the Azure 222, billing solution on it. We had the, we had the billing we had the dispute management, we had the single proxies. We have the debit cap and limit management and the portal solution. So we have all of these component within 17 and a half month. This breaks the world record of implementing an instant payment solution globally. >> We'll call Guinness and get you in the book then. It is a remarkable achievement. It really is. And you know, and you've talked about some of the the values here in terms of reduced transaction costs. Greater stability, greater security, greater transactional relationships, I imagine market liquidity, right? In your thought, I mean, tie all that together for our viewers in terms of impact and what you think this kind of partnership is going to create in terms of changing the way basically financial services are delivered in the kingdom. >> So it will change a lot. And the impact in the economy, like I said this is going to be on a three-fold. One, from a consumer point of view, you'll be able to save time in making your transactions. You will be able to trace your transactions and be able to have enough data to understand how you're managing your budget in your annual transaction. From a business point of view, you will be able to save yourself from theft. I mean, again, having cash in your business, it will tend to having more people coming in and stealing them from you either your employees or your customers or anybody else. But having a cashless business nobody can literally steal your money. They can only steal your phone or steal your gadget that you have for that aspect. Managing and maintaining cash also is a big problem. Now from a government point of view, this is where it gets very interesting, especially for Saudi Arabia, the taxation of the employees or the payment of it, the trustability of all of that and being able to trace it and being able to say, okay how much tax you will need to pay by end of the year without you doing the calculation. That information was already provided to the government. And as a central bank, the printing of cash, maintaining cash, storing cash, securing cash all of those costs will be going away. This is why the country wanted to go into a cashless society. >> Well, it's a fascinating endeavor. And certainly congratulations on that front. We're talking about real time payments and really making a significant difference in in how services are delivered in the kingdom and Elhadji, I certainly have appreciated your time here today and talking about it and and wish you all the best down the road. Thank you very much. >> Thank you very much, John. I appreciate it. >> All right. So we're talking about the journey to a cashless society in the kingdom of Saudi Arabia and what Elhadji is doing and what IBM is doing to make that happen. I'm John Wallace and thanks for joining us here on the Cube!

>>Live from Copenhagen, Denmark. It's the Q covering Nutanix dot. Next 2019 brought to you by Nutanix. >>Welcome back everyone to the cubes live coverage of dot. Next here in Copenhagen. I'm your host, Rebecca Knight along with my cohost Stu Miniman. We are joined by Sammy Zog LaMi. He is the SVP sales Europe, Nutanix and Sylvan CU. He is the senior director systems engineer for EMEA at Newtanics. Thank you so much for coming on the cube for you for returning. And this is your first time. >>First time. Absolutely. >>Well I want to, I want to start with you. You were on the main stage this morning and you were describing being one of the first few employees in France, working out of hotel lobbies, keeping all the promotional materials in your house and people not even knowing how to pronounce Nutanix. Now here you are for you six years later. Describe, describe a little bit what it, what, what this journey has been like for you. Being at Nutanix >>for this journey. Um, you know, is a, is a successful journey obviously, uh, where we started from scratch in Eva, uh, where we built a lot of relationship with the channel. We started to have our first stories with customers and, uh, you know, the only thing we could not, uh, you know, focus was the speed of growth. And I, if you told me six years ago that we would be four and a half thousand, you know, in this conference, I wouldn't have believed it. And I think the, you know, overall journey is a, you know, an accelerated journey of development and that we have, >>yeah, Sam, Sammy, prednisone side, a little bit about, uh, you know, we sometimes call it nation building, but, uh, you know, the channel of course, a very important, uh, you know, talked about some of the, kind of, the challenges in, uh, some of the successes as to what, what has made Nutanix so successful, uh, in, in your time. Yeah. I think, uh, >>you know, the technology is for sure a big element in this that is solving business problems. But when you think about it, there's many stories of great technologies that didn't make it or didn't make it big. So I think the openness of this company from day one, uh, to work with partners to work with an ecosystem of Alliance partners. Uh, we were also very open to share how the Nutanix technology is built and is working. So there's a lot of openness around your Hasise works. It's not a black box. Uh, and