>>Welcome back to VMO 2022. We're in the home stretch. Now, Dave ante for Dave Nicholson, and we're excited to have drew Schlissel on he's the director of product marketing at wasabi, and he is joined by Dustin Albertson, the manager of cloud and application alliances, product, product management at Veeam software. Dustin, did I get that right? You got it right. All right. You're gonna explain all those little titles in a moment. So wasabi is a company cool name, but you may not know much about them drew. What does wasabi do? >>We do cloud storage, plain and simple. It is the one thing we do extremely well. It's S3 compatible, and it covers a broad range of use cases, right? Primarily we work with Veeam on backup and recovery, and >>We're gonna get into that. But when we, what there's a lot of people do cloud storage, a lot of people do object store. What makes you wasabi unique >>Simplicity, predictability performance security, right? Predictability. Let's talk about price, right? That's the thing that gets people's attention, right? Oh, sure. Okay. You can look at it. One of two ways. It's either one fit the price of all the hyperscalers, significant difference there, or right. For fundamentally the same price. You get five times more storage, which makes a huge difference, especially in the backup space. When you want to have a lot of backups, right. Folks would prefer to have months of backups as opposed to days or weeks. Right? >>How do you, how do you do that? Because, because there's, you know, maybe >>It sounds like magic, doesn't >>It? Yeah. Yeah. I mean, you know, look at us, we've all been around the block quite a few times and we know that the bits and the bites and the bolts are all basically the same. What are you doing to get that level of? >>I can't tell you >>Secret's secret. It's secret. >>Look, it, it doesn't have to be that expensive. Okay. Now granted, there's some things obviously we do that are proprietary and different from, >>Well, like stealing electricity from your neighbor or something. I mean, what, >>You just run a cord over a >>Absolutely that's one way to cut down on price. But because we are so focused on just the storage, right. And our founders, you know, the gentleman who founded Carbonite, no a thing or two about storage. Sure. Right. We have a very highly optimized stack, very efficient. You know, you guys know what raw to usable story is. Right? You've gone through that TCO analysis before, and we're highly efficient in how we use the raw storage. And we pass that price on to our customers. Right. We believe that a low price cloud storage, right? One tier always hot, always available. It gives our customers the ability to spend their money in other places. Right. >>Well, and, and there's a price umbrella that the public cloud guys have is kind of a gift that they've given you. Hey, look at Amazon's operating profits last quarter. It was 35%. Those are like Oracle operating margins. Not that I, we don't know what your operating margins are, but I I've followed David friend's career for a long, long time. He's got good nose for business. But so Dustin, when you, when you hear drew talk about the ability to retain that much data, what does that mean for Veeam customers? >>So the primary thing for Veeam customers is the ease of use. I would say, you know, the, the performance and things like that are all nice, right? They're, they're important. But primarily what I see is people say how easy it is to use and how easy it is to price. Now, the objective, you know, the alternative is you go to another cloud provider and you say, well, how much will this cost me per month? You really have to underst yes, you really have to understand object storage, how Veeam works, how we're moving data, all the API calls, all of that to really kind of correlate out a guesstimate of what your price would be per month. You know, with LASA it's, it's a flat fee it's per terabyte. You know what it is gonna be? That's it? There's no API charges. There's no egres. So the customers really love that. Ease of use this become one of the most popular endpoints for object storage for our customers. >>Imagine this, right? You go to best buy and you buy a refrigerator and you bring it home and you stock it with all your favorite drinks and snacks. Okay. You on game day, you go and you open the fridge and you hear a sound Bing. And it's your phone and it's your credit card company telling you that you've been charged a door opening fee. Okay. And then you grab a beer out of that fridge, Bing, Bing, and you hear another ring and now you're getting a beer extraction fee. Okay. Now I want to be fair to, you know, all the sponsors here, but okay. With wasabi, you can open that door. You could stand there. You can air condition, the whole house. You can take a beer out and put a beer back or whatever your favorite beverage is. And you're not gonna hear that noise. Okay. Very straightforward. Like in, in geometry class, right? The slope of a line Y equals MX plus B B equals zero. Okay. Well, >>Whoa. Well, you had me at free beer. You didn't, >>You don't, but you understand why? >>Why would you, you don't need to go see >>To open your fridge and take out a beverage, take out a snack. Okay. That's the predictable part of wasabi. That's what's resonating so strongly with folks where everything else is in this world. Unpredictable. >>So ease, simplicity. Maybe the answer to that is, well, there's all this other stuff in the cloud. I can just, it's convenient for me. It's right there. So how do you address that convenience factor? All these other services, you know, that I can get streaming and machine learning and all that other great stuff. How do you address that? >>Sometimes all you need is storage. Okay. That no, it that's yet put, okay. That's beauty of wasabi. We're not trying to be everything to everyone. We're trying to be one thing executed very well for a, a specific set of users and use cases. >>I may be a little objective here, but I, I, you know, I've grown up with you guys, right? You, you, you were one of the first partners that I started working with and, and, you know, I've seen you kind of grow, but one of the things I think that you've done a real good job at is, is like you say, sticking to your, your lanes, you know, just going after use cases that just need data. Right. I don't need to get into the AI or the analytics or all of this. We just do this and do it well. And, and people have resonated with that. Right? Yeah. >>So big topic here of course is ransomware. Yeah. 3, 2 11, 0. What is that? What are the threes? The twos, the ones >>That's you, you gotta explain that one. Okay. >>So forever we had the 3, 2, 1 rule, right? Like three copies of data, two different, two different copies, two different media types. Yeah. One offsite. And then one is, is testing. And then zero now is, is validation. BA basically reuse that data. Make sure that you're testing it because if you're not, if you're following through two one, and you're not actually testing your data, is it really good? You don't know. You're just, you may have bad copies spread out all over the place. So one of the things where wasabi shines is is that they don't have these E risk charges. They don't have these API charges. So you can test that data. You can, after you send a backup up there, restore it somewhere else and validate that it works and then get rid of it. And it's still sitting up there in BAA. >>So you're not trying to balance your activities and your operational requirements with your, with your bill. Correct. You're not getting yelled at, by the, the controller at the end of the month. >>You're unconstrained. Yeah. Right. And I think also imutability comes into play. Correct. As well. >>Talk about >>That. Right. So, you know, we heard this morning in the keynote, right? That backup data sets are, you know, one of the main attack vectors, right. For cyber criminals. And it makes sense, right. They take down your primary systems and they control your backup systems. They've got you. You have no choice, but to pay that ransom. Okay. So mutability, that means that your backups are untouchable, your root user, your admins, the folks at wasabi, the folks at Veeam, nobody can alter that data period. End of story. Okay. That saves you from yourself that saves you from the hackers, right? I mean the most disturbing story I've read about cyber warfare right now is that people are getting bribe offers from these cyber gangs. And they're just, you know, for a couple of Bitcoin handing over the keys to the kingdom with imutability, you're actually safe from that scenario. >>So that's a service, correct? >>No, it's a feature. >>Okay. So can I turn it off? >>Yeah. You don't have to use it. >>No. Can I, after I've, after I've turned it on, can I turn it off? >>Oh, it's up to you. I mean, why don't you talk about >>That? Yeah. Yeah. So it's, it's an API. So if let's say you send some backups up there today and you set it for two weeks and you decide today. Oh, I made a mistake. I wanna turn it off. You can't turn it off. Yeah. >>Okay. So as long as you set that policy, it's, it's a big warning, right? You can't undo this. Correct. Okay. So even if I come, come to jump to the admin with a bunch of Bitcoin yep. He or she can't undo, right? >>Nope. That's right. And you can set it for two weeks, two months, two years. Right. You can use it to secure your backups. Yep. Right. You can also use that same feature in compliance situations. Right. Regulatory environments, where you've gotta retain customer data for, you know, 5, 7, 10 years. Right. By using that imutability feature, you guarantee the integrity of that data for whatever period you set. >>And it's a feature it's not a paid for service. Is that right? >>It is included as part of the service. >>Okay. So I don't >>Free beer and free meat. >>I think I'm correct that some, some competitors you're paying for that service. So if you turn it off, there's a, if you don't stop paying, there's a, there's a theory. They could turn it off on you. They will warn you. >>Sure. But >>That says to me that somebody could be tempted by a few Bitcoin. >>That's not a mutable. Well's >>Notable. I agree. Yeah. Yeah. Yeah. >>Well, and, and there is a charge to use it in other places because it's an API request. Right. It's an action. It's opening the fridge. >>It's like texting. Yes. Maybe a charge. >>Yeah. I remember. I remember those days. Was it 10 cents? A 10 cents a message or something Telegraph. >>Yeah. >>Yeah. >>Yeah. You still get those messages. Right? Text, text fees may apply. I'm like really? Okay. So tell me more about, so you got me. I'm sold. Okay. I've I've David friends got good job. Got cred, got credibility. Okay. But I have some other questions. Like where's my data. You guys running your own data centers. What's your global footprint. How do you deal with data sovereignty? All that stuff. >>So right now, oh boy. Now I'm on the spot. I wanna say 11 locations around the world. It's our gear. We're running it in concert with folks who are helping us host that system. Right. But we have complete control of course, over our systems. We're everywhere. Right? Just open, let's see. Toronto Frankfurt, Paris, London, Sydney just spun up in the last week. We've got Singapore coming online. I think in the next two weeks. Two >>In Japan. >>Yep. Two in Japan, multiple locations in the United States. So in terms of sovereignty, right, as long as folks are keeping it within, you know, their, their physical boundaries, not a problem. And if folks want to use, you know, other locations in other countries, great. We can support that as well. >>So you got momentum as a business. I mean, that's pretty clear. Yeah. Just from the discussions I've had with, with folks like David, and obviously you you're excited about this, where's it coming from? Is it really that, that price factor that's driving people to you? Is it Dustin said simplicity. I mean, where are you seeing the momentum geographies? Where is it? Where's the action. >>I I'll say, you know, from my point of view, it's, it's been a combination of all that, right? It, it's simple. It's easy to use a, like a user can, any user who's not cloud friendly, right. Can log in and create one. It's a simple portal to create a bucket and then start sending stuff off site. But also they've, they've kind of, they reminded me of a younger Veeam, like when they first started, because they went after the channel and they went and started these partner programs and, and MSP programs and things like that that have been really successful as far as one of the key markets is MSPs. Right? Because they, you know, want a cheap place to put this data. They don't wanna have to buy appliances. They don't wanna have to go to AWS and things like that. So this has been really appealing to >>Them. You know, it's interesting. So I have a, we have a partnership with a data company down in New York called enterprise technology research. We write a breaking analysis every week and we use a lot of their data. One of the things that popped up recently, maybe a year ago, OpenStack I'm like OpenStack. So we dug in like where's OpenStack and what it was was MSPs didn't want pay the VTax. Right. So they were rolling their own with, with open source and open stack. It was red hat services, blah, blah, blah. But it sounds like a similar dynamic, especially with the MSPs. >>I, so I think we've, I, I hate to use the, the metaphor, but I will. Right. There's a perfect storm happening, right. Especially in the last, what, two years. All right. The cloud has been gaining traction, but we've been around long enough to see the pendulum swinging. Right. Some folks went crazy for the cloud and then they got their bill and then they went crazy to get back out of the cloud. But now, you know, with distributed workforces, with the, you know, the, the constant attacks on their, their on-prem systems, right. The growth in cloud across the board has been phenomenal. I know you're a market watcher. Right. I know you guys are keeping close eyes. I saw your recent analysis on the cybersecurity firms. Right. It continues to grow. There's no question about it. We're we're on that wave. Right. And I think we've, you know, we're not, we're, we're, I don't know if it's the long board or the short little snappy board. Yes. We actually identify and, and, and went after the opportunity to partner with Veeam very early on, because it's the perfect work case work, work load. >>How long can you sustain that? And still resist the temptation to come out with some new shiny object to distract people? >>I >>Mean, what, what, what does that, what does that look like in terms of, as you look out in this laser focused yeah. Addressable market that you're going after now. >>So, you know, the best part about being here this week is having great conversations and, and talking to folks about what they're seeing in the marketplace and the different verticals. I don't think we've even scratched the surface of any of the verticals that we are working in today. Right. First and foremost, when it comes to backup and recovery, there's so much more opportunity with Veeam, right? Whether it's healthcare, manufacturing, logistics, analytics, backup of IML, you know, analysis, I think it's almost limitless, right. Data's growing what, 40, 80% year, over year, depending on who you ask. Right. Then the other things that we do, which maybe folks don't even know about, we have a burgeoning business in video surveillance, right. We're working with all the top partners in that sector. And the takeup is phenomenal because they are tweaking their technology to maintain a relatively small cash, right. OnPrem or in the central office. And then they're just kind of, you know, tearing that off to the cloud to have essentially a bottomless backup or archive of that footage. And they can do it at 4k. Here's the best part, right. When AK comes out, guess what, you know, that data set doubles in size. >>Right. But that's right in your zone. That's not stepping out that that's not stepping after that's that's classic leveraging. Good >>Answer. In other words. Yeah. Yeah. Thank you. >>I mean, if >>You're, if you're, if you're hitting singles and doubles all day long, right. Do you have to switch to be a power hitter and go for the fences and drop your batting average down, but hope that your slugging percentage goes up. I think you keep hitting singles doubles, you know, in triples, >>A lot of people on Sandhill road or, you know, at the bar at the Rosewood would disagree with you. Wow. And so I, I appreciate the discipline. >>Yeah. And it's true. And, and as we know, the industry is littered with a lot of those names that just didn't didn't make it >>Let's stay positive, you know? >>Okay. No he's saying yeah, no, no. A lot of guys at sand hill road would say, no, you gotta go for it. Yeah. You gotta, you gotta forget these singles. We want, >>Yeah. We need home runs gotta be >>Shiny. Well, I mean, look at Vema as a, as a, as an example right. Of a disciplined approach. Right. Exactly. To, to a space that they have steadily grown. I mean, congratulations. Right. You guys have been identified by IDC, right. Is essentially, you know, co number ones. And I expect that to be the number one in the market. Right. I think, you know, David friend clearly has provided excellent guidance, right. To steer the company that way. And I'm just really happy >>To be about that. Oh. And the Tam is data. Right. And you're, you're just another node on the data universe. Right. Which is, that's what you want. You want, you don't necessarily wanna move it around. Yeah. If you don't have to. >>It is interesting though. I mean, we, we are seeing more and more analysts identifying with Sabi as like the fourth player. Yeah. Which is pretty cool. Right. And I also heard it from some good sources this week that let's say one of the hyperscalers has, you know, started to yeah. Have conversations about us. Let's just >>Leave it. That's good. It means you're bothering people. Yeah. Said, all right, guys, we gotta go. Thanks so much for coming on the queue. Thank you. Great to have you. That was easy. Thank you. Appreciate it. Very welcome. All right. Keep it right there. We'll be back to wrap up day one from VMO in 2022, right back.

