>> Narrator: Live from Chicago, Illinois it's theCUBE. Covering VeeamON 2018. Brought to you by Veeam. >> Welcome back to VeeamON 2018. This is theCUBE, the leader in live tech coverage. My name is Dave Vellante with my co-host Stu Miniman. #VeeamON, our second year of VeeamON coverage, this is day one. Carey Stanton this year is the Vice President of Strategic Alliances at Veeam. We're having a great conversation about it. Hockey, Cape Cod. >> Golden Retrievers. Golden Retrievers. >> Oh, I love dogs. >> Dave, how many times do we travel the world and talk to a local? (laughs) >> Boston area guy. >> So welcome to theCUBE. >> Thank you very much. >> And welcome to Boston. >> A year and a half in Boston, right downtown empty nesters. My two children are back doing university in Canada. I've got a sophomore and a junior so my wife and I are living in Boston empty nesters, it's awesome. >> That's great, you've got to love it. And I love the fact that you're from Ottawa, but you're a Bruins fan. >> Yes, I've basically turned into a Bruins fan. I'm a Red Sox fan and a Patriots fan and the Celtics are in the playoffs. >> Yes, love this guy. >> You'd better be if you're working for Peter MacKay. >> Yeah, you have to. It's like you have to sign in. And I've worked for Peter for 17 years, three different companies. >> Okay, so you were at VMware. >> I was at Vmware, I was at Desktone, and then we did IBM and part of that was Watchfire which we sold to IBM. So, a long journey. >> So give us the update, what's happening in alliances. >> Yeah, so it's great. As you know we have our global reseller agreement that we announced most recently with NetApp just in March. We're now on their GPL. We went live on Cisco, we announced Cisco back in August but we went live on November 15th and we have HPE and all three of them are just exceeding expectations as far as the demand and the interest we're getting from our sellers. As you've seen from Peter and Veeam, we're targeted to the enterprise. We have our messaging our own hyper-availability. So these partners bring us a huge opportunity by working into their customer base, but we close 133 customers a day, right you heard Peter mention that. But we're bringing them into our customer base which is traditionally SMB and commercial and we're working with them on their enterprise. But an exciting stat for that one is that we say no naked Veeam. When you sell with an alliance partner it's six to eight times larger than if we sell standalone. So it's working, the messaging and the enabling we have with our field and we're 100% channel. So that's working very well on just the enablement with Jeff Giannetti, Sean, and Olivia, and Ameya. >> Well the other thing that you guys seem to have done is figured out how to take a long view, a strategic view with these partners. Many organizations, they look for the tactical. Okay, how much money >> Yes, yeah. are we going to make this year? You're looking at the lifetime value of a customer. >> Correct. >> It's frankly quite unique in this business. >> Well, the interesting thing we're doing which is not just on the global resellers which is on all of our partners is that we look and say what's a good partnership look like or what's the great partnership look like. And what we have is the investment that we are because we're private is we'll do the front-end investing up front. We'll do a joint business plan, have shared metrics across the table. So whether that's with Pure Storage or with Nutanix, with our VMware, Microsoft, we front-load all of those investments. To your point, is that we're not just waiting to see did we have success year one and then we'll invest year two. We take that three year business case view up front and do the front-end load investment. So, what does that mean? That's a dedicated business development team. We have 25 people working and go to market with HPE or 12 working with Cisco and we take that from technical architects, field marketing, product marketing and to make that in clot entire plot. >> Yeah, Carey, I wonder if you can give us a little bit of a compare and contrast. VMware built one of the best ecosystems out there. We already talked once today. For every dollar you spend on VMware you did 15, 20 dollars with the ecosystem, Veeam's nice vibrant ecosystem >> Yes. getting deeper with some of those partners. Give us a little compare from your previous life. >> Yeah, sure, so at VMware no question that they had that solution so we take that here as well and we call it the Veeam Currency. So when you're going in and selling Veeam, if you're selling an average selling price of $10,000, we're working with our partners where they're seeing that that deal is going to turn into a $50,000 traditional with an alliance partner sale in conjunction with their hard work. So they're managing the entire software process so they're seeing their up leveling the messaging so no longer just pinpointing at a hardware solution. And they're increasing their average selling price by 10x, so Cisco is at a great set. 10x, again I'll repeat 10x with Veeam on doing those deals. First it's just trying to go in and sell HyperFlex Standalone. >> It's just a really critical time in the industry right now. Our research shows that there's a gap between what the business expects in terms of the degrees of automation, the level of quality of services and what IT is actually delivering. So that says that customer base is really ripe for churn in a lot of accounts. And so you guys being aggressive with partnerships in regard to making that investment as a private company, the timing frankly couldn't be better. Especially as you go from what was a virtualized world where you guys did very, very well to now this cloud, multi-cloud digital, you know throw in whatever buzzword you want. But, we are at an inflection point. >> Yeah, we sure are. I think that what we're seeing with our partners especially on HPE and Cisco and Nutanix is they're all near hyper converged and so they're going in a whole different sales motion. We're seeing it on our hybrid cloud, we're a number one close sell partner with Microsoft. So we have our backup, native backup to Azure and so we're seeing this destructive market in the market place and we're also seeing a lot of our partners have competitive takeouts of Dell Avamar, right and their data domain. So we're going in and taking out Dell Avamar and they're going in and data domain so we have a lot of synergy and so as these traditional vendors such as Avamar, Veritas, Commvault, and the IBM Tivoli Solution is that we have those sales motions going with our partners that are going after those hardware solutions. So, again, it's very synergistic with our tier one partnerships. >> Well you see a huge drive towards simplicity. I mean, another thing you guys do really well is, and it sounds so simple, but you're compatible with a lot of different clouds, for example. So more work loads, more environments increases your TAM and your friendliness to partners. It sounds simple, but execution is not. >> Yeah, we're a Swiss based company, we remain. The Switzerland is that we work with all partners in all routes and so we've seen a lot of success in that way. We see a lot of demand coming from our customers, our partners wanting to work with us in these multi-cloud solutions that we have with Microsoft. >> Biggest challenges, is it a channel conflict? Dealing with deal registration, I mean, what are some of the challenges you guys are facing? >> I think that challenge is just enabling our sales teams on how to work with these partners and to understand the sales motion. And some of our sales execs are 20 year veterans that have come in and worked in a traditional place where when you went out to tackle an enterprise deal, you did that standalone. And we realize that we don't take any deals direct. So just getting them in the sales motion with our partners is a challenge, but one that is easily adapting to success that we're having in the field. >> Alright, Carey I know you're super tight on time. We promised to get you out >> Yes, sir. of here. We've got to leave it there, but thanks so much for coming on theCUBE. We really enjoyed having you. >> Okay, thank you very much. >> Alright, keep right there everybody, we'll be back with our next guest right after this short break. You're watching theCUBE live from VeeamON 2018. (techno music)

>> Announcer: Live from Chicago, Illinois it's the CUBE, covering Veeamon 2018. Brought to you by Veeam. >> We're back in Chicago, Veeamon 2018, you're watching the CUBE, the leader in live tech coverage. We go out to the events, we extract the signal from the noise. My name is Dave Vellante and I'm here with my co-host Stu Miniman. Day one of our two day coverage of Veeamon, On our second year. Vaughn Stewart is here who is the vice president of Technology at Pure Storage, Cube alum, good friend. Great to see you man. >> Good to see you Dave, Stu. >> Dave: Thanks so much for coming on. >> Vaughn: Great to be back. >> So Pure, you know, I remember when you joined Pure and you were like, "Dave, this is going to be the rocket ship of a lifetime." it's turned out to be the case. First company since NetApp to hit a billion dollars in the storage business. It's like independent storage companies are back. >> Yeah. (laughs) >> So give us the update, what's happening at Pure? >> So fantastic year. Wrapped up end of January, right. So first independent storage company to hit a billion dollars. Actually, we're kind of on the cusp of maybe being the the fastest infrastructure company, if not the fastest tied with being the fastest to hit a billion dollars. So the growth rates been great, the products, obviously, have been off the charts. Whether you're looking at it from an analyst's perspective, you know, the gardener reports, the IDC market scape, so if you look at from the customers perspective with the NPS scores, right. Just crushing in terms of the products, the customers stating that we're not overstating the capabilities, and we make some pretty bold statements. But when you kind of boil it back to where we're at now, I think our focus is helping customers adopt a data centric architecture as a part of their IT or data center modernization plans, right. This is, we've kind of gone through this phase of like virtualizing everything, now everything's in the cloud and now we're starting to mature a little bit and we're always looking at this tsunami of data that's being created and it's more around, where's your data going to reside? Because there's going to be some gravity around it and bring the compute to where the data should reside. And so our products and our strategy is to help customers again, this data-centric architecture, adopt new technologies that are going to help them radically shift how they operate, changing the cost of operations, changing the complexity to either let an existing storage team scale to a larger capacity per full-time, you know, FTE or to allow actually the application teams or the private cloud teams to just manage their infrastructure stack, right. We're seeing we're seeing kind of growth in both areas. I think beyond that, our technology with our evergreen storage as a subscription model has also been able to be transformative for Enterprise about how do they acquire, refresh, and introduce new technologies within the storage space. And so it's been pretty exciting. >> So let's talk about some of that. I remember, I've I've been around a long time Stu, as you know, so Al Shughart, the legend, once told me when I was just a pup trying to understand the business. He said, "Dave, the storage business is simple. The customers want it to be dirt cheap, rock solid, and lightning fast." >> Vaughn: Yeah. >> This is the days of spinning discs, which we're kind of dirt cheap, but they really weren't that rock solid and they really weren't that lightning fast. So you guys actually delivered on that promise but you added some other things. Simplicity, the business model of reduced friction. You mentioned Evergreen, so it's not, obviously, not just about flash, where we say, "oh, flash, Pure storage flash, we have flash too." It's so much more than that. The way you positioned it just now the company in terms of data centricity. And, as they say, the business model innovations have really worked well for you. You've been able to stay ahead of the competition. I wonder if you could comment. >> Sure. So I, for your audience, I think it's important to maybe back up a bit. Pure was born in in the the wave of a number of all flash arrays. >> Dave: Yeah. Right? And a fair amount of them were acquired by large existing storage vendors. And I think now that the dust has settled a bit, you know, we were kind of the phoenixes that rose through those ashes, if you will, within the storage space and I think, really, the key driver there was, it wasn't about performance. Flash makes everything faster. >> Dave: Right. It was about a combination of the business model, the operational simplicity, but also, what I would call, the Tier One Feature Sets, right. You had to deliver on six nines of greater availability. You had to have all the data management capabilities to plug into a large partner ecosystem like veeam, which, you know, we're at Veeam live and that was kind of what I would call Act one of Pure, which was, you know, flash ray based, you know, storage for your traditional enterprise apps. Last year we introduced flash blade, right. This was a radically different architecture. It was to scale out a scale out blade-based storage platform that scaled capacity and performance linearly. And the adoption in that space has been this next-generation apps, which... Are just..the sets are growing, you know, out of control and beyond what we would have ever expected with an Enterprise app. So whether it's AI, machine learning, deep learning, analytics, or this new use case we're seeing, which is rapid data recovery. The flash blade, because of the combination of its low latency and massive parallel throughput, has really been a big growth vector for us and it's kind of act two, if you will, of Pure Storage. >> Dave: Go ahead Stu. >> Yeah, Vaughn I'd love to hear more your thoughts on, kind of, an application proliferation. so I think back, you know, you and I lived through that wave of virtualization. While I love virtualization, one of the challenges I had with it was I could take my old application that was probably already too long in the tooth and stick it in a VM and then keep it for another five to ten years because it didn't care about the hardware, their OS, and all that standpoint. Today, talk about cloud native apps, talk about IOT and analytics and all of these micro services and everything like that. It's a huge impact on infrastructure and how we build things. It brings up to speed how we bridge from, kind of, the