we integrate with the ecosystem. So for our positioning, which is mainly initially the data center, the large environments we have to integrate into customer environment, we have to integrate with existing technologies and uh, the fact that we are open from day one and we keep that line is helping a lot in the traction. >>I want to get into that strategy in a little bit, but I want to bring you into this conversation to Sylvan and, and just to have you talk a little bit about what you're seeing in the competitive landscaping, what, what are some of the things that Nutanix needs to focus on? Because the competitors are a really edging in. We are focused to deliver >>our vision and continue to build the pieces that are still under construction there right now. And to be back on the question about the partners, the adoption also come first from the partners before their customers. And really working with them on engaging with them was the result of the success was not just signing contract enabled them, but really engaging with them at customer sites. And as soon as they see the reaction of the customer, they can be believe in it. And we scaled very fast because of them. I'm wondering, get both of your comments. Talk about the, uh, the competition for talent. Also, when you talk about Nutanix over 5,000, the channel is very strong. It makes it a little bit tougher, uh, to kind of pull those pieces in. If you're Silicon Valley, Oh, there's this startup, I want to join, things like that, but have to imagine things are a little bit different. And I'm in Mia, >>I would say. Well, competition for talent is definitely here in Emir, especially on the topics that we are tackling in the cloud, the DevOps, big data, et cetera. Um, now, you know, we are not attractive brand, uh, you know, there's a demonstrated pass of development for our employees. So I think on top of being a successful company, we have a lot of proof points of building careers. So people want to join for the fun for the success. We are also to be able to fast career. That's helps now saying that it's still not an easy task. You know, there's a, especially the volume of recruitment we are doing, uh, so we have organized ourselves very well, uh, to onboard people, enable people and maybe be in a position to hire people that don't have all the skills but have the right DNA and then we can, you know, always teach the skills. That's the way we are. >>and on a technical side, uh, all the user's previous it vendor let's say, was looking for specialists of complexity. You know, what is the behind the scene and we are in different situation, meaning that we can start small first and we talk about the project of the customer. And until this project works, we cannot move forward. We cannot obsessive. So our situation is more consultative and being a trusted advisor of what they tried to achieve and not anymore on what we tried to build our own our side. >>That's a very important point. The mindset of successful employees are the ones that are focused on the outcomes. You know, they're not here to sell a product, they focus on project and the outcome of customers. >>So how do you find that person when you are, when you're interviewing your pool of applicants? I mean that, that is, that is such an important part of the culture here, this people first attitude and really being all hands on deck if a customer has an issue. So how do you, how do you know when you're interviewing someone that, that, that they have got their, the right DNA to be here? >>Well, first we knew before they, during the interview, because we are well connected on the market and we have sources of information about how they operate on day to day. Now, of course, of hiring so many people over the years helps. And there's a lot of small details that, you know, we can notice, uh, in, uh, in our recruitment process. I think we've gotten very professional in the way we recruit. We still have a lot of refills as well from employees, which helps in terms of, uh, you know, making sure we hiring the right DNA, but we want to diversify. We don't want people coming from the same background. We're doing a pretty good job on diversity, on every topic, you know, gender, ethnicity, background, uh, this is a, you know, pretty good success. Alright, so >>semi you, you've got a new role. So it gives us a little bit of insight as to your vision. What should we should expect to see as a strategy for Nutanix and EMEA? >>I would say first, uh, you know, three months on the job and I have no intent to break anything that works. Uh, I think there's a successful recipe in anemia, which is a legacy of Chris Keller Ross. Uh, lots of good methodologies, verse of good principles of working, no intention to change that and maybe the phase after that for MEA, but for the whole company is to focus on Australia. And we see that, you know, our technology is well suited for mission critical environment is well suited for strategic projects for customers. And maybe we should become the default, uh, you know, uh, vendor that you think about when you go for mission critical projects and you know, trust formation. Uh, I think today we do a very broad set of projects with customers. Um, tomorrow I would like customers to think first