(upbeat music) >> We're back at AWS reinvent 2021. You're watching The Cube, I'm Dave Vellante with my co-host Dave Nicholson. David Nicholson, I'm Dave he's David. >> We're trying something new here at the cube. A little stand up cube. You've heard of the pop-up cube, maybe. We're going to stand up. I work at a stand, standing desk at my office, so let's try it. Four days, two sets, a hundred plus guests. Why not? So Manish Sood is here, he's the founder and CTO of Reltio, Cube alum. >> Dave: Manish, thank you for standing and good to see you again. >> Dave, It's great to see you again, and David, thank you for having me here. >> So, tell us a little bit about your, yourself, your background. I'm always interested to ask founders why you started your company, but tell us the background. >> Yeah, so a little bit of my background and the company's history. I, most of my background has been in data management and creating products for data management. I was at a company called Informatica, came through an acquisition through Informatica, back in 2010. And Started Reltio in 2011. The reason why we started Reltio was that, if you look at the enterprise space and how things have been evolving, there have been an explosion of applications. There's almost an application for every little business process that you can possibly imagine. Enterprise customers who used to struggle with 12 or 24 different systems, are now coming to us and saying they have 300 or 500 different applications that they use to run their business. And that's at the lower end of the spectrum. Even a business like Reltio today, runs on a hundred plus SAAS applications, end to end. And that it is creating one of the biggest opportunities, as well as one of the biggest friction points in the enterprise. Because in order to create better, efficient business outcomes, you have silos of data and you don't know where the source of truth is. And that is something that we saw early on in 2011. At the same time, we also saw that digital transformation or cloud transformation type of requirements, were going to drive a larger need for this kind of capability, where Reltio type of products could act as that single source of truth to unify all of the multi-source siloed information. So, that's what got us started down this journey. >> So, okay. So, when see people hear single source of truth, they think, oh, database, right? But that's not what you guys do, right? I mean, it's, it's, can I call it master data management? But it's really modern master data management. You're kind of recreating a new or creating a new category that- >> Manish: A little bit. >> solves a similar problem. Maybe you could explain that. >> Yeah. A little bit of background. So the term master data management came about the 1920s. (Dave laughing) You believe that? When during the pandemic, the U.S. government was trying to figure out how to know who is still alive versus, you know, not there anymore. And they created something called the death master. Now a very ominous name, for a concept of just bringing data together and figuring out what's going on in the economy, but that need, or problem hasn't gone away. It has just become a harder problem to solve because now we have so many different systems, to deal with. And both internal as well as third-party data sources that companies have to work with. And that's where the need has been around, but the technical capabilities to really keep solving the problem and delivering the solution in a manner where it can keep pace with the evolving needs, that capability has been missing. And that's where the "aha" moment for us was that we really needed to build it out as a foundation that would continue to grow and scale, with the magnitude of the problem that we were going to see in the future. >> Okay, so this idea of single version of the truth, obviously critically important for reporting, financials, you can't, you can't tell an auditor one thing, you know, your, your customers are another thing, your consumers, it's got to be consistent. And especially in regulated industries. Is there a difference Manish, between sort of that type of data and the data maybe that's in the line of business that doesn't necessarily affect the rest of the business? Can they have their own version of the truth, which is just their version, their, their, their single version? It doesn't necessarily have to affect anything else. Do you, are you seeing that changing data landscape, where things are getting more distributed and ownership is becoming more distributed? >> So, the change in the paradigm that we are seeing is because of the proliferation of the data, there is a need to establish, what is the aggregated view of the information. Aggregated and unified, which means that, you know, if there is a record for Dave Vellante or David Vellante. It's the same person. Establishing that fact as the truth across any number of systems that you have, versus the multiple versions of the truth, where somebody comes in and says, for compliance reasons, I want the entire collection of data versus for marketing reasons, I only want one third the slice of this information. So that's where this concept of aggregate once, unify that information, but then make it ready and available for multiple consumers to partake from that. That's becoming the norm. >> Dave: Got it. >> And you mentioned something, Dave, that analytics, reporting, BI, data science, those have been some of the traditional playgrounds for this kind of information to be unified, because if you're trying to roll up the revenue for, you know, the business that you do with Coke or Coca-Cola, you know, you don't know which name you used, then you have to go back to the analytics warehouse and aggregate all of that information and do the reporting. But the same problem is coming up in real time, digital experiences as well. The only difference is, that instead of having the luxury of a few hours, now you have to make the decision in a few milliseconds. >> So, when you talk about those silos of data and seeking to have a unification of those silos, how has that changed in the era of cloud? Is it that Reltio is integrating those disparate sources that now exist in cloud, or is it that you are leveraging cloud to address the problem that's been with us for a long time? And I have to say that Dave Vellante, take him off the the death master. He's definitely still with us. (Manish and Dave laugh) >> Dave: Another good day. >> I'm pretty sure too. But how, how, how has, how have things changed as you know, with, with the dawn of cloud? >> With the dawn of cloud, there are two things that have become available to us. One is using the power of the cloud compute to solve the problem, so that you can keep growing with the footprint of the problem itself and have a solution that scales along with it. But at the same time, you have systems of record, could be your mainframe systems, could be your SAP, ERP type of deployments that you have. Some of those functional applications, they're not going away anytime soon, they're there to stay. But at the same time, you also need the new digital experiences to be delivered on. The glue between those two worlds is the source of truth data that sits in the middle and the best place for it to sit is the cloud, because you have to open it up to the rest of the ecosystem that sits in the cloud, but you also have to maintain a connection to the on the ground type of systems. Putting it behind the firewall and trying to do that is next to impossible, but doing it in the cloud opens up all the doors that you need for your transformation to take place. >> You know Dave, there was a time when I was part of an industry where coding, not writing code, but coding data to basically say, look, this field here is the person's last name. This field is the address where the mortgage is being held. How much of that is still manual, as opposed to applying some form of AI to the problem? Let's say you have 200 different sources of information, where Dave Vellante's name shows up in a variety of contexts. Are we still having to go in manually and sift through to make those correlations? How much of that has been automated at this point? >> So, there are systems of capture where some of that information, because your loan mortgage application was entered by somebody into a system, will still be captured in those places, but we'll take in that information. That's the starting point, but if there are other sources, then we will apply AIML type of capabilities to bring on those new emerging sources. Because at the same time, think about this equation where, you started with five systems or, you know, a dozen systems. Now you're talking about 300 plus systems. You cannot keep doing this manually for every system possible. And this number is only going to grow as we move forward. So AIML definitely has a role to play and further automate this landscape. >> I had to, I saw an amazing stat the other day, the source was the Sand Hill Econometrics, you know, a Silicon valley company. And the stat was that 70% of the series, A, B and C companies, fail to return at least one X to their investors. So you've made it through that nut hole. Congratulations you just raised $120 million dollar round. That's got to be super exciting for you. >> David: No pressure by the way. >> Dave: Tell us about that. Well, I mean, you'd think the industry would have de-risked by now, right. But anyway, so, tell us about that raise. Where are you, where are you guys are at? Very exciting times for you. >> Yeah, really, really exciting time for us. We just raised $120 million dollars. The company was valued at $1.7 billion dollars. >> Dave: Awesome. Congratulations. >> And the round was, you know, all of our existing investors participated in it. We also had a new investor join in the process, as well. >> Dave: They wanted their pro-rata. (Dave and Manish laugh) >> Everybody, everybody wanted their pro-rata. >> Dave: That's great. >> But you know, one of the things that we have been very careful about in this whole process and journey, is something that you and I were talking about, the step function of scale. We're making sure that we are efficient stewards of capital and applying it in a manner where we are at every turn, looking at what's the next step function that we need to graduate to, because we want to make use of this capital to efficiently grow our business and be a Rule of 40 growth company. And that's something that you don't typically hear these days from a lot of the growth companies, but we are certainly focused on building long-term value and focusing on that Rule of 40 growth efficiency. >> Yeah, so Rule of 40 is growth plus EBITDA, or sometimes they use other metrics, but is that how you look at it? Growth plus EBITDA. >> Yes. Yeah. >> Great. >> And that's the formula that we are driving for. And most of our investments with this round of capital are going to be not only pushing forward with the go-to market strategy, because we have a lot of growth opportunity, we have been North America focused, now we can take this global. At the same time, looking at the verticals where we need to double down and invest more, given that we have been a horizontal platform that is core to our capabilities, that we have built with Reltio. But at the same time, making sure that we are investing in the key verticals that we are present in. >> Yeah. So, you were explaining to me that you, you started in the pharmaceutical industry, that's where you got go to market fit. And then you went to other industries. When you went to those other industries where they're similar patterns, or do you do almost have to start from ground zero again, to get that product market fit? >> No. So from the very beginning, the concept has been that this is a horizontal data problem. And at the heart of it, it's information about people, organizations, product, locations, and most of the businesses run on that type of information. That's the core part of the data that they build their business on. Life sciences was a perfect starting point for us, because it had examples of all of those data. When you start with commercial operations, which is sales and marketing, you have people, organization, product type of information. When you go into clinical trials, you have site investigators and patient type of information. When you go into R and D within that same space, you have drugs, compounds, substances, finished products, type of information, all coming from multiple sources. So it was a perfect place for us to prove out, all of the capabilities end to end, which we like to call multi-domain capabilities. And then we looked at what other verticals have similar patterns. And that's why we went after healthcare, financial services, insurance, retail, high tech. Those are some of the key verticals that we are in right now. >> That's awesome. Great vision. Last question, could you give us a sense of the futures, where you're going? Well, first of all, what are you doing with the money? Is it, you go to market, throwing gas on the fire? And what can we expect in the coming year and years? >> Go to market expansion is a key area of investment, but also doubling down on the customer experience that we deliver, how we invest in the product, what are some of the adjacent capabilities that we need to invest in? Because you know, data is a great starting point and data should not hold businesses back. Data should be the accelerant to the business. And that's our philosophy, that we are trying to bring to life. So making sure that we are making the data, readily available, accessible and usable for all of our customers is the key goal to aim for. And that's where all the investment is going. >> Well, Manish was a pleasure having you on at the AWS startup showcase, and then subsequently you become a unicorn. So congratulations on that. Really excited to watch the continued progress. Thanks for coming back in The Cube. >> Well, thank you so much, Dave and David, thanks for having me. >> David: Thanks for validating that Mr. Vellante is still with us. >> (laughs) He's going to be with us for a long time. >> I hope so, I hope so, I got, I got one more to put through college. Thank you for watching this edition of The Cube, at AWS reinvent. I'm Dave Vellante, for Dave Nicholson. We are The Cube, the leader in high-tech coverage, Be right back. (somber music)

