from the cube studios in Palo Alto in Boston bringing you data-driven insights from the cube and ETR this is breaking analysis with Dave vellante the ascendancy of AWS under the leadership of Andy jassy was marked by a tsunami of data and corresponding cloud services to leverage that data now those Services they mainly came in the form of Primitives I.E basic building blocks that were used by developers to create more sophisticated capabilities AWS in the 2020s being led by CEO Adam solipski will be marked by four high-level Trends in our opinion one A Rush of data that will dwarf anything we've previously seen two a doubling or even tripling down on the basic elements of cloud compute storage database security Etc three a greater emphasis on end-to-end integration of AWS services to simplify and accelerate customer adoption of cloud and four significantly deeper business integration of cloud Beyond it as an underlying element of organizational operations hello and welcome to this week's wikibon Cube insights powered by ETR in this breaking analysis we extract and analyze nuggets from John furrier's annual sit-down with the CEO of AWS we'll share data from ETR and other sources to set the context for the market and competition in cloud and we'll give you our glimpse of what to expect at re invent in 2022. now before we get into the core of our analysis Alibaba has announced earnings they always announced after the big three you know a month later and we've updated our Q3 slash November hyperscale Computing forecast for the year as seen here and we're going to spend a lot of time on this as most of you have seen the bulk of it already but suffice to say alibaba's cloud business is hitting that same macro Trend that we're seeing across the board but a more substantial slowdown than we expected and more substantial than its peers they're facing China headwinds they've been restructuring its Cloud business and it's led to significantly slower growth uh in in the you know low double digits as opposed to where we had it at 15 this puts our year-end estimates for 2022 Revenue at 161 billion still a healthy 34 growth with AWS surpassing 80 billion in 2022 Revenue now on a related note one of the big themes in Cloud that we've been reporting on is how customers are optimizing their Cloud spend it's a technique that they use and when the economy looks a little shaky and here's a graphic that we pulled from aws's website which shows the various pricing plans at a high level as you know they're much more granular than that and more sophisticated but Simplicity we'll just keep it here basically there are four levels first one here is on demand I.E pay by the drink now we're going to jump down to what we've labeled as number two spot instances that's like the right place at the right time I can use that extra capacity in the moment the third is reserved instances or RIS where I pay up front to get a discount and the fourth is sort of optimized savings plans where customers commit to a one or three year term and for a better price now you'll notice we labeled the choices in a different order than AWS presented them on its website and that's because we believe that the order that we chose is the natural progression for customers this started on demand they maybe experiment with spot instances they move to reserve instances when the cloud bill becomes too onerous and if you're large enough you lock in for one or three years okay the interesting thing is the order in which AWS presents them we believe that on-demand accounts for the majority of AWS customer spending now if you think about it those on-demand customers they're also at risk customers yeah sure there's some switching costs like egress and learning curve but many customers they have multiple clouds and they've got experience and so they're kind of already up to a learning curve and if you're not married to AWS with a longer term commitment there's less friction to switch now AWS here presents the most attractive plan from a financial perspective second after on demand and it's also the plan that makes the greatest commitment from a lock-in standpoint now In fairness to AWS it's also true that there is a trend towards subscription-based pricing and we have some data on that this chart is from an ETR drill down survey the end is 300. pay attention to the bars on the right the left side is sort of busy but the pink is subscription and you can see the trend upward the light blue is consumption based or on demand based pricing and you can see there's a steady Trend toward subscription now we'll dig into this in a later episode of Breaking analysis but we'll share with you a little some tidbits with the data that ETR provides you can select which segment is and pass or you can go up the stack Etc but so when you choose is and paths 44 of customers either prefer or are required to use on-demand pricing whereas around 40 percent of customers say they either prefer or are required to use subscription pricing again that's for is so now the further mu you move up the stack the more prominent subscription pricing becomes often with sixty percent or more for the software-based offerings that require or prefer subscription and interestingly cyber security tracks along with software at around 60 percent that that prefer subscription it's likely because as with software you're not shutting down your cyber protection on demand all right let's get into the expectations for reinvent and we're going to start with an observation in data in this 2018 book seeing digital author David michella made the point that whereas most companies apply data on the periphery of their business kind of as an add-on function successful data companies like Google and Amazon and Facebook have placed data at the core of their operations they've operationalized data and they apply machine intelligence to that foundational element why is this the fact is it's not easy to do what the internet Giants have done very very sophisticated engineering and and and cultural discipline and this brings us to reinvent 2022 in the future of cloud machine learning and AI will increasingly be infused into applications we believe the data stack and the application stack are coming together as organizations build data apps and data products data expertise is moving from the domain of Highly specialized individuals to Everyday business people and we are just at the cusp of this trend this will in our view be a massive theme of not only re invent 22 but of cloud in the 2020s the vision of data mesh We Believe jamachtagani's principles will be realized in this decade now what we'd like to do now is share with you a glimpse of the thinking of Adam solipsky from his sit down with John Furrier each year John has a one-on-one conversation with the CEO of AWS AWS he's been doing this for years and the outcome is a better understanding of the directional thinking of the leader of the number one Cloud platform so we're now going to share some direct quotes I'm going to run through them with some commentary and then bring in some ETR data to analyze the market implications here we go this is from solipsky quote I.T in general and data are moving from departments into becoming intrinsic parts of how businesses function okay we're talking here about deeper business integration let's go on to the next one quote in time we'll stop talking about people who have the word analyst we inserted data he meant data data analyst in their title rather will have hundreds of millions of people who analyze data as part of their day-to-day job most of whom will not have the word analyst anywhere in their title we're talking about graphic designers and pizza shop owners and product managers and data scientists as well he threw that in I'm going to come back to that very interesting so he's talking about here about democratizing data operationalizing data next quote customers need to be able to take an end-to-end integrated view of their entire data Journey from ingestion to storage to harmonizing the data to being able to query it doing business Intelligence and human-based Analysis and being able to collaborate and share data and we've been putting together we being Amazon together a broad Suite of tools from database to analytics to business intelligence to help customers with that and this last statement it's true Amazon has a lot of tools and you know they're beginning to become more and more integrated but again under jassy there was not a lot of emphasis on that end-to-end integrated view we believe it's clear from these statements that solipsky's customer interactions are leading him to underscore that the time has come for this capability okay continuing quote if you have data in one place you shouldn't have to move it every time you want to analyze that data couldn't agree more it would be much better if you could leave that data in place avoid all the ETL which has become a nasty three-letter word more and more we're building capabilities where you can query that data in place end quote okay this we see a lot in the marketplace Oracle with mySQL Heatwave the entire Trend toward converge database snowflake [ __ ] extending their platforms into transaction and analytics respectively and so forth a lot of the partners are are doing things as well in that vein let's go into the next quote the other phenomenon is infusing machine learning into all those capabilities yes the comments from the michelleographic come into play here infusing Ai and machine intelligence everywhere next one quote it's not a data Cloud it's not a separate Cloud it's a series of broad but integrated capabilities to help you manage the end-to-end life cycle of your data there you go we AWS are the cloud we're going to come back to that in a moment as well next set of comments around data very interesting here quote data governance is a huge issue really what customers need is to find the right balance of their organization between access to data and control and if you provide too much access then you're nervous that your data is going to end up in places that it shouldn't shouldn't be viewed by people who shouldn't be viewing it and you feel like you lack security around that data and by the way what happens then is people overreact and they lock it down so that almost nobody can see it it's those handcuffs there's data and asset are reliability we've talked about that for years okay very well put by solipsky but this is a gap in our in our view within AWS today and we're we're hoping that they close it at reinvent it's not easy to share data in a safe way within AWS today outside of your organization so we're going to look for that at re invent 2022. now all this leads to the following statement by solipsky quote data clean room is a really interesting area and I think there's a lot of different Industries in which clean rooms are applicable I think that clean rooms are an interesting way of enabling multiple parties to share and collaborate on the data while completely respecting each party's rights and their privacy mandate okay again this is a gap currently within AWS today in our view and we know snowflake is well down this path and databricks with Delta sharing is also on this curve so AWS has to address this and demonstrate this end-to-end data integration and the ability to safely share data in our view now let's bring in some ETR spending data to put some context around these comments with reference points in the form of AWS itself and its competitors and partners here's a chart from ETR that shows Net score or spending momentum on the x-axis an overlap or pervasiveness in the survey um sorry let me go back up the net scores on the y-axis and overlap or pervasiveness in the survey is on the x-axis so spending momentum by pervasiveness okay or should have share within the data set the table that's inserted there with the Reds and the greens that informs us to how the dots are positioned so it's Net score and then the shared ends are how the plots are determined now we've filtered the data on the three big data segments analytics database and machine learning slash Ai and we've only selected one company with fewer than 100 ends in the survey and that's databricks you'll see why in a moment the red dotted line indicates highly elevated customer spend at 40 percent now as usual snowflake outperforms all players on the y-axis with a Net score of 63 percent off the charts all three big U.S cloud players are above that line with Microsoft and AWS dominating the x-axis so very impressive that they have such spending momentum and they're so large and you see a number of other emerging data players like rafana and datadog mongodbs there in the mix and then more established players data players like Splunk and Tableau now you got Cisco who's gonna you know it's a it's a it's a adjacent to their core networking business but they're definitely into you know the analytics business then the really established players in data like Informatica IBM and Oracle all with strong presence but you'll notice in the red from the momentum standpoint now what you're going to see in a moment is we put red highlights around databricks Snowflake and AWS why let's bring that back up and we'll explain so there's no way let's bring that back up Alex if you would there's no way AWS is going to hit the brakes on innovating at the base service level what we call Primitives earlier solipsky told Furrier as much in their sit down that AWS will serve the technical user and data science Community the traditional domain of data bricks and at the same time address the end-to-end integration data sharing and business line requirements that snowflake is positioned to serve now people often ask Snowflake and databricks how will you compete with the likes of AWS and we know the answer focus on data exclusively they have their multi-cloud plays perhaps the more interesting question is how will AWS compete with the likes of Specialists like Snowflake and data bricks and the answer is depicted here in this chart AWS is going to serve both the technical and developer communities and the data science audience and through end-to-end Integrations and future services that simplify the data Journey they're going to serve the business lines as well but the Nuance is in all the other dots in the hundreds or hundreds of thousands that are not shown here and that's the AWS ecosystem you can see AWS has earned the status of the number one Cloud platform that everyone wants to partner with as they say it has over a hundred thousand partners and that ecosystem combined with these capabilities that we're discussing well perhaps behind in areas like data sharing and integrated governance can wildly succeed by offering the capabilities and leveraging its ecosystem now for their part the snowflakes of the world have to stay focused on the mission build the best products possible and develop their own ecosystems to compete and attract the Mind share of both developers and business users and that's why it's so interesting to hear solipski basically say it's not a separate Cloud it's a set of integrated Services well snowflake is in our view building a super cloud on top of AWS Azure and Google when great products meet great sales and marketing good things can happen so this will be really fun to watch what AWS announces in this area at re invent all right one other topic that solipsky talked about was the correlation between serverless and container adoption and you know I don't know if this gets into there certainly their hybrid place maybe it starts to get into their multi-cloud we'll see but we have some data on this so again we're talking about the correlation between serverless and container adoption but before we get into that let's go back to 2017 and listen to what Andy jassy said on the cube about serverless play the clip very very earliest days of AWS Jeff used to say a lot if I were starting Amazon today I'd have built it on top of AWS we didn't have all the capability and all the functionality at that very moment but he knew what was coming and he saw what people were still able to accomplish even with where the services were at that point I think the same thing is true here with Lambda which is I think if Amazon were starting today it's a given they would build it on the cloud and I think we with a lot of the applications that comprise Amazon's consumer business we would build those on on our serverless capabilities now we still have plenty of capabilities and features and functionality we need to add to to Lambda and our various serverless services so that may not be true from the get-go right now but I think if you look at the hundreds of thousands of customers who are building on top of Lambda and lots of real applications you know finra has built a good chunk of their market watch application on top of Lambda and Thompson Reuters has built you know one of their key analytics apps like people are building real serious things on top of Lambda and the pace of iteration you'll see there will increase as well and I really believe that to be true over the next year or two so years ago when Jesse gave a road map that serverless was going to be a key developer platform going forward and so lipsky referenced the correlation between serverless and containers in the Furrier sit down so we wanted to test that within the ETR data set now here's a screen grab of The View across 1300 respondents from the October ETR survey and what we've done here is we've isolated on the cloud computing segment okay so you can see right there cloud computing segment now we've taken the functions from Google AWS Lambda and Microsoft Azure functions all the serverless offerings and we've got Net score on the vertical axis we've got presence in the data set oh by the way 440 by the way is highly elevated remember that and then we've got on the horizontal axis we have the presence in the data center overlap okay that's relative to each other so remember 40 all these guys are above that 40 mark okay so you see that now what we're going to do this is just for serverless and what we're going to do is we're going to turn on containers to see the correlation and see what happens so watch what happens when we click on container boom everything moves to the right you can see all three move to the right Google drops a little bit but all the others now the the filtered end drops as well so you don't have as many people that are aggressively leaning into both but all three move to the right so watch again containers off and then containers on containers off containers on so you can see a really major correlation between containers and serverless okay so to get a better understanding of what that means I call my friend and former Cube co-host Stu miniman what he said was people generally used to think of VMS containers and serverless as distinctly different architectures but the lines are beginning to blur serverless makes things simpler for developers who don't want to worry about underlying infrastructure as solipsky and the data from ETR indicate serverless and containers are coming together but as Stu and I discussed there's a spectrum where on the left you have kind of native Cloud VMS in the middle you got AWS fargate and in the rightmost anchor is Lambda AWS Lambda now traditionally in the cloud if you wanted to use containers developers would have to build a container image they have to select and deploy the ec2 images that they or instances that they wanted to use they have to allocate a certain amount of memory and then fence off the apps in a virtual machine and then run the ec2 instances against the apps and then pay for all those ec2 resources now with AWS fargate you can run containerized apps with less infrastructure management but you still have some you know things that