old world and the new world. >> Yeah, I'm glad that you asked this question. I wish you would be coming to our conference next week - >> Stu: Well, Dave will be there. >> because we'll have a session discussing this and it'll include an internal case study. And so that's all the details I can give right now. For a long time I think a lot of IT vendors, particularly, those who made hardware products, try to position this on-prem versus the cloud, right. and it was really the wrong mindset. Cloud is just one more deployment model for an organization to look at. The question that I think organizations have is, what fits where? And I think, to your point, if you're looking to build a new application or re-platform an existing, what you have today versus in the past was, you had a contained set of APIs and interfaces to work with, right. If you were building on, say, you know, a database vendor's enterprise business suite that was the tools that you got to use. Today you look at what's available, an open source or in the public cloud space, and you get to build a massively disaggregated application that's comprised of functions and and microservices, right. And it gets to leverage these notions of scaling on demand and being being very elastic. What I would share with you and what we discussed with customers is, your development team will want to go as fast as they can and leverage all these new tools and they're iterating very quickly, and the cloud is an ideal platform for that. But you need to plan and look forward to, around what's the the volume of data that you may be dealing with? What's the access requirements of that data over time? And where's it going to be a better position? Should it sit in the cloud? Should it sit on Prem? Should it sit in a private to public cloud hybrid type of architecture model and leverage, say, the compute and all the software agility within the cloud and yet still have stewardship over your data and not have to deal with with maybe unforeseen things like charges per, you know, API call or egress charges things of that nature. >> And Edge as the whole, >> And so I'm grossly simplifying a lot this. but these are the conversations that you get within the enterprise, which is where the sweet spot is. These are real considerations that that they have right there past the is cloud secure or, you know? They're past the data sovereignty type of concerns. They're more around how is this going to scale long-term because, for example, I'll give you an example. So we rolled out meta, which is our AI as part of our support for our products. This all getting ahead of the customers and predicting faults, getting them... This is what helps us achieve greater than six nines availability across the entire fleet for the last two and a half years, right. It's, it's getting ahead of the problems. When we work on looking at some of the AI that we create around meta and we want to test it, we have to download a year's worth of phone home data from the cloud. That takes 45 days to download today and it's not going to get any faster as the install base gets larger, right. And so those are challenges that you have to look at and say, maybe I started in the cloud but maybe I need to look at something in a hybrid model because it's going to impact my business agility. And so these are conversations that we can have and our architects have with customers based on whatever their criteria or forecast look like. >> So just about a year ago Scott Dietzen stepped down as CEO, brought in Charlie - >> Vaughn: Yeah >> new leader. It was kind of, kind of interesting, it was right on the heels of Frank Slootman doing something similar. Frank Slootman just stepped down as chairman and so how's the new leadership going? What, what has Charlie brought? I can't wait to interview him next week on the CUBE but give us your take as somebody who's been an industry observer and, obviously, a long-time Pure employee. >> So ,so a great question. So just for the audience to know, so Dietzen is still with us, right. He stepped down from being the CEO and is now the chairman of the board. and I owe a large gratitude of debt to Scott. Scott brought me into Pure and I'm always encouraged when, you know, every now and then you get that that direct email from him, you know, you know, keep, you know, keep being a thorn in someone's side and push this forward. That was a little self-serving, so I apologize. But what I like about Charlie is, and, and understand I was, I was with Ned F for 13 years, right. And so we did this large growth cycle, not as early as with Pure, but going through a lot of the same growth pains and and whatnot that we have today. But we did all that growth under Worman Joven before they changed over. What was nice about Scott is, he told me on day one that he didn't know how far he would take Pure but it was apparent to him that he had taken it as far as he could, he would find his, his, his heir and obviously Charlie was the choice. And what Charlie's brought in has been a lot of structure, right. The formation of business units, a lot of accountability, a lot of, what I would say, that maturation phase from startup, right. That's kind of grown to the, to the the maximum output of your current organizational structures, to looking forward into a structure that that is going to allow us to scale better over time, right. Continue to grow as well as.. I think Charlie be the first to tell ya, you know, Pure's on a trajectory to hit two billion dollars and can do that on inertia in the current products, right. Charlie's focus or one of Charlie's focuses over the last handful of months is, is, what are we going to become two years from now and what investments do we need to start making in the near term to get prepared for two years from now? >> So I, I brought up Frank Slootman who's in the service now because I know, I know Frank and Scott were close, right? There's some board action going on there over the years, they're part of the Silicon Valley mafia with the Mai Bucherii. But but I, and we can joke about that but there's a there's a culture of succession that has really taken hold in in certain parts of the valley and, and again, very similar to what we saw as service now, where was the new guy was brought in to take them to the next level. And the existing CEO, you know, mature enough, you know, maybe, maybe worked so hard for all these years too, maybe felt like they need a little break. but still mature enough to say, okay, I know my limitations and I want to bring somebody else in. So it's been sort of this new thing and I want to tie it back to something we were talking to before on the CUBE. I mean, you guys hit escape velocity. When you look back at the sort of the virtualization craze with Three Par and Isilon, Data Domain, Compelling. Yeah, they kind of hit a billion-dollar status you know, they hit unicorn, but they never hit billion dollar revenue. And, and so now, and then the other thing you talked about was some of the bigger players decided to buy up flash companies. >> Vaughn: Yeah. >> And they said, you know, rather than pay 2.5 billion dollars for a data domain or Three Par, we'll spend a billion dollars or, in some cases, hundreds of millions of dollars and then we'll organically grow that internally. Did it work? Yeah, maybe yeah, you know. Maybe some of it, maybe not. But, but you guys stayed the course and are now on track to do two billion. >> Vaughn: Yeah >> So here's my question, long-winded sort of narrative babble, sorry about that. I used to question Worman Joven all the time Tucci, even. Can you stay independent? Right? That was the big question. You know, because Converged is coming. But now it looks like being an independent is actually in vogue. Best-of-breed is actually still a viable business model. >> So obviously I'm not in on the inside of whatever the board decisions may be. >> Yeah, but you're an observer who know this business. We're kind of talking about Vaughn the prognosticator, analyst, if you will. >> What I think is different today, and Stu and I were talking about this because we ran into each other over in the corner with Duncan. You know, the emergence of all the flash vendors and them getting acquired and really what's happened by and large is just the same old products just got flash injected into them and, you know, got, you know, the the vendors hope to get another decade out of them. But okay, they're faster, but it doesn't fundamentally change your business model or your operations and sometimes that's a good thing, right. For some customers, right, their change averse. >> Right, they don't want that disruption. >> Yeah. For us, right, we're trying to usher in now this this next wave of shared accelerated storage and it's a disaggregated model, right. Start to look up it at what, you know, in a commercial sense, if you will. What are the enter.. what are the the hyper scalars, you know, delivering, you know? They're not running data direct attached storage. They're not doing HCI, right? They've got pools of compute and pools of storage and it's either disk and cold or it's flash flash and hot and, you know, they've got network and it's all over Ethernet, so it's greatly simplified. We're trying to help our customers with, with that type of architecture. Whether they're looking at simplifying their private cloud or extending the private cloud to the public cloud, or what's even more interesting, as they look at like their data pipelines, you know, a lot of, you know.. There's, there's AI and analytics in every organization of every size. They may or may not sit inside the IT department but they tend to follow that model of eighths and software. So I'm just going to do it on DAS and I'm going to build this siloed cluster. And, you know, it must be cheap regardless of whatever the efficiency I get out of it. And what we're trying to help large organizations look at is data pipelines and flow and the flexibility that you gain by separating compute from storage and not having to worry about the performance issues or constraints of disk-based systems from a decade ago because technologies like flash and now with non-volatile memory Express and non-volatile memory expressed over fabrics, right. You're getting direct memory to memory communications from the servers to the storage. So you're getting all the benefits of pooling and sharing your storage with all the benefits of it without a local bus in terms of speed and performance. And so it can change, particularly, a large volume of data. You can change your agility. >> So that that is certainly a tailwind for you but it was a tailwind for a lot of companies and you have the product. Let's assume best product just for sake of argument. I'm sure you would agree. But best product doesn't always win, right? So what I'm hearing is there was business model innovation. >> Vaughn: Yeah. >> Obviously very strong go to market. You guys knew where all the skeletons were buried with all the reps that you guys hired. But there were other factors involved in your ascendancy, which maybe is independent of the structure of the industry because the industry structure is changing. It's going from, you know, now remote cloud services into these digital, this digital matrix and somehow you have to fit into that digital matrix and participate in that. >> Yeah, it's.. I think you brought up two points,\. So I think if you if you're going to be a start-up, to be successful, it's not just technology. You've hit the head on the nail there. Pure had.. the technology had to deliver, Pure had that. The business model was innovative, the marketing was off the hook, right? For a start-up, you know, we were punching above our weight but you also have sales, have sales force execution and, you know, you never know what you get when you walk into a start-up. But you've got to.. If you don't hit on all four of those dimensions then you don't achieve escape velocity. In terms of shifting from startup to, you know, becoming mainstream. Not only did we achieve a billion dollars last year, we were cashflow positive for the year and we were profitable for Q4, right? So that puts a lot of wind in ourselves as we go forward. You know, with, at the end of last year, a half a billion dollars in the bank and now a billion dollars in the bank. You know, for us to go you know figure out what we're going to grow and go into. I think moving forward and being independent, I think we'll see, right? I think there's always a tick-tock in our industry, right? Things are distributed, they're centralized, their distributed, I want one throat to choke, I want best-of-breed. I think with all the distributed apps and all the analytics platforms that are going to start to become more important than what we're used to in the X83 space. I think best-of-breed is starting to rise up right now and so I think the runway for Pure to stay independent is there. Don't get me wrong, we're going to have to do our works with plugging into clouds, right? And all those those ecosystems because customers want a transparent experience. But we'll be sharing some news on that, I think next week. >> Well and excited to here that. The cartel will continue to suck up startups, no question about it. But, you know, we love companies like Pure, put Nutanix in that mix and it was sad to us to see all their run of the virtualization comers, they just disappeared. Because if it's just the cartel building new products, you're not going to have the level of innovation that you get with VC funded startups in the valley. you just, you're just not. >> Well, in the US you're seeing, I mean, you're, in the US you're seeing VC investment starting to diversify a bit, right? >> Dave: Yeah >> Colorado's getting hot, the Boston area is, it has been there for a while but it's getting hot. >> IOT and security. >> And, you know, that's been the great thing about, you know, about IT in the US, right, is we've been an innovative landscape. I think the barrier has probably forced some innovators out based on just the cost of living. So, you know, who knows what the mix will look like a decade from now, but yeah, we're still going to be Silicon Valley centric for the near-term. >> So I love talking you because we can have these conversations. We were joking off-camera, we could go for 90 minutes, which we easily could. We got to, we got to go soon but let's talk about Veeam, relationship with Veeam. You guys are kind of birds of a feather in a lot of ways but, but take us through that. >> Yeah, so the opportunity to partner with Veeam was a no-brainer. There were synergies there, right? Pure and Veeam both trying to just disrupt legacy markets, doing it through simplicity, right? Riding the wave of, you know, virtualization as a primary business focus but not exclusive. our Net Promoter scores with both companies are off the charts, right. Customers