(upbeat music) >> Man: From San Francisco it's theCUBE covering Accenture Tech Vision 2020 (upbeat music) brought to you by Accenture. >> Hey, welcome back everybody. Jeff Frick here with theCUBE. We are high atop San Francisco. It is absolutely beautiful outside. Sun is going down, we're here for a really special event, It's the Accenture Tech Vision, kind of unveiling of the five things that we should be paying attention to as we look to 2020 the year that we're going to know everything with the benefit of hindsight. So it's pretty exciting, it's pretty exciting time. And we have a new guest, Mike Redding, he's the managing director of Accenture Ventures telling us where the Accenture Ventures plays in all this stuff, so Mike, well, welcome. >> Well, thanks for having me, I'm really excited to be here. It's a big day here at Accenture with the launch of the 2020 tech vision. You know, and one of the key trends is about innovation DNA, which is really saying, how does an organization connect to the external ecosystems to systematically and scalably and sustainably innovate? And that's part of the role of Accenture Ventures. >> Well, it's an interesting play, right? Because unfortunately Clayton Christensen just passed away, my favorite business writer ever. And the whole innovator's dilemma is that smart people working at big companies making sound business decisions based on revenue and their customers will always miss this continuous change. So really you need some other things to help motivate that. And that's really piece that you guys play. >> Right, exactly cause what, you know, we're a bridge builder between those highly successful large enterprises, which are big, they're slow and they're risk adverse, and the startups, which are small, fast and nothing but risk. And so for us, the role of Accenture and Accenture ventures as being part of that innovation DNA is to say, let's make a bridge, let's figure out how the elephant can dance. And as a result, not get caught up in those disruptions, but in fact leverage them to propel those big enterprises forward. >> Right, now you guys invest in all types of areas, Ais, looking through the portfolio, security, big data, I love this Industry X Dot O, what is Industry X Dot O? >> Well, so, you know, a lot of places talk about industry 4.0 but we're like, why put it, you know, X dot O, is make it a variable? five point O, six point O, which makes it evergreen. Which says, every industry on the planet is going through a transformation, you know, powered by AI, powered by all those areas you mentioned. And as a result, we want to make sure that whatever the future of any industry is, Accenture is part of it and we're bringing in the startups and of course the big technology players that are going to be the fundamental players making that transformation possible. >> Right, there's so much synergy, right? Because for the little guys, right? They've got all the juice behind the innovation and the really smart people and they're kind of breaking things and moving fast, but the challenges there are scale and a sales force and marketing and reach and distribution and all these things that are not too hard for the big guys. >> Right, and so that's why it's a marriage made heaven, right? Again, if you can bring, I always like to say the analogy of you've got the aircraft carrier and then you have all the battleships and the PT boats circling around it, that's a battle group. And so that's what we really see as the opportunity is to bring what each strength, the strength of that disruption and passion and energy and capital to marry to market scale and data and customer base, right? Put those things together, unstoppable force? >> How do the enterprises, you know, kind of view it, do they, obviously they see the value, you wouldn't be doing what you're doing, but is that something that's attracted to them? Is it too disruptive to them? How do they try to work these little startups? Cause (laughs) the other thing, right? Is always vendor viability when you're a little startup doing business with a big company and they can kill you with meetings and there's all kinds of, you know, kind of interesting things that can happen to screw that up. >> Well you're right on and so that's part of where, you know, Accenture comes in as that broker, that bridge maker, because we help each other find how to match up, how not to crush the little guy with infinite meetings, you know, in an enterprise, you know, six months is quick, in a startup, that's a funding cycle, right? And so we've got to find a way to meet each other in the middle and as a result, get the strength of each, but pointed in the same direction and really, you know, become really good dance partners. And that's what we really think any organization, cause they know they need to do it, they know they want to do it, they just don't know how. And that's the gap we help fill. >> And then how do you find your investments? Are you partnering with other venture firms? How are you kind of out prospecting for new opportunities? >> Well, so for us, since we're a corporate strategic, we're really focused on the future of our client's business, the future of the marketplace. And so for us, it's a network game. It's, you know, it's everything from what the corporate venture units at our clients are up to where they're seeing strategic bets. Of course, we're the VC, you know, of Sand Hill Road, of Tel Aviv, of Shenzhen and Shanghai, you know, Bangalore, you know, there's so many great venture capital communities. We love the syndicate, we love friends because we, you know, a financial VC will bring their discipline and we'll bring Accenture's discipline and that's a combo pack that one plus one is three. >> Right, so I want to get your take, you've been in this for a while -- >> Oh, yeah. and one of the themes that we hear over and over, right, is the acceleration of accelerating pace of technology innovation, right? And this exponential curve and people have a hard time with exponential curves, we like linear curves. But it's getting steeper and steeper and steeper. So you know, from your kind of cap bird seed, as you've watched the evolution, do you see, you know, kind of, is this the only way for the enterprises to keep ahead of these things? Is it just an augment? Is it more important than it used to be? How has the landscape kind of changing as this acceleration just keeps going and going and going? >> Well, I think that the era of build it all yourself vertically integrate it So, you know, start to finish, soup to nuts yourself, you can't do it, right? If you're a large incumbent and, but also if you think about this way, and I would talk to audience especially, you know, business audience and say, "Who's got enough budget?" Nobody, there's no such thing as enough budget, the government doesn't have enough budget, right? Nobody does, but if you partner, you can leverage other people's money, their investment cycles, and as a result, for every dollar you have, you can get multiple dollars of leverage. And as a result, no matter how fast it's going, because of the Public Clouds, because of the big software players, you can get so much further. So even though things are moving faster, what you can leverage to adapt to that change is more powerful than ever before. So the good news is the rate of change is fast, but you're not starting from dead stop. You're jumping on a moving train and going where it's going and putting your own business spin on it. >> Right, the other piece is kind of the disruptive speeds. It's funny you mentioned Amazon just, you know, watch a lot of great interviews with Bezos. One of them, he talks about AWS having, you know, a seven-year uninterrupted headstart because no one down the road in Redwood shores or Philadelphia or Waldorf was really paying attention to the little bookseller up in Seattle as a competitor for enterprise infrastructure. So you know that which is going to get you is often not the competitors that you're benchmarking against. It's not the same people that you've been competing with but can completely come out of left field. >> Well, and so that again, is why we really believe passionately that with this future, the next few years, those enterprises that have an innovation DNA that get out of their foxhole and don't just look at your bank, don't just look at FinTech, look at all tech and thanks to this thing called the internet. It's really possible, and language translation, even if you don't speak Chinese, you can get a sense of what's happening in China, where you can call a friend like Accenture and we can hook you up. And regardless of the fact is you can now, if you cast that wide net, if you challenge yourself to get out of that Foxhole and look around, well then suddenly you can't be surprised. You can see it coming and you can then use your superpowers, which is incumbency, scale, balance sheet, customer base, you know, loyalty, all those things that you brand, all the things that make you strong, you can now append that disruption to it and basically, not get disrupted. So I think that's, that's the formula for going forward. >> Yeah, well, I love the one plus one makes three formula cause it really is kind of a match made in heaven really bringing together two sets of strengths that the other person or the other party doesn't really have. So you guys been at it for awhile and continued success. >> Well, thank you very much. All right. Well, Mike, thanks for taking a minute. He's Mike, I'm Jeff, you're watching theCUBE. With the Accenture Tech Vision launch 2020. Thanks for watching, we'll see you next time. (upbeat music)

>> Narrator: From Sand Hill Road, in the heart of Silicon Valley, it's the CUBE. Presenting, The People First Network, insights from entrepreneurs and tech leaders. >> Hello everyone welcome to this special CUBE conversation, I'm John Furrier, host of theCUBE. We're here at Mayfield Fund, on Sand Hill Road and Menlo Park. As part of Mayfield's People First Network, co-creation with SiliconANGLE and theCUBE and Mayfield. Next guest, Beth Devin, Managing Director of Innovation Network and Emerging Technologies at Citi Ventures. Thanks for coming on. >> Thanks for having me. >> Hey, thanks for coming in. We're here for the Mayfield fiftieth anniversary, where they're featuring luminaries like yourself, and we're talking about conversations around how the world's changing and the opportunities and the challenges can be met, and how you can share some of your best practices. Talk about what your role is at Citi Ventures and what your focus is. >> Sure, sure, and boy howdy, has it been changing. It's hard to keep up with. I've been at Citi Ventures about two years and one of the reasons I joined was to stand up an Emerging Technology practice. Citi Ventures does a lot of work in corporate venture investing. We tend to be strategic investors, for start up companies that are aligned with the strategy of Citi, as well as our client. We serve probably, eighty percent of the Fortune Five Hundred companies in the world. But we also are a really important part of the innovation ecosystem at Citi. Which is looking at how to drive culture change, broaden mindset, and really, enlist our employees to be part of the innovation process. So, we have an internal incubator, we have a Shark Tank-like process we call Discover Ten X. And what I really bring to the table with my team is monitoring, and learning about, and digesting technology that's not quite ready for commercialization but we think it might be disruptive in a good or challenging way for the bank or our clients. We try to educate and provide content that's helpful to our executives, and just the employee body at large. >> I want to get into a LinkedIn post you wrote, called the Tech Whisperer, which I love. >> Thank you. >> You're there to identify new things to help people understand what that is. But that's not what you've done. You've actually implemented technology. So, on the other side of the coin, in your career. Tell us about some of the things you've done in your career, because you've been a practitioner. >> Beth: Yeah. >> and now you're identifying trends and technologies, before you were on the other side of the table. >> That's right, and sometimes I'll tell you, I have that itch. I miss the operator role, sometimes. Yeah, you know, I feel so fortunate I sort of stumbled on computer science early when I was going to school. And, the first, I'd say twenty years of my career, were working in enterprise I.T, which at that time I couldn't even have made that distinction, like why do you have to say enterprise I.T. I was a software developer, and I was then a DBA, and I even did assembler language programing. So way back when, I think I was so fortunate to fall in to software engineering. It's like problem solving, or puzzle making, and you with your own brain and sort of typing can figure out these problems. Then over the years I became more of a manager and a leader, and sort of about a reputation for being somebody you could put on any hard problem and I'd figure a way out. You know tell me where we're trying to go it looks knotty, like not a fun project, and I would tackle that. And then I'd say, I had some experience working in lots of different industries. Which really gave me an appreciation, for you know, at the end of the day, we can all debate the role that technology plays in companies. But industries, whether it's health care or media, or financial services. There's a lot of the same challenges that we have. So I worked at Turner Broadcasting before it was acquired, you know by Time Warner and AOL. And I learned about media. And then I had a fantastic time working at Charles Schwab. That was my first big Financial Services role when it came back to the bay area. I worked at Art.Com, it was a need converse company, the first company I worked at where I was in charge of all the technology. We had no brick and mortar, and if the technology wasn't working, we weren't earning revenue, in fact, not only that, we were really making customers angry. I also had a role at a start up, where I was the third person to join the company, and we had a great CEO who had a vision, but it was on paper. And we hadn't really figured out how to build this. I was very proud to assemble a team, get an office, and have a product launch in a year. >> So you're a builder, you're a doer, an assembler, key coding, hexadecimal cord dumps back in the day. >> Way back when. We didn't even have monitors. I'll tell ya, it was a long time ago. >> Glory days, huh? Back when we didn't have shoes on. You know, technology. But what a change. >> Huge change. >> The variety of backgrounds you have, The LinkedIn, the Charles Schwab, I think was during the growth years. >> And the downturn, so we got both sides. >> Both sides of that coin, but again, the technologies were evolving. >> Yes. >> To serve that kind of high frequency customer base. >> Beth: That's right. >> With databases changing, internet getting faster. >> It has. >> Jeff: More people getting online. >> We were early adopters, I'll tell you. I still will tell people, Charles Schwab is one of the best experiences I have, even though at the end I was part of the layoff process. I was there almost seven years, and I watched, we had crazy times in the internet boom. Going in 98, 99, 2000, I can't even tell you some of the experiences we had. And we weren't a digital native. But we were one of the first companies to put trading online, and to build APIs so our customers could self service, and they could do that all online. We did mobile trading. I remember we had to test our software on like twenty different phone sets. Today, it's actually, so much easier. >> It's only three. Or two. Or one. Depending on how you look at it. >> That's right. We couldn't even test on all the phone sets that were out then. But that was such a great experience, and I still, that Schwab network, is still people I'm in touch with today. And we all sort of sprinkled out to different places. I think, I dunno, there's just something special about that company in terms of what we learned, and what we were able to accomplish. >> You have a fantastic background. Again the waves of innovation you have lived through, been apart of, tackling hard problems, taking it head on. Great ethos, great management discipline. Now more than ever, it seems to be needed, because we're living in an age of massive change. Cause you have the databases are changing, the networks changing, the coding paradigms changing. Dev ops, you've got the role of data. Obviously, mobile clearly is proliferated. And now the business models are evolving. Now you got business model action, technical changes, cultural people changes. All of those theaters are exploding with opportunity, but also challenges. What's your take on that as you look at that world? >> You know, I'm a change junkie, I think. I love when things are changing, when organizations are changing, when companies are coming apart and coming together. So for me, I feel like, I've been again, so fortunate I'm in the perfect place. But, one of the things that I really prided myself on early in my career, is being what I call the bridge, or the, the translator between the different lines of business folks that I work with. Whether it was head of marketing, or somebody in a sales or customer relationship, or service organization, and the technology teams I built and led. And I think I've had a natural curiosity about what makes a business tick, and not so much over indexing on the technology itself. So technology is going to