you can you can you can do with the with the infrastructure so with fargate what you do is you'd build the container images then you'd allocate your memory and compute resources then run the app and pay for the resources only when they're used so fargate lets you control the runtime environment while at the same time simplifying the infrastructure management you gotta you don't have to worry about isolating the app and other stuff like choosing server types and patching AWS does all that for you then there's Lambda with Lambda you don't have to worry about any of the underlying server infrastructure you're just running code AS functions so the developer spends their time worrying about the applications and the functions that you're calling the point is there's a movement and we saw in the data towards simplifying the development environment and allowing the cloud vendor AWS in this case to do more of the underlying management now some folks will still want to turn knobs and dials but increasingly we're going to see more higher level service adoption now re invent is always a fire hose of content so let's do a rapid rundown of what to expect we talked about operate optimizing data and the organization we talked about Cloud optimization there'll be a lot of talk on the show floor about best practices and customer sharing data solipsky is leading AWS into the next phase of growth and that means moving beyond I.T transformation into deeper business integration and organizational transformation not just digital transformation organizational transformation so he's leading a multi-vector strategy serving the traditional peeps who want fine-grained access to core services so we'll see continued Innovation compute storage AI Etc and simplification through integration and horizontal apps further up to stack Amazon connect is an example that's often cited now as we've reported many times databricks is moving from its stronghold realm of data science into business intelligence and analytics where snowflake is coming from its data analytics stronghold and moving into the world of data science AWS is going down a path of snowflake meet data bricks with an underlying cloud is and pass layer that puts these three companies on a very interesting trajectory and you can expect AWS to go right after the data sharing opportunity and in doing so it will have to address data governance they go hand in hand okay price performance that is a topic that will never go away and it's something that we haven't mentioned today silicon it's a it's an area we've covered extensively on breaking analysis from Nitro to graviton to the AWS acquisition of Annapurna its secret weapon new special specialized capabilities like inferential and trainium we'd expect something more at re invent maybe new graviton instances David floyer our colleague said he's expecting at some point a complete system on a chip SOC from AWS and maybe an arm-based server to eventually include high-speed cxl connections to devices and memories all to address next-gen applications data intensive applications with low power requirements and lower cost overall now of course every year Swami gives his usual update on machine learning and AI building on Amazon's years of sagemaker innovation perhaps a focus on conversational AI or a better support for vision and maybe better integration across Amazon's portfolio of you know large language models uh neural networks generative AI really infusing AI everywhere of course security always high on the list that reinvent and and Amazon even has reinforce a conference dedicated to it uh to security now here we'd like to see more on supply chain security and perhaps how AWS can help there as well as tooling to make the cio's life easier but the key so far is AWS is much more partner friendly in the security space than say for instance Microsoft traditionally so firms like OCTA and crowdstrike in Palo Alto have plenty of room to play in the AWS ecosystem we'd expect of course to hear something about ESG it's an important topic and hopefully how not only AWS is helping the environment that's important but also how they help customers save money and drive inclusion and diversity again very important topics and finally come back to it reinvent is an ecosystem event it's the Super Bowl of tech events and the ecosystem will be out in full force every tech company on the planet will have a presence and the cube will be featuring many of the partners from the serial floor as well as AWS execs and of course our own independent analysis so you'll definitely want to tune into thecube.net and check out our re invent coverage we start Monday evening and then we go wall to wall through Thursday hopefully my voice will come back we have three sets at the show and our entire team will be there so please reach out or stop by and say hello all right we're going to leave it there for today many thanks to Stu miniman and David floyer for the input to today's episode of course John Furrier for extracting the signal from the noise and a sit down with Adam solipski thanks to Alex Meyerson who was on production and manages the podcast Ken schiffman as well Kristen Martin and Cheryl Knight helped get the word out on social and of course in our newsletters Rob hoef is our editor-in-chief over at siliconangle does some great editing thank thanks to all of you remember all these episodes are available as podcasts wherever you listen you can pop in the headphones go for a walk just search breaking analysis podcast I published each week on wikibon.com at siliconangle.com or you can email me at david.valante at siliconangle.com or DM me at di vallante or please comment on our LinkedIn posts and do check out etr.ai for the best survey data in the Enterprise Tech business this is Dave vellante for the cube insights powered by ETR thanks for watching we'll see it reinvent or we'll see you next time on breaking analysis [Music]

>>Hello and welcome to this session on experiencing secure agile hybrid cloud for your absent data. My name is Andrew labor. I'm a worldwide business unit product manager, Hc I Solutions with HP and I'm joined by my teammate Jeff Corcoran, who was go to market program Solutions or HP as well. And with that let's just dive right into it. Well, everybody has absent data. They're all over the place. They're both live on your phones, your computers and the cloud and servers are everywhere, absent data are all over the place. Well, what can we really do about that from moving forward modernization of that? Well, we have expectations for personalized, instant and engaging experiences that are the benchmark of your experience, more speed and agility or more paramount than ever. You see a world where apps and data like I mentioned our live and all over the place and that data explosion is happening at the edge where 75 of data is now created in moving us from a data center too many locations and many centers of that data. We have a digital transformation that has reached only a fraction of that. And we have modern cloud experiences for speed and agility and we want to really push that into an on premise reality where data has gravity security formats and compliance that you require. You really want that data transformation that somehow remains elusive for most outside of the public cloud. We want that true private premised on premise cloud infrastructure that translates to your hybrid cloud where you already have your apps and data live in the public cloud. And so as I mentioned, 70 of the public of the apps are outside in the public cloud and we really want that to be able to be brought into the local as well. And the on premise give you more flexibility, more agility and only H P E brings the cloud experience absent data everywhere. We define that right mix for you to move your data to the local and with that we have an approach that's any cloud anywhere and we have the expertise to help you define that right mix of cloud for your enterprise. We also create modern casual platforms for innovation where we bring your non native traditional apps that are slowing you down. We bring that into a modern enabled cloud experience together with cloud data of apps to achieve that speed and agility that I mentioned, being able to create a consistent strategy for you and your infrastructure. We also consume everything as a service everywhere. We bring the modern cloud experience to you and your apps and data self service ease being able to scale up or down depending on usage and flexibility. And we also have to pay for use and all managed for you with HP. Green Lake services the market leading infrastructure as a service platform for well over a decade. We also unify that hybrid cloud estate being able to move operations to a cloud native Cloud ops process manage for you with one unified management platform. Hp Green Lake Central. This helps you manage and unify your applications across cloud native and non cloud native workloads, drive insights and control for operational excellence and we do that by defining the right mix of cloud for you with HPD Point Next services, we're able to assess applications to determine the right mix for your business objectives. Hp Point Next services, we have cloud in technology experts on hand and ready to task for you to assess your existing IT infrastructure strategy, identify trapped capital that you might not even notice is there as well as help you assess your people and teams to identify critical gaps in your cloud journey. Finally, HP Point next services capital experts can determine the right mix of cloud strategy for you. Help you move and migrate your data into that optimized for every workload. And we do that by creating modern agile platform for innovation and we achieve the speed and agility you want report folio of software defined rack optimized HP keep Reliant and H. P. S. Energy infrastructure. Using that compose Herbal cloud compose double infrastructure platform that we support through our intellectual property and through leading partner Cloud solutions and who is that? That's BM wear with cloud foundation. I am a cloud foundation is the perfect blend for HP synergy and HP. Reliant to create that universal hybrid cloud platform, both modern and traditional applications. The Cloud foundation is characterized by many tenants such as develop Already Infrastructure, which creates that automated full stack experience. To help you get ready to do your development through a PS and infrastructure. Universal platforms, a single platform virtual machines and containers as well as application focused management. To simplify your management, being able to have multiple application resources and foundation for that hybrid cloud that I described being able to extend that same software stack to the public cloud. You connect to your flavor of choice for public cloud consume. And together with HB solutions and BMR Cloud Foundation, we create that perfect platform for a consistent hybrid cloud experience from the mid market to the large enterprise customers. We are transforming that traditional I. T. To a virtualized data center. Our goal is to help you move quickly and be agile to digitally transform software defined data center supporting that hybrid infrastructure. Hp envy m where have been working together for years and we are providing a simple experience for hybrid cloud that you can create and deliver to show value instantly and continuously achieve faster innovation, consistent operation and reducing costs. And how do we do that together? Well with HB solutions from being more cloud foundation, we've revolutionized that data centre by building a single consistent hybrid cloud experience that you can see that delivers greater agility and simplicity with five times faster automation tools for building out your infrastructure in getting time to market quicker, invalidating that solution stack. Where we have end to end fully tested and validated solutions that reduce your complexity and allow you to consolidate your VMS and your containers into one environment. Seamlessly, we also integrate management. We have unique the upper management integration and automation through firmer lifecycle management. Vis a vis L C M on the VM ware side, simplify I. T and deliver more agility to your infrastructure as well as your software defined data center. And then we also have services with HB Point Next they accelerate that time to deployment using HP Green Lake and providing as a service experience that we bring that cloud to you. And we bring that with an enhanced ballistic 360° view of security that begins in the manufacturing supply chain of our servers and concludes with safeguarded end of life Decommissioning. We power that by the recently announced Gen 10 plus servers uhh peep Reliant NHP synergy and integrate that Silicon Root of Trust technology offering protection detection and recovery from attacks industry leading encryption and firmware protection. And finally all of that is brought together. Hp one view We take HP one view as the management solution which transforms all of the compute storage networking into one software defined infrastructure Through HP one View we offer a template driven approach for deploying provisioning, updating, integrating compute storage networking All together in one infrastructure. and HP one View uses those software templates single line of code. We can deploy and manage and compose all of your physical resources, require for that application or virtual host or container infrastructure. We deliver the flexibility to compose different tiers of storage as well as types of provisioning by HP One View through direct or attach fabric using cloud foundation and HPV Premera. And now I'd like to ask my coworker Jeff to dive into some customer experiences around the hybrid cloud Jeff. Take it away. >>Thanks. Andrew. I think a great way to follow up and talk about our solutions is to really look at how one of our customers is enabling this transformation. So Wedbush Security is one of the leading financial services firms in the US, providing private and institutional clients, securities brokerage wealth management, in investment banking services. The company is headquartered in los Angeles California and has about 100 offices across the United States to meet increasingly rigorous financial regulations for more resilient operations and mitigate the threat of earthquakes in the Los Angeles area and increase operational efficiencies. Wedbush was looking for transformation is looking for a change to what the way they are currently operating. And to do this, Wedbush partnered with lumen and HP to develop a new private, cloud based data center using bloomin Private cloud on VM ware Cloud foundation. This was located in lumens Dallas hosting center using HP Keep Reliant dl 33 60 jen tens to create a hyper converged, high performance infrastructure using integrated software defined networking and security. To date, Wedbush has migrated its entire production facility to this private cloud. The virtual machines support a range of business applications, including Refinitiv, Thompson, Reuters and if I ask financial systems, they're also hosting Web Bush's in house broker management tool and Microsoft, sequel server and Mongo DB. Now, how did this impact them? They were able to impact Their financial reporting by cutting that from five hours down to 58 minutes. At the same time, they are able to reduce the time that it takes to deploy these Infrastructure resources by 50%. So this allows them to deploy a modern IT infrastructure for performance, reliability and efficiency improvement. The net impact on their business Was that it reduces the analytic costs by 27%. It increases their business agility and it developed, allows them to develop new lines of business faster and increases their compliance for the new Finra financial regulations with HP Green Lake, the cloud that comes to you. Hp Green like brings that cloud experience, self serve paper use scale up and down and manage for you by HP and our partners to absent data everywhere, whether they're in the edges co locations or data centers, enabling you to free up capital most operational and financial flexibility and free up talent to accelerate what's next for you and your business with HP Green Lake customers get cloud services that our production ready, elastic for any scale With a simple experience delivered to customer locations and as little as 14 days. Now, let's take a look at how some of our customers are experiencing the benefit of HP Green Lake as the voice of Austrian business. The Austrian economic chamber delivers advocacy and support to over 500,000 companies and trade groups, thereby helping to foster the country's robust economic growth. However, a policy of fiscal prudence Led to a mandated 30 cost reduction and the chambers it service provider needed to cut costs without compromising service levels. So to do this, they turn to HP to pair a future proof compose herbal infrastructure with a consumption based support model and HP Green Lake. Now, both the internal and regional chambers offices are getting better performance and faster access to I. T. Services enabled them to focus more than ever on boosting critical Austrian economic forces in sectors. Hp is here to help you accelerate your transformation. We just talked about Green Lake. So this enables you to deploy any workload as a service and with HP Green Lake services, you can bring that cloud like speed, agility and as a service model to where your data, data and apps live today, it enables you to transform the way you do business with one experience in one operating model across your distributed clouds for apps and data at the edge in co locations and in data centers with HP Point Next services. They have conducted over 11,000. IT. projects in over 1.4 million customer interactions each and every year. HB Point Next services 15,000 plus experts and its vast ecosystem of solution partners and channel partners are uniquely able to help you at every stage of your digital transformation journey because we address some of the biggest areas of concern that can slow you down. We bring together technology and expertise to help you drive your business forward. Lastly, with HP financial services, flexibility and investment capacity are key considerations for business to drive digital transformation initiatives. In order to forge a path forward, you need access to flexible payment options that allow you to match your IT costs to usage, from helping release capital from existing infrastructures to deferring payments and providing pre owned technology to relieve capital strain. Hp financial services unlocks the value of your entire estate from edge to cloud to end user with multi vendor solutions consistently and sustainably around the world. H P E F s helps you create the financial capacity to transform your business, Y H P E. We have the experience to get you there Over 1000 successful cloud migrations. We have the expertise to help you at any stage to accelerate adoption of any cloud or financial model to help you deploy the like cloud experience for your apps and data. We're open to any cloud strategy with deep expertise across Azure AWS and google cloud. We have unbiased expertise and I p to accelerate your right mix of clouds for your enterprise and we can tie that all together with I. T. As a service from our market leading platform of HP Green Lake. After you viewed this session, we have a lot of resources that you can now use to help you continue your digital transformation and educate yourself. You'll find links here on the slide to a lot of different products and solution areas as well as social media interactions that we have to engage with you. Thank you for joining. We hope you find the sexual useful. Have a great day.