love it and, you know, we're multiples higher than any of our competitors. And so bringing the technologies together were real simple. So last month we announced, four or five weeks ago we announced and released a new set of solutions and integrations. It was comprised around three areas of benefit, right? Accelerating backups, increasing the speed at which you could recover data, and adding a new level of agility within your ecosystem. So delivering those three value props were based on us supporting their Universal API adapters. So now that they can offload some of the backup process to array-based snapshots and that preserves the performance, makes the window collapse faster. That's where when production data sits on the flash array. We've also certified putting the flash blade behind the Veeam servers as a backup data repository and the benefits of that from a backup window are faster data ingestion times across your real estate. Obviously, smaller footprint, lower cost within the data center. The bigger impact on both of these is on rapid data recovery. So with Veeam, through their explorer integrations, you can pull files, disks, VMs, applications, right out of the array snapshots. If the array is still online but someone's just munched the data, if the array is no longer there and you need to pull from the flash blade, flash blade gives them a capability that they never had with disk, which is they can start because, you know, how Veeam recovers, right? They actually start the data services and recover them from the backup repository and then live migrate it back to the production environment. With the live, with the back and the data repository being all flash, now they can bring up a significant, if not all of your data back online and then trickle restore it back to the production data sets. We had a customer with a large distributed database that was on a more traditional disk backup system that was really focused on ingest, right? Make the backup window not so much focused on the restore times. It took them in excess of 36 hours to put back their database and this was the mission critical database to the organization. We've come in and replaced that. 36 hours is now 30 minutes. So is all flashes as repository for your backup for everyone? Maybe not for every organization but we're seeing a big growth ramp on that in the enterprise. The last piece that we've brought to market together in integrations is, integrating with their data labs. That's their environment to be able to on-demand create, test, and DEV infrastructures for you and that pairs really well with all flash arrays and snapshots because it's instantaneous, consumes no new storage, and our automatic QOS preserves that, preserves the resources for the production environment from the lab. And so those are our three areas: accelerate backups, rapid restores, and give you some agility with your test DEV. >> Okay and the agility in the ecosystem is oftentimes underappreciated, right? >> I'm amazed at the customers that I.. Large enterprise customers, right? Revenues in the tens of billions of dollars that you still meet with today, where they've half staffs that their job is to restore, you know, an Oracle database to an Oracle developer and that's all the guy does 40, guy or gal, does 40 hours a week, it's amazing. >> Right, Vaughn, great to see you again. >> Dave, awesome. >> Thanks so much for coming to the CUBE. We'll see you next week Pure Accelerate at San Francisco. We're there Wednesday, I believe, we're broadcasting. So look for all the things that Vaughn teased. He showed a little leg on some stuff, so we'll be covering that next week. We're back here tomorrow. Stu and I will be kicking off at 9:30 with Peter MacKay, so don't miss that. We're out for today, Veeamon 2018 the CUBE. See you tomorrow (electronic music)

>> Announcer: Live from Chicago, Illinois. It's the Cube, covering Veeamon 2018. Brought to you by Veeam. >> Welcome back to Chicago everybody, this is the Cube, the leader in live tech coverage. My name is Dave Vellante, and I'm joined by my co-host Stewart Miniman, Ratmir Timashev is here, he's the cofounder of Veeam and in my opinion, the man who brought Veeam into the modern era, created the persona of Veeam, allowed it to punch above its way, Ratmir thanks for coming back in the Cube, great to see you again. >> Thank you Dave, thanks. >> So congratulations on another kickoff to another great event, you painted Chicago green. Love it, first of all how do you feel. >> Fantastic, awesome. It's great being here, great city, the weather is finally nice, so spring is here finally, so we are great time. >> Yeah we had a little trouble getting in, but everybody's here, everybody's here safely which is the most important thing. I want you to talk about the evolution of Veeam, you started out as a virtualization specialist, generally VMware specialists, especially focusing on small business. We used to see you everywhere, now you're extending into the enterprise. What's that all about, what's the vision, give us your perspective. >> You're absolutely right, Veeam started with the single focus to be the best for VMware, for VMware, data protection, cap replication, and we started as the easy to use, simple, powerful solution for SMB, moved into mid-enterprise and now we added lots of enterprise features, and moving into the large enterprise. And last year was really the most important and most successful year, 2017, in the history of Veeam, so we finally admitted that we'd be lying to our customers for 10 years. >> Dave: You've been lying? >> Yeah, we've been lying. >> What do you mean by that. >> For 10 years we've been saying, Veeam is VMware only, Veeam is high B only, we will never do physical. So last year we introduced the comprehensive M2M platform to do everything, virtual, physical, and cloud. So we integrated our agent-based technology into our flagship product, to provide a single panel blast to manage all your data across the cloud, M2M. >> Why lie for a decade? >> That's a good question. You know, when you deal with sales people, smart sales people, they constantly ask you, hey, when I will do that, I will go and do physical, I was going to do physical. You have to tell them no, never, because once you say yeah, we will do physical, the next question is when. >> Dave: Yeah, when can I sell it, right. >> So we don't want to give our sales people an excuse to lose a deal because we've got the best virtual, go and sell the best virtual, and make our customers happy. >> You don't want to head fake the customers either. >> Maybe explain, what were the core principles back from the early days that are still holding true, what is the same and what's different now that you're doing cloud and virtual. >> Again, the core principle. >> Stu: Or physical, I should say. >> For principle, again, in terms of the product design, think customer first, make it easy for the customer and really stick to your core customer, that customer that is using your product every day. So make it easy, powerful, and affordable. That was our core principles in designing the product, and the whole business model behind Veeam. >> Talk about the metrics a little bit. Stu and I were talking at the open, 820 some odd million in booking, so you can see a billion dollars. We said, software companies that are a billion dollars are few and far between so that's a huge milestone if and when you hit that. But talk about that and the growth, share with us whatever metrics you can. >> Again, 2017 was one of the most successful years in our history, yeah, like you mention, we recorded bookings revenue of 830 million and that was 36% growth. Actually, our growth is accelerating as we become bigger. So we just celebrated 300,000 customers, we are adding 4,000 new customers every day, and Peter Mackay, our president and co COO mentioned this morning at the keynote, that we're adding 133 customers every single day, so that's very impressive. >> Yeah, it's awesome. So yeah, just to give you a sense, 300,000 customers, VMware, who basically owns the enterprise, says slightly over half a million customers. >> So we probably are on 50% of VMware, so we own 50% of VMware market in terms of data protection. >> So one of the challenges that we mentioned upfront was okay, so you drove a truck through the opportunity when virtualization VMware came in, and a lot of the incumbents were caught flat footed. They didn't have the architecture, they didn't have the go to market, et. Cetera. Now things are changing, moving to cloud, moving to this digital world, how does Veeam retain its edge in that new world. >> That's an excellent question, so that's the big opportunities that we see for the next five years. So we won the first battle, the battle of on pram, highly virtualized modern data center. We are the leader, we are number one data protection and ideal ability for that market, right. So the next battle, the next opportunity that we see for the next five years is to dominate the, what we call intelligent data management market in the multi cloud world. So we have to think how we approach that, once you win the market, like there is a saying, the winner takes it all. Once you win the market, you are going to dominate that, so for us the next two or three years are the most critical in dominating this multi cloud world for the next decade. >> Ratmir, I'd love to hear, you wrote that virtualization wave, which really was about creating virtualization admin, huge shift going from silos to admins. And we're seeing that change from architects in the cloud and the like, talk to, who you're selling to, and the partners that you have to grow. There's just so much change happening in that kind of environment. >> Yeah we see the change as we are moving from VMware administrator, so originally the product was designed for VMware administrator, now we are moving to the infrastructure person that is responsible not just for private part of your infrastructure, but for the multi cloud strategy, which includes the public cloud, SAS, physical servers, everything than an enterprise has as far as the infrastructure. >> Okay, so I want to go through just a couple of things that we talked about earlier and get your reaction to this. So some of the things that we've seen in our research is that data protection and orchestration are becoming much much more important in the list of CXO concerns. And that's something that your messaging is going after. But there's a dissonance between the business expects out of data protection and what IT is actually delivering, and I wonder if you can comment on that. >> Sure, so yeah, we are introducing our new message. So our previous message was focused on VMware administrator, now we are moving into the enterprise, and our message is about the importance of data. We see the three characteristics of the modern data, hyper critical, hyper sprawled, and hyper growth. So this leads to the need of creating a new type of solution what we call is intelligent data management solution. To manage the hyper available enterprise. So we're using the word hyper a lot because the data is now hyper critical, it's over distributed, hyper distributed, and is growing exponentially. That's part of our new message, that as we go into the C level people, about how important this data, and what with all the things that going on, in terms of the security compliance and how we're going to extend this platform to solve other business issues and provide more value and more business outcomes of using your late. Veeam's emporium has grown within this enterprise customers. However, as we mentioned, we are moving further, we are not standing still, so we have added lots of capabilities in terms of protecting cloud, native cloud, AWS, Azure, as well as a physical servers. So we are moving more into the end to end strategic data management platform provider from being just a niche point solution. >> I want to give you another stat that came out of our research, which I think you'll love, is that our David Foyer calculated that on average, a Fortune 1000 company over I think a three or a four year period, loses about a billion and a half dollars in value because of poorly architected data protection approaches, whether it's they're not end to end, or they're not protecting their cloud data properly, or they're not doing, whether it's backup or disaster recovery properly, well over a billion dollars over a four year period, your thoughts. >> Yeah, that's similar to what our research shows as well. So we do annual research and ask all customers how much down time and data loss costs them annually or through hour, that research shows that average enterprise can lose as much as over 10 million dollars per hour, so if you add it up over four years, that might be close to that number. But with all the compliance and the new security risks and security threat, and reason where this is becoming more and more of a critical business critical problem to solve. >> So this is a huge opportunity for Veeam, because when you think about your total available market, what a lot of time analysts will do is they'll add up all the spending on let's say data protection solutions, but to me your tam is actually quite a bit larger because of this lost revenue opportunity. It's many tens of billions, maybe 30 to 50 billion, I don't know if you have any thoughts on that. >> Yeah definitely, so data protection is just part of that core market right, so that data management is much bigger, by data management we mean not just the protection of data, but using this data to help businesses, to accelerate the innovation rate, so to reduce risk, to comply with the new regulations. So all these challenges are much bigger part of not just the data backup and recovery, overall data management market which is much bigger and probably is larger than 20, 30 billion range. >> So okay, so you have 2,500, 3,000 of your favorite people here gathered this week. As always I expect that you're going to have a big sendoff, a big party, what can we expect this week. >> As always, that's part of the Veeam culture, is work hard, play hard, and so Veeam is known for having the best parties. Yeah we, now Peter runs the company day to day, but culturally we still remain young entrepreneurial spirited company right, so we like party and we like to work hard. >> Well you know, if you've never been to a Veeam party, you're missing it. I don't usually stay for these things, I get out of here, we have to do so many Cubes, but we'll be at the Veeam party this week. >> Awesome, awesome. >> Thanks very much, always a pleasure seeing you, and congratulations on all your success. >> Thank you very much. >> Alright you're welcome. Keep it right there everybody, we'll be back with our next guest, you're watching the Cube from Veeamon 2018. We're in the Windy City and we'll be right back.