come and go, there's going to be different flavors. But actually, how to really take advantage of that technology, to better engage your customers, which as you said, their needs and their demands are changing, their expectations are so high. They really set the pace now. Who would have though that ten years ago we'd live in an environment where industries and businesses are changing because consumers have sort of set the bar on the way we all want to interact, engage, communicate, buy, pay. So there's this huge impact on organizations, and you know, I have a lot of empathy for large established enterprises that are challenged to make it through this transformation, this change, that somehow, they have to make. And I always try to pay attention on which companies have done it. And I call out Microsoft as an example. I can still remember several years ago, being at a conference. I think it was Jeffrey Moore who was speaking, and he had on one slide... Here's all the companies in technology that have had really large success. Leading up to the internet boom days, there would be a recipe for the four companies that would come together. I think it was Sun, Oracle, and Microsoft. And then he said, and now here's the companies of today. And most young people coming out of college, or getting computer science degrees won't use any of these old technology companies. But Microsoft proved us all wrong, but they did it, focused on people, culture, being willing to say where they screwed up, and where they're not going to focus anymore, and part ways with those parts of their business. And really focus on who are their customers, what are their customer needs. I think there's something to be learned from those changes they made. And I think back to the Tech Whisperer, there's no excuse for an executive today, not to at least understand the fundamentals of technology. So many decisions have to be made around investment, capital, hiring, investment in your people. That without that understanding, you're sort of operating blind. >> And this is the thing that I think I love, and was impressed by that Tech Whisperer article. You know, a play on the Horse Whisperer, the movie. You're kind of whispering in the ears of leaders who won't admit that they're scared. But they're all scared! They're all scared. And so they need to get, maybe it's cognitive dissonance around decision making, or they might not trust their lead. Or they don't know what they're talking about So this certainly is there, I would agree with that. But there's dynamics at play, and I want to get your thoughts on this. I think this plays into the Tech Whisperer. The trend we're seeing is the old days was the engineers are out coding away, hey they're out there coding away, look at them coding away. Now with Cloud they're in the front lines. They're getting closer to the customer, the apps are in charge. They're dictating to the infrastructure what can be done. With data almost every solution can be customized. There's no more general purpose. These are the things we talk about, but this changes the personnel equation. Now you got engineering and product people talking to sales and marketing people, business people. >> And customers. >> They tend not to, they traditionally weren't going well. Now they have to work well, engineers want to work with the customers. This is kind of a new business practice, and now I'm a scared executive. Beth, what do I do? What's your thoughts on that dynamic? >> You know, I'm not sure I would have had insight in that if I hadn't had the oppurtunity to work at this little start up, which we were a digital native. And it was the first time I worked in an environment where we did true extreme programming, pair programming, we had really strong product leads, and engineers. So we didn't have project managers, business analysts, a lot of things that I think enterprise I.T tends to have. Because the folks, historically, at an enterprise, the folks that are specifying the need, the business need, are folks in the lines of business. And they're not product managers, and even product managers, I say in banking for example, they aren't software product managers. And so that change, if you really do want to embrace these new methods and dev ops, and a lot of the automation that's available to engineering and software development organizations today, you really do have to make that change. Otherwise it's just going to be a clumsy version of what you use to do, with a new name on it. The other thing though that I would say, is I don't want to discount for large enterprises is partnerships with start up companies or other tech partners. You don't need to build everything. There's so much great technology out there. You brought up the Cloud. Look at how rich these Cloud stacks are getting. You know, it's not just now, can you provision me some compute, and some storage, and help me connect to the internet. There's some pretty sophisticated capabilities in there around A.I and machine learning, and data management, and analysis. So, I think overtime, we'll see richer and richer Cloud stacks, that enables you know, every company to benefit from the technology and innovation that's going on right now. >> Andy Jassy, the CEO of Amazon Web Search, has always said whenever I've interviewed him, he always talks publicly now about it is, two pizza teams, and automate the undifferentiated heavy lifting. In tech we all know what that is, the boring, mundane, patching, provisioning, ugh. And deploying more creative research. Okay so, I believe that. I'm a big believer of that philosophy. But it opens up the role, the question of the roles of the people. That lonely DBA, that you once were, I did some DBA work myself. System admins, storage administrator, these were roles, network administrator, the sacred God of the network, they ran everything. They're evolving to be much more coding oriented, software driven changes. >> It's a huge change. And you know, one thing that I think is sad, is I run into folks often that are, I'll just say, technology professionals, just say, you know, we're at large. Who are out of work. You know, who sort of hang their head, they're not valued, or maybe there's some ageism involved, or they get marked as, oh that's old school, they're not going to change. So, I really do believe we're at a point, where there's not enough resources out there. And so how we invest in talent that's available today, and help people through this change, not everybody is going to make it. It starts with you, knowing yourself, and how open-minded you are. Are you willing to learn, are you willing to put some effort forth, and sort of figuring out some of these new operating models. Because that's just essential if you want to be part of the future. And I'll tell you, it's hard, and it's exhausting. So I don't say this lightly, I just think. You know about my career, how many changes and twists and turns their have been. Sometimes you're just like, okay I'm ready, I'm ready to just go hiking. (Beth laughs) >> It can be, there's a lot of institutional baggage, associated with the role you had, I've heard that before. Old guard, old school, we don't do that, you're way too old for that, we need more women so lets get women in. So there's like a big dynamic around that. And I want to get your thoughts on it because you mentioned ageism, and also women in tech has also grown. There's a need for that. So there's more opportunities now than ever. I mean you go to the cyber security job boards, there are more jobs for cyber security experts than any. >> Oh, I'll tell you, yesterday, we held an event at our office, in partnership with some different start ups. Because that's one of the things you do when you're in a corporate venture group, and it was all on the future of authentication. So it was really targeted at an audience of information security professionals and chief information security officers. And it was twenty men and one woman. And I thought, wow, you know I'm use to that from having been a CIO that a lot of the infrastructure roles in particular, like as you were saying, the rack and stack, the storage management, the network folks, just tend to be more male dominant, than I think the product managers, designers, even software engineers to some extent. But here you know, how many times can you go online and see how many openings there are for that type of role. So I personally, am not pursuing that type of role, so I don't know what all the steps would need to be, to get educated, to get certified, but boy is there a need. And that needs not going to go away. As more, if everything is digitized and everything is online. Then security is going to be a constant concern and sort of dynamic space. >> Well, we interview a lot of women in tech, great to have you on, you're a great leader. We also interview a lot of people that are older. I totally believe that there's an ageism issue out there. I've seen it first hand, maybe because I'm over fifty. And also women in tech, there's more coming but not enough. The numbers speak for themselves. There's also an opportunity, if you look at the leveling up. I talked to a person who was a network engineer, kind of the same thing as him, hanging his head down. And I said, do you realize that networking paradigm is very similar to how cyber works. So a lot of the old is coming back. So if you look at what was in the computer science programs in the eighties. It was a systems thinking. The systems thinking is coming back. So I see that as a great opportunity. But also the aperture of the field of computer science is changing. So it's not, there are some areas that frankly, women are better than men at in my opinion. In my opinion, might get some crap for that. But the point, I do believe that. And there are different roles. So I think it's not just, there's so much more here. >> Oh, that's what I try to tell people. It's not just coding, right. There's so many different types of roles. And unfortunately I think we don't market ourselves well. So I encourage everyone out there that knows somebody. (Beth laughs) Who's looking-- >> If someone was provisioned Sun micro-systems, or mini computers, or workstations, probably has a systems background that could be a Cloud administrator or a Cloud architect. Same concepts. So I want to get your thoughts on women in tech since you're here. What's your thoughts on the industry, how's it going, things you advise, other folks, men and women, that they could do differently. Any good signs? What's your thoughts in general? >> Yeah so, first of all, I'm just a big advocate for women in general. Young girls, and, young women, just getting into the work force, and always have been. Have to say again, very fortunate early in my career working for companies like a phone company, and Schwab, we had so many amazing female leaders. And I don't even think we had a program, it was just sort of part of the DNA of the company. And it's really only in the last couple of years I really seen we have a big problem. Whether it's reading about some of the cultures of some of the big tech companies, or even spending more time in the valley. I think there's no one answer, it's multifaceted. It's education, it's families, it's you know, each one of us could make a difference in how we hire, sort of checking in what our unintended biases are, I know at Citi right now, there's a huge program around diversity and inclusion. Gender, and otherwise. And one of the ways I think it's going to be impactful. They've set targets that I know are controversial, but it holds people accountable, to make decisions and invest in developing people, and making sure there's a pipeline of talent that can step up into even bigger roles with a more diverse leadership team. It will take time though, it will take time. >> But mind shares are critical. >> It absolutely is. Self-awareness, community awareness, very much so. >> What can men do differently, it's always about women in tech, but what can we, what can men do? >> I think it's a great question. I would say, women can do this too. I hate when I see a group together, and it's all women working on the women issue. Shame on us, for not inviting men into the organization. And then I think it's similar to the Tech Whisperer. Don't be nervous, don't be worried, just step in. Because, you know, men are fathers, men are leaders, men are colleagues. They're brothers, they're uncles. We have to work on this together. >> I had a great guest, and friend, I was interviewing. And she was amazing, and she said, John, it's not diversity and inclusion, it's inclusion and diversity. It's I-N-D not D-I. First of all, I've never heard of it, what's D-N-I? My point exactly. Inclusion is not just the diversity piece, inclusion first is inclusive in general, diversity is different. So people tend to blend them. >> Yes they do. >> Or even forget the inclusion part. >> Final question, since you're a change junkie, which I love that phrase, I'm kind of one myself. Change junkies are always chasing that next wave, and you love waves. Pat Gelsinger at VMWare, wave junkie, always love talking with him. And he's a great wave spotter, he sees them early. There's a big set of waves coming in now, pretty clear. Cloud has done it's thing. It's only going to change and get bigger, hybrid, private, multi Cloud. Data, AI, twenty year cycle coming. What waves are you most excited about? What's out there? What waves are obvious, what waves aren't, that you see? >> Yeah, oh, that's a tough one. Cause we try to track what those waves are. I think one of the things that I'm seeing is that as we all get, and I don't just mean people, I mean things. Everything is connected, and everything has some kind of smarts, some kind of small CPU senser. There's no way that our existing, sort of network, infrastructure and the way we connect and talk can support all of that. So I think we're going to see some kind of discontinuous change, where new models are going to, are going to absolutely be required cause we'll sort of hit the limit of how much traffic can go over the internet, and how many devices can we manage. How much automation can the people and an enterprise sort of oversee and monitor, and secure and protect. That's the thing that I feel like it's a tsunami about to hit us. And it's going to be one of these perfect storms. And luckily, I think there is innovation going on around 5G and edge computing, and different ways to think about securing the enterprise. That will help. But it couldn't come soon enough. >> And model also meaning not just technical business. >> Absolutely. Machine the machine. Like who's identity is on there that's taken an action on your behalf, or the companies behalf. You know, we see that already with RPA, these software robots. Who's making sure that they're doing what they're suppose to do. And they're so easy to create, now you have thousands of them. In my mind, it's just more software to manage. >> And a great contrary to Carl Eschenbach, former VMware CEO now at Sequoia, he's on the board of UIPath, they're on the front page of Forbes today, talking about bots. >> Yes, yes, yes, I've heard them speak. >> This is an issue, like is there a verification. Is there a fake bots coming. If there's fake news, fake bots are probably going to come too. >> Absolutely they will. >> This is a reality. >> And we're putting them in the hands of non-engineers to build these bots. Which there's good and bad, right. >> Regulation and policy are two different things, and they could work together. This is going to be a seminal issue for our industry. Is understanding the societal impact, tech for good. Shaping the technologies. This is what a Tech Whisperer has to do. You have a tough job ahead of you. >> But I love it. >> Jeff: Beth thank you for coming on. >> Thank you for having me. >> I'm Jeff Furrier for the People First Network here at Sand Hill Road at Mayfield as part of theCUBE and SiliconANGLE's co-creation with Mayfield Fund, thans for watching.