>> Narrator: Live from San Francisco. It's the theCUBE covering RSA Conference 2020 San Francisco, brought to you by SiliconAngle Media. >> Alright, welcome to theCUBE coverage here at RSA Conference in San Francisco and Moscone Halls, theCUBE. I'm John Furrier, the host of theCUBE, in a cyber security is all about encryption data and also security. We have a very hot startup here, that amazing guest, Dr. Ellison Anne Williams, CEO and Founder of Enveil just recently secured a $10 million Series A Funding really attacking a real problem around encryption and use. Again, data ,security, analytics, making it all secure is great. Allison, and thanks for coming on. Appreciate your time. >> Thanks for having me. >> So congratulations on the funding before we get started into the interview talking about the hard news, you guys that are around the funding. How long have you guys been around? What's the funding going to do? What are you guys doing? >> Yeah, so we're about three and a half years old as a company. We just announced our Series A close last week. So that was led by C5. And their new US Funds The Impact Fund and participating. Other partners included folks like MasterCard, Capital One Ventures, Bloomberg, Beta 1843, etc. >> So some names jumped in C5 led the round. >> For sure. >> How did this get started? What was the idea behind this three years you've been actually doing some work? Are you going to production? Is it R&D? Is it in market? Give us a quick update on the status of product and solution? >> Yeah, so full production. For production of the product. We're in fact in 2.0 of the release. And so we got our start inside of the National Security Agency, where I spent the majority of my career. And we developed some breakthroughs in an area of technology called homomorphic encryption, that allows you to perform computations into the encrypted domain as if they were in the unencrypted world. So the tech had never existed in a practical capacity. So we knew that bringing seeds of that technology out of the intelligence community and using it to seed really and start the company, we would be creating a new commercial market. >> So look at this, right? So you're at the NSA, >> Correct >> Your practitioner, they're doing a lot of work in this area, pioneering a new capability. And did the NSA spin it out did they fund it was the seed capital there or did you guys bootstrap it >> No. So our seed round was done by an entity called Data Tribe. So designed to take teams in technologies that were coming out of the IC that wanted to commercialize to do so. So we took seed funding from them. And then we were actually one of the youngest company ever to be in the RSA Innovation Sandbox here in 2017, to be one of the winners and that's where the conversation really started to change around this technology called homomorphic encryption, the market category space called securing data in use and what that meant. And so from there, we started running the initial version of a product out in the commercial world and we encountered two universal reaction. One that we were expecting and one that we weren't. And the one that we were expecting is that people said, "holy cow, this actually works". Because what we say we do keeping everything encrypted during processing. Sounds pretty impossible. It's not just the math. And then the second reaction that we encountered that we weren't expecting is those initial early adopters turned around and said to us, "can we strategically invest in you?" So our second round of funding was actually a Strategic Round where folks like Bloomberg beta,Thomson Reuters, USA and Incue Towel came into the company. >> That's Pre Series A >> Pre Series A >> So you still moving along, if a sandbox, you get some visibility >> Correct. >> Then were the products working on my god is you know, working. That's great. So I want to get into before I get into some of the overhead involved in traditionally its encryption there always has been that overhead tax. And you guys seem to solve that. But can you describe first data-at-rest versus data-in-motion and data-in-user. data at rest, as means not doing anything but >> Yeah, >> In flight or in you so they the same, is there a difference? Can you just tell us the difference of someone this can be kind of confusing. >> So it's helpful to think of data security in three parts that we call the triad. So securing data at rest on the file system and the database, etc. This would be your more traditional in database encryption, or file based encryption also includes things like access control. The second area, the data security triad is securing data- in- transit when it's moving around through the network. So securing data at rest and in transit. Very well solution. A lot of big name companies do that today, folks like Talus and we partner with them, Talus, Gemalto, etc. Now, the third portion of the data security triad is what happens to that data when you go use or process it in some way when it becomes most valuable. And that's where we focus. So as a company, we secure data-in-use when it's being used or processed. So what does that mean? It means we can do things like take searches or analytics encrypt them, and then go run them without ever decrypting them at any point during processing. So like I said, this represents a new commercial market, where we're seeing it manifest most often right now are in things like enabling secure data sharing, and collaboration, or enabling secure data monetization, because its privacy preserving and privacy enabling as a capability. >> And so that I get this right, the problem that you solved is that during the end use parts of the triad, it had to be decrypted first and then encrypted again, and that was the vulnerability area. Look, can you describe kind of like, the main problem that you guys saw was that-- >> So think more about, if you've got data and you want to give me access to it, I'm a completely different entity. And the way that you're going to give me access to it is allowing me to run a search over your data holdings. We see this quite a bit in between two banks in the areas of anti-money laundering or financial crime. So if I'm going to go run a search in your environment, say I'm going to look for someone that's an EU resident. Well, their personal information is covered under GDPR. Right? So if I go run that search in your environment, just because I'm coming to look for a certain individual doesn't mean you actually know anything about that. And so if you don't, and you have no data on them whatsoever, I've just introduced a new variable into your environment that you now have to account for, From a risk and liability perspective under something like GDPR. Whereas if you use us, we could take that search encrypt it within our walls, send it out to you and you could process it in its encrypted state. And because it's never decrypted during processing, there's no risk to you of any increased liability because that PII or that EU resident identifier is never introduced into your space. >> So the operating side of the business where there's compliance and risk management are going to love this, >> For sure. >> Is that really where the action is? >> Yes, compliance risk privacy. >> Alright, so get a little nerdy action on this one. So encryption has always been an awesome thing depending on who you talk to you, obviously, but he's always been a tax associate with the overhead processing power. He said, there's math involved. How does homeomorphic work? Does it have problems with performance? Is that a problem? Or if not, how do you address that? Where does it? I might say, well, I get it. But what's the tax for me? Or is your tax? >> Encryption is never free. I always tell people that. So there always is a little bit of latency associated with being able to do anything in an encrypted capacity, whether that's at rest at in transit or in use. Now, specifically with homomorphic encryption. It's not a new area of encryption. It's been around 30 or so years, and it had often been considered to be the holy grail of encryption for exactly the reasons we've already talked about. Doing things like taking searches or analytics and encrypting them, running them without ever decrypting anything opens up a world of different types of use cases across verticals and-- >> Give those use case examples. What would be some that would be low hanging fruit. And it would be much more higher level. >> Some of the things that we're seeing today under that umbrella of secure data sharing and collaboration, specifically inside of financial services, for use cases around anti-money laundering and financial crimes so, allowing two banks to be able to securely collaborate with with each other, along the lines of the example that I gave you just a second ago, and then also for large multinational banks to do so across jurisdictions in which they operate that have different privacy and secrecy regulations associated with them. >> Awesome. Well, Ellison, and I want to ask you about your experience at the NSA. And now as an entrepreneur, obviously, you have some, you know, pedigree at the NSA, really, you know, congratulations. It's going to be smart to work there, I guess. Secrets, you know, >> You absolutely do. >> Brains brain surgeon rocket scientist, so you get a lot of good stuff. But now that you're on the commercial space, it's been a conversation around how public and commercial are really trying to work together a lot as innovations are happening on both sides of the fence there. >> Yeah. >> Then the ICC and the Intelligence Community as well as commercial. Yeah, you're an entrepreneur, you got to go make money, you got shareholders down, you got investors? What's the collaboration look like? How does the world does it change for you? Is it the same? What's the vibe in DC these days around the balance between collaboration or is there? >> Well, we've seen a great example of this recently in that anti-money laundering financial crime use case. So the FCA and the Financial Conduct Authority out of the UK, so public entity sponsored a whole event called a tech spread in which they brought the banks together the private entities together with the startup companies, so your early emerging innovative capabilities, along with the public entities, like your privacy regulators, etc, and had us all work together to develop really innovative solutions to real problems within the banks. In the in the context of this text spread. We ended up winning the know your customer customer due diligence side of the text brand and then at the same time that us held an equivalent event in DC, where FinCEN took the lead, bringing in again, the banks, the private companies, etc, to all collaborate around this one problem. So I think that's a great example of when your public and your private and your private small and your private big is in the financial services institutions start to work together, we can really make breakthroughs-- >> So you see a lot happening >> We see a lot happening. >> The encryption solution actually helped that because it makes sense. Now you have the sharing the encryption. >> Yeah. >> Does that help with some of the privacy and interactions? >> It breaks through those barriers? Because if we were two banks, we can't necessarily openly, freely share all the information. But if I can ask you a question and do so in a secure and private capacity, still respecting all the access controls that you've put in place over your own data, then it allows that collaboration to occur, whereas otherwise I really couldn't in an efficient capacity. >> Okay, so here's the curveball question for you. So anybody Startup Series today, but you really got advanced Series A, you got a lot of funding multiple years of operation. If I asked you what's the impact that you're going to have on the world? What would you say to that, >> Over creating a whole new market, completely changing the paradigm about where and how you can use data for business purposes. And in terms of how much funding we have, we have, we've had a few rounds, but we only have 15 million into the company. So to be three and a half years old to see this new market emerging and being created with with only $15 million. It's really pretty impressive. >> Yeah, it's got a lot of growth and keep the ownership with the employees and the founders. >> It's always good, but being bootstrap is harder than it looks, isn't it? >> Yeah. >> Or how about society at large impact. You know, we're living global society these days and get all kinds of challenges. You see anything else in the future for your vision of impact. >> So securing data and your supplies horizontally across verticals. So far we've been focused mainly on financial services. But I think healthcare is a great vertical to move out in. And I think there are a lot of global challenges with healthcare and the more collaborative that we could be from a healthcare standpoint with our data. And I think our capabilities enable that to be possible. And still respecting all the privacy regulations and restrictions. I think that's a whole new world of possibility as well. >> And your secret sauce is what math? What's that? What's the secret sauce, >> Math, Math and grit. >> Alright, so thanks for sharing the insights. Give a quick plug for the company. What are you guys looking to do? Honestly, $10 million in funding priorities for you and the team? What do you guys live in to do? >> So priorities for us? privacy is a global issue now. So we are expanding globally. And you'll be hearing more about that very shortly. We also have new product lines that are going to be coming out enabling people to do more advanced decisioning in a completely secure and private capacity. >> And hiring office locations DC. >> Yes. So our headquarters is in DC, but we're based on over the world, so we're hiring, check out our web page. We're hiring for all kinds of roles from engineering to business functionality >> And virtual is okay virtual hires school >> Virtual hires is great. We're looking for awesome people no matter where they are. >> You know, DC but primary. Okay, so great to have you gone. Congratulations for one, the financing and then three years of bootstrapping and making it happen. Awesome. >> Thank you. >> Thank you for coming ,appreciate it. So keep coming to your RSA conference in Moscone. I'm John Furrier. Thanks for watching more after this short break (pop music playing)

>>LA Las Vegas. It's the cube hovering AWS reinvent 2019 brought to you by Amazon web services and along with its ecosystem partners. >>Hey, welcome back everyone. This is the cubes live covers Las Vegas anus. Re-invent. I'm John furrier with Dave Alante extracting the signal from the noise sponsored by Intel and AWS. They put the stage together, two big stages. Day two, we're here day Jew, I rapid fire a devil's execs coming on. Dave McCann, cube alumni, VP of ADAS migration marketplace and control services known most for the marketplace and a lot of stuff going on. That's exciting in the marketplace. It's where all the ecosystem actions happening. Congratulations on you six. I know you're busy, you've got new stuff, but the marketplace seems to be changing the procurement and the consumption of software and solutions, whether it's SAS or images and technology, your demand on the marketplace. So great to be back, Kimberly. It's another reinvent. This is my sixth. Um, so lots going on. Marketplace has got a lot bigger in the last year. >>We're up to 260,000 customers, so not substantial growth from last year. And we're adding thousands of customers every month. Um, big headline I have to start with is marketplace has been a marketplace for software for the last seven years. And two weeks ago we launched a marketplace for data and it's a new service that we call AWS data exchange. And instead of allowing you to point, click subscribe to software, and if you're a data consumer and a bank and you're an analyst or you're a researcher and a pharma company, you actually buy data from hundreds of companies, you know, you can go into the new console, find the product and market, please go over to this console called data exchange. And you can go buy research data or you can buy healthcare data from change healthcare. You can buy news data from Thomson Reuters, you can buy consumer data from Experian. >>And we've launched 1400 products from 19 data providers and we've made it available globally. So it's a whole new class of intellectual property data sources in there as well. There's some open source public sources as well. And we're adding literally dozens of products every day. So really easy API. And the cool thing is that after you subscribe, you copy it right into your S three bucket, moves into your VPC and then you move it into your project and you can actually create a Lambda function with the next version of the data. The next day gets updated and know the data just gets updated. And the use case here is like, if I'm a retail outlet, I could buy or go and get weather data and do some things. Is that kind of the model? Exactly. Right. I mean companies all over the world by $150 billion worth of data, but it's all delivered thousands of different EPA. >>Dave, we got cube data, we put all of our advanced data out there, which might be an opportunity. But seriously, Q three 65 is our new listing on the market place. So we have a Q cloud service, little plug for the cube cube three 65 on the marketplace and we're, we're happy. But I want to ask you because one of the things that's coming up is, um, from your team in the marketplace, the industry is this notion of buying through the marketplace. The trend is increasing private offers is a hot feature that you guys have put in place. And there's some news there. Could you explain how private offers is changing the game in the marketplace? I'd love to show you, if you think about it, a lot of our customers are developers and builders and they're working on something on test and it's a pilot and you use it for a few hours or a week. >>But once a company contracts for software and if you're contracting for a lot of software, procurement, one's best price, legal one's best terms, and there's going to be in negotiation and we call that negotiation of private offer. And so that involves salespeople. And so our top software vendors like a Splunk and new Relic of trend micro, uh, Palo Alto, their sales guys, or negotiate our sales ladies and negotiating with the customer for a couple hundred thousand dollars and there's a price and terms. When are you going to pay? What clauses do you agree? How many of you buying? Where are you going to deploy? All of that's negotiated and no, we have a portal for the sailor. We've had it for a year, we've made some really good changes and the central, they arose the seller to automate that price court rate into your account and then the buyer subscribes, and this is allowing our sailors to do quotations in the hundreds of thousands, the millions and sometimes in the tens of millions on a contract rate through marketplace, you're doing millions of dollars of business with with private offers today we've seen vendors write contracts for over $10 million, Peter over three years SAS contracts. >>So we've had that program available for the last year and we'd be working on a lot of features with the help of people at Splunk and new Relic today, we've made it available for all ISBNs and marketplace. You say all the iterations get to take place in the market place, so it's all those informations. I should just speak, just make sure I get it right before private offers were invite only kind of thing. Now you're making it available to all ASVs. Correct. We've got one. As of today, we've over 1,500 ASVs in the marketplace. You're one of them. And with those 1500 vendors within our go into marketplace, there's a new button and the seller portal and it says create Piper offer and any over ISV can note create a private. So I'm going to put my little seller hat on. I have a SAS application. Look at, I don't have a big Salesforce. >>How can you guys help me? How do I, how do I get more sales? Is there a, there's the money just following my bank account. Oh, are you overstaffed to do marketing? You have to do some discussions. You know, we had a company in the UK called Matilda MAF last year on, on the cube. Medallian Staffan was 17 engineers and new salespeople and now they're like 300 people, two runs of venture and everything's through marketplace. Big booth here. Well, congratulations to those guys. We love them. And to come Mytilene again, they engage rafted with you guys. It is all the sales and go to market through AWS complete everything goes through marketplace. Okay. We've made it available to 1,500 vendors today. Okay. So changing procurement. I love that trend. You kind of modernizing the procurement process with the marketplace. What about um, resellers? What's the update there? >>So the big update there is, you know, for the first six years of marketplace we couldn't handle the resaler. We didn't conceive of the VAR or the consulting partner and we got a lot of feedback that we had to do work. And so we've taken private offers and we've designed consulting partner, private offers and no, we've saved up over a hundred top consulting partner resellers, the likes of an OCT of an Ashi, a Rackspace in Europe computer center and Softcat and they were working with all of the world's top resellers and know if you are a Splunk or trend micro, you can authorize computer center to offer private prices to their customers and you can actually authorize a wholesale price from Splunk directly to computer and get paid for. Well, they could actually set the price. Mark it up. I got to ask you, Dave, what's your vision for marketplace? >>Because you're doing a great job. It seems like you're paddling as fast as you can constantly improving the service. I know you've got a big to do list, you want to make it easy or make it faster, all that good stuff, but what's the vision? Where do you see marketplace evolving? You know, Jeff Bezos says it's only day one. We're seven years old. We've barely scratched the surface. Global software is 450 billion growing 8% data is 150 billion growing at 3% you've got a $600 billion industry. Marketplace has not touched a tiny percentage. We want all of our customers to be able to find, discover, provision, and run all of their software and their data out of marketplace and it's gonna take us another 10 years and you get a lot of teen. How big is the team? We never publish JFK K but just let's say the Andy Jassy continues to invest in the business and as we add engineers and we add business people and development people, you know we work well with our partners. >>We cool market. Yeah, we grew up well, as Andy always says, you know, and you always say this, the customer needs come first. That's kind of a vetting process. Then working backwards documents, we know all about that history. What is the number one customer need that you're hearing, that you're addressing, that you see coming up around the corner, you're constantly working on and new potentially new requests that are coming in that are relevant to your business. There's two or three big customer needs. The number one is governance. So while engineers are going fast, innovating, legal, finance and procurement need to be confident that the contracts are being written well and is the spend under control. And so we're doing a lot of work around tagging or the resources so that it's tagged to the right project. Did you overspend on the project? And then on the contracting inside we launched this thing called enterprise contract and we're continuing to work with customers. >>We just integrated into the leading procurement system called ACP a Reebok and we launched that last week. And so we know have a procurement workflow that says procurement's happy it finances happy legal needs to be happy because the engineers want to go quick, but we can't leave the it finance legal professionals behind because they protect the risks for the kinda, the contracts too are all there. So you're modernizing procurement. We are transforming the supply chain for data and for software, you know big. You know I'm a big fan of what you do and I know you got a lot of hard work, a lot of demand, there's a lot of money to be made there, water customers to make happy and you know we've got great customers that BP or shell or Coca Cola, Coke industries that are using marketplace on a regular basis and we have customers now with over a foes and subscriptions from over 50 vendors and that's a single customer. >>Dave, thank you so much for coming on. I know you're super busy and making the time for wrestling the cube means a lot. You've been with us the entire journey for the Ravens, our seventh reinvent. You've been a great one. I missed one but usually patients man it's just you. You saw it working backwards and it's happening. It's working well and you know we learn from our customers and I'm having a dinner tonight with 40 more and I'm sure they'll hit us with more requirements. I'll check my email for the invite. I'm sure it's in there somewhere. Dave McKenna inside the cube. Good friend of the cube, hardworking, billable in the next generation, the next gen marketplace. Check it out. Of course, the cube three 65 our new offering is up there as of Monday. It's kind of a soft launch, but we're telling you now, I'm John Freud. Dave Volante. Thanks for watching back with more. Thanks and have a short break.