>> Voiceover: Live from Chicago, Illinois it's The Cube, covering Veeamon 2018. Brought to you by Veeam. >> Welcome back to the Windy City everybody. You are watching The Cube, the leader in live tech coverage. My name is Dave Vellante and I'm here with Stu Miniman. Veeamon 2018 #Veeamon The husband of Mrs Philbin is here. (chuckling) The Astros, Warriors, Eagles, and whoever wins the Stanley Cup this year fan, Bill Philbin, Senior Vice President and Global Chief Technology Officer for Hybrid IT, for Hewlett Packard Enterprises, good friend of The Cube. >> Hello everybody. >> Awesome seeing you again, thanks for coming on. >> Every time you introduce me, it's something new, so I can't wait to share that with Mrs Philbin. >> Well she, like Stu says, that's where you go, for the information. >> That's exactly right, that's exactly right. >> So, another great keynote here, you stole the show last year, you're vying for top spot, top gun this year, so how do you feel? >> It was good, I said I think, the funny thing about Veeamon Hewlett Packard is, we have so much in common. The agenda is the same. It was almost hard to actually to create a unique slide set that was different from what they said, versus what we said. I think after 32 years, Mrs Philbin and I, we're not quite finishing each other's sentences, but I know what she wants me to do, without her telling me at this point. So, Veeam and HP have that kind of relationship. >> Well Veeam has a tendency and a way of inserting itself, into an ecosystem and it's certainly embedded itself into the HPE ecosystem. >> And I think that's, that's a lot of credit to Peter Mackay you know, he's joined now, what is it, 23, 24 months ago, and he's sort of brought that partner-centric viewpoint, grew the team around us. And they're really a, who we sort of pull out for other partners, say hey look, this is what these guys are doing, this is what you need to do to be successful, in a sprawling enterprise like Hewllet Packard, so, he's done a really, really good job I think. >> So give us an update on that sprawling enterprise. We make Hybrid IT simple, is your mantra. How is that going, you know where does your group fit in? >> So our couple of quarters into the new tenure of Antonio Anieri being the CEO, the engineer turned CEO. >> Got to make you happy? >> Absolutely makes me, and the thousands and thousands of engineers happy. Great first quarter, and we'll see what happens, sort of in quarter number, in quarter number two. There's a lot of focus within the company, now that we have divested ourselves of things that were less important. Focus on enterprise infrastructure, customers, around a couple of key concepts. Certainly we're pushing synergy, sort of, the synergy platform. Second pushing and talk about one sphere or hybrid IT, hybrid cloud offering, three, you know, we've had a lot of success in storage. Certainly the Nimble acquisition, which is hard to believe, was almost consummated, (mumbles) it's almost a year ago right? Its a year ago, actually in May. I just got off a holiday with Mrs Philbin, last year on the holiday, I was closing the Nimble transaction in the middle of the Indian Ocean, talking WIFI on the boat, via Google Voice to San Jose. There is nowhere now. >> Always on. >> Always on, exactly right. Talk about hyper availability. And so, I think we're pushing on, pushing on that, and then we've got, we renamed our services offering to Point Next offering, focusing around transformation et cetera so, I think the business is really clicking on all cylinders, and I think, you know, focus is actually quite interesting. We often focus on what we don't have, versus only focusing on what remains. And just like any start up, you focus on the first market segment, second market segment. Hewlett Packard is focused on enterprise infrastructure as a profession, I think that's, I think that's bode well for us. >> Yep, Bill one of the things we were talking about on the intro is, Veeam getting much deeper with their partners. One of the things we highlighted is, there's a couple of partners added in the price book. >> And what does that mean, from a go to market standpoint, that it's a little bit more seamless, you know, not invented by HP, but part of the whole solution. >> Well I said to Peter Mackay on stage, 18 months ago we did this transaction, which at the time was considered pretty revolutionary, given the fact that we had other things in the portfolio at that point that did data protection. And it's what, first and foremost, it's what our customers wanted and asked for. They wanted a more seamless transaction between the two organizations so we went ahead and did that. Second, there's always been a strong engineering relationship between the two companies, but if it's still talking to two partners at the end of the day, it doesn't matter. You know, an integrated offering, on the same price list, on the same PO, supported by both companies together, is really what customers are looking for. And as I said in the keynote, you know, we closed the single biggest transaction that, in Veeam's history, which was a Hewlett Packard and Veeam win for every seven dollars, I think it was, of Hewlett Packard, that we closed, a dollar of that was Veeam. And that's, sort of, the power of the partnership, demonstrated by the two companies coming together. And it's hard to believe, again, it's 18 months, you know, that's a pretty impressive track record. >> You're obviously not sharing, you know, any names on that deal. But can you share with us, any other information that's public, why did you win? Maybe you can share, you know, the type of win that it was. Why HPE and Veeam? >> Yeah, the customer, obviously, is not prepared to have us, sort of, talk about their name, for now anyway. But, essentially, what the customer was looking for was, a complete sort of back up and recovery solution that covered, not only traditional virtualized environments, but also gave them outlet for the cloud. More and more customers, as I said in my keynote, it's more than keeping a copy everyday between your primary and your secondary. You need a third copy, because guess what happens? And I said this last year, if you remember. Boo boos happen quickly right? (laughing) Something changed and deleted here, actually fast replicates here, you need a third copy to be complete, they were looking for that. And third, they were looking for, sort of, they were already an HP customer, they were looking for solution offering that would amortize their existing real estate, that was the three reasons. >> And, but your third copy model is different than having to build a third data center. It's a much more space-efficient, modern approach. >> So together with Veeam and our, (mumbles) our displace back up target, roughly last year, we announced this capability called Cloudbank which allows you to keep a copy in any S3 compliant interface. So it can be in on prem, or on open stack, implementation or it can be on any of the web services providers and it's done in an efficient, data protected deetip capability so, it's an efficient way to keep a copy of, what we call hail Mary data. Right, you hope you never need it right? An efficient way to sort of do that. >> Okay, one of the big topics of discussion these days is ransomware, what are your thoughts on ransomware? >> Well it's funny, you know, I always thought ransomware was something that you wore when you were dropping off the money, right. (laughing) Apparently it means something more than that. >> Dave: Yeah, I think so. (voice drowned out by crosstalk) >> Last year at Discover, we had a customer who was a meat processor, a meat processor. Now you can imagine what kind of customers you're going to ask, a customer that does meat processing. But it actually infected their servers that actually helped them run their meat processing capability. Now that is not a business that you would expect someone will call you up and say, "Hi we have your data, give us $1000 and we'll give you your data back.". It's a meat processing company, or a gourmet food provider is a more typical way they would present it. But if they're, if that's happening to that sort of line of business, imagine what's happening to power plants, you know et cetera et cetera. So the ramsomware stuff is really real. So if you think about HP, we developed the most secure server with our Gen10 platform. We actually guarantee and actually look at changes being made in a firmer environment. We cover them for you automatically. We've got the Veeam sort of capability to recover, and I think we were talking about it in the preview. We used to measure availability in how many nines you had. Now, unavailability is the only thing that customers care about and if you go to a customer and say, "It's okay, you're only .0001 of the rest of our customers" that's not a good story right? It's not about when something happens, or if something happens, it's when something's going to happen and the power of Veeam and HP together, prevents, bad things from happening right? >> Bill, it's interesting, I know in my career, it's been a significant shift. It used to be, let's pardon it as much as possible, tool, redundancy, hardware focused. But cover eventually breaks. >> Bill: It does. >> Today, it's a soft world, it's distributed architecture, look at things like your synergy solution, it's much more modular and componentized. Maybe you can talk a little bit about some of those shifts, as to how we build availability architecturally, like the HPE and Veeam meet the new needs of what we need, as opposed to kind of the old way of doing things. >> It's actually interesting, so a lot of customers are looking at software-fine infrastructures as a way of amortizing their existing infrastructure. And it's actually cost savings. But I equate it to sort of, making a decision to buy Mrs Philbin a chest of drawers at a furniture store or, going to Home Depot, buying the wood, milling the wood and actually creating something myself. Now the good news about software fine infrastructure is, it's just like me making Mrs Philbin a chest of drawers, is at the end, it's mine. Right, I got it to my specifications. The bad news about software fine infrastructure is when there's a problem, Mrs Philbin isn't calling the furniture store, she's calling me right? And so, when you think about software fine infrastructure, is, you have to imagine two things. One is, are you prepared to write an application that is ready to resolve the kinds of data resiliency and data availability, capabilities that the hardware manufacturers have built into systems for 20 years. Now if you've got a unique system, that does one thing, it's probably easy. Imagine hosting 160 different applications, like that was mentioned on the stage today. And creating resiliency for that. So my conversation with customers about software define is, please go in wide open. Number two, please think about resiliency, not at the storage level, but also think about resiliency at the application level. You have got to provide for a time when something is not as available as you think it is. And make those steps consciously. >> Let me ask you, from a technologist's perspective. >> Bill: Yeah. >> If I understand you correctly, so if I'm Oracle, I can do things in the application, >> Bill: Sure. >> To accomplish that outcome, but you're not an application ISD, so you have to do things in your architecture, and assume that any application that's running can recover. >> Bill: Correct. >> Is that right? So can you help us understand that, how you approach that problem architecturally? >> Well I think you know, we haven't talked about big data, or Infosite, but if you think about it. The way to best protect a customer's infrastructure, is to actually monitor their infrastructure, compare their results to what others are receiving, recommend ways that they can actually tune up their infrastructure and eventually, act on their behalf, to make the changes to their infrastructure, so they're always protected. As I said in my keynote, it's getting to a point where you actually can't do all that stuff yourself. So the key, one of the key strategies around Hewlett Packard Enterprises, is to take the infrastructure capability which is basically machine learning, artificial intelligence, sort of capability, and deliver a system which helps customers be always on. That's the first thing that I think you can do. And you're going to be really good about making sure that I get out. >> I am, we got like two minutes, and I want to use every second I have of you, so. Okay, so I want to follow up on the Infosite, you've brought that out beyond just Nimble. >> Bill: That's right. >> I think you've brought it to Three Par and you're pushing it out throughout your entire portfolio right? >> So for customers who are going to see us at Discover, we've got some interesting things we'll talk about there. But effectively we've rolled it out across the portfolio, because, as I said in my keynote, it's not really easy to predict, why availability is an issue. Is it a host issue, is it a software issue, is it a networking issue, is it a storage issue. What Infosite eventually provides is a set of hooks that allow you to meter and measure and manage your