>> Narrator: From Sand Hill Road, in the heart of Silicon Valley, it's theCUBE, presenting the People First Network, insights from entrepreneurs and tech leaders. >> Hello and welcome to a special Cube conversation, I'm John Furrier with theCUBE. We're here at Mayfield Fund on Sand Hill Road, Venture Cap for investing here for the People First co-created production by theCube and Mayfield. Next to us, Phil Finucane who's the former CTO of Express Scripts as well as a variety of other roles. Went to Stanford, Stanford alum. >> Mm hmm. >> Good to see you, thanks for joining me for this interview. >> Thank you, thank you for having me. >> So, before we get into some of the specifics, talk about your career, you're a former CTO of Express Scripts >> Yep. >> What are some of the other journeys that you've had? Talk about your roles. >> Yeah, I've had sort of a varied career. I started off as just a computer coder for a contract coder in the mid-90s. I sort of stumbled into it, not because I had a computer science background, but because when you start coding, sort of for fun in Silicon Valley in the mid-90s, there are just lots of jobs and I was lucky to have great mentors along the way. In 2003, I joined Yahoo and came in as the lead engineer, sort of the ops guy and the build and release guy for the log in and registration team at Yahoo, so I learned how to, went from being just a coder to being somebody who know how to run and build big systems and manage them all around the world. That was in the day when everything was bare metal and I could go to a data center and actually look at my machine and say, "Wow, that one's mine," right? And you know, sort of progressed from there to being the architect by the time that I left for some of the big social initiatives at Yahoo. On my way out, the YOS, the initiative to try to build Facebook in I think 2007, 2008 to try to take them on. That didn't work out too well, but it was definitely a formative experience in my career. From there I went to Zynga, where I was the CTO for Farmville. Was really, really good at getting middle-aged women in the Midwest to come play our game, and you know, was there for >> And it was highly, >> About three years >> high growth, Farmville >> Huge growth >> Took off like a rocket ship. >> Yeah, you know, over the 10 quarters I worked on the game we had over a billion dollars in revenue and that was, you know, the Zynga IPO'd on the back of that, right? And we weren't the only game, but we were certainly >> That was one of the big games >> The big whale, us and poker were the two that really drove the value in Zynga at that point. After that, I went to American Express, where I worked in a division that sort of sat off on the side of American Express focusing on stored value products. I was the chief architect for that division. Stored value products and international currency exchange. So, you know, at one point, I was in charge of both a pre-paid platform and American Express's traveler's checks platform, believe it or not, a thing that still exists. Although it's not heavily used any more. And you know, finally, I went to Express Scripts, where I spent the last three years as the CTO for that org. >> It's interesting, you've got a very unique background, because you know, you've seen the web scale, talk about bare metal Yahoo days, I mean, I remember those days vividly, you know, dealing with database schemas, I mean certainly the scale of Yahoo front page, never mind the different services that they had, which by the way, silo-like, they had databases >> Very, oh totally >> So building a registration and identity system must've been like, really stitching together a core part of Yahoo, I mean, what a Herculean task that must've been. >> Yeah, it was a lot of fun. I learned a lot, you know, we, it was my first experience in figuring out how to deal with security around the web. You know, we had, at the beginning, some vulnerabilities here and there, as time went on, our standards around interacting around the web got better and better. Obviously, Yahoo has run into trouble around that in subsequent years, but it was definitely a big learning experience, being involved in you know, the development of the OAuth 2.0 spec and all of that, I was sort of sitting there advising the folks who were, you know, in the middle of that, doing all the work. >> And that became such a standard as we know, tokens, dealing with tokens and SAS. Really drove a lot of the SAS mobile generation that did cloud, which becomes kind of that next generation so you had, you know Web 1.0, Web 2.0, then you had the cloud era, cloud 2.0, now they're goin' DevOps and apps. I want to get your thought, and you throw crypto in there just for fun, of dealing with blockchain and then token economics and new kinds of paradigms are coming online >> It's amazing how far we've come in those years, right? I mean I look at the database that was built inside of Yahoo and this predated me, you know, this was back to circa 1996, I think, but you know, big massively scalable databases that were needed just because the traditional relational database just wouldn't work at that scale, and Yahoo was one of the first to sort of discover that. And now you look at the database technologies that are out there today that take some of those core concepts and just extend them so much further and they're so much easier to access, to use, to run, operate, all of those things than back in the days of Yahoozle, UDB, and it's amazing just to see how far we've come. >> Phil, I want to get your thoughts, because you know, talking about Yahoo and just your experiences and even today, at that time it was like changing the airplane's engine at 35,000 feet, it's really difficult. A lot of corporate enterprises right nhow are having that same kind of feeling with digital, and digital transformation, I'd say it's a cliche, but it is true this impact, the role of data that's playing and the just for value creation but also cybersecurity could put a company out of business, so there's all kinds of looming things that are opportunities and challenges, that are sizable, huge tasks that was once regulated to the full stack developers and the full web scalers, now the lonely CIO with the anemic enterprise staff has to turn around on a dime. Staff up, build a stack, build commodity, scale out, this is pretty massive, and not a lot of people are talking about this. What's your view on this? Because this is super important. >> Yeah it is, and you know, so I had kind of a shock, moving from working my whole career here on Silicon Valley and then going to American Express, which you know, is very similar in a lot of ways to Express Scripts, and the sort of corporate mindset around, "What is technology?" There is this notion that everything is IT and here in the valley, IT is you know, internal networks and laptops and those sorts of things, the stuff that's required to make your enterprise run internally. Their IT is all of your infrastructure, right? And IT is a service organization, it's not the competitive advantage in your industry, right? And so both of the places that I've gone have had really forward-thinking leaders that have wanted to change the way that their enterprise operates around technology, and move away from IT but, to technology, to thinking about engineering as a core competency. And that's a huge change, not only for the CIO >> You're saying they did have that vision >> They had the vision, but they didn't know how to get there, so my charter coming in and you know, others who were on the teams around me, our charter was to come in and help build a real engineering organization as opposed to an IT org that's very vendor-oriented, you know, that's dependent on third parties to tell you the right thing or the wrong thing, you know that hires consultants to come in and help set up architecture standards, because we couldn't do that on our own, we're not the experts on this side. You know, that's sort of the mindset in many old school companies, right? That needs, that I think needs to change. This notion that software is eating the world is still not something that people have gotten their heads around in many companies, right? >> And data's washing out old business models, so if software's eating the world, data's the tsunami that's coming in and going to take out the beach and the people there. >> Right. And so it's like, all of these things, it's one thing for, you know, a forward-thinking CEO like Tim Wentworth at Express Scripts, who was responsible for bringing me and the group in, you know, those kinds of folks, it's one thing to know that you have to make that transition it's another thing to have a sense of what that means for an engineering team, and all the more for the rest of the organization to be able to get behind it. I mean, people you know, I don't know any number of business partners who've been used to, just sort of taking a spec, throwing it over the wall, and saying, "Come back to me in two years when you're done." That's not how effective organizations work around technology. >> Let's drill into that, because one of the things that's cultural, I mean I do some of the interviews of theCUBE, I talk to leaders all the time like yourself, the theme keeps coming back, it's culture, it's process, technology, all those things you talk about, but culture is the number one issue people point to, saying, "That's the reason why "something did or didn't happen." >> Correct. >> So, you talk about throwing it over the fence, that's waterfall, so you think about the old waterfall methodology, agile, well documented, but the mindset of product thinking is a really novel concept to corporate America Not to Silicon Valley, and entrepreneurs, they got to launch a product, not roll out SAP over two years, right, or something they used to be doing. So that's a cultural mindset shift. >> It's difficult for folks, even if they want to get on board to come along some of the time. One of the real big successes we had early on at Express Scripts was, you know, transitioning our teams to Agile wasn't difficult, what was difficult was getting business partners to sort of come along and be actively engaged in that product development mindset and lifecycle and all those sorts of things. And you know, we had one partner in particular, we were migrating from a really old, really clunky customer care application that you know had taken years and years to build, took on average, a new agent took six weeks to get trained on it because it was so complex and it's Oracle Forms and you know, every field in the database was a field on this thing, and there were green screens to do the stuff that you couldn't do in Oracle Forms, so and we wanted to rebuild the application. We tried to get them to come along and say, "Okay, we're going to do it in really small chunks," but business partners were like, "No, we can't afford "to have our agents swiveling between two applications." And so finally after we got our first sort of full-feature complete, we begged to go into a call center, you know with our business partners, and sit down with a few agents and just have them use it and see if it looked like it worked, if it did the right thing, and it was amazing seeing the business partner go, over the course of an hour, from "I can't be engaged in this, "I don't want an agent swiveling, "I don't want to be, you know, delivering partial applications "I want the whole thing." to, "Oh my god, it works way better, "the design is much nicer, the agents seem to like it," you know, "Here are the next things we should work on, "These are the things we got wrong." They immediately pivoted, and it wasn't, it was because they're the experts, they know how to run their business, they know what's important in their call centers, they know what their agents need, and they had just never seen the movie before, they just had no concept you could work that way. >> So this is actually interesting, 'cause what you're saying is, a new thing, foreign to the business partners, the tech team's on board, being Agile, building product, they have to, they can't just hear the feature benefits, they got to feel it. >> Yeah, they have to see it >> This seems to be the experience of success before they can move. Is that a success you think culturally, something that people have to be mindful of? >> It's absolutely something you have to be mindful of. And that was just the first step down the path. I mean, that team made a number of mistakes that folks here I think in the valley wouldn't normally make, you know. Over-committing and getting themselves into deep water by trying to get too much done and actually getting less accomplished in the process because of it and you know, the engagement around using data to actually figure out what's the next feature that we build. When you've got this enormous application to migrate, you should probably have some insight as to you know, feature by feature, what are you going to work on next? And that was a real challenge, 'cause there's a culture of expertise-driven, you know being subject-matter driven, expertise driven as opposed to being data driven about how do you >> Let's talk about data-driven. We had an interview earlier this morning with another luminary here at the Mayfield 50th conference celebration that they're having, and he said, "Data is the new feedback mechanism." and his point was, is that if you treat the Agile as an R&D exercise from a data standpoint. Not from a product but get it out there, get the data circulating in, it's critical in formulation of the next >> It is, yeah, it's absolutely critical. That was the eye opener for me going to Zynga. Zynga had an incredible, probably still does have, an incredible product culture that every single thing gets rolled out behind an experiment. And so you know, that's great from an operational perspective, because it allows you to, you know, move quickly and roll things out in small increments and when it doesn't work, you can just shut it off but it's not some huge catastrophe. But it's also critical because it allows you to see what's working and what's not and the flip side of that is, some humility of the people developing the products that their ideas are not going to work sometimes just because you know this domain well doesn't mean that you're necessarily going to be the expert on exactly how everything is going to play out. And so you have to have this ability to go out, try stuff, let it fail, use that, hopefully you fail quickly, you learn what's not working and use that to inform what's the next step down the path that you take, right? And Agile plays into it, but that's for me, that's the big transition that corporations really have to struggle with, and it's hard. >> You know you're, been there done that, seen multiple waves of innovation, want to bring up something to kind of get you going here. You see this classically in the old school 90s, 80s day. Product management, product people and sales people. They're always buttin' heads, you know? Product marketing, marketing people want this sales and marketing want this, product people buttin' heads, but now with Agile, the engineering focus has been the front lines. People are building engineering teams in house. They're building custom stacks for whatever reasons, the apps are getting smarter. The engineers are getting closer to the edge, the customer if you will. How do you help companies, or how do you advise companies to think about the relationship between a product-centric culture and a sales-centric culture? Because sometimes you have companies that are all about the customer-centric, customer-centric customer-centric, product-centric and sometimes if you try to put 'em together there's always going to be an alpha-beta kind of thing there and that's the balance in this. What's your take on this? Seems to be a cutting edge topic >> Yeah, well, so you know, one of the last big initiatives that I worked on at Express Scripts. Express Scripts has the, to my knowledge, the largest automated home delivery pharmacy in the world. It's amazing if you walk into one of our pharmacies where automation is packaging and filling prescriptions and packaging and shipping and doing all of that stuff. And we've built so much efficiency into the process that we've started getting slack in the system. Every year, you're trying to figure out how to make something work better and you know, have better automation around it. And so, you know, what do you do with all of that slack? The sales team can't sign up enough new customers for Express Scripts to actually fill that capacity. And so they create a division of commoditizing this, basically white labeling your pharmacy. We called it Pharmacy as a Platform, exposing APIs to third parties who might want to come along and hey, Phil's pharmacy can now fill branded prescriptions to get sent to you in your home, right? And so that's a fantastic vision, but there's a real struggle between engineering who had all these legacy stacks that we needed to figure out how to move to be able to really live up to this, you know the core of Express Scripts was our members and not somebody else's members. And so there's a lot of rewiring at the core that needs to be done. An operations team, a product team that's, you know, running these home delivery pharmacies, and a sales team that wants to go off and sell all over the