live from Las Vegas it's the Cuban covering AWS reinvent 2017 presented by AWS Intel and our ecosystem of partners ok welcome back everyone we're here live in Las Vegas forty two thousand plus people maybe forty five huge numbers here at AWS reinvent twin seventeen Amazon Web Services annual conference wall-to-wall coverage our third day I'm John Ferrier the co-founder of silicon Anglo what's two Minutemen we're here with Andy Jesse the CEO of Amazon Web Services the Andy crate to see you again great to see you thanks for having me on graduations we had a great chat a week ago you and I sat down for breakfast and you kind of laid out you kind of laid out with a plan for the show here but I you kind of left a lot out of this you hold it back I've know every three hours from I thought I had a great story you needed the floor our breakfast oh damn it's good what an announcement I mean your keno two and a half hours I mean the longest keynote I've seen just non-stop announces you went right into a no preamble right into the announcements how many announcements did you do like fifty plus or what was the number I think there were 22 news services and features announced in the keynote I did alright so you gotta look back now as it's coming down to an end to reap the parties tonight what's your take I mousey you're absorbing it still he's still kind of like numb pinch me moment what's what's the vibe what are you feeling right now you know it's been a fantastic week and this is our favorite week of the year just having the chance to spend the week with our entire community and I think that it's been a very successful week in terms of what we were trying to accomplish which was it's always first and foremost of learning and education conference and I think that people feel like the array of sessions they've been able to go to and what they've learned both about the services altogether the new services we announced and then just especially what other peers are doing on top of the platform I think has been really valuable and I've had a lot of customer meetings over the last few days and the conversations have been so excited you know people saying I just can't you know you guys already had so much functionality but I just can't believe the amount of innovation and capability the two guys just released over the last couple days and several people said to me you know how to I knew I was having a meeting with you so I had a list of things I was gonna ask you to to deliver and during your keynote I kept going check check check so they're a really positive excited conversation talk about the flywheel what's going on with you guys right now I use that term kind of a pun intended because you've got some flywheel going on as you add more services I detailed in my story after we met I teased out this is a competitive advantage for you you just listen to listening to customers but you're putting out more services there's leveraging those services so it's good for customers but I worry about the complexity and they might worry about the complexity how do you talk about that and how does your team address that because I mean tsunami of services yeah well you know I think that the first thing to remember is that simply because we have a lot of functionality doesn't mean that customers have to know about every single service and every single feature they use what they need when they need it and they don't have to pay for it up front and so you know one of the reasons we release so many things during the area of over 1300 services and features this year alone and in about 70 new releases just at reinvent this week is that when you have millions of active customers you have lots of diversity in those customers you know lots of different businesses lots of different priorities lots of different needs and so you know even in the set of customer meetings I've had this week the first question I asked every single customer i sat down with is what are your impressions what are you excited about they were some who said I can't believe I'm so excited about sage maker it's gonna completely change the accessibility of doing machine learning in my org and some said oh I really really wanted those language application services and machine learning others were totally focused on the multi master or aurora on the global tables for dynamodb and the graph database and then still others said you know I love ECS but I've wanted a kubernetes option and then now that I don't even have to manage containers at the server level and I can manage the task level is what I'm excited about still others who are IOT customers that's what cared about so we have so many customers it was such diversity in their businesses and their priorities that they all have a bunch of needs keep on delivering on that and I want to get your reaction something that we've been talking about in the cube all week which is well I've been pushing its due and I've been kind of debating it but we see a clear path towards a new renaissance in software development and invention and it comes down to some of the things that you guys have enabled we saw a lot of go get excited by some of the deep learning I'll see lecture for business and two other things it's easier to do stuff now the application layer because you don't have to build the full stack so we're you guys are talking about a reimagining architecture that was Vernors keynote it's all kind of pointing to a new Renaissance a new way to create value what's your reaction then how do you share that the customers because it's kind of a new new model yeah well I think that this has been happening now for you know the last ten years and I think that people aren't building applications for the most part the way they used to it you know if you if you're building new applications and you're trying to build all the hosting software and all the storage software and all the database software at all the messaging and queuing and analytics and and machine learning you're just wasting resource because because when you when you have the option of using 120 services from a platform like AWS that has thousands and thousands of people working on it delivering on average three-and-a-half new features a day that you could choose to use or not it's so much faster and so much more empowering to let your builders take advantage of that platform you get from idea to implementation and orders of magnitude faster using the cloud and that you know what keeps happening is we just keep adding more and more capabilities that allow people get now even the marketplace we just had Barry Russell on and you go now are bringing a global reach opportunity so not only can you help them get to market faster with coding and building value this growth so it's not just parking the marketplace and hope that something happens they're taking advantage of that growth I think it's a really important point it's it's not just a set of services that we're building but are thousands and thousands vis--vis and SAS providers who are also building products on top of AWS where their business is growing by leaps and bounds I mean one of the interesting things about the marketplace I don't know how much you guys have talked about this in the past or currently is that most if you talk to most software buyers they hate the process it you know it's just how long it takes the negotiation process most the software sellers also hate the process and so if you can find a mechanism which is what we're trying to provide with the AWS marketplace where buyers and sellers can complete those transactions and find each other so much faster it totally changes the world of buying software and consuming software Andy I came in this week pretty excited to look at the adoption of server lists and you know congratulations you've impressed a lot of announcements talked a lot of customers the thing that probably impressed me the most is it went from being kind of just lambda to really integrated all the service it's a much more holistic view but you made a comment that I that a lot of us in the community kind of you know poked at a little witches if you were to build AWS today in 2017 you would build it you know on you mean Amazon yes sorry Amazon on it today now I've talked to startups that are building all server list but you know it was on D gigantic company and you know I talked to Tim I talked to the team a lot of things I can't do so is this a goal or you know it just being kind of kind of the future or you know do you feel that I can put you know a global you know company of your size you know built with yeah yeah it's a good question and you know I really the comment I made was really about directionally what Amazon would do you know in the city in the very earliest days of AWS Jeff used to say a lot if I were starting Amazon today I'd have built it on top AWS we didn't have all the capability and all the functionality at that very moment but he knew what was coming and he saw what people were still able to accomplish even with where the services were at that point I think the same thing is true here with lambda which is I think if Amazon we're starting today it's a given they would build it on the cloud and I think we with a lot of the applications that comprise Amazon's consumer business we would build those on our server list capabilities now we still have plenty of capabilities and features and functionality we need to add to to lambda and our various serverless services so that may not be true from the get-go right now but I think if you look at the hundreds of thousands of customers who are building on top of lambda and lots of real applications you know FINRA is built a good chunk of their market watch application on top of lambda and Thompson Reuters has built you know that one of their key analytics apps like people are building real serious things on top of lambda and the pace of iteration you'll see there will increase as well and I really believe that to be true over the next year or two and you talked a little bit more about competition than then I'm used to hearing in the keynote I mean there's been some pokes at some of the database stuff in that migration but you know when it walked talked about there was this colorful bar chart you put up and you had some data pointing about that you know in your market chairs growing your continuing growth you know how do you look at the market landscape what are people you know still getting wrong yeah I think that I don't think that we actually talked that much more or less about competitors in the keynote there was a slide that had a color chart that may have been the only difference but you know for us it's always about you you could spend so much your time trying to look at what others are doing and wondering what they're gonna do the reality is if you don't stay focused on your customers and what they actually care about you know you're wasting your time about mobile and business years ago Alexa for business is a new thing voice we heard from Berner today it's a new interface so we were talking on the cube it's the first time we're kind of talking about this constant maybe we're the first ones to say it so we'll just say it voice first strategy mobile first created a massive wealth creation iPhone new kinds of application development voice has that same feel voice first interface could spawn massive innovation yeah what's your view their reaction what do you guys talk about internally at Amazon in terms of a how voice will take advantage of all your scale yeah well I strongly agree with what you heard Verner communicate in the in his keynote today which is just you know when we first had phones that had apps and you could do all kinds of things by tapping on the phone like that was revolutionary but then when you experienced a voice app it makes tapping on your phone so circa 2010 and so I think that the world will have a huge amount of voice applications it's gonna be people's preference and in part because it's just a more natural expression than actually tapping and trying to click and type things and so we we had so many customers almost a good chunk of our enterprise meetings that we have throughout the year one of the things customers want to talk about is how can I actually be involved in using Alexa how can I build skills for Alexa and then over the last few months that conversation has started to turn to hey you thinking about making Alexa more useful inside of businesses and for work and so there's so much applicability I think that voice first it's gonna have the same kind of impact or more than the mobile trend or I think it has a chance to have as big an impact I mean all the devices have to continue to evolve and you can see that at Amazon we're continuing to build all kinds of diverse devices but I think voice is gonna be a major mode of how people interact with handi 42,000 people I don't know how you top it congratulations on all your success and appreciate the growth and you've done with the company congratulate breaking chicken wing contest to Tonka yeah we said a Guinness I what is that about come on tell us about this door well I Tatanka is a buffalo wing eating club that we started in Seattle back in 1997 and we go for wings we used to go every Tuesday night for wings and we have membership standards you can become a regular member if you need 10 wings with five pasty wings a pasty wing is you know when the wing sauce sits the room temperature and it kind of congeals it gets Spacey so it's five wings wrapped in that pays platinum membership is 25 wings plus five pasties then we started having eating contests and we call it a tonka Bowl and so when we start a reinvent we very much wanted to have a conference that had a lot of interesting fun quirky events and one of the ideas we had was we said well let's try an eating contest and the first year we tried it we did it a lunchtime down in the basement and nobody wanted to have an eating contest at one o'clock in the afternoon in the middle of rain BAM so then we moved it to Lagasse Stadium here in the Venetian and people started coming so this year we had two groups of about a hundred each one at Lagasse won at the MGM and they they did a 30-minute round and then the top five wing eaters in each venue came back to one place for a second round and the winner apparently ate a cumulative total of 59 wings there were three thousand eight hundred and fifty-seven Wings consumed in the contest about as many features as Amazon has released since the first time event sounds like to continue the momentum and you're eating away at the competition congratulations Andy jazzy CEOs on Web Services the cube thanks for coming in man and I appreciate it guys thanks for being here appreciate it live coverage here from Las Vegas Amazon webster's reinvent annual conference 2017 s the cube I'm John Force to Minutemen be back with more live coverage after this short break [Music]

>> Narrator: Live from Las Vegas: It's theCUBE covering AWS reInvent 2017. Presented by AWS, Intel, and our ecosystem of partners. (techno music) >> Welcome back, everyone, we're live here in Las Vegas. 45,000 people here at Amazon Web Services reInvent. This is theCUBE's exclusive coverage. I'm John Furrier, my co-host Stu Miniman. Our next guests are Barry Russell, general manager and business development of Amazon Web Services marketplace, growing like a weed, and Chad Whalen, who is the global Vice President of Public Cloud for F5, guys, welcome back to theCUBE. Barry, welcome to theCUBE. >> Thank you. >> So, I mean, just, you can kinda see it now. Clear as day, no more, I mean, Andy says, "We're okay to be misunderstood." That quote, okay, no one's gonna misunderstand the Marketplace. >> Barry: I think it's pretty clear. >> You get in there, and you make money. It's pretty straightforward. >> Barry: Reducing a bunch of friction for customers. >> What's the current pitch, I mean, because this sounds like an easy sell at this point, what's the real benefits? Because, more of services are coming in. You got composability. What's the current state of the Marketplace? >> Yeah, you know, I think it's a couple of things. Uh, it's about selection and customer choice, so we've really grown the catalog, in terms of number of listings that are available and now more than 4200 listings in the catalog, and we announced three key features that we launched on Tuesday: AWS private link which enables SAS products to be run in a VPC. We announced Private Image Build that allows enterprise customers to run their own hardened OS underneath an image, and then we announced Enterprise Contract to reduce friction in the procurement process between large enterprise customers and software vendors. >> Okay, so I gotta ask, the AWS question: What was the working backwards document on this? Was it a main request from the customers? What was the main driver for some of these features because it sounds like they want to be cloud native, but, yet, they still gotta get that migration over, or was it something else, what was the driver? >> The driver was customer feedback. We went out, and we interviewed hundreds of customers over the last 12 months before we started building some of these features, and, without a doubt, they told us they wanted broader selection, broader deployment options, and to reduce friction around the contracting process, and then we just started building, and, over the course of the last nine to 10 months, that's what we've delivered. >> Awesome, all right, F5, you guys are in the Marketplace. You're partnered with AWS. What's your relationship with AWS, how's that going? >> Oh, I would say our relationship with AWS is fantastic. I mean, they're obviously the innovator in the Cloud space. Public Cloud is a strategic imperative for F5. They're at the vanguard of really the innovation of what's taking place in Public Cloud, and Marketplace is that fantastic medium to reach market, and, so, we really have the premise around meeting our customers how and when they want to be met. Marketplace is an excellent vehicle for us to do that, and we've enjoyed a lot of success with launch. >> How has your customers' consumption changed with the Cloud 'cause I can only imagine that, as they look at the mix of how they're gonna consume technology, they want some Cloud. How did you guys hone in on AWS? What was the real factor there? Was is acquisition of the technology? Was it the performance, what was some of the key things? >> You know, I think it's all about really reducing the friction in the process, right? Our customers are moving to the Cloud to have real-time agility and velocity in their business. What we get out of Marketplace is a fantastic set of options from a commercial construct. This solved the customer requirements. If it's going to be at development, we do it on a utility by the hour. When you start to go into production, we can do it in a subscription or a BYOL, so it's really about what application is there permanence and what's the best outcome for the customer, and we have all of that in front of us in multi-year agreements or otherwise leverage in this vehicle. >> So they're tailoring the products, basically. >> Absolutely. >> It sounds like customers are looking at this tailored model, whatever their needs are. They don't wanna be forced into a. >> Correct. >> Certain use case, they can just kind of mix and match. >> Yup, absolutely. >> Yeah, Barry, you know, think networking security have been spaces that I've seen really exploding in this ecosystem over the last couple a years. It, building off of what John was say, I mean, how much of it is custom stuff? You know, things that they're coming, working with Amazon versus just, you know, oh, it's the everything store where I can go get pieces? >> Well, we work with each vendor that lists in the catalog. We have a SA team, Solution Architect team, to work with them on the optimal architecture, be that an omni-based, API-based, and SAS-based, and then we give that vendor and their product development teams the ability to price those products in utility consumption model metered, for example, on the amount of data or band-width consumed, multi-year contracts that are publicly priced or negotiated behind the scenes. So, both in the innovation and the engineering and how the customer actually deploys the product, we innovate on pricing and consumption models to match those deployment options, and we give vendors, all vendors, that enter the catalog, whether they're open-source or commercial