entire infrastructure, and get it to a point where it's actually subscribing to the best practice of the organization or application provider. >> One of the things you hear a lot about is, how do you take back up and recovery, which is largely an insurance business, and create value out of it? GDPR is this sort of heinous you know, set of regulations, everybody's got to pay attention to it. Are we finally seeing the day, where the backup data protection, governance approach, can actually bring value to the rest of the organization? Or is it still just insurance, deal with it? >> So I think, I would say two things Dave, one is if you look at what Nimble's just announced with their secondary flasher right? Where we can keep a very cost effective copy of your data on an array, that looks like the array you copied it from. That can be used for dev ops, it can be used in the event of a failure et cetera. I think we're starting to see technologies available now where that, that happens. Second, the ability to make a copy of that in the cloud, and actually bring up your most critical applications in the cloud by using a Synergy, or a Onesphere capability, so you can actually keep a hot stand by, I think we're starting to see that. I think, you know backup is moving from a, cost of doing business, to something that's vital, vital in the enterprise but always remember that, the best time to think about a backup, is before you need it. The worst time to think about a backup, is when you need it. >> Yeah, and I think you'd agree that data protection as a topic, is moving up in the minds of CXO and boards of directors and the like. >> Yeah, and it's unfortunate that some of these bad actors that are out there, right, the CNN's and, this has caught more than just the IT community press, it's actually caught the business press. And I think it's drawing a lot more attention around the reason why people should think about availability. >> Right, you got to go, you got to catch a plane. But just give a little tease for HPE Discover. It's coming up in June, it's a great conference that you guys have every year, twice a year you do this US one, and one in Europe, give us a tease for June. >> I would say, this is going to be the most exciting HPE Discover on record. And this is Antonio's opportunity to sort of, talk to you about what's headed, what's headed forward for Hewlett Packard so, be there or be square. >> Okay. >> Dating myself. >> Okay we're square. Alright thank you Bill, for coming on The Cube and we'll be right back after this short break. We're at Veeamon 2018 in Chicago. Thanks for watching. (electronic music)

>> Announcer: Live from Washington D.C., it's theCube, covering .Next conference. Brought to you by Nutanix. >> We're back, this is Dave Vellante with Stu Miniman, and this the wrap of .Next, Nutanix's customer event, #NEXTConf and this is theCube, the leader in the live tech coverage for enterprise technology. Stu, second day. I got to say, Nutanix has always done a good job, innovative venues, they do funky, fun stuff with marketing, we haven't seen the end of it. We have another keynote today, there's a keynote tomorrow morning, big names, Bill McDermott's here, we just saw Peter MacKay, Chad Sakac is here. Who am I missing? >> Stu: Diane Greene >> Diane Gree was up yesterday. >> Y'know, thought leaders, had the CEO of NASDAQ on this morning Dave, y'know really good customers, thought leaders, Nutanix always makes me think a little bit, which I really enjoy. My fourth one of these Dave, usually by the fourth show I've gotten to, it's like I've seen it. Have we made progress, where are we going? >> I thought Sunil Podi's comment was really interesting, he said, "Look, we saw the trends, "we knew that hardware was going down." I mean, they're essentially admitting that they were a hardware oriented company, infrastructure company, we saw what was happening to infrastructure and hyper-converge, and we could just packed it up then, sold the company for a bunch of money, there were rumors floating around, you know they were pre-IPO, they easily could have sold this thing for a billion plus, all could have cashed out and made a buncha dough, and they said, "Y'know what, we're going to do something "different, we're going to go for it." You got to love the ambition, and so many companies today just can't weather that independent storm. I mean, you've seen it over and over and over again. The last billion dollar storage company that remained independent was NetApp, that was 14 years ago, now Nutanix isn't a storage company, but look around here, look at the analysts, a buncha storage guys that have grown up, and it's to me, Stu, it's a representation of what's happening in the marketplace. Storage as we know it is going away, and it always has transformed, y'know it used to be spinning disc drives, then it was subsystems, then it was the SAN, now it's evolving, these guys call it invisible infrastructure, call it whatever you want, but it's moving toward infrastructure as code, which is just a stepping stone to cloud. So your thoughts on the event, the ecosystem, and their position in the marketplace. >> Right, they reach a certain point, they've gone public, can they keep innovating? Look at a number of announcements there, we spent a lot of time talking about the new CloudZi service out there. >> Si? >> Zi. >> Zi, zi, sorry, you got it. (chuckles) >> Pronunciation of some of these, "it's Nutanix, right?" >> Nutonix, Nutanicks, (chuckles) >> They made jokes about the company last year, but this year, that's product, we're talking vision. The ink is still drying on the relationship with Google, doesn't mean they haven't been working for a while, but where this deal goes, interesting to see where it is six months from now, a year from now, because also Google, small player, I mean it wasn't to be honest, I was at the Red Hat Summit and they had a video of Andy Jassy saying, "We've extending AWS with OpenShift." And you're like wow. Red Hat has a position in a lot of clouds, but for Andy Jassy to make an appearance, Amazon, the behemoth in the cloud, that's good. Look, getting Diane Greene here, I said number one, it gives Nutanix credibility, number two it really pokes at VMware a little bit, she's like, "Oh, I did this before." And everybody's like, "Well, she's here now at Nutanix." Nutanix wants to be, that they've compared themselves to both Amazon, I think we hear it was Sunil or Dheeraj in an analyst session said they "want to be like the A Block." Not the V Block that EMC did, but the Amazon Block for the enterprise, or the next VMware, they talked about the new operating system. It's funny, in a lot of my circles, we've been trying to kill the operating system for a while, I need just enough operating system, I want to serverless and containerize all of these things because we need to modernize, and the old general-purpose processor and general-purpose operating system has come and gone, it's seen its day, but Nutanix has a play there. When I look at some of the things going on, we're talking about microsegmentation Dave, we're talking about multi-cloud and some interesting pieces. I like the ecosystem, I like that balance of how do you keep growing and expand where they can go into, leading the customers, but they're delivering today, they've got real products, they've got real growth, sure they have some challenges as to that competitive back and forth, but you asked Chad Sakac if this reminded him of Dell EMC, and kind of that partnership that they had for years, reminded me a little bit of kind of EMC and VMware too, once EMC bought VMware, VMware, the relationship they had, HP, and IBM, and other companies that they needed to treat as good or better than EMC. They're some of those tough relationships, and Dell with Nutanix, their partner, not only do they do Dell XC, but now they're doing like Pivotal on top of it, they can do Hyper-V deployments, Lenovo's another partner, Nutanix is broadening their approach, there's a lot of options out there and a lot of things to dig into, interesting, they keep growing their customers, keep delighting their customers, it reminds me of other shows we go to, Dave, like Amazon re:Invent, customers are super excited, You tell me about the Splunk conference and the ServiceNow conference where those customers are in there, they're excited, and Nutanix is another one of those, that every year you come, there's good solid content, there's a customer base that is growing and exciting and sharing, and that's a fun one to be part of. >> So, I want to ask you about VMware, it's kind of a good reference model. EMC paid out, I don't know, $630 million for VMware, which was the greatest acquisition in enterprise IT history, no question about it in terms of return. A couple questions for you, you were there at the time, you signed the original NDA between EMC and VMware, kind of sniffed em out. Would VMware's ascendancy been as fast and as successful, or even more successful, without EMC? Would VMware have got there on its own? >> I don't think so Dave, because my information that I had, and some of it's piecing together after the fact is VMware was really looking for that company to help them get to the next state. The fundraising was a little bit different back in 2003 than it was later, but rumors were Semantic was going to buy them. Everybody I talked to, you'd know better than me Dave, if Semantic had bought them, they would have integrated into all their pieces, they would have squashed it, the original talent probably would have fled much sooner. EMC didn't really know what they had, I had worked on some of the due diligence for some of the product integration, which took years and years to deliver, and it was mostly we're going to buy them. Diane had a bit of a tense relationship with Joe Tucci kind of from day one, and it was like okay, you're out there in Palo Alto, we're on the other coast, you go and do your thing, and you grow, and by the time EMC had gotten into VMware a little bit more, they were much bigger. So I think as you said, they're one of the great success stories, EMC did best in a lot of its acquisitions where it either let it ran a division and go, or let it kind of sit on its own and just funded it more, so I think that was a-- >> Well, and the story was always that Diane was pissed because she sold out at such a low price, but that's sort of ancient history. The reason I brought that up is I want to try to draw the parallel with Nutanix today, and come back to what you were saying about the A Block. When you look at Amazon, we agree, they have a lead, whether that lead is five years, seven years, four years, probably more like five to seven, but whatever, whatever it is, it's a lead, it's substantive. Beyond the infrastructure, the storage and the compute, they're building out just all kinds of services, I mean just look at their website, whether it's messaging, on and on and on, there's database, there's AI, there's their version of VDI, there's all this big data stuff, with things like Kinesis, and on and on and on, so many services that are much, much larger than the entire Nutanix ecosystem. So the reason for all this background is does Nutanix need a bigger, can Nutanix become it's ambition, which is essentially to be the next VMware, without some kind of white knight? >> So my answer, Dave, is if you look at Nutanix's ambition, one of the challenges for every infrastructure company today, if you think okay, we've talked about True Private Cloud, Dave, what services can I run on that? How can I leverage that? Look at Amazon, y'know a thousand new services coming every year, look at Google, they've got TensorFlow, really cool stuff, they've got those brilliant people coming up with the next stuff, how do I get that in my environment? Well, Nutanix's answer, coming at the show was we're going to partner with Google, we're going to have that partnership, you're going to be able to plug in, and you want to do your analytics and everything, use GCP, they're great at that, we're not, we know that you need to be able to leverage Google services to do that. The Red Hat announcement that I mentioned before, another way how I can take OpenShift and bridge from my data center and my environment and get access to those services. The promise of VMware on Amazon, yeah we're going to have a similar stack that I can go there, but I want to be able to access those VMware servers. Now, could it suck them eventually into all of Amazon and leave VMware behind? Absolutely, it's tough to partner with Amazon. So, the thing I've been looking at at almost every show this year is how are you tying into and working with those public clouds, we talked about it at VMON, Dave, they have Microsoft up on stage, they have partnerships with the public cloud-- >> David: HPE was up there. >> But the public cloud players, if you're not allowing your customers and the infrastructure that you're building to find ways to leverage and access those public cloud services, which not only are they spending $10 billion a year for each one of the big guys on infrastructure to get all around the globe, but it's all of those new services ahead, moving up the stack. To stitch together that in your own environment is going to be really