about Nutanix when they think about something that is critical to their business. >>And in the same way for partners, uh, if we can move from being a vendor with high grows, great margin to a vendor that is helping them transform, you know, their business model or the way they attack different segments, you know, then we will have achieved a good phase two. What do you see as the biggest challenges facing you right now? Well, the biggest challenge is inside clearly is growth. We see that in every area, every time we grow fast, then suddenly you need to change organization processes, your principle of working and you, you need to reassess yourself and your way of doing things. Even at pesonal level. Uh, that's the biggest challenge. I think we, if we are not constantly paranoid about re re assessing that uh, growth can break a lot of quality, uh, in the relationship we have with customers but also in our velocity. >>Oh, I wonder if you could bring us inside the customers a little bit. What are some of the key roles that you find in, you know, where does Nutanix has the best engagement with and you know, strategically where would Nutanix may be a change over time as to where they're, where they're engaging with a customer. >>So now there is no more question about the fact that part of the, it will be in the cloud part will be internally, some people will go more one side or the other side because Nutanix both technology >>on both sides, we can take care of old school application and be sure that can still run in the cloud. And on this society, if you develop an application totally distributed and so on, meaning a cloud native, we can run it on a Nutanix and all the platform looks like the pubic cloud for this application. So we are the unique situation where we can, we don't need to be in the cloud or outside of the cloud, meaning that we can give a strategy with the customers or what it can do. What is the good point, what is the most difficult to achieve on both sides. And also we provide a way to package application to deploy everywhere. We have all these governance tools on top of it because we know the new way of consuming the cloud is more open bar, which you need some way of controlling the situation and we are really trusted advisor on their strategy to define what will be their it in two, three or four years. >>Okay. So sounds like not just the infrastructure owner but talking to the application owner or some of the C suite that might make some of those broader strategic decisions. >>Yeah. Yeah, exactly. Uh, the platform works, meaning that there is no more cushion on that at scale. You get all the benefits that you can see on the, on the public cloud. Now it's more the way you consume it, you organize the consumption and also you've have those, the same of urine Mount whatever is the application, uh, to, to find the, to have the best place for this application. >>What would you say your, your, your here as you said, uh, at in Copenhagen, thousands of European customers all here under one roof. What are you getting out of this? What kind of conversations are you hearing? What's most surprising to you? Just to, I mean we're, I know we're only in the beginning of day one, but what, what do you, what are you hearing right now? >>Well, we talked to a few customers already and what's a very common pattern? Most of the customers I took so far, they really accelerating on becoming a service organization. So enterprise companies, they really want to organize themselves to be cloud ops. And even though we were talking about automation before, now they really are doing it and they are actually focusing on changing the skills of their teams, their organizations and of course the technology afterwards. >>Yeah. Uh, any, any particular is on automation. Cause I think back, we've been talking about automation my entire career. I agree with you today. It is a, you know, more substantial conversation on automation. Are there any particular as either in Newtanics portfolio where some of the kind of partner tooling out there that are kicking things along? >>So, uh, we talk about automation since a long time, but most of the time that was, you have an orchestrator, it's like a Swiss knife and you can orchestrate what you want, but at the end of the day, nothing was done. We believe that the platform must be automated by design, right? And everything need to be by design. So it's a, it's the difference between the, between the previous way of thinking, automation and now where the platform is totally it. >>I believe Leber GF said autonomous is what >>we were looking for. Yes. You got to the point. If it's not autonomous, why? Why bother? Yeah. Or we had examples of customers who launched private cloud projects and they had like 8,000 Mondays to build the orchestration of the private cloud. And honestly, if you don't have a a hundred thousand VMs to run, it makes no sense. So the fact that no, it's built in and it's not a project to have automation, you know, that makes sense economically as well. Great. Well semi and see you. Thank you so much for coming on the cube. It's a pleasure having you later, Rebecca. Thanks a lot. Thank you. I'm Rebecca Knight for Stu Mittleman. Stay tuned for more of the cubes live coverage of.next.