products, like F5, the option to use all of those features. >> Yeah, Chad, I think back to, you know, there was the wave of like software, you know, happening kind of networking and secured and everything, but, you know, you've always been in kind of the application delivery portion of this. How is Cloud accelerating your customers' journey and impacting how fast you need to change inside at F5? >> Yeah, that's a great question. I think that because Public Cloud is such a fantastic vehicle for our customers it was really customers-focused, right? So, when you work back from what the customer wants both in terms of how you orchestrate, how you automate, and then with the commercial construct is then they can use it in a best-fit application, and that's really the grounding point for us, and, when we get friction, any time you have a new medium there's going to be friction points and learning points. We've worked in concert with AWS, Marketplace in particular, about solving these ways, whether it's in private offers or custom negotiated offers specifically for customers to meet their needs from an economic and a delivery standpoint. >> I gotta ask the question 'cause it always pops into my head, especially at this reInvent, the pace of services being released, Lambda, Serverless, you can just see it coming. It's going to put more pressure under the hood for automation, that heavy lifting that's Dev Ops, as we know, right, so no new news there. The question is what does it mean for the Marketplace 'cause now you're gonna be under a lot of pressure to integrate a lot of these plumbing and or, abstracted away dev ops-like tools that developers don't wanna provision, so you have the automate so that seems like a challenge. How are you guys dealing with that? How do you make Lambda sing? How do you guys make this thing go smoother? >> Yeah, it's a really great question. I mean, one of the challenges that you get in, when you get into what I would say Cloud Sprawl, within an organization, is how do you maintain the governance and compliance of those workloads? And so we're really lookin' at it from that basis. We want to give as much flexibility into the model while still maintaining what was designed from the beginning, and so our customers wanna use the rules. They wanna have that portability into Public Cloud so they have the assurance. The underlying technologies are just the delivery vehicles, whether it's containers or Lambda or whatever in a server-less architecture, we're focused really on making sure that we have that ubiquity of posture across the asset wherever that asset is. >> Jeff: Makes your sources work together properly. >> Absolutely. >> Barry, what's the trends that you're seeing in the Marketplace? I mean, obviously, there's a lot of growth. Lot of data, and one of the things that I love about this reInvent is they're servicing this new playbook of, hey, use the data, your own data. We saw a new relic had a great report, Sumo Logic kind of report, that basically anonymizes the data, but they're using real data and Verner will talk about this at the keynote. What data can you share about the Marketplace that shows some trends that indicates or allows us to read the tea leaves of what's gonna happen next? >> Well, I think the customer growth stat that we shared, in terms of active monthly customers, we've gone from a hundred active monthly customers we announced last reInvent last year when we were here to now 160,000 active customers using the Marketplace, so we see steady growth. We see growth and adoption from the enterprise, and customers like Shell and Thomson Reuters, that we announced were part of Enterprise contracts on Tuesday, really beginning to think about using the Marketplace to go from traditional procurement moving to digital procurement model allows their IT organizations' dev ops teams to move much fast when pairing with services like a Kinesis, like an S3, like a Red Shift, when they're matching third party software with an AWS-native service. >> Jeff: Are you happy with things right now? Pretty much looking pretty good! >> I'm happy. >> Jeff: Middle of the fairway. >> I think it's been a fantastic show! (laughing) >> I'm happy, F5 has been a great partner of ours in the Marketplace, I'm a happy camper. >> Jeff: What's next? >> What's next? I think what's next for us next year is continuing to grow the Enterprise contract that we deployed, so we started with a small set of customers and vendors that participated to help us arrive at that contract that they both could use, and, I think that over the course of the next 12 months, we really need to think about the types of customers and vendors that enter that program. >> All right, Barry Russell and Chad Whalen with F5. Barry will be back on our next segment with another partner. A lot of partner goodness here. Amazon's ecosystem's exploding, and there's a lot of value to be had by all. That's theCUBE bringing you some content value on our third day live coverage. 45,000 people here this year at Amazon Webster's reInvent. More after this short break. I'm John Furrier with Stu Miniman. We'll be right back. (techno music)

>> Announcer: Live from Las Vegas, it's theCUBE, covering Oracle Modern Customer Experience 2017, brought to you by Oracle. (techno music) >> Okay, welcome back, we're live here at the Mandalay Bay, this is theCUBE's coverage of Oracle's Modern Customer Experience event, I'm John Furrier with SiliconANGLE and my co-host Peter Burris, Chief Researcher at Wikibon.com, and our next guest is Nick Edouard, who's the President CM of LookBookHQ, welcome to theCUBE. >> Thank you very much-- >> I was talking hockey, so I'm all distracted, I'm ruined, I'm disappointed, good to see you, before we get into it, it's all intelligent content, some of the things that are going on on this platform. But take a minute to talk about what your company does so we have some context. >> Yeah, absolutely. Well, we're a marketing technology company based in Toronto. We are a very big part of the Oracle Marketing App Cloud. And we kind of pick out where Oracle basically leaves off, where the Marketing Cloud stops. So a lot of what happens in the Marketing Cloud is focused on generating moments of attention and orchestrating that kind of buyer's journey. We're what happens in the destination side of the click. So we focus on the intelligent use of content. How do we deliver content? We think of every moment of attention as core to a marketer, that that really is their currency, the attention. We need to actually think that marketers, B2B marketers in particular, need to think a lot more like B2C, to think more like publishers. They're obsessed with attention. We shouldn't be satisfied with clicks or form fills. We need to actually be capitalizing on those moments of attention to make sure that if Bob is really my whitepaper, then I need to know that he's actually reading it. How do I then move him to the next best content asset, or give him a choice of content assets in session? So in essence what we do, what our company does, and we help companies like Thomson Reuters and ADP, in fact ADP is speaking on about half this afternoon, Polycom, Quintiles, whole host of big Eloqua customers. What we do is to help them take their content use model from something that looks and feels like Blockbuster, one size fits all, I don't know if actually Bob watched the video that he walked out of the shop with or the DVD, rather. And hence, why Blockbuster is RIP. And we take that and make it far more like Netflix. We make it far more on demand. >> Instrumented. >> Yeah, it's very much like-- >> This is interesting, the attention to impact is interesting, and you know, attention is essentially aided awareness, which is the Holy Grail in marketing, right? I mean, getting people to have some aid to a final destination or transaction of some sort. Am I getting that right? >> Yeah, very much so. I mean in the B2B side, obviously a marketer's job is to generate high quality marketing qualified leads and the real emphasis is on the Q, qualified. But companies like SiriusDecisions report that 94% of marketing qualified leads don't close. And that's a damning statistic for a B2B marketer. And our whole hypothesis is, and we're proving this to our customers is the reason why that happens is they're not qualified. Bob might have clicked on an e-mail, he might have filled in a form, et cetera, but did he read the content? We need to get an MQL to engage with five, seven, ten pieces of content to become a high quality MQL. And if we're only doing that one piece of content every engagement, that's really hard to do. No wonder our sales stat was this low. >> Well, we also need to understand that there's a progression people go through as they learn. It's not just that we want them to click on nine pieces of content-- >> Absolutely. >> As much as we want to see a pattern. So they've read this content and there was a suggestion made or an option provided and they then took the option, which is an even stronger suggestion that they've absorbed it, they've internalized it, and they're now part of a journey. So how does, I really like the idea that we're on the delivery side of the click, so you're, you know, we got all the stuff that's happening on the presenting things, the options, and then you're ensuring that when they click, whatever is being delivered is the highest quality-- >> Yeah. >> In terms of driving that customer forward in the journey, have I got that right? >> Yeah, absolutely. So if we take, if you take something which Eloqua's done a fantastic job, for example, of teaching their community of their customers about lead nurture and the typical nurture track looks and feels something like six emails over six weeks advertising content offer A, then content offer B, content offer C. And typically they're scheduled 10:00 a.m on a Thursday. Now this would be great, if we could get Bob and the other 12,000 people that we sent the email to to click on every single one of those emails. And the reality is, if I've got low, single-digit clickthrough rate, it's not going to happen. So what we do instead is, well, if they're engaging with A, why don't we give them B in the same session? While they're here, while we've done the hard work in getting their attention. And to your point, Peter, we're tracking that, and then we can start to make some really intelligent decisions going forward, as to, oh it worked, this is what resonated with Bob. This content asset's actually performed well. So we have two basic approaches to this. One is we let the marketer curate that experience, decide what A, B, C is et cetera. Or we actually use machine learning to auto-generate. If Bob arrives at A, what should B, C, and D et cetera be? So to that, it's very much like Netflix, where we kind of base our algorithm, it looks and feels very similar to Netflix's content discovery. That's great for anonymous or net new prospects in the top of your funnel, once you've figured out what they're actually interested in, then you can actually-- >> How does it work for you guys? Do you require registration, because content in these days has two flavors, free and gated. So there's always that dilemma, how much is free, you want some flow, tension, and then you go on conversion, gated, maybe premium content, how do you guys view that, is that part of or independent of what you do? >> No, it's a big part of what we do. And, one of the things, one of the capabilities that we have in our application is actually the ability to serve forms based on time and behavior. So, if they've engaged with three content assets, then maybe I actually want them to give me some more information or put up a hand. So we can make the form time-based, you can let them try before you buy, as it were, or you can hard gate it. We use Eloqua Forms in our application, so all that information flows as normal, as the work flows all get triggered, et cetera. It's very much up to the marketer how they want to use it, but one of the things, what we increasingly see amongst our customers, is the most successful do try to take the forms out of the way. Once we've got, once they are a member of our known database, how much more information do we really need them to volunteer, particularly with our ability to augment that contact record with other sources of data. Asking the marketer, I'm sorry, asking the prospect for it isn't always the most sensible thing to do. >> It's the free versus registration, but it's also new kinds of content. One of the things I like to say is software is content. Trying software, for example, is content. Or presenting an interactive experience that has a software element associated with it is a crucial part of gaging where people are. Are you able to start embedding your tooling directly into some of these more interactive elements and choose options within that interaction, or is it more options on static content? >> It could be both. So we are fundamentally content diagnostic. The best way to think about what we do is really as a very smart wrapper that goes around the content and then that can be embedded or it could be shared however you want, it could be used as a destination in its own right. So, sure if you want to kick something off with some former interactive content, absolutely. We also pull all different types of content together. So if your content is distributed or you want to use third party content, reviews, an expert in the space that's writing about something, and you pull that in and use that as a jumping off point. And what's really interesting is frequently it is the sequence of content that's the most interesting thing, not the behavior or engagement of a single asset. >> Right, and so part of the experience that sort of marketing is developing here translates into other disciplines within the business, for example, service. Come into respects, one of the things that you're presumably testing is is the prospect learning the right stuff that actually makes them more qualified. Well the same thing could be said for service, self-service. Is the person going through the right sequencing? Are you also seeing a demand for this kind of a product over on the service side and does that tie marketing back together? >> That's a great question. And one of the things that when we kind of officially launched our company in the application, three or four years ago now, we focused very much upon demand generation. Like we knew the problem that were helping themselves, but there are a handful of our customers, Cisco being one, actually, where actually at the moment, all they do is use us on the customer marketing side of things. How do I drive adoption, how do I drive cross-sell and upsell? I mean, all this is, we've got to remember that attention's what we're looking for and the way that we achieve that is using content as our primary asset as a marketer. The channels are important, the creative is important, but these really are content offers. Bob doesn't buy because he clicks on an email, Bob buys because he reads the stuff and watches the things. >> Peter: But it's attention and competence. >> Yeah. >> Right, so it's, Sy Syms used to say, I think it was Sy Syms, used to say that an informed customer is the best customer. You want a competent customer. >> Nick: Yeah. >> In many respects, the process of moving from the marketing qualified an MQL to an SQL it is, is that customer competent enough to actually engage with a sales person or somebody else to do something. >> That is spot on. So what we're seeing across our customer base is improvement in conversion rates from MQL to SAL for example. So McAfee, Intel Security, now McAfee again, they've seen a three times increase in the MQL to SAL conversion rates. Rockwell Automation has actually made a 300x return on their investment in us in nine months by passing higher qualified leads to the sales team. I think they generated $250 million in additional net-- >> Peter: Rockwell? >> Rockwell, yeah. ADP, that's doing our customer case study this afternoon, a 3x increase in marketing influence opportunities, and a 6x increase in closed won marketing opportunities. So more, but to your point here, better qualified. We know that these people are actually read our stuff, therefore the conversation is easier. They are actually generally qualified. Carrier's been proving that out by actually 2.4 times faster through the funnel to MQL, and then their ACP is 2.3 times higher. Why? Because they're not getting the pushback in the sale cycle because the prospect has self-educated and they see the value now. >> Nick, I want to get your thoughts on something that's involved in our, we're in a independent media company and we don't really have any ads on our site at all, but we have a sponsorship model, we have data. But it's interesting, I'm reading an Ad Age article right now that says for the first time ever, digital has surpassed TV. I mean, I can remember-- >> Wow. back in the days, it's always this little slice and it's getting bigger and bigger. But for the first time, desktop and mobile ad revenue surpasses TV for the first time, 22% upswing from the previous year. So, digital ads, some are calling it native advertisement, whatever the hell that means, is a key part of the attention cycle. So the role that a marketer needs to take with channels as important, and a lot of content marketers are failing these days that we talk to because they're not being authentic with their message and the users can smell-- >> Right. >> You know, non-relevant content. Some are clever and make it link-baitish and some are actually really super smart and actually do authentic content. But, so that's kind of progression. That's an evolution in the industry, but from a data standpoint, there are platforms out there, like SiliconANGLE and others, that have an opportunity for impression and attention in real time. How does your system, how does your clients, and how do people deal with that? Is there a way, is there mechanisms? >> So we have two large publisher customers that run multiple different properties and have very large communities they're looking to monetize and they're all part of the Oracle Marketing Cloud, they use their tech stat, and we're helping them in two ways. Firstly, kind of from an advertising thing, like high value added, advertising solutions, for want of a better description. How do I help to monetize my community, not just pass to HP, if they're the advertiser, here's a list of names of people that filled in the form. Here's actually people that are engaging with your content. And it's a mix of our editorial and your content to tell a story. And then one of the things that we're starting to explore for them is actually far more on the native side of things, actually being embedded as... >> John: An asset? >> Essentially, as a native ad in its own right, which can kind of get launched. That's something which I'm keen to explore further. And at the heart of it is, it's probably an even bigger problem on the ad tech side that it is on the martech side, but people like Gary Vaynerchuk are starting to ask the ad tech industry, we need a dose of common sense here, was the marketing consumed? And that's something which I am fascinated with, we're starting to see that we can actually identify by channels. This channel might, well this particular display provide the SP may have generated, you say, oh I don't know, 1,000 clicks in the last 30 days. Did it do anything? Did my-- >> A lot of times valuable. >> Exactly. >> You know at the end of the day, to sustain attention, you have to be valuable. I think John, we're talking really about a continuum from impression to attention to competence. We want to work with competent buyers because it cuts down the time that we spend on it, it reduces the risk that we're wasting our time, and quite frankly, it's a lot easier to work with someone who's really engaged and wants to succeed with whatever we're offering. >> It's also, he mentioned the publisher angle, I was thinking also from the customer angle, because I'm a customer and a marketer, I'm going to be looking for mechanisms to go to. The publisher wants better monetization of their communities, so have you seen any patterns in the business that could be a use case for helping customers operationalize, and we had great success with our business in the sense of saying, hey, we're engaging users, so that's good, you should join in with us at the right time not, you know, try to do it six hours too late, right, it's like being late to the party, right. So that real time piece is really super important. >> For sure. We've actually just changed the way that we're integrating with Eloqua to speed that up. So now we've actually moved to using web hooks as part of the integration and using their map form processing capabilities. Because it's faster, it's more extensive, it's more scalable. It means we can get very rich in content engagement data into someone's hands faster and better. And, I think, what is it? 50% of people buy from the first person that shows up, so being able to do that is critically important. >> Member-based communities are getting a lot of trends, traction these days. Some call, you know, subscribers, buyer walls, but member-based. >> So something we're starting to look at is how do we actually start to auto-generate the content experience, yeah, around kind of key accounts or topics, et cetera. >> Fascinating conversation, Nick, appreciate it, coming on. >> Nick: My pleasure. >> LookBookHQ, check 'em out, doing intelligent content, scaling content, looking at data, congratulations on your success, look forward to following up with you on some of the native advertising solutions that we, me need, that you need and congratulations, Oracle's certainly taking advantage of it. >> See you next time. Cheers. >> Thanks for coming out. Be back with more live coverage, I'm John Furrier, Peter Burris after this short break. (techno music)