place, right? And so, you know, early on, we started off and the sales team tried to sell, like six different deals that all required different parts of the vision, but you know, they weren't really, there was no real roadmap to figure out how do you get from where we're at to the end, and we could've done any of those things, but trying to do them all at once was going to be a trainwreck. And so, you know, we stubbed our toes a couple of times along the way, but I think it just came down to having a conversation and trying to be as transparent as possible on all sides, in all sides. To you know, try to get to a place where we could be effective in delivering on the vision. The vision was right. Everybody was doing all of the right things. But if you haven't actually, with so much of this stuff, if you haven't seen the movie, if you haven't worked this way before, there's nothing I can tell you that's going to make it work magically for you tomorrow. You have to just get this together and work in small increments to figure out how to get there. >> You got to go through spring training, you got to do the reps. >> Yep, absolutely. >> All right, so on your career, as you look at what you've done in your career, and what people outside are looking at right now, you got startups trying to compete and get a market position. You have other existing suppliers who could be the old guard, retooling and replatforming, refactoring, whatever the buzz word you want to use. And then the ultimate customer who wants to consume and have the ability of having custom personalization, data analytics, unlimited elastic capability with resources for their solution. How, what advice would you give to the startup, to the supplier, and to the customer to survive this next transition of cloud 2.0, you know and data tsunami, and all the opportunities that are coming? Because if they don't, they'll be challenged a startup goes out of business, a supplier gets displaced. >> Right, I mean, well, so the startup, I don't know if I have good advice for the startup. Startups in general have to find a market that actually works for them. And so, you know, I don't know that I've got some secret key that allows startups to be effective other than don't run out of money, try to figure out how to build effectively to get you to the point where you're, you know, where you're going to win. One of my earliest, one of the earliest jobs I had in my career, I came into a startup, and I tried, one of the founders had written the initial version of the code base. I, as a headstrong engineer, was convinced that he had done horrible work, and so I sort of holed up for like, six to eight weeks doing a hundred hours a week trying to rewrite the entire code base while getting nothing done for the startup. You know, in the end, that was the one job I've ever been fired from, and I should've been fired, because, you know, honestly as a startup, you shouldn't worry about perfection from an engineering perspective. You should figure out how to try to find your marketplace. Everybody has tech debt, you can fix that as time goes on, the startup needs to figure out how to be viable more than anything else. As far as suppliers go, you know, I don't know it's interesting the, you know, I sort of look at corporate America and there are many many companies that really rely heavily on their vendors to tell them how to do things. They don't trust in their own internal engineering ability. And then there are the ones, like the teams I have built at AmEx and Express Scripts that really do want to learn it all and be independent. I would say, identify when you walk into somebody's shop which they are and sell to them appropriately. You know, I've been a Splunk customer for a long time, I love Splunk. But the Splunk sales team early on at Express Scripts tried to come in and sell me on a whole bunch of stuff that Splunk was just not good at, right? >> And you knew that. >> And I knew that, because I've been a hands-on customer every since Zynga, right? I know what it's good at, and I love it as a tool, but you know, it's not the Swiss Army knife. It can't do everything. >> Well now you got Signal FX, so now you can get the observability you need. >> Exactly, right? So yeah, I, you know, I would say, you know, for those kinds of companies, it's important to go in and understand what your customer is, you know, what your customer is asking for and respond to them appropriately. And in some cases, they're going to need your expertise, either because they're building towards it or they haven't gotten there yet, and some cases, one of the things that I have done with teams of mine in the past, was it with AppDynamics at Express Scripts, excuse me at AmEx, five or six years ago, they were sold on, you know, bringing in AppDynamics as a monitoring tool, I actually made them not bring it in, because they didn't know what they didn't know. I made them go build some basic monitoring, you know, using some open source tools, just to get some background, and then, you know, once they did, we ended up bringing AppDynamics in, but doing it in a way that they were accretive to what we were trying to accomplish and not just this thing that was going to solve all of our problems. >> And so that brings up the whole off-the-shelf general purpose software model that you were referring to. The old model was lean on your vendors. They're supplying you, and because you don't have the staff to do it yourself. That's changing, do you think that's changing? >> It is, it's changing, but again, I think there's a lot of places where people nominally want to go there, but don't know how to get there, and so, you know, people are stubbing their toes left and right. If you're doing it with this mindset of, we're constantly getting better and we're learning and it's okay to make mistakes as long as we move forward, >> It's okay to stub your toe as long as you don't cut an artery open. >> Yeah, that's true, yeah exactly >> You don't want to bleed out, that's a cybersecurity hack >> That's true, that's true. But for me a lot of the time that just comes down to how long are you waiting before you stub your toe? If you're, you know, if you wait two years before you actually try to launch something, the odds of you cutting your leg off are much higher than >> Well I want to get into the failure thing, so I think stubbing your toe brings up this notion of risk management, learning what to try, what not to do, take experiments to try to your, which is a great example. Before you get there, you mentioned suppliers. One of the things we hear and I want to get your thoughts on, is that, a lot of CIOs and C-sos, and CBOs, or whatever title is the acronym, they're trying to reduce the number of suppliers. They don't want more tools, right? They don't necessarily want another tool for the tool's sake or they might want to replatform, what does that even mean? So, we're hearing in our interviews and our discussions with partitioners, "Hey, I want to get my suppliers down, "and by the way, I want to be API driven, "so I want to start getting to a mode "where I'm dictating the relationship to suppliers." How do you respond to that? Do you see that as aspirational, real dynamic, or fiction? >> It's a good goal to give motivation, I believe it. For me, I approach the problem a little differently. I'm a big believer, well, so, because I've seen this pattern of this next tool is going to be the one that consolidates three things and it's going to be the right answer and instead of eliminating three and getting down to one, you have four, because you're, you need to unwire this new thing, there's a lot of time and effort required to get rid of, you know, your old technology stack, and move to the new one, right? I've seen that especially coming from the C-Sec for Express Scripts is an amazing guy, and you know, was definitely trying to head down that path but we stubbed our toes, we ran into problems in trying to figure out, you know, how do you move from one set of networking gear to the next set? How do you deal with, you know, all of the virus protection and all the other, there's a huge variety of tools. >> So it's not just technical debt, it's disruption >> It's disruption to the existing stack, and you've got to move from old to new, so my philosophy has always been, with technical debt, when you're in debt, and I think technical debt really does operate in a lot of ways like real debt, right? Probably good to have some of it. If you're completely debt-free, that's I've never been in that place before. >> You're comfortable. You might not be moving, >> Exactly, right? But with that technical debt, you know, there's two ways to pay down your debt. You can scrimp and save and put more money into debt principal payments as opposed to spending on other new things, or, well and/or, build productive capacity. So a huge focus for me for the engineering teams that we've built, and this is not anything new to the folks in this area, but, you know, always think about an arms race, where you're getting 1% better every day. The aggregation of marginal gains and investing in internal improvements so that your team is doubling productivity every year, which is something that's really possible for, you know, some of these engineering organizations, is the way that you deal with that, right? If you get to the point where your team is really, really productive, they can go through and eliminate all the old legacy technology. >> That's actually great advice, and it's interesting, because a lot of people just get hung up on one thing. Operating something, and then growing something, and you can have different management styles and different techniques for both, the growth team, the operating team. You're kind of bringing in and saying, we can do both. Operate with growth in mind, to 1% better approach. >> Right, you know, and for me, it's been an interesting journey, you know. I started off as the engineer and then the architect, who was always focused on just the technology, the design of the system in production. Sort of learned from there that you had to be good at the you know, all the systems that get code from a developer's desktop into production, that's a whole interrelated system that's not isolated from your production system. And then from there, it has to be the engineering team that you build has to be effective as well. And so, I've moved from being very technology-centric to somebody who says, "Okay, I have to start "with getting the team right "and getting the culture right if we're ever going to "be able to get the technology to a good place." Mind you, I still love the technology. I'm still an architect at my core, but I've come to this realization that good technology and bad teams will get crushed by bad technologies and good teams. Because now I've seen that a couple of places, where you have old but evolving technology stacks that have gone from low availability and poor performance and low ability to get new features into production to a place where you're fixing all of that at a high rate. It starts with the team. >> You're bringing us some core Silicon Valley ethos to the IT conversation, because what you're talking about is "I'll fund an A team with a B plan any day "over a B team with an A plan." >> Right. >> And where this makes sense, I think is true, is that to your point about debt, A teams know how to manage it. >> Yeah. >> So this is kind of what you're getting at here. >> Right. >> You can take that same ethos, so it's the Agile enterprise. >> Yeah, it is >> That's what we're talking about. Okay, so hypothetical final point I want to chat with you about. Let's just say you and I were startin' a company. We're chief architects, you're the chief architect, I'm a coder, what are we doing? Do I code from horizontally scalable cloud, certainly cloud native, how would you think about building, we have an app in mind, all of our requirements defined, it's going to be data-centric, it's going to be game change and have community, it might have some crypto in there, who knows, but it's going to be fun. How do we scale this out to be really fast? How would you architect this? >> Yeah, well, you know, I do start in the cloud. I go to AWS or Azure or any of the offerings that are out there, and you know, leverage everything that they have that's already wired up already for you. I mean the thing that we've seen in the evolution of software and production systems over the last, well, forever, is you get more and more leverage every day, every year, right? And so, if you and I are startin' a new company, let's go use the tools that are there to do the things that we shouldn't be wasting our time on. Let's focus on the value for our company as much as we can. Don't over-architect. I think premature optimization is a thing that you know, I learned early on is a real problem. You should, you know >> Give an example, what that would look like. >> I've seen >> Database scale decisions done with no scale >> Correct, yeah, you know? You go off >> Let's pick this! It's the most scalable database, well we have no users yet. >> Right, you know you build the super complicated caching architecture or you know, you go design the most critical part of the system out of the gate, you know, using Assembly. You use C++ or, you use a low level language when a high level language with your three users would be just fine, right? You can get the work done in a fraction of the time. >> And get the business logic down, the IP, >> Solve the problem when it becomes a problem. Like, it's, you know, I've, any number of times, I've run into systems, I've built systems where you have some issue that you run into, and you have to go back and redesign some chunk of the system. In my experience, I'm really bad at predicting, and I think engineers are really bad at predicting what are going to be the problem areas until you run into them, so just go as simple as you can out of the gate, you know. Use as many tools as you can to solve problems that, you know, maybe as an engineer, I want to go rebuild every thing from scratch every time. I get the inclination. But it's >> It's a knee-jerk reaction to do that but you stay your course. Don't over-provision, overthink it, thus start taking steps toward the destination, the vision you want to go to, and get better, operate >> Solve the problem you have when it shows up. >> So growth mindset, execute, solve the problems when they're there. >> Right, and initially the problem that you have is finding a market, you know, not building the greatest platform in the world, right? >> Find a market, exactly. >> Right? >> Phil, thanks for taking the time >> Thank you very much, appreciate it. >> Appreciate the insights. Hey, we're here for the People First, Mayfield's 50th celebration, 50 years in business. It's a CUBE co-production, I'm John Furrier, thanks for watching >> Thanks John. (outro music)