challenging, how many different software pieces, how do I license it? How do I get it on, as opposed to oh, I'm in the public cloud, it's a checkbox, okay I want to access that, and I consume it as I need it, that consumption model needs to change, so I think Nutanix understands that's directionally where they want to go, I look at the Calm software that they launched and say hey, you want to use TensorFlow? Oh, it's just a choice here, absolutely, go. Where is it and how do I use it? Well, some of these details need to be worked out, as Detu said, "it's not like it's one click for every application, any cloud, anywhere." But that's directionally where they're going to make it easy, so all that cool analytic stuff that we cover a lot on theCube, a lot of that is now happening in the cloud, and I should be able to access it whether I'm in my private cloud or public cloud, and it's just going to be consumption model, whether I have certain characteristics that make it that I'm going to want to have that infrastructure for whether that's governance or locality, we talked to Scholastic yesterday, and they said, "Well when you've got manufacturing "in books, I need things close "to where they're coming off the production line, "otherwise there's things that I'm doing "in the public cloud." So that's there we see, when I talk to companies like I do here, at the Vienna show last year, when I talk to Christian Reilly with Citrix, who had been at Bechtel for many years, there's reasons why things need to live close to what's happening, y'know we've talked a lot about Edge, and therefore public cloud doesn't win it all, I know we had one guest on this week that said, "Right, depending on what industry you're is, "is it a 30/70 mix or a 70/30 mix?" There's a lot of nuance to sort this out, and this is long game, Dave, there's this change of the way we do things is a journey, and Nutanix has positioned themselves to continue to grow, continue to expand, some good ambition to expand on, like the five vectors of support that they have, so I've liked what I've heard this week. >> So in thinking about what we're talking about VMware, the imperative for virtualization was so high in the early 2000's because we were coming out of the dot com bust, IT was out of favor, VMware was really the only game in town, there really wasn't a strong alternative, had by far the best product, Microsoft Hyper-V was sort of in-concept, and KVM and others were just really not there, so there really was no choice, it appealed to 100% of the IT shops, I mean essentially. So I wonder though, today, is the imperative for multi-cloud the same? The fundamental is yes, everybody has multiple clouds. But this industry has lived in stovepipes forever, and has figured out how to manage stovepipes, it manages them by fencing things off. So I wonder is the imperative as high, you could maybe make an argument that it's higher, but I'm still not quite getting it yet, as it was in the early 2000's, where the aspirin of virtualization to soothe the pain of do more with less was such an obvious and game changing paradigm shift. I don't see it as much here, I see people still trying to figure out okay, what is our cloud strategy? Number one, number two is the competition seems to be much more wide open, it's unclear at this time that any one company has a fast-track to multi-cloud. >> I think you've got some really good points there, Dave. A thing that I've pointed out a few times is that one of the things that bothered me from the early days with VMware is from an application standpoint, it tended to freeze my application. I didn't have a reason to kind of move forward and modernize my application. Back in 2002 it was like oh, I'm running Windows NT with a really old application, my operating system going to end of life, well maybe it's time to uplift. Oh wait, there's this great virtualization stuff, my hardware's going end of life too. No, shove it in a VM, let's keep it for another five years. Oh my god, that application sucked then, it's going to suck even more in five years, and workforce productivity was way down. So, the vision for Nutanix is they're going to be a platform that are going to be able to help you modernize your environment and how do we get beyond, is it virtualization, is it containerization, is it a lot of the cloud-native pieces, how does that fit in? Starting to hear a little bit more of it, a critique I'd have on HCI about two years ago was it was the same applications that were in my VMware SAN, not VSAN, but my just traditional storage area network was what was running on Nutanix. We're starting to see more interesting applications going on there, and look, Nutanix has a bullseye on them, there are all the HCI direct replacements, there is the threat of the cloud, and I haven't heard as many SAAS applications living on Nutanix as I do when we talk to all flash-array companies, Dave, every single on of them can roll out, here's all these SAAS deployments on our environment, just scalable environments that build that for the future. I haven't heard it as much from Nutanix. >> So VMware was aspirin , Nutanix originally started as aspirin, and now they're pivoting to vitamin. Who are they up against? Who do you like? Who are the horses on the track? Let's analyze the race and then wrap. >> Yeah, so when Nutanix got into this business, it was well, they're helping VMware environments, it was 100% VMware when they first started that relationship with VMware was really tough, they've lowered that too, they've now got what, 28% is running HV, they've got a little bit on Hyper-V, but they've still got about 60% of their customers are VMware. So VMware, y'know, huge challenge, VSAN has more customers than anyone in the hyper-convergent infrastructure space, easy, number of customers, but virtualization admin has taken that. Microsoft, huge potential threat, Azure Stack's coming this year, it's been coming, it's been coming, it's really close there, all the server guys are lining up. Microsoft's a huge player, Microsoft owns applications, they're pulling applications into their SAAS offerings, they're pulling applications into Azure, when they launch Azure Stack, even if the 1.0, if you looked at it on paper and say Nutanix is better, well, Microsoft's a huge threat to both VMware, which uses a lot of Microsoft apps, as well as Nutanix. So those are the two biggest threats, then of course, there's just the general trend of push to SAAS and push to public cloud where Nutanix is starting to play in the multi-cloud, as we talked about, and COM and the DR cloud services are good, but can Nutanix continue to stay ahead of their customers? They're ahead of the vast majority of enterprises, but can they convince them to come on board to them, rather than some of these big guys? Nutanix is a public company now, they're doing great, but yeah, it's a big TAM that they're going after, but that means they're going to have a tax from every side of the market. >> I see HCI as one where you got a leader, and that leader can make some good money. I don't see multi-cloud as a winner-take-all market because I think IBM's going to have its play in multi-cloud, HPE has its play in multi-cloud, Dell EMC is going to have its play in multi-cloud. You got guys coming out of different places like ServiceNow, who's got an IT operations management practice, builds business big, hundreds of millions of dollars of business there, coming at multi-cloud, so a lot of different competitors that are going to be going for it, and some of them with very large service organizations that I think are going to get there fair share, so I would predict, Stu, that this is going to continue to be, multi-cloud is going to be a multi-stovepipe cloud for a long, long time. Now, if Nutanix can come in and solve that control plane problem, and demonstrate substantial business value, and deliver competitive advantage, y'know that might change the game. It's difficult at this point in 2017 to see that Nutanix, over those other guys that I just mentioned, has an advantage, clear advantage, maybe from a product standpoint, maybe. But from a resource standpoint, a distribution channel, services organization, ecosystem, all those other things, they seem to me to be counterbalancing. Alright, I'll give you last thought. >> Yeah, so it's great to see Nutanix, they're aiming high, they're expanding into a couple of areas, and they keep listening, so I hope they keep listening to their customers, expand their partnerships, SAAS customers would be really interesting, service provider is something that they've gotten into little bit, but plenty more opportunity for them to go there. Dave, personally for me, to it have been a company I've watched since the earliest days, it's been a pleasure to watch, y'know I think back, right, VMware you said, I think it was a hundred person company when I first started talking to them and Diane Greene, and I look at where VMware went. I've been tracking VMware for now five years, and reminds me a lot of some of those trends, for a 20 person company, I said to hear almost 3000 boggles the mind, I've been to their headquarters a bunch. So it's been fun to watch the Newton army, and they've been loving watching it from our angles. >> Well and these events are very good events, and so there's a lot of passion here, and that's a great fundamental for this company. So I'm a fan, I think it may be undervalued, I think it very well may be undervalued. >> Wall Street definitely doesn't understand this stuff. >> Alright Stu, great working with you this year, (chuckles) this month, this quarter, this month, certainly this show, so great job. I really appreciate it >> Stu: Thanks, Dave. >> There's a big crew behind what Stu and I, and John Ferrier, and Jeff Frick, and others do here. Here today with us Ava, Patrick, Alex, Jay, you guys have had an awesome spring. Brendan is somewhere, I guess Brendan is doing the keynote right now. So, fantastic job, as always, Kristen Nicole and her team, writing up the articles. Jay Johanson back at the controls, Bert with the crowd shots. Everybody, really appreciate all your support, thanks for watching everybody. We'll see you, we got a little break, I think, in the action, cause it's July Fourth, well it's Canada year, or Canada week-- >> Canada Day and Independence Day next week. >> And Independence Day in the United States, and then we'll be at Infor Inforum, second week of July, I'll be there with Rebecca Knight and the crew, so watch for that, check out SiliconAngle.com for all the news, Wikibon.com for all the research, and theCube.net to find all these videos, Youtube.com/SiliconAngle, it's everywhere, if you can't find it, you're not on Twitter, you're not on social. Thanks for watching, everybody. This is Dave Vellante with Stu Miniman, we're out. (lo-fi synthesizer music)

>> Announcer: Live from New Orleans, it's The Cube covering VeeamON 2017. Brought to you by Veeam. (upbeat jingle) >> Welcome back to New Orleans everybody. I'm Dave Vellante with Stu Miniman and this is The Cube. The Cube is a leader in live tech coverage, and we're here covering VeeamON 2017. This is day two for us. Paul Mattes is here. He's the vice president of The Global Cloud Group at Veeam. Paul, good to see you. >> Hey, great to be here guys. Thanks for having me in. >> You're welcome. Hosting the conference this morning, throwing Peter MacKay under the bus a little bit. That was kind of funny. He's going to get you in a headlock later. (laughter) No doubt. But you know, it's funny, it's great. VeeamON is an experience for people. You know, it's not just about the hardcore learning, which there's a lot of that going on, but it's about having fun. And a lot of people here are having fun, and you guys embrace that, it's great. >> Yeah, I mean, it's part of our culture, right? I think that's why it's a great company. It's one of the reasons why I came here. And listen, if you can't have fun doing something you love, there's something wrong. So, yeah, we're going to keep that up. >> A lot of sports analogies going on too, which we love in The Cube, oh geeze, ya know? (laughter) Sports angles, and so you guys seem like you're pretty competitive. You're not afraid to put it out there. So, give us the lay of the land. What's happening in the marketplace? >> So, on the cloud specifically this is an area of major growth for us at Veeam. I think it's certainly a competitive landscape, no question about that, but I think we have some advantages given our lineage and where we've evolved from, from an on-prem organization into the cloud. The cloud market's moving very rapidly. You heard me talk about that this morning a little bit, about the pace of cloud adoption. I think it's happening much more quickly than we've ever seen, and I haven't talked to anyone here, and having dozens and dozens of conversations, who haven't talked about having some kind of cloud strategy or trying to figure out how that impacts their go-forward planning in IT. >> You gave some IDC stats I wanted to ask you about that. 46% I think by 2019... >> 2019, right. >> Are going to be doing cloud, and I presume that meant both on-prem cloud? >> Correct. >> So, cloud being an operating model not necessarily a destination. >> That's