[Announcer] Live from Las Vegas. It's theCUBE. Covering NAB 2017. Brought to you by HGST. >> Welcome back everybody, Jeff Frick here with theCUBE. We're at NAB 2017 with a hundred thousand of our closes friends but we actually do have one of my friends here. Who I can't believe we haven't had on theCUBE since 2013 ServiceNow Knowledge. >> That's right. That's right. >> Just down the road at the Cosmopolitan. Brian Lillie, he is now the Chief Customer Officer and EVP of Technology Services from Equinix. >> Brian, it's always great to see you. >> Jeff, it's always a good thing to be on theCUBE. And I love NAB. Love it! >> What do you think, you've been coming here for awhile. What's kind of your take away, what's the vibe? >> Well, so the vibe, it feels as innovative and as exciting as ever. And I really think that, people are seeing, are starting to hit a tipping point where they're seeing what's possible. What's possible with the cloud, possible with increased collaboration. When I first started coming here a few years ago, saw very few of these kinds of projects. Now, we're seeing tons of innovative approaches to using the cloud. Using our facilities, using really some of our network providers that are really innovating around this vertical. >> Yeah, it's pretty interesting Brian because this is our first time for theCUBE being here. And what's surprising me is how many of the macro trends that we see time and time again at all the other shows about increasing capacity, flexibility, democratization of data, democratization of assets. All these kinds of typical IT themes that are being executed here within the media entertainment industry both on the creative side and as well as the production side. >> That's right. That's very well said. I think this industry, really more than many, is very, very collaborative. You know, from everything from acquisition to pre-production, production, post production, delivery. It feels like a community that wants to share, wants to learn, sees that they don't necessarily own all the best ideas. And that we're seeing some young innovative startups from all over the world. Everywhere from Europe to Asia coming up with ideas that the big houses, big players are starting to see as viable. And I do think, I think, when you talk about it being maybe some of these IT trends, I think some of the secular trends. The fact that consumers want their content anytime, anywhere, on any device. >> Jeff: Right, right. >> Really if you work from the customers backwards, everybody else has to adjust to that. And we're parents. >> Jeff: Right, right. >> We see what our kids wants. And it's really driving I think the whole industry. >> And good stuff for you. You guys at Equinix made a big bet on cloud long time ago. And the fact of the matter is, we're surrounded by all these crazy hardware, both in the production side, the data center side. No one is buying this. You don't just take this stuff home anymore and plug it in. It's just too big and too expensive. As you said, I think was interesting about the media business, is everybody comes together around a project. When the project's over, they go away. How many people has Quentin Tarantino employed directly, probably not that many. But the guy kicks out a lot of big budget movies. >> That's right. I think when you think about the creation of a production, like a QT movie, wherever that set is, it's ephemeral. You go, you setup and it's big data needs, it's high bandwidth, low latency, you've got to get the data. In some cases centrally, but in some cases you're processing at the edge. But it's very cloud-like. We're seeing a lot of this unfold. We're seeing these players not only in the centers where it makes sense to consolidate, but we're actually seeing some of this kit show up in our data centers in a distributed mode, where they say some information, some equipment, we want to keep behind our firewalls on our premise, which could be an Equinix cage or their own. But then I want to absolutely connect to multiple clouds. I want to use the tools in Asure, the tools in Amazon, the tools in Google and others to further enhance our abilities. And so it's truly this hybrid, best of breed, I got a lot of tools in my tool kit, some cloud, some on premise. And there has never been a better time to be in this industry. >> Right. >> You see a lot of industries, you got a lot of customers, how do you see it kind of compare, are financial services, the entertainment, et cetera, are they all kind of progressing pretty much down the same path, at the same rate or do you see some significant laggers or significant people ahead of the curve? >> Well, I would say that financial services is way ahead, to be frank. Financial services has been doing this for a long time. Like when we built Equinix, it was really starting with the networks at the core. And the first vertical to take advantage of that was the financial services, where they said, hey, I want low latency routes between New York and London. Low latency routes between Chicago and New York. And so they've been doing that and then building communities of interest where they could reach all the folks in their digital supply chain. On the financial services side, guys like Bloomberg and Reuters, they said, I can reach all my customers in one place. And I can direct connect to them. So they built early. The content guys did see it right after that. Guys like Yahoo, and if you remember Myspace. >> Jeff: Right, right. >> So it's wonderful to see Facebook video here. I mean, here's now Facebook, real-time video, live at NAB. And with a big presence. So I think content digital media has been a little bit slower to move. But it's one of these ramps. >> Jeff: Right, right. >> And they, over the last two years, I think they have been the fastest excelerating vertical using the cloud and interconnection to build their brand, to build their business. >> Right. It's interesting, because some of our other guests were talking about the theme I guess last year, here was a lot of VR. >> Brian: Yes. >> It's all about the VR theme. But now, we're hearing about machine learning, and metadata and a lot more kind of tradition themes, it's not necessarily just about the VR and the 360. >> Brian: Yup, yup. >> To add more value to these assets, to be able to distribute them better, to have the metadata, to create an experience for that individual person, >> Yup. >> even within the context of a bigger asset, have these small ones, they're pretty interesting trend. >> Yeah, it's spot on. I think VR, virtual reality and augmented reality, >> Jeff: Yeah, I think so. >> is the future. I mean it's the future. I think what maybe what people are realizing is, it's at it's really early days. But data we have, and this whole notion of data science and analytics that you can put around the customer experience in real-time, in situ. >> Right. >> They're like, we can do that now. >> Where virtual reality, the massive bandwidth, the storage, the compute, the compute. Because it's no longer that you're watching the movie in a third person, you are the movie. You are the experience, you're in it. And that's just going to require just massive compute, that in my opinion, only the cloud can do. [Jeff] Right, right. >> So I think it's a little bit further off, But I think VR and AR is the wave, it's the future. >> And certainly in the AR, I think is really cool because there's so much potential there. So from a data center perspective, you guys are sitting right at the heart of this thing. And you're taking advantage of these tremendous Moore's law impacts on not only compute and store but networking, it's got to be phenomenal to see the increase demand. I always think of the old Microsoft Intel, you know back in the day, >> Brian: Right, right. you get a better microprocessor, well, Microsoft's OS heats up, another 80% of that one back and forth. But now we're really hitting huge, huge efficiencies in these core components that are enabling ridiculous scale that you could never even imagine before. >> I think the Intel Microsoft example or analogy is a really, really interesting one because in fact, when you look at companies like Mesophere and Google's Kubernetes and these others, that are, they're calling themselves the data center operating system which is operating containers with the move to microservices, all this technology that's coming, that's making compute more ubiquitous, where you can run workloads anywhere. The fact that we sit, we feel privileged cuz we sit in the middle, of not only all the networks, but of the clouds, the multi-clouds. >> Right, right. >> And if you're a, whether you're a producer or you're in production, you're in delivery, you're an over-the-top guy, where you want to be is where you can connect very directly with little latency and high security and high reliability, to the clouds you need, to the networks you need, to the partners you need. I think that's just a powerful thing. Now the operating system is how do we make that easy, how do we create the easy button. >> Right, right. >> For these folks to access these resources. And what' the value we provide as that neutral, in the middle provider that brings people together. You know, I was at an event last night, and DPP, Mark from DPP was there. We were talking about the question of who owns this new business model. He said he saw a panel on Sunday, because it's transforming in front of us. [Jeff] Right, right. >> And it's an excellent question. I don't know who owns it, but I know we see it. And we're seeing people talk about it. I think the community owns it. They own what this new business model looks like and we're just listening to our customers and letting them lead us. >> Jeff: Right. >> To the place we need to go. >> Interesting. So we're running a little low on time. Just want to get kind of what are your priorities for 2017. >> Well, priorities in this area is really to make cloud ubiquitous globally. It's to push that out to the edge, make that available in as many markets, to as many customers as we can. With our big partners, with Google and Amazon and Microsoft and Oracle and all the rest. That's a big priority. Second is this notion of the easy button. How can we add value, how can we take friction out of the system to make collaboration and communication between this industry that much easier, that much faster. Those are our two big ones in particular here. And I'm delighted to see this vertical just taking off with the cloud. >> Yeah. Pretty exciting times. >> Brian: It's a great time. >> Alright, I got to embarrass you before I let you go Brian. Never have I met an executive that takes such pride in in losing good employees to better jobs. I just want to compliment you on that. (Brian laughs) I know you take pride in CIOs all over the industry that were once your charges. So I want to give you a shout-out for that. >> Okay. Alright, he's Brian Lillie, keep working for him. Don't take the other CIO jobs just yet, but if you do, he'll be happy to mentor you. >> Brian: I will help you get there. >> Alright, thanks for stopping by. He's Brian Lillie, I'm Jeff Frick. You're watching theCUBE from NAB 2017. We'll be right back after this short break. >> Brian: Thanks Jeff. >> Good to see you buddy. (techno music)

live from Seattle Washington it's the cube covering dr. Kahn 2060 brought to you by dr. now you're your host John furrier and Brian Grace Lee okay welcome back and we are here live in Seattle Washington for Doc archon 2016 this is SiliconANGLE media is the cubes our flagship program and go out to the events and extract the signal from noise I'm John fourth by coach Brian Grace Lee our next guests Emil khandekar was the CEO of nuage networks part of Nokia welcome to the cube thank you to see you right so my doctor madness is really exploding in the developer community certainly galvanizing the digital transformation at the end of the day we always say in the cube the network's a bottleneck you got it and it's really about what's under the hood we just had talked to head biggest startup about storage you see a lot of disruption certainly and how infrastructures being technology being developed and make it more programmable yeah where is the story with the network where's that fit in what's the updates there because this is the day that's a critical piece of the pie indeed absolutely for ultimately for apps to be deployed on the network on any infrastructure as you said network has to get out of the way to create that developer efficiency to allow for applications to be deployed very quickly and how do you make that happen because containers are really being talked about we are the conference 4,000 plus people fantastic however CIOs know that they have not only the container technology to deal with but they have virtual eyes were closed and have had those words will eyes were closed for a long time they have bare metal servers that are supporting applications that probably will never move for a while so you have these very changing very dynamic environment and you have to understand how the networking can tie those things together seamlessly that's where we come in as much networks because your networks is essentially Sdn venture of Nokia and what we have at large networks what we've done is it's a modern Network policy based automation platform that allows for any workload whether it's a virtualized workload weather is a container workload whether it's a bare-metal server all to come together and be stitched automatically to allow for that application to be deployed quickly how is that different from other Sdn cloud architectures right you guys are doing within Nokia right so first and foremost what we have is it's a platform that we've built it's a virtualized services automation platform it's not a point solution for only the data center assets to be automated or only the SD when as it's called branch to be automated what it is it's is declarative policy-based automation platform that allows for which is open by the way completely open incorporates open source technologies and allows for all types of workloads if it's in and across data centers so virtualized workloads bare-metal workloads existing were closed as well as incorporates different hypervisor and cloud management system technologies and allows for connection to the branch and to the white area so you're saying it was built for cloud in mind is that what it was very much built for cloud enablement in mind making sure that we didn't forget on the way the existing environment and what you're seeing in the difference really between us and other platforms that are out there is essentially some of the SDN platforms are mono if you will and very narrow sliver they're based only for the data center and work on it on only on a mono hypervisor technology or some platforms are only looking at the SD van branch platform then were meant is such that you want and the cios want automation platform that is consistent across private on-prem as well as public resources and works across multiple hypervisor technologies and the big deal there is because you say point technologies but that that's code word for the older older approaches which was you know back in the mini-computer land days internet internet working you stand up some networks have policies and certainly policy based in a packet management and that was it that's right and you manage it within the data center that's right and that was adequate at that time so a vertically integrated stack in that simplified environment was adequate now now have such a variety of use cases you have got to deal with the cloud native applications you go to deal with the older applications but you need a consistent platform because ultimately you're looking to align ID to business needs and how do you align idea to business needs you do that by getting the networking out of the way and creating automation but again delivering operational simplification getting network out of the way I love that I you know a lot of CIOs are CEOs are seeing startups get into their industry you know if you're in pure and automobiles there's people that are trying to disrupt you you're in hotels everybody knows about those would what what is that you know they go great i can go hire some application developers i want to go faster yeah somebody says gilts get the network out of the way who are who are you selling to them what who is that person that says that sounds great but i still got to figure out routing and i got to figure out security i got to make it highly available who's the decision-maker in your world these days great great question Brian so a couple of points one these days any large enterprise that is looking to IT to create differentiation for their core business and if that means almost every large enterprises rely on IT heavily for their requirements as well as to create a differentiation for their own for product whatever it might be but they saw tomato its farmers pharmaceutical its retail those are indeed the customer that we are talking to because what they have is their environment has shifted as John said earlier it's not very simply a simple environment the environment will become complicated and to do that the networking requirements have become a very sophisticated as in you need application isolation you need multi-tenancy you need the ability to deploy policy very very quickly you need effortless governance of your security policies and compliance you need to be able to stitch all these were close together and also have a strategy for private and public cloud what that means is you need the technologies that were available to the top of the if you will only tier one service providers and bring that to the enterprise's and that's what we have done what use can you what use cases specifically around containers and policy do you see out there okay you specific yeah absolutely so I'll give you an example of a customer that was in OpenStack betfair is online betting and we have my cubes yeah that's right you had richard i say i believe and and what they have is they have 100 million plus transactions in a day on their infrastructure dare use cases continuous integration anything that did that scale at that scale and and so they're using the wash to basically create that automation for all their workloads that's one use case the other use cases we have a very large fortune five company that is looking to use the watch for automation of their virtualized machines so they have a cloud stack and they have kvm based hypervisor with virtual as virtual machines and they're using containers with measles and watch is the only platform that's allowing them to stitch these environments together seamlessly apply the same policy and same so you guys are a platform for a cloud native like environment with existing infrastructure you bring those together we bring that together in a highly automated way and then we allow for security very important security as in we prevent you know spread of mile there we die very