>> Announcer: From Sand Hill Road in the heart of Silicon Valley, it's theCUBE, presenting the People First Network, insights from entrepreneurs and tech leaders. (bright electronic music) >> Everyone, welcome to this special CUBE conversation. We're here at Sand Hill Road at Mayfield Fund. This is theCUBE, co-creation of the People First Network content series. I'm John Furrier, host of theCUBE. Our next guest, Yuvi Kochar, who's the Data-centric Digital Transformation Strategist at GameStop. Variety of stints in the industry, going in cutting-edge problems around data, Washington Post, comScore, among others. You've got your own practice. From Washington, DC, thanks for joining us. >> Thank you, thanks for hosting me. >> This is a awesome conversation. We were just talking before we came on camera about data and the roles you've had over your career have been very interesting, and this seems to be the theme for some of the innovators that I've been interviewing and were on the People First is they see an advantage with technology, and they help companies, they grow companies, and they assist. You did a lot of different things, most notably that I recognized was the Washington Post, which is on the mainstream conversations now as a rebooted media company with a storied, historic experience from the Graham family. Jeff Bezos purchased them for a song, with my opinion, and now growing still, with the monetization, with subscriber base growing. I think they're number one in subscribers, I don't believe, I believe so. Interesting time for media and data. You've been there for what, how many years were you at the Washington Post? >> I spent about 13 years in the corporate office. So the Washington Post company was a conglomerate. They'd owned a lot of businesses. Not very well known to have owned Kaplan, education company. We owned Slate, we owned Newsweek, we owned TV stations and now they're into buying all kinds of stuff. So I was involved with a lot of varied businesses, but obviously, we were in the same building with the Washington Post, and I had front row seat to see the digital transformation of the media industry. >> John: Yeah, we-- >> And how we responded. >> Yeah, I want to dig into that because I think that illustrates kind of a lot what's happening now, we're seeing with cloud computing. Obviously, Cloud 1.0 and the rise of Amazon public cloud. Clearly, check, done that, a lot of companies, startups go there. Why would you provision a data center? You're a startup, you're crazy, but at some point, you can have a data center. Now, hybrid cloud's important. Devops, the application development market, building your own stack, is shifting now. It seems like the old days, but upside down. It's flipped around, where applications are in charge, data's critical for the application, infrastructure's now elastic. Unlike the old days of here's your infrastructure. You're limited to what you can run on it based on the infrastructure. >> Right. >> What's your thoughts on that? >> My thoughts are that, I'm a very, as my title suggests, data-centric person. So I think about everything data first. We were in a time when cloud-first is becoming old, and we are now moving into data-first because what's happening in the marketplace is the ability, the capability, of data analytics has reached a point where prediction, in any aspect of a business, has become really inexpensive. So empowering employees with prediction machines, whether you call them bots, or you call them analytics, or you call them machine learning, or AI, has become really inexpensive, and so I'm thinking more of applications, which are built data-out instead of data-in, which is you build process and you capture data, and then you decide, oh, maybe I should build some reporting. That's what we used to do. Now, you need to start with what's the data I have got? What's the data I need? What's the data I can get? We were just talking about, everybody needs a data monetization strategy. People don't realize how much asset is sitting in their data and where to monetize it and how to use it. >> It's interesting. I mean, I got my computer science degree in the 80s and one of the tracks I got a degree in was database, and let's just say that my main one was operating system. Database was kind of the throwaway at that time. It wasn't considered a big field. Database wasn't sexy at all. It was like, database, like. Now, if you're a database, you're a data guru, you're a rock star. The world has changed, but also databases are changing. It used to be one centralized database rules the world. Oracle made a lot of money with that, bought all their competitors. Now you have open source came into the realm, so the world of data is also limited by where the data's stored, how the data is retrieved, how the data moves around the network. This is a new dynamic. How do you look at that because, again, lagging in business has a lot to do with the data, whether it's in an application, that's one thing, but also having data available, not necessarily in real time, but if I'm going to work on something, I want the data set handy, which means I can download it or maybe get real-time. What's your thoughts on data as an element in all that moving around? >> So I think what you're talking about is still data analytics. How do I get insights about my business? How do I make decisions using data in a better way? What flexibility do I need? So you talk about open source, you think about MongoDB and those kind of databases. They give you a lot of flexibility. You can develop interesting insights very quickly, but I think that is still very much thinking about data in an old-school kind of way. I think what's happening now is we're teaching algorithms with data. So data is actually the software, right? So you get an open source algorithm. I mean Google and everybody else is happy to open source their algorithms. They're all available for free. But what, the asset is now the data, which means how you train your algorithm with your data, and then now, moving towards deploying it on the edge, which is you take an algorithm, you train it, then you deploy it on the edge in an IoT kind of environment, and now you're doing decision-making, whether it's self-driving cars, I mean those are great examples, but I think it's going down into very interesting spaces in enterprise, which is, so we have to all think about software differently because, actually, data is a software. >> That's an interesting take on it, and I love that. I mean I wrote a blog post in 2007 when we first started playing with the, in looking at the network effects on social media and those platforms was, I wrote a post, it was called Data is the New Development Kit. Development kit was what people did back then. They had a development kit and they would download stuff and then code, but the idea was is that data has to be part of the runtime and the compilation of, as software acts, data needs to be resident, not just here's a database, access it, pull it out, use it, present it, where data is much more of a key ingredient into the development. Is that kind of what you're getting at? >> Yes. >> Notion of-- >> And I think we're moving from the age of arithmetic-based machines, which is we put arithmetic onto chips, and we then made general-purpose chips, which were used to solve a huge amount of problems in the world. We're talking about, now, prediction machines on a chip, so you think about algorithms that are trained using data, which are going to be available on chips. And now you can do very interesting algorithmic work right on the edge devices, and so I think a lot of businesses, and I've seen that recently at GameStop, I think business leaders have a hard time understanding the change because we have moved from process-centric, process automation, how can I do it better? How can I be more productive? How can I make better decisions? We have trained our business partners on that kind of thinking, and now we are starting to say, no, no, no, we've got something that's going to help you make those decisions. >> It's interesting, you mentioned GameStop. Obviously, well-known, my sons are all gamers. I used to be a gamer back before I had kids, but then, can't keep up anymore. Got to be on that for so long, but GameStop was a retail giant in gaming. Okay, when they had physical displays, but now, with online, they're under pressure, and I had interviewed, again, at an Amazon event, this Best Buy CIO, and he says, "We don't compete with price anymore. "If they want to buy from Amazon, no problem, "but our store traffic is off the charts. "We personalize 50,000 emails a day." So personalization became their strategy, it was a data strategy. This is a user experience, not a purchase decision. Is this how you guys are thinking about it at GameStop? >> I think retail, if you look at the segment per se, personalization, Amazon obviously led the way, but it's obvious that personalization is key to attract the customer. If I don't know what games you play, or if I don't know what video you watched a little while ago, about which game, then I'm not offering you the product that you are most prone or are looking for or what you want to buy, and I think that's why personalization is key. I think that's-- >> John: And data drives that, and data drives that. >> Data drives that, and for personalization, if you look at retail, there's customer information. You need to know the customer. You need to know, understand the customer preferences, but then there's the product, and you need to marry the two. And that's where personalization comes into play. >> So I'll get your thoughts. You have, obviously, a great perspective on how tech has been built and now working on some real cutting-edge, clear view on what the future looks like. Totally agree with you, by the way, on the data. There's kind of an old guard/new guard, kind of two sides of the street, the winners and the losers, but hey, look, I think the old guard, if they don't innovate and become fresh and new and adopt the modern things that need to attract the new expectations and new experiences from their customers, are going to die. That being said, what is the success formula, because some people might say, hey, I'm data-driven. I'm doing it, look at me, I'm data. Well, not really. Well, how do you tell if someone's really data-driven or data-centric? What's the difference? Is there a tell sign? >> I think when you say the old guard, you're talking about companies that have large assets, that have been very successful in a business model that maybe they even innovated, like GameStop came up with pre-owned games, and for the longest of times, we've made huge amount of revenue and profit from that segment of our business. So yes, that's becoming old now, but I think the most important thing for large enterprises at least, to battle the incumbent, the new upstarts, is to develop strategies which are leveraging the new technologies, but are building on their existing capability, and that's what I drive at GameStop. >> And also the startups too, that they were here in a venture capital firm, we're at Mayfield Fund, doing this program, startups want to come and take a big market down, or come in on a narrow entry and get a position and then eat away at an incumbent. They could do it fast if they're data-centric. >> And I think it's speed is what you're talking about. I think the biggest challenge large companies have is an ability to to play the field at the speed of the new upstarts and the firms that Mayfield and others are investing in. That's the big challenge because you see this, you see an opportunity, but you're, and I saw that at the Washington Post. Everybody went to meetings and said, yes, we need to be digital, but they went-- >> They were talking. >> They went back to their desk and they had to print a paper, and so yes, so we'll be digital tomorrow, and that's very hard because, finally, the paper had to come out. >> Let's take us through the journey. You were the CTO, VP of Technology, Graham Holdings, Washington Post, they sold it to Jeff Bezos, well-documented, historic moment, but what a storied company, Washington Post, local paper, was the movie about it, all the historic things they've done from a reporting and journalism standpoint. We admire that. Then they hit, the media business starts changing, gets bloated, not making any money, online classifieds are dying, search engine marketing is growing, they have to adjust. You were there. What was the big, take us through that journey. >> I think the transformation was occurring really fast. The new opportunities were coming up fast. We were one of the first companies to set up a website, but we were not allowed to use the brand on the website because there was a lot of concern in the newsroom that we are going to use or put the brand on this misunderstood, nearly misunderstood opportunity. So I think it started there, and then-- >> John: This is classic old guard mentality. >> Yes, and it continued down because people had seen downturns. It's not like media companies hadn't been through downturns. They had, because the market crashes and we have a recession and there's a downturn, but it always came back because-- >> But this was a wave. I mean the thing is, downturns are economic and there's business that happens there, advertisers, consumption changes. This was a shift in their user base based upon a technology wave, and they didn't see it coming. >> And they hadn't ever experienced it. So they were experiencing it as it was happening, and I think it's very hard to respond to a transformation of that kind in a very old-- >> As a leader, how did you handle that? Give us an example of what you did, how you make your mark, how do you get them to move? What were some of the things that were notable moments? >> I think the main thing that happened there was that we spun out washingtonpost.com. So it became an independent business. It was actually running across the river. It moved out of the corporate offices. It went to a separate place. >> The renegades. >> And they were given-- >> John: Like Steve Jobs and the Macintosh team, they go into separate building. >> And we were given, I was the CTO of the dotcom for some time while we were turning over our CTO there, and we were given a lot of flexibility. We were not held accountable to the same level. We used the, obviously, we used-- >> John: You were running fast and loose. >> And we were, yes, we had a lot of flexibility and we were doing things differently. We were giving away the content in some way. On the online side, there was no pay wall. We started with a pay wall, but advertising kind of was so much more lucrative in the beginning, that the pay wall was shut down, and so I think we experimented a lot, and I think where we missed, and a lot of large companies miss, is that you need to leave your existing business behind and scale your new business, and I think that's very hard to do, which is, okay, we're going to, it's happening at GameStop. We're no longer completely have a control of the market where we are the primary source of where, you talk about your kids, where they go to get their games. They can get the games online and I think-- >> It's interesting, people are afraid to let go because they're so used to operating their business, and now it has to pivot to a new operating model and grow. Two different dynamics, growth, operation, operating and growing. Not all managers have that growth mindset. >> And I think there's also an experience thing. So most people who are in these businesses, who've been running these businesses very successfully, have not been watching what's happening in technology. And so the technology team comes out and says, look, let me show you what we can do. I think there has to be this open and very, very candid discussion around how we are going to transform-- >> How would you talk about your peer, developed peers out there, your peers and other CIOs, and even CISOs on the security side, have been dealing with the same suppliers over, and in fact, on the security side, the supplier base is getting larger. There's more tools coming out. I mean who wants another tool? So platform, tool, these are big decisions being made around companies, that if you want to be data-centric, you want to be a data-centric model, you got to understand platforms, not just buying tools. If you buy a hammer, they will look like a nail, and you have so many hammers, what version, so platform discussions come in. What's your thoughts on this? Because this is a cutting-edge topic we've been talking about with a lot of senior engineering leaders around Platform 2.0 coming, not like a classic platform to... >> Right, I think that each organization has to leverage or build their, our stack on top of commodity platforms. You talked about AWS or Azure or whatever cloud you use, and you take all their platform capability and services that they offer, but then on top of that, you structure your own platform with your vertical capabilities, which become your differentiators, which is what you take to market. You enable those for all your product lines, so that now you are building capability, which is a layer on top of, and the commodity platforms will continue to bite into your platform because they will start offering capabilities that earlier, I remember, I started at this company called BrassRing, recruitment automation. One of the first software-as-a-service companies, and I, we bought a little company, and the CTO there had built a web server. It was called, it was his name, it was called Barrett's Engine. (chuckles) And so-- >> Probably Apache with something built around it. >> So, in those days, we used to build our own web servers. But now today, you can't even find an engineer who will build a web server. >> I mean the web stack and these notions of just simple Web 1.0 building blocks of change. We've been calling it Cloud 2.0, and I want to get your thoughts on this because one of the things I've been riffing on lately is this, I remember Marc Andreessen wrote the famous article in Wall Street Journal, Software is Eating the World, which I agree with in general, no debate there, but also the 10x Engineer, you go into any forum online, talking about 10x Engineers, you get five different opinions, meaning, a 10x Engineer's an engineer who can do 10 times more work than an old school, old classical engineer. I bring this up because the notion of full stack developer used to be a real premium, but what you're talking about here with cloud is a horizontally scalable commodity layer with differentiation at the application level. That's not full stack, that's half stack. So you think the world's kind of changing. If you're going to be data-centric, the control plane is data. The software that's domain-specific is on top. That's what you're essentially letting out. >> That's what I'm talking about, but I think that also, what I'm beginning to find, and we've been working on a couple of projects, is you put the data scientists in the same room with engineers who write code, write software, and it's fascinating to see them communicate and collaborate. They do not talk the same language at all. >> John: What's it like? Give us a mental picture. >> So a data scientist-- >> Are they throwing rocks at each other? >> Well, nearly, because the data scientists come from the math side of the house. They're very math-oriented, they're very algorithm-oriented. Mathematical algorithms, whereas software engineers are much more logic-oriented, and they're thinking about scalability and a whole lot of other things, and if you think about, a data scientist develops an algorithm, it rarely scales. You have to actually then hand it to an engineer to rewrite it in a scalable form. >> I want to ask you a question on that. This is why I got you and you're an awesome guest. Thanks for your insights