right, yeah. >> Talk about that a little, what does that mean? >> So, yeah, you hear Danny and I talk about this all the time is that I've been doing the cloud since 2010 when I was with Azure at Microsoft. And everybody talks about moving to the cloud as if that's it, you know, once you're there, it's over with. The reality is, you need to think of the cloud as a way to deliver business results and deliver business solutions. So, just getting to the cloud doesn't mean you're over. Doesn't mean you don't have to think about things like availability and data protection and backup and disaster recovery. So the journey to the cloud, I think it's sort of a, it's a step, right? And then once you're there, there's a whole lot more that you have to do once you're there. >> Paul, one of the things I've been seeing for a couple of years is when it comes to cloud, follow the applications and follow the data. You said you worked on Azure. I mean, no doubt that Azure has lots of applications. Business productivity, I think marketers did a great job this morning laying that out. Virtualization was kind of a tool that applications sat on top. What's that maturation that you see of customers as to how they think about their data and their applications and where things live? >> Yeah, no, it's a great question. I think they're getting much smarter about how they separate and divide those things intelligently. Especially when you think about things like, you know, Mark talked this morning about Stretch DB moving into Azure. And so customers are having to rethink all that that because the cloud really does change how you have to think about application architecture, application deployment. Especially as you do division of data application and sort of the entire architecture end to end. So, I think we're still early days, quite frankly. I think for as much as cloud is in the buzz, and we love where we're evolving to as a cloud organization. The market in general is still early days, and there's a lot of work left to do there. >> Paul, what visibility do you give customers, and how do you help when it comes to the cost of all of this? There's so much, it's often on fud in the market place as to, oh well public cloud's super expensive. No wait, owning it yourself is always expensive. You should always rent versus buy. How do you inject yourself into that conversation? >> Great question, and this is something that has come up since day one. And the assumption is, you've got commodity hardware, you've got scale, so you've got decreasing costs. The reality is it's workload. It's entirely workload dependent, right? There are some workloads that you want to put into the cloud. Absolutely, you would experience amazing economics. We talked today about the scale out backup repository model, taking advantage of Blob story. Perfect example, one of the things customers need to think about is, in addition to those things is ingress and egress costs. It's not just the cost of storage. In the cloud, you have things that surround that in order to make it workable and make it really, really valuable. So one of the things we are doing now with customers is we're starting to work through and develop models to help them think though that. In various stages of network costs, storage costs, and being able to give them some tools that really help them make those decisions. It's not an easy task by any means because at the senior level, executives seem to say, well everybody's saving money in the cloud. Why aren't we there? Why aren't we experiencing that? When you get into the details, it's a little more complicated. But, at the end of the day, the right workload in the right cloud infrastructure, absolutely economic advantages, and more importantly, business advantages. >> Doesn't the savings or business impact really come from what we were talking about earlier, the operating model? Alan Nance, who was the former CIO of Phillips, he was on The Cube, and he said, "If you don't change your operating model, "you're going to just barely scratch the surface of benefits." And so, I wonder if we could explore that a little bit. Is that what you're seeing in the marketplace, that people lift and shift? Maybe there's an advantage that you're shifting CapEx to OpEx, but it's really not moving. >> No, I totally agree. That's not, and it's always frustrated me a little that the economic end of it really seems to dominate a lot of the conversation based on perception. The reality is, yes, this is about changing the operating model and changing the ability of the organization to map to customer demand and map to market demand. The cloud does provide that, and you can't just lift and shift. Yeah, that's okay for some things, but you really have to rethink, okay, if I have this agility and the ability to deliver solutions in a cloud, what does that really mean? How do I really have to think through that from end to end, not just, going back to our earlier question, I'm going to put that in the cloud and we're done. You know? Absolutely you have to rethink everything when you're moving to the cloud from an application's perspective. >> And then from Veeam's perspective, when you think about cloud, obviously you featured Azure up there today. You guys have talked about Affinity with AWS, but there's a lot of cloud providers. >> Paul: Oh yeah, 18,000 of 'em for us. >> And some of those may be managed hosting, but the business model is similar to cloud. So, what are you seeing in terms of the, the market's highly fragmented today. It's very localized. In your view, will it stay that way? Will you see substantial consolidation, or will it be more like the services markets typically are, which is very local, very fragmented, zillions of companies? >> I think, and we think, that there will continue to be a consolidation in this part of the market. There's been an explosion of providers. And what happens is, how do you differentiate if you're a provider in that market, right? What is your secret sauce? What makes you more attractive than another provider? And so, we were already seeing consolidation globally for organizations, so what'll happen, what we think will happen is, yes, there will be some that are very niche, very specialized that continue to have great success, but we will see organizations coming together. Increasingly what we're seeing is providers wrapping new value at its services around their offering, right? This is how they differentiate. We're also seeing service providers that are starting to verticalize. So specializing in a particular healthcare of financial services market as a way to provide value and differentiation for themselves. It's not going to just, and this is why one of the things we've done in Veeam is yes, we will continue to grow the provider base but really focusing ones that differentiate and add value to customers and can partner really, really well with Veeam. >> Paul, Veeam kind of grew up right at that time that not only was was VMware exploding on the market, but there was a new virtualization administrator that didn't exist before. And Veeam helped solve a really salient pain-point that they had. Can you talk to us about when it comes to cloud who are you selling to? The community's very different in a very fragmented cloud world than that kind of big VMware community that we all know. >> Yeah, so it's interesting because we're clearly in an evolution at Veeam. Veeam's legacy, very squarely focused in IT and the IT pro community. That won't change. That will not change. But as you heard from all of our messaging here over the past couple of days, what we really want to continue to evolve to is understanding from a business perspective what is the business value of driving agility, or, driving agility and availability? And so that is now a conversation at a different level. You're talking a CIO level. You're talking COO level. And that's an evolution. It's an easy conversation to have when you're talking about a bits and bytes perspective of how do the bits move, and what are these feature's functions? But you'll see us continually now relate this to, what are the business outcomes? What are the business risks? Why do you need to have an availability strategy, and why is Veeam the choice for that? >> So your positioning is as an availability specialist. No question about that. I want to start by talking a little bit about the market for that. So there's Multi-Cloud, there's Hybrid-Cloud that you've talked about this. I don't know, sometimes we call it inter-clouding. But you are positioning the strategy as positioning in the middle of all that as the availability, the best at availability, always on. So, first of all, how big is that market? Can you talk a little bit about the TAM, however you look at it? Maybe not hardcore numbers, but if you have 'em, we'd love it, but how do you look at that? >> Well I think Peter presented some data in his keynote on Tuesday. And we see the total addressable market as in the six to nine billion dollar range, which is pretty massive. If we can capture just a fraction of that, we're going to easily blow through our stated goals of getting to a billion, a billion five in the next couple of years. So, and that's why we're going to, we will continue to focus across the spectrum of those platforms, right? You heard us talk about, that's the core. We grew up in virtualization, now physical, and that we're going to attack storage. But, and we won't lose that. But now, understanding how all the different cloud assets and cloud platforms intersect that, that whole market is massive and will continue to grow. It's interesting, I was talkin' the other night with an analyst about cloud predictions, and we said, we'd love to go back and look at the last four or five years of predictions from analysts and see, where do they land? Where do they really end up? And I went back, and this is not an in-depth, robust survey, but going back a few years looking at all the estimates of cloud market growth, they were all wrong. And they were all wrong on the low side, all right? And it's hard sometimes to get analysts to not over-hype things, right? But everyone that I looked at, it was more, the reality turned out to be greater than what the prediction was. >> It's the definition of a disruptive technology 'cause we're usually horrible at forecasting it, right? >> (laughing) Yeah, exactly, exactly, which is a good thing. >> So in that sort of center of the cloud, if we can call it that, explain to people why Veeam and not a higher level of abstraction. Like VMware for example, them tryin' to be sort of, even though they're not availability specialists, but they're pretty good at availability. And people are concerned about managers of managers. Why does Veeam win in that scenario? >> I think Veeam wins in that scenario given the breadth of our capability, given the breadth of what we do, thing number one, given the breadth of our ecosystem, number two. We don't have all the answers, but we have an amazing partner ecosystem that does. And number three, I would say the simplicity, right? This mantra that we have at Veeam of it just works, that's very, very valuable. I heard, you know just wandering around here, unsolicited. People don't know who I am when I'm walking with my badge off. And I've heard multiple times, they're not kidding when they say that it just works thing. That's something that we will never ever get away from, and that's a clear differentiator for us. We were talking, we did a breakout session the other day, Danny and I, and we were with a number of service providers, and they asked, we had these canonical examples of what we're doing. And they asked a few questions of why can't we do this? And Danny and I would look back and say, well you can do that, but it's not to the point where we have it yet where we say, it just works. There's a way to string it together. There's a way Veeam can solve that problem, but we need to continue to improve engineering in order to get it to the point where it just works. To make it that simple, elegant, and that's a huge differentiation. >> So the premise there is it's not a zero sum game, certainly between you and VMware because of the simplicity and the integration that you do with VMware. Very interesting dynamic going on in the marketplace. It's early days, but you guys are, I love the positioning. It's clean and it's focused. >> No, thanks, I'm glad because we love the feedback. It's something we work really, really hard at. Veeam is in a great period of transition, bringing Peter on, the leadership team that Peter's brought in. That's really, really important that we're able to communicate where we're going and how we position because we are so passionate about it. You want to make sure that the words come out, well, and that the messaging is proper, and that our strategy is locked on. >> All right, we'll give you the last word on VeeamON 2017, bumper sticker as the trucks are pullin' away... What does it say? >> I mean, I think it's an amazing event. It's my first VeeamON. I have been blown away by the energy and the information that we've shared. I think we have a lot of exciting things that are coming down the pike, and we just can't be thankful enough for the great participation and look forward to the future. >> All right, Paul Mattes, thanks for comin' on The Cube. >> Hey, thanks guys. >> All right, you're welcome. Keep it right there everybody. Stu and I will be back with our next guest at The Cube. We're live from VeeamON 2017 from New Orleans. We'll be right back. (upbeat jingle) (electronica jingle)