quickly being able to enforce the policies we provide multi-tenancy doctors a huge security nightmare because just as much the benefits can interoperate with I mean the applications can be put in containers so good viruses exactly a naked scale and that's what our job is to make sure that how do you do it it doesn't do that because by able to very quickly enforce policies and Quarantine the workload so upon detection of malware our system gets a notification based on that notification we are able to because we have full view of all the workloads whether they are in private data center of public data center or in the branch we can very quickly then quickly effectively and surgically quarantine that workload because we know exactly where that workload is and we know exactly the policy to enforce this also helps by the way this system also helps by you know you get a security threat alert today it's it's a brute-force approach you go down and shut down a segment now with this policy based automation you go to the policy and you say I want only this application to not be allowed to do use this protocol and instantly that policy is deployed yeah I'm sort of picking up on two things you talk about sort of end and the platform for everywhere a lot of that's because we don't have boundaries anymore you know mobile phone changes a boundary that its executive office people are moving around so you need to be you need to have that sort of end end visibility you don't have segmentation like you used to and you talk about policy you know I need to be able as a developer to go network team I need you to sort of give me a service and then I just want to call it I don't want to have to call you I might be working at two at night we might have to change something on the fly like that's why the policy piece is so important is that right you are absolutely correct Brian and that is so critical because ultimately what ID is struggling with is how do they enforce the governance the security governance when application needs to be deployed I teak generally gets in the way not because they want to because they want to enforce certain security certain compliance policies and until now it has always been that manual process now with the security policy based infrastructure what they are able to do is they are able to put the policy once and they're insured that that policy is deployed seamlessly across all their workloads and so they have to audit the policy once and it's guaranteed provisioning which is error-free provisioning so it's huge in terms of the ability for enterprises to react to problems but also any changes the agility this brings the system brings to the table because ultimately you know without the network there is really no cloud and this is why we're hearing people talk about sec ops and sec DevOps and really security integrated without automation consistently automatable same thing every single time absolutely we have a one customer which is again a very large financial base in New York and their issue was exactly that in terms of being able to when I'm talking their CSO and the chief security officer the biggest thing that they took away from our policy based automation was not only the ability to able to stitch all these environments together seamlessly but being able to provide compliance being able to provide the automated policy infrastructure for all their birth was being able to really provide that application isolation those are big deals yeah very big deals for the CX those and csos Sonia we gotta wrap but I want to get your final thoughts on nuage and Nokia like you spend a minute talk about the distinction between the branding of the sea of nuage honestly the name is different I'll see Nokia is big you guys are part of that yes I explain to the people watching what you guys are about size scope the kind of engagement revenue or and how that compares and contrasts to nokia which we're part of but integers so we had a wholly-owned SD inventor of nokia and what we are focusing on is this policy based automation network automation for the data centers wide area and the branches nokia provides us tremendous sponsorship they are very much behind cash is and they recognize the value in our ability to serve the largest of the largest enterprise customers but also because of nokia we are able to address and are involved in very large service Reuters of projects so that's what helps us be involved they have huge scale so the way we work is we focus on over RND the innovation we bring to the table the community that we serve but nokia provides us and the reach yeah reporting the resources but you're wholly-owned meaning you run and run independently if you will we are yes but we are fully owned by nokia we just operate and focus on this it allows us to number customers can you share some data yeah and if we completed two years in the market and in two years we have over 60 plus customers we have over 200 deployments that we have completed pilot trials and deployments but we have 60 Plus very large service droid our customers cloud service providers for huge integrations and also the very big very big enterprise customers i named a couple of Fortune five companies but we are in retail we are in high tech we are in health care the new fabric your new fabric in these big high scale infrastructures that have diverse needs and diverse workloads there and have the need to stitch all that together in a cohesive fashion to build that automated fabric for a poseable almost right composable yeah to ultimately bring agility and align ID to the business I love the word composable infrastructure it really treats the infrastructure is programmable which is the nirvana make it an invisible make it get out of the way get out of the way but yet make it effortless I leave highly performing too so indeed heuer high-performance invisible that's right that's infrastructure as code and Neil thanks for sharing your insight here and the cube really appreciate nuage networks the CEO here on the cube live at da Kirk on I'm John Foley Brian Grace Lee we write back you're watching the cube

prepare for the extraction point we've been briefed on all the important stories and events in the world of emerging information now it's time to extract the data and turn it into action live from the silicon angle studios in the heart of Silicon Valley this is extraction point with John furrier okay we're live back in the palo alto studios i'm john furrier for the extraction point we extract the signal from the noise and my special guest today i'm excited to have here is Paul Martino who is the founder of aggregate knowledge and also storied entrepreneur in Silicon Valley who now lives in Philly with his family comes out here Paul is known for among other things being a great entrepreneur tech geek loves tech loves to build build startups started one of the first social networks with Mark Pincus called tribe started his own company funded by Kleiner Perkins with his partner Chris law called aggregate knowledge which is booming and doing great and now more famous for being the first round investor in zynga company that is exploding with revenue as Kleiner Perkins said is the of all their portfolio comes in the history more than Google's made more money faster than anybody Paul Martino welcome to the extraction point great to see you John as always awesome to see you first I got to start with your now I forgot to mention that you're actually running a venture firm so in addition to being famous with Zynga you're running bullpen capital so first give the folks out there an update and first confirm or deny you were in the first round of Zynga or not yes the the first round of Zynga there were several institutional investors and several individual investors Morocco me Reid Hoffman were individual investors Avalon Union Square accelerator ventures and foundry where the institutional investors in that first round Peter was Peter Thiel yeah Peter was also an individual investor in the first round so that's officially the first round investors of Zynga we have clarified that and that is now hot on the books but now you're you've been successfully founded aggregate knowledge you know have a CEO running that what's the update with aggregate knowledge yeah so great guy runs that company as a guy you need to meet and have on this show Dave jakubowski aggregate knowledge really went in a direction where all of the focus was on providing data and analytics to the major ad agencies and John John Nelson who started organic one of the first agencies is now the CEO of Omnicom digital joined the board and I said look we got to get a guy who's an ad heavy in here and jakubowski was previously the GM of microsoft adcenter and had a senior position at specific media and we brought him in and he's just been kickin butt our greek knowledge has really really made a significant significant contribution in the area of data and analytics for these major agencies and he was very able to bring in a crew of people know exactly how to run that business so you're a big fan of big data then mm-hmm oh yeah we just had a big special yesterday on Big Data mentioned about it so that's cool we're going to get into a lobbyist I was just kind of get the small talk out of the way here your current role is the founder of bullpen capital right so bullpen to me I'm a baseball not I love baseball bullpen means you go the bullpen for relief right yep thank God close the game out hopefully or mid-innings relief so tell us about what bullpen is it's a special fund as I know from reading talk to you to target an expansion of this new seed and explosive new funding environment Bryce plain force right I'll tell you how we got the name at the end too so here's what happened I've been investing with a lot of the so-called super angels and that's kind of a misnomer because they really are actually in some cases actual small venture firms to I've been investing with a lot of them since they got off the ground Josh Kopelman from first round is one of the first investors in aggregate knowledge mike maples was an early advisor to the company I've known Jeff claw be a who run soft tech since he was at Reuters and with the late 90s and so I've worked with these guys done a lot of investing and we were me and my buddies Duncan Davidson rich Melman were sitting around over summer of 09 doing a little bit data analysis right another big data assignment we realized that as more and more these seed funds got created they were creating an inventory of companies that weren't quite ready to go to the traditional venture guy but we're also difficult to bridge from just the seed guys because the see guys at that time didn't have really big funds so wait a minute you've got some really good companies here is to clarify the for the folks out there seed funds don't traditionally have follow-on big funds like a VC firm right that's what you're referring to yeah they tend not to have as bigger reserve so if a big fun writes you a five-million-dollar check and you stub your toe you can probably get some more money to get through the hardships but a lot of the the new super angel funds or smaller funds and you get a five hundred thousand dollar check and if you need another five hundred thousand dollars it can frequently be very difficult because they make so many investments with smaller reserves yeah and so you've got dave McClure clavey a maples first round capital true ventures made the first round truevision more traditional VC then say dave McClure and mike maples and claw VA they're out doing some really good work out their funding really good company spending a lot of time I know I've seen them working their butt off yeah they need some air support right they need some cover the little bullpen is that that's you come in and say hey for your stars they're going to rise up yep and so that's exactly right so what happens is here's what the analysis we did turned out of their portfolio thirty percent of their portfolios in aggregate quickly are really exciting companies you know and they quickly go up to a venture auction and the guys and sandhill rotor excited about it about twenty percent of their deals you know that they don't like too much it's kind of just floating there yeah that you know the entrepreneur wasn't a fit that team didn't execute that left fifty percent of their deals in the middle which they kind of were too early to tell as Mike maple sometimes says they were in an extended learning and discovery phase they hadn't quite figured out what their models yeah and this de pivoting stuff's going on right now the Marcus changes turbulence so these guys are right and so you look you look at some examples and you go well wait a minute for every zynga that goes up into the right immediately go look at the stories of chegg and modcloth and etsy and quite frankly the in-between round on twitter and for everyone Zynga that you find that just hits it out of the park the right way there were four to five companies that went through that hard intermediate round that it was difficult in the environment where you have only a potentially thinly capitalized seed fund in front of you go get through that difficult point I said guys you need a bull pen and way we came up with the name is I'm involved in a deal with Chad Durbin who used to pitch for the Phillies and now as a relief pitcher for the cleveland indians and he was in our office and we were talking about this idea and Chad said yeah it's kind of like you're building a bullpen for the seed guys I'm like that's exactly right that's the name we got to go with and so fortunately I was involved in in this company called showcase you which is actually cool cited suppose for recruiting for college scholarships for a collegiate athletes right you're a high school student you throw 80 miles an hour left hand it and you're in 10th grade how do you figure out where the right scholarships are so Durbin and some of the Phillies where the original investors in this company called showcase you it's actually a cool company as the combine work out online basically fries for the high school kids and because the high school kids sometimes are in tough geographies to get to you're in you're in a small rural area in Nebraska how do they find out that you're the guy who can throw 89 miles an hour great so I mean this VC market so basically you're referring to with bullpen right now is an innie and you've been in our sprayer so you live through classic you know classic financing your last company financed by kleiner perkins and a tribe i forget who financed tribe yet Mayfield was the lead investor may feel again another traditional VC firm all tier 1 VCS although may feel people are you now is slipped a little bit that's some of their key partners who have slipped away but they've all moved on what you're really referring to is there's a new dynamic of entrepreneurship going on now we're now there are some break outcomes that just need a little bit more time to mature in the old model they just be kind of closed down the VC guy would be on the Bora has just a pain in the ass and you know really not growing and do another round it's they get kind of lazy in a way if they got 10 10 boards are on so with the super angels and the fact that does take a lot of cash to start a company you've got more deals getting done so the the Y Combinator the Dave McClure's and chef claw va's in the mike maples and sometimes SiliconANGLE labs which we're doing here is telling you about right we're funding companies the more [ __ ] is funded a better will you come in as you keep them alive longer just wreck the pivot possibly that's right and so what happens is right now the venture industry is being disrupted the same way the venture industry has funded companies that have rupted other industries they are being disrupted in the exact same way and the disruption happened from below as always happens it started in seed stage now in order for the disruption to go all the way through there need to be companies that come after seed stage investors that have the same philosophy and mentality pro entrepreneur easy terms operating people who get their hands dirty to get deals done you need that in the B stage and in the sea stage and here's what our prediction is John our prediction is a few years from now there'll be a company that comes after bullpen that does series c and series d financing or mezzanine financing but the same philosophy is bullpen and then DST s at the end of that chain and you can imagine building companies that go all the way to liquidity that you got money from maples first bullpen second this unnamed company third and you went quasi-public with DST and you've bypassed the entire venture scheme entirely and the entire institutional public markets complete liquidity wealth creation companies creating jobs I mean this is new paradigm I mean this isn't amazing I mean this is a potentially amazing point in the history of us finance the idea that you could go two billion dollar outcomes by passing not only the public markets on the back side but the traditional venture ecosystem on the front side I mean that is a disruption if ever there was one amen I mean hi and with you a hundred percent the other some people who will argue regulation is if market forces first of all I'm a big believer in market forces so I think what you're doing is clearly identifying an opportunity that dynamics are all lying lining up entrepreneurs are validating it and so but the questions are regulations I mean first of all I'm anti-regulation but as you start to get to that liquidity and some are arguing I even wrote a blog post about saying hey you know basically Facebook's public merry go buddy what do you say to those guys this is the change in the history of this financial asustor we want the government regulating this yeah so my co-founder of both i started bullpen with two really good guys Duncan Davison who was the founder covad was advantage point for years asking them to buy government regulation would go bad i mean what happened then because of the I lack warsi like Wars but only that the some extent covet doesn't exist unless the telco 1994 happens through in some ways a creation of the government to good point it's social right but but think about it the arbitrariness of government as opposed to a well-thought-out centralized plan so anyway so Duncan sometimes uses that phrase you know he talks a lot about the way in which the government you know that the worst thing you can ever hear is I'm with the government I'm here to help right i mean that's about the way it goes but his point around the the the new quasi public markets is money we'll find a way yeah and when sarbanes-oxley happens and it's tough to go public and you're a CEO like Pincus who's running one of the great all-time companies in Silicon Valley at Zynga he says you know going public is not an entrance is not an exit it's an entrance that's that's this quote what why would I why do I need that headache I mean I was just talking with Charles beeler who sold for the hell dorado he sold to compel in one of his investments to dell for over a billion dollars and and 3 para nother firm he wasn't on that one that was sold to HP during storage wars he's talking about the lawsuits literally this shakedown of immediately filed lawsuits you know you could have got more money so this is this public markets brutal no doubt no doubt i think what you're doing is a revolution I'm all excited about this new environment again anything with his liquidity wealth creation with the engine of innovation can be powered that's fantastic look back the startups okay get back to where you're playing yeah the history of Silicon Valley was built on the notion of value add some have said over the past 10 years venture capital has not been truly value add and some were arguing value subtract and then just money so what you're talking about here is getting in and helping me stay alive what's the value added side of the equation mean I know that a lot of these folks like like like ourselves here it's looking angle McClure Xavier and maples and true ventures they roll their sleeves up first round capital right before we can only provide so much it kind of expands right you guys are filling in the capital market side right how are you guys helping out on the value add because a lot of those companies may be the next Twitter right you've got a bridge to finance that's right allow them to do the pivot or