here, and we'll take a detour into machine learning. Machine learning really is what AI is about. AI is really nothing more than just, I love AI, it gets people excited about computer science, which is great. I mean my kids talk about AI, they don't talk about IoT, which is good that AI does that, but it's really machine learning. So there's two schools of thought on machine. I call it the Berkeley school on one end, not Berkeley per se but Berkeley talks about math, machine learning, math, math, math, and then you have other schools of thought that are on cognition, that machine learning should be more cognitive, less math-driven, spectrum of full math, full cognition, and everything in between. What's your thoughts on the relationship between math and cognition? >> Yeah, so it's interesting. You get gray hair and you kind of move up the stack, and I'm much more business-focused. These are tools. You can get passionate about either school of thought, but I think that what that does is you lose sight of what the business needs, and I think it's most important to start with what are we here trying to do, and what is the best tool? What is the approach that we should utilize to meet that need? Like the other day, we were looking at product data from GameStop, and we know that the quality of data should be better, but we found a simple algorithm that we could utilize to create product affinity. Now whether it's cognition or math, it doesn't matter. >> John: The outcome's the outcome. >> The outcome is the outcome, and so-- >> They're not mutually exclusive, and that's a good conversation debate but it really gets to your point of does it really matter as long as it's accurate and the data drives that, and this is where I think data is interesting. If you look at folks who are thinking about data, back to the cloud as an example, it's only good as what you can get access to, and cybersecurity, the transparency issue around sharing data becomes a big thing. Having access to the data's super important. How do you view that for, as CIOs, and start to think about they're re-architecting their organizations for these digital transformations. Is there a school of thought there? >> Yes, so I think data is now getting consolidated. For the longest time, we were building data warehouses, departmental data warehouses. You can go do your own analytics and just take your data and add whatever else you want to do, and so the part of data that's interesting to you becomes much more clean, much more reliable, but the rest, you don't care much about. I think given the new technologies that are available and the opportunity of the data, data is coming back together, and it's being put into a single place. >> (mumbles) Well, that's certainly a honeypot for a hacker, but we'll get that in a second. If you and I were doing a startup, we say, hey, let's, we've got a great idea, we're going to build something. How would we want to think about the data in terms of having data be a competitive advantage, being native into the architecture of the system. I'll say we use cloud unless we need some scale on premise for privacy reasons or whatever, but we would, how would we go to market, and we have an app, as apps defined, great use case, but I want to have extensibility around the data, I don't want to foreclose any future options, How should I think about my, how should we think about our data strategy? >> Yes, so there was a very interesting conversation I had just a month ago with a friend of mine who's working at a startup in New York, and they're going to build a solution, take it to market, and he said, "I want to try it only in a small market "and learn from it," and he's going very old school, focus groups, analytics, analysis, and I sat down, we sat at Grand Central Station, and we talked about how, today, he should be thinking about capturing the data and letting the data tell him what's working and what's not working, instead of trying to find focus groups and find very small data points to make big decisions. He should actually utilize the target, the POC market, to capture data and get ready for scale because if you want to go national after having run a test in... >> Des Moines, Iowa. >> Part of New York or wherever, then you need to already have built the data capability to scale that business in today's-- >> John: Is it a SaaS business? >> No, it's a service and-- >> So he can instrument it, just watch the data. >> And yes, but he's not thinking like that because most business people are still thinking the old way, and if you look at Uber and others, they have gone global at such a rapid pace because they're very data-centric, and they scale with data, and they don't scale with just let's go to that market and then let's try-- >> Yeah, ship often, get the data, then think of it as part of the life cycle of development. Don't think it as the old school, craft, launch it, and then see how it goes and watch it fail or succeed, and know six months later what happened, know immediately. >> And if you go data-centric, then you can turn the R&D crank really fast. Learn, test and learn, test and learn, test and learn at a very rapid pace. That changes the game, and I think people are beginning to realize that data needs to be thought about as the application and the service is being developed, because the data will help scale the service really fast. >> Data comes into applications. I love your line of data is the new software. That's better than the new oil, which has been said before, but data comes into the app. You also mentioned that app throws off data. >> Yuvi: Yes. >> We know that humans have personal, data exhaust all the time. Facebook made billions of dollars on our exhaust and our data. The role of data in and out of the application, the I/O of the application, is a new concept, you brought that up. I like that and I see that happening. How should we capture that data? This used to be log files. Now you got observability, all kinds of new words kind of coming into this cloud equation. How should people think about this? >> I think that has to be part of the design of your applications, because data is application, and you need to design the application with data in mind, and that needs to be thought of upfront, and not later. >> Yuvi, what's next for you? We're here in Sand Hill Road, VC firm, they're doing a lot of investments, you've got a great project with GameStop, you're advising startups, what's going on in your world? >> Yes, so I'm totally focused, as you probably are beginning to sense, on the opportunity that data is enabling, especially in the enterprise. I'm very interested in helping business understand how to leverage data, because this is another major shift that's occurring in the marketplace. Opportunities have opened up, prediction is becoming cheap and at scale, and I think any business runs on their capability to predict, what is the shirt I should buy? How many I should buy? What color should I buy? I think data is going to drive that prediction at scale. >> This is a legit way that everyone should pay attention to. All businesses, not just one-- >> All businesses, everything, because prediction is becoming cheap and automated and granular. That means you need to be able to not just, you need to empower your people with low-level prediction that comes out of the machines. >> Data is the new software. Yuvi, thanks so much for great insight. This is theCUBE conversation. I'm John Furrier here at Sand Hill Road at the Mayfield Fund, for the People First Network series. Thanks for watching. >> Yuvi: Thank you. 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>> Announcer: From Sand Hill Road in the heart of Silicon Valley, it's "theCUBE," presenting the People First Network, insights from entrepreneurs and tech leaders. (upbeat electronic music) >> Hi, everyone, welcome to this special "CUBE" conversation. I'm John Furrier, co-host of "theCUBE" and co-founder of SiliconANGLE Media. We are on Sand Hill Road at Mayfield Fund, the venture capitalist funding startups. We're here with Tara Vaishnav, who is the vice president of technology, innovation, and advanced analytics at The Clorox Company, as part of the People First Network co-creation of content with SiliconANGLE and Mayfield. Tara, welcome. >> Well, thank you very much for having me! And congratulations to Mayfield on 50 amazing years, wow! >> 50 years they have been in Sand Hill Road, they've been investing in some great startups. They really have a great philosophy about people first. >> Yep. >> And you've had a very distinguished career in technology, IT, in big companies. Long tenures, too, like, you know, decades. >> Yes, oh, yes. >> And now at Clorox, a consumer company. So talk about your journey, where your experience is, where you started, tell us about your background. >> Yeah, well, I grew up in India, if it's not obvious already. I came to the United States after I finished my undergrad in India, I had an undergrad in electrical engineering. Came over here, got my electrical engineering master's at the University of Southern California, go Trojans. And after that, I worked for several companies, but mostly in health care and life sciences. So the past four years, I have been the vice president of IT at The Clorox Company, which is a CPG company, so quite a bit of a learning curve there. >> Health care, serving patients, now you're serving consumers. >> That's right, that's right. >> Clorox is well-known for their analytics, well-known for technology, innovation. >> Tara: Yes, yeah. >> I've interviewed a bunch of folks at Clorox, they've always been at the head of the curve. >> Tara: Yeah. >> Like Procter & Gamble, you guys, consumer companies have to be. >> Tara: Definitely. >> Now, more than ever, digital disruption is an opportunity for companies to have a better relationship with their customers. >> Tara: Absolutely. >> And changes the makeup of their brand as well, since it touches the customer. How do you see that evolving? What's the current state of the art of some of the things you're working on? >> Yeah, it's pretty fascinating, actually. And I hate to use cliches, but things like consumer experience is really at the heart of it. We're a brand company, at the end of the day, and how people feel about us is really, really important. It's not so much, it is about the products, and we make amazing products, but how do they feel about us as a company, and how do they engage with us differently than they did before? We do not buy the same way as we did even five years ago. And so, learning that, learning the new, evolving consumer, and getting really close to what's important to them, that's really on the forefront of how we think about our digital transformation. >> One of the cool things that's great about the People First Network that we've been doing-- >> Tara: Yeah. >> This content, is that we have a lot of luminaries who have had a storied career, like yourself, have looked at the changes and the waves of innovation that have come before, and now, more than ever, omnichannel, how you advertise and reach customers, how they interact, how they buy and consume. When you look at health care and some of the things you've been involved in, in the '90s, remember, client-server was big, they had computers. >> Tara: (laughs) Oh, yes. Oh, yeah. >> IT has changed a lot. >> It has. >> What is the most striking thing that you see from those changes in this new wave that we're living now? >> You know, so, (sharply exhales) I was fortunate in that I decided that data was where it was at, right from the beginning of my career. That's how I kind of made my way up my career ladder, is really that focus on data. I had a software engineering background, but really felt the power of data to change things. What has happened, if I think about some of the big changes, or the key milestones, if you will, in my career, one of the first real big changes came about when data, which was up until that point really sort of coming along for the ride, you had applications, applications had data, when data actually became the mainstay and the applications kind of came and went. I remember one of my mentors in the past, a past CIO, actually, telling me that applications come and go, but data is forever. And when that really started to become a thing was when big data and big data technologies became, came of enterprise age, if you will, along with cloud technologies. That marriage really, that was, I think, the tipping point where the things that you could do with data and the way that you could get insights from data really took on a life of its own, if you will. >> You know, one of the things, that's a great point. I'd love to get your insights as a leader and as you grew with data, because it wasn't really obvious at that time. Certainly, people had databases and that, the big data, the applications had data. >> Tara: Sure, sure, yeah. >> But it was always kind of old-school data. "Hey, get some data, let's look at the demographics, "let's look at the Consumer Price Index," blah, blah, blah, all kinds of data. But access to data became driven by the database. >> Tara: Correct. >> So there might've been data available-- >> Tara: Yeah. >> But getting it in the hands of the practitioners even now is hard, but even back then, you might not have had the data. So as a leader who's sought data-- >> Tara: Yeah. >> As a strategic advantage. By the way, that's rare early, isn't it? So, (laughs) awesome for you. >> You know, I got lucky. >> How did you get through that? How did you lead the organization to make data at the center of things? >> It is a very good question. There were a few things that started to take shape once big data and the marriage of the cloud started to happen. It started to open up doors, break down organizational silos. When you brought that data together, the business value, or the potential business value that could be unlocked, became obvious. The way that we approached it, though, under my leadership, I always believe in small steps. I believe in leapfrog, but I believe that you have to feed innovation or innovative thinking out in small doses. People are not always ready to consume it in one big (laughs) fell swoop, if you will. So doing things incrementally, but with an idea towards transformation, was, I think, the secret sauce that I used to approach these things. So as a couple of examples, in Kaiser Permanente, when I worked there for almost seven years, I was instrumental in bringing their big data platform to life. But it was not just a matter of, "Here's the technology "for technology's sake." It was a matter of, "Here are some real problems "that we are having a lot of difficulty in solving today. "Let's show you how we can solve those differently "in an amazing way." And we proved that. It was an experiment, that we proved that, and that really started to get us those adopters, if you will. >> John: So take baby steps. >> Yep. >> Don't try to do wholesale changes hardcore. >> Correct, correct. >> Let people get used to it. >> Yeah. >> This must've had an impact on culture. >> Yes, yes. >> And this comes up a lot in the DevOps culture we've seen in the past decade, even now. >> Yeah. >> Getting people to change has become very difficult. >> Yes! >> John: We all know that person-- >> Yes. >> Has their project that's their baby, adding features, "No, don't take my "baby away from me." >> Tara: Yes, yes, yes. >> "I don't want to change." >> (laughs) Oh, yeah. >> How do you make that happen? How do you lead people through that very difficult transformation at an emotional level, on a business level? What's the strategy there? What's your technique? >> Yeah, so, again, back to, you have to show results. And you have to show results incrementally in a way that people can appreciate them and consume them. You have to look at technology from a business value perspective. Business value comes first, technology is just along for the ride. That's how people see it, and that's how they should see it. >> John: Mm-hm. >> It's what you can do with the technology that makes a difference. So, some of the techniques that I have used in the past have been, number one, you do have to find like-minded people in the organization. You can't go at it alone. You have to start to build your clan, if you will, of innovators, so you've got a target audience that you're chippin' away at, slowly, but you've got to build credibility. Because results build credibility. Credibility builds trust. Trust removes barriers. So that's kind of the way that I approach things. I bring like-minded people together, I find people in the organization, of the people that are resistant, that I can bring onto "my side," if you will, and I use their knowledge, their insights, their knowledge of how this person who is obviously a stakeholder, and an important stakeholder, how they think and what's important to them, and I use that language and that person to be able to approach individuals in different ways. It's about culture. >> And it's always good to make them, you know, success has many fathers, if you will-- >> Yep. >> Is always an expression. Making them feel part of the solution. >> Absolutely. >> So I got to ask you a question. Is having a software background, coming into the tech world and the business world, this, now, you're starting to see applications really dictate to the infrastructure. Elastic clouds are out there