>> Announcer: Live from New Orleans, it's the Cube. Covering VeeamOn 2017. Brought to you by Veeam. >> We're back, Dave Velante with Stu Menamin. This is the Cube, the leader in live tech coverage. Kevin Rooney is here. He is the vice president of North American Channel Sales at Veeam, good to see you. Thanks for coming on. >> Thank you for having me. >> You're welcome, so the channel is where it's at in your company from day one, right? >> From day one I have to say that Veeam did a wonderful job in terms of their go to market was always through the channel. We're not changing DNA of the company in terms of getting them to engage with our partners and figure out how to work well with them. It's been the case since the beginning. >> How are you guys organized? Obviously you've got a sales force as well and that's what, an evangelist force? They're an overlay, they're sort of catalyst? How does that all? >> From a channel perspective we want to work to enable our partners obviously, understand the technology, understand how do we solve customer challenges. Then we align ourselves to our segment teams. So from an end-users sales standpoint we have the traditional enterprise, commercial S and B sled-fed teams. But really from a general standpoint I look at our salespeople and we carry quota. I mean, we are salespeople so we're not just in the enablement game, we're also in helping our partners to get closer to their customers and deliver the solutions that really do solve the problems that our customers are facing. >> So when you're real tiny company we know the channel. The channel wants to make money. How do I make money with you guys? Veeam had a hot product so the channel said okay good, I'm there. Now as you're a larger company moving upmarket, you know it's really got to provide more support and training and deal with your deal reg and all kinds of things. Can you talk about that transformation and what people are asking you for? >> Yeah, one of the things that I love about Veeam, and I've been on board for about 15 months. I've come from some larger companies certainly in my past. Even though we're getting bigger we're staying very entrepreneurial in our approach. We realize that we have to be very proactive in our approach with working with partners. We need to provide them the complete story. So profitability is certainly a component. Our partner program is consistently rated as one of the best in the business. It's because it allows partners to be profitable, but again the product and the solution is so complete. It just works, that it's the right fit for shared our customers. As we've gotten bigger we need to continue to make sure that we're staying very much engaged with our partners. We focus on our enablement. We make sure that they have the right level of training. We make sure that they understand what is our sales pitch into the customer base. Why is it that Veeam is a better option than what else they might be looking at. We started in the S and B, right? The company started in the S and B eight and a half, nine years ago when we started selling products. But absolutely were on that journey into the enterprise space. Without forgetting that S and B's we were born and bred. >> Kevin, one of the great things about Veeam is there's really a simplicity to the product set. Can you explain kind of the segmentation? You've got the S and B, you've got the enterprise. Does the product differentiate itself? Is there pricing and bundling, incentives? How does that break up when you go to market? >> Great question, the reality is that the solution is the same. It's funny that as companies you segment a market and the customers don't see themselves as any different whether they're 100-man shop or a Fortune 50. They have business problems that they have to solve. So the solution is the same, but we really realize that we need to make sure we dedicate a part of our end-user sales force against each of the segments to make sure they get the right level of service. The way that we do it is that everything below 250 seats we classify as S and B. We have a very significant commercial space that is almost everything else. Then we name about 1,000 accounts that we go after from an enterprise standpoint. But the reality is every single customer is just as important as the next. So it really was a matter of how do we best service them as opposed to hey, we treat them differently, we give them different pricing. None of that exists. It is just really a matter of our level of service for them. >> We talked to Peter Mackay earlier, he said about 30% of revenue is with service providers. How does that fit into the whole channel mix? >> That's a part that's growing each and every day. As the cloud becomes more and more important our cloud service providers become a more significant portion of our business. So it's really, it's the full spectrum. We work with the traditional resellers that are simply interested in the typical infrastructure, software sales. Then you have the cloud service providers that get more into that type of model. Then we certainly have the folks that do both. It's really, I think that's our next big jumping off point is that cloud business because literally there's no better solution for our customers and therefore our partners to do that hybrid model than Veeam. >> Speak a little bit to the channel readiness for cloud. I remember a few years ago it was like 10 or 15% of the channel was ready. I think a much higher percentage at least understands cloud, or trying to figure out how cloud fits into their practice. Are you riding that wave? Are you educating them on that next wave? >> I think we're all learning together. I mean it's a brand new world if you will. I think you're going to see, and we have seen, the folks that can't make that transition into what is required by our customers which is truly that hybrid. I do need on-premise, and I do need off-premise. >> We're all learning together. So we're educating. We're figuring out what are the right programs with the right sales approach. What is the right level of support? And I think that if we don't make this transition together there will be people left behind. >> Help us understand the make up of the channel. Sorry for the pejorative, but you've got the box sellers, you've got the cloud service providers, you've got solution providers, and you have this maybe I don't know what you call them, the DevOps, the hoodie crowd. This is more of an influencer than anything of our channel. The traditional guys that just move boxes, they're either evolving or they're going to probably die. Solutions guys, okay well the SAP, Oracle, Veeam Ware obviously, some of those guys. Then it was to say the cloud service providers and the DevOps, how do you refine that little model that I just painted? Is that a viable picture of the channel? >> It is, and I think you said it well. Those that don't make that transformation into what is really required by our customers, they dictate what we need to become, right? We can all sit back in think tank rooms and say what do we think we want to go out and be? But if it doesn't apply to solving the business challenges that our customers are facing, it doesn't matter. So those box pushers as you put it, they're going to go away. If they don't transform their business to truly meeting the requirements that the business is driving today, they won't be around. So we're working to try to identify and I think for the most part a lot of us in the technology sector recognize the partners that have made that transition or that are in the process of making that transition and we're investing heavily into them. They're the ones that have a deep and wide services bench. They're the ones who have the ability to do massive deployment type of activities. I mean, for the first time in the history of the channel the last two years we've seen over 50% of the revenues come from services. So if you're not working with partners that have that deep and wide services engagement ability then you're probably working with the wrong people. >> So what's that total ecosystem? >> Revenues over the last two years have now tilted to the majority being in the services side from the traditional infrastructure sales. Really that just lends itself to the fact that we're getting into more complex deployments. We're getting into longer engagements. So for those of us as vendors that are looking out for the partners that are going to help take these solutions to the next level for our shared customers, we have to have partners that have that ability to deliver those services to have those lengthy engagements. >> So the conversation that you're having with customers is changing as well, obviously. >> It's interesting, there was a day and it wasn't that long ago, that you sat down and you talked features. This is what my product does. That isn't the way that customers want to talk any longer. Yes, embedded in the discussion is the fact that our software can deliver all kinds of features and functionality. But you start out with what keeps you up at night? What do you worry about? What is it that your leadership is putting pressure on you, Mr. IT leader? I mean IT is no longer just a support mechanism for businesses, it's a way to make revenue. And if it's not done properly you're missing a tremendous opportunity. When we go in with our partners and they're having these discussions the correct way as well, is that we sit there and say what is it that we need to solve? We don't sit there and say let me tell you what Veeam 10.0 brings you. Yes, that is embedded into the conversation when we tell you how we can solve your problems. But we don't start with that. >> With 45,000 partners obviously that's a lot of partners. You're going to span all those constituencies that we had just talked about. How do you look at the ROI of partnership and where you invest and how you sort of manage that portfolio? It's a great question and it's a great challenge. Because look, we want as many people out as we possibly can delivering the Veeam value proposition. That said, we understand that we need to identify the partners that are actually investing back on ourselves. And that we're building a business together as opposed to customer asked for it, I provided it. That's going to happen and that's great. But we have to identify where it makes sense to place our bets, if you will. So whether that's from our field resources, whether it's from our dollars investment we're identifying the partners that have a deep and robust bench of services opportunity, understand the value of really data availability. That's what it is any longer. It's no more about high availability, it's business availability, it's data availability. And those partners that are willing to take the leap with us and start to invest and do the technical certifications, sales certifications, build a practice where Veeam is a part of it, that's where we're putting our investments. >> Kevin you spend a day with partners yesterday. Can you give our audience a little bit of insight. What are some of the key things you're doing? What feedback you're getting, what advice you are giving to the channel partners? >> All I say is it's been a wonderful ride. As I stated in the opening I've only been onboard for about 15 months so I can't take credit for all the greatness that has been going on at Veeam. (laughter) But the reality is it's been a great ride. But the ride we're about to take out for the next five to ten years is going to be entirely different and it's going to be a wonderful one. What we're telling partners is thank you for being a part of this to this point but boy is this going to be really interesting here as we go out over the next one, two, five years. I mean the work that we're doing with our alliance partners, the product we iterate on it every six to 12 months. I mean, a lot of the people in our space and I won't name names, but they sit on the same technology that's been in place for years. So they're not out looking to try to solve the next customer problem. My message to the partners is this is only going go get better. We are enterprise ready. We were born in that S and B space and we love that space and we're never going to look away from it. But come along with us because we solve all customer problems. So if I'm a partner sitting in the audience yesterday or today or in these meetings that we're having in the Expo Center, I feel pretty confident that I've hitched my ride into the right player. >> Well it talks to relevance. The partners wants to work with the company that is relevant, that has momentum. You guys have got a lot of tailwinds behind you. Kevin, thanks very much for coming on the Cube, it was great to see you. >> I appreciate it, thanks guys. >> All right you're welcome. Keep it right there, Stu and I will be back with our next guest right after this. This is the Cube, we're live from New Orleans, VeeamOn. (upbeat digital music)