get the creative energy to grow and they hit that market if they hit that hit it going vertical you got it kind of sometimes nurture it you guys have a strategy for that talk about the so let me let me give you my perspective on that so I think 10 years ago when you're starting a company the name of the venture firm was more important than potentially the partner on your board ten years later the name of the firm matters much less and it's the name of the partner and it's the operating experience that that partner partner brought to bear and you go talk to the 24 year old entrepreneur verse the 34 year old entrepreneur the 24 entrepreneur 24 year old entrepreneur wants a guy like you or a guy like me on his board he wants have been there done that started a company was a CEO exited it got fired hired people fired other people scar tissue scars knowledge experience exactly and if a good friend of mine who's in the traditional business I'll leave his name out of it he sometimes says the following phrase the era of the gentleman VC is over and what he means by the era of the gentleman VC is over is you know if your background is you were a junior associate who came in with a finance degree in an MBA and it never started a company you're not going to get picked by the entrepreneur anymore in 10 years from now almost everyone in the business is going to have a resume that looks more like a Cristal Paul Martino a mark pincus that you name all the people who we've started our companies with if there's a lot more hochberg with track record certainly with with the kind of big companies in the valley just in our generation yet started with netscape google paypal right now i want to see facebook is and then now's inga either the ecosystem is just entered intertwined I mean for every failure that spawns more success right so that's right that's a Silicon Valley way yeah well a tribe was tribe was a perfect example of a successful failure tribe was not a successful outcome but it was in many ways a very successful way to actually pioneer what became social networking you know investments got made into Facebook as a result of that Zynga in aggregate knowledge were both the outcrops of what was learned to some extent the original business case of Zynga was remarkably simple there is a ton of time being spent on social networks and after you get done finding your buddies and looking at photos what do you do and Pincus is original vision to some extent was let's have games to play and that insight doesn't happen that way unless you don't do tribe and go into the trenches and get the scars on your back and your in your your second venture of our adventure right at the tribe was aggregate knowledge was similar concept people are connected I mean you got to be excited though I mean you know you were involved in tribes very early on all the stuff that you dealt with activity streams newsfeed connections the social science you know the one that one of the nicest pieces of validation of this recently was over in q4 of 2010 seven of the patents that me Chris law Elliot low and Brian Waller wrote got issued now they're all owned by Cisco Cisco bought tribe in the end they bought the assets in the and the patent filings but there are patent filings that go back to 2002 on the corner stones and hallmarks of what social networking really is that we wrote back then that have now issued order granted or sitting in the cisco portfolio and well that's kind of like a consolation prize and that there wasn't a big outcome for tribe it is very validating to see that those original claims on really cutting-edge stuff have been had been issued and I'm excited about that you should be proud i'm proud to know your great guy you have great integrity you're going to do well as a venture capitalist i think you people will trust you and you're fair and there's two types of people in this world people who help people people who screw people so you know you really on one side of the other you're you're not in between you're truly on the on the good side I really enjoy you know having chatting with you but let's talk about entrepreneurship from that perspective about patents you know I'm try was an outcome that we all can relate to the peplum with Facebook of what Zuckerberg and and those guys are doing over there that's entrepreneurship so talk to the entrepreneurs out there yeah hey you know what you do some good work it all comes back to you talk about the the Karma of entrepreneurship a failure is not a bad thing it's kind of a punch line these days I'll failures are stepping stone to the next thing but talk about your experience and lets you and i talk about how to deal with faith for those first-time entrepreneurs out there in their 20s what just give them a sense of how to approach their venture and if it fails or succeeds what advice would you give them yeah well like winning and losing is important part of the game I mean certain companies are going to be successful in certain ones art and if you go and start ten unsuccessful companies maybe this isn't exactly the business for you but that said how you the game is important as well and if you're a high integrity guy who gets good investors and you make quality decisions and let's say the market wasn't a fit you're going to get the money the second time because people said you know I work with that guy that guy really did a good job you know they never got it quite right but this is a guy learn the right lessons so when I'm coaching a first-time CEO and i'm the CEO coach of a couple guys now you know i'm looking for someone who's sitting there going hey i not only want to do this to win and be successful but i want to learn i I want to do this better than no one no one walks in and says I learn from my failure I hope I'm successful I mean you let it go and say hey I'm gonna be successful I want to win failure is not an option but failure happens right i mean you know it's bad breaks that mean but but here is the key less I tell this to all of the entrepreneurs I work with you will not be successful if you're making mistakes that were made by those before you if you make novel mistakes you're in good company right and so only ever make a novel mistake I made a good example this is one claw and I started Chris law and I started aggregate knowledge aggregate knowledge was the original business model was around recommendations and there were dead bodies in front of us there was net perceptions there was fire fly and she was in the office this morning with Yazdi one of the founders of [ __ ] cast with it man yeah so predictive analytics residi what did we do we went out and we I flew out and met John riedle University of Minnesota who was the founder of net perceptions I dug up yes d i got these guys on my advisory board and while aggregate knowledge was not successful in the recommendation business and pivoted into the data management thing we made novel mistakes we did not repeat the mistakes of met perceptions and firefly and so i think that's an important important lesson to an entrepreneur if you're going into an area that has dead bodies in front of you you better research them you better know who they are you better know what happened and you better make sure that if you screw it up you at least screw it up in a way which none of us could have predicted yeah that's the only way you're going to get a hall pass on that well let's talk about talk about some of the hot Renisha of activity saw so you're in that sector where you're feeding the seed the super angels in the first rounds early stage guys and it's a good fit what about some of the philosophies on like the firms out there there's of this to this two philosophies I just taught us to an entrepreneur here you met on the way out a street speaker text and there at seven you know under a million dollars in financing hmm series a yeah and then you got in the news yesterday color 41 million dollars building to win magnin flipboard a hundred million dollars i got this is these guys that we know i mean there are yep our generation and a little bit around the same time and certainly they have pedigree so remember the old days the arms race mentality right when the sector at all costs right that's kind of what's going on here i mean some of the command that kind of money there's actually an auction going on what do you make of that I mean bubble is an arms race so so rich Melman inside a bullpen de tu fascinating analysis he looked at the full portfolio of 28 took about 20 of the best super angels by the way the super angles are all different some are micro vc summer buying options etc so so first off super angel is a weird word but it's everybody from Union Square and foundry on one side first round and flooding but any take the top 20 or so of these guys and look at their portfolios what's amazing about their portfolios is the unlike 10 and 20 years ago in prior tech bubbles there are not 20 companies doing the same thing when you categorize them yeah ten percent are in ad tech ten percent our direct-to-consumer consider but like forty percent are one-offs that is this is I think one of the first times in the history of venture that forty percent of the deal flow is a one-off unique business idea that there aren't 30 guys going to do and I think that the importance of that to what happens in this next stage of the tech boom we don't know what that means yet because back in the day well we need to just we're venture firm we need to disk drive company okay so your venture firm you've got your disk drive companies and I'll 20 venture friend knows if drive out and created the herd mentality everyone talks about with venture yep mean I was an opponent on a talk on here in the cube and I don't think I actually put in a blog post but I called the era of entrepreneurship like with open sores and low cost of entry with cloud computing and now mobility the manure of innovation where you know in the manure that's being out in the mark place mushrooms are growing out of it right and these you don't know what's going to be all look the same in a way so how do you tell the good ones from the bad ones so it's hard right so you have a lot of one you have a lot more activity hence angel list hence the super in rice so so the economics and the deal flow are all there the question is how do you get them from being just a one-off looked good on paper flame out the reality yeah well look in my opinion seed stage investing is about investing in people and I think when big firms trying to seed stage investing there's an impedance mismatch a lot of times because they want more evidence they want to know did the market work to the management then this is this is an early stage venture and am I going to want to go in a foxhole with this person and in many ways the good super angels are instinctive investors who are betting on people that they want to be in the foxhole with and yeah did they do it before do they know how to hire people is the market reasonably interesting but guess what they're probably gonna pivot three times so wait a minute at the end of the day you got to invest in people later stage venture is not you can look at discounted cash flows you can look at mezzanine financing you can do traditional measures but if you're going to invest in two people who have a prototype and need five hundred thousand dollars you're investing in people at that point what do you think about the OC angel is I'm a big fan of and recently was added thanks to maybe out there but even though i'm not i don't really co-invest with anyone else other than myself maybe you guys would bullpen but but if that's a phenomenon you don't have angel list which is opening up doors for deal flow companies are getting funded navales getting yeah a ton of activity nivea doing great job with venture hacks i get y combinator which I called the community college of startups they bring in like they open the door and I mean that an actually good way don't mean that negatively I mean they're giving access to entrepreneurs that never had access to the market right and now you have Paul Graham kind of giving the halo effect or thrown the holy water on certain stars and they get magically funded but yesterday at an event and they're they're packed right I've heard from VC saying I'm not invited because I didn't wasn't part of the original investment class so it seems that Y comma day is getting full yeah so do you see that you agree is there will be an over lo y combinator you know kind of like I've TED Conference has you know Ted they'll be you know y combinator Boston little franchises will be like barcamp for sure I mean look and look at techstars they franchise they'd I was over there with Dave Tisch in New York there's TechStars New York after those TechStars older in techstars seattle there is no doubt in my mind that right now there is an over investment in the seed stage meaning that there is a little bit of a seed bubble going on that's not necessarily bad though because in terms of raw dollars there's not a bubble yet Rory who's over at rafi it smells like a bubble it looks like a bubble but when you look at the mechanic when you look at the actual total dollars it's not a bubble rory who has a hinge recent Horowitz been said that that it's a boom not a bubble yeah so don't be confused it looks like bubbles and booms kind of look together the same right I actually I'm not quite sure I had the exact data right but here's the quick summary if you take a look at venture capital investment as a percent of GDP historically it's been something like point one percent of GDP in the bubble back in 99 it went to one percent something like it went 10x higher right now we're still at point one percent but since it's very much centered around the seed stage investing you see this frothiness in the sea but until that number goes from point 1 percent of GDP back up to one percent there's no real bubble because the tonnage of money hasn't come in yet and so so it's starting but this is what a tech boom feels like the early stages are excitement and lots of ideas and lots of flowers blooming and then the big money comes in because John I'll bet you're your brother and your sister and your mom haven't invested in a tech startup back in 99 video there's no public market that supports seven in a way that's a good and bad star basement yeah there's no fraud going on and most of the companies that are out there whether their lifestyle business or seed or bullpen funded are actually generating income the entrepreneur he has any earlier Mike was saying that he could a business deal so people are kind of like saw the old bubble and said shoot I don't want to do that again I gotta have at least revenue right and so companies didn't seem to start out with cash so you know that because you invested it but you know Pincus was getting some cash flow in the door from day one that's right that company was company was profitable the first day it started basically so talk about you know so I'm with Paul Martino by the way with bullpen capital entrepreneur wrote the patents on social networking which he sold the cisco when they sold the company now with bullpen capital huge dynamic you're a company out there this is exactly the positive dynamic you want to see because mainly you know dave mcclure jeff clavier mike maples have been kind of getting their butts handed to them in the press about super angels not having the juice to kind of go anywhere and it's been kind of a negative press there so you know this is the kind of void that's been filled by you guys to show the market that look at this there's a road map here so even though that the McClure's and clubs don't have big funds that there's a path to follow on financing so that the vc's can't shut them down and i've heard some pc say that so a lot of traditional venture guys would like to say that you know this little disruption we nipped it in the butt and it stopped after the seed stage but that's not the history of disruptions the history of disruptions are they start from the bottom then they get ecosystem support and then they grow and they disrupt the incumbents and I think we're halfway there so so the Angel gate thing that Arrington reported on was interesting because you know essentially what happened there it was a lot of him fighting Ron Conway I was not happy you can't be happy about competition I mean this is competition that increases prices right so you know in the short term prices have been inflated on valuations true or false that's true but but but I think I think the whole way angel gate was reported was absurd the most Pro entrepreneurial venture people perhaps in the history of the business are the guys who were supposedly at those tables I mean mike maples Jeff claw VA josh cop and Ron Conway fired his guy that was there I I understand suppose again suppose a key are right these are the most Pro entrepreneurial venture guys in the history of the business so I think that turned into something that it never was yeah well I mean that's the thing you know good for content producers who want page views I got to create some drama and you know as you know SiliconANGLE doesn't have any banner ads on our site quick plug for us we are motivated by content not page views so thanks for coming in today no but seriously I mean there's a there's a black cloud over the super angels has been since Angel gate I've heard privately from VCS that super angels it's been kind of a scuttlebutt they're misaligned just rumors I completely overblown and you know their business model threatens the incumbents and you know someone needed someone needed a piece of fodder to start a you know start a techcrunch discussion right there's no doubt that the market is need in need of a new ecosystem for the early stage because individual angels traditionally were wealthy individuals but now you have people with more experience like yourselves and entrepreneurs from google and facebook etc coming out and doing some things okay so next topic more on a personal kind of professional note k last final question is I know you got to run appreciate your time you're a technologist a lot of folks don't know that you're hardcore computer science guy and our model southern angles computer science meet social science right in your wheelhouse so with that just kind of final parting question what gets you excited technically right now I mean I'll see you have roots in both comps I and social Iran Zynga's early investor roster you got a bullpen capital you're looking at a lot of deals outside of that you as a computer scientist geek mm-hmm what gets you jazz what do you see in the horizon that's not yet on the mega trend roster that kind of you can't put your finger on it truly we might really get a good feeling well so I think you'll be disappointed with this answer because I think it's now cross the chasm to start being one of those mega trends it's called consumerization of enterprise and that's now the buzz word for it but what is it really mean and why do I think it's for real look you've got cool self-service applications for everything you can go do home banking by logging into a portal you can go to an ATM you can go do these things but you know go bring a new laptop into your big stodgy fortune 500 company and you know it's like getting a rectal exam right you know we got to install this we got to give you this private key yet that's TSA it writes like going through TSA exact idea that IT inside of big fortune 500 companies is going to stop being this gatekeeper to new technology I think look how long do you think it'll be until pick your favorite fortune 500 company the IT people know how to deal with the ipad 2 but how many people bought an ipad 2 into the off already everyone and so this to me is going to be the big next deck the next decade are going to be self service offerings for the enterprise getting around a very frustrating gatekeepers inside of you know the IT department etc and that's going to lead to an awesome boom of everything from security to auditing to compliance etc that's the convergence question Paul Martino my friend entrepreneur great guy venture capitals now on the good side helping the seed Super Angel micro VCS great to have you consumerization of IT that hits the cloud mobile social it's everything so that I was buzzword compliant on that great job great to have you know you're busy got to have you in again thanks so much for time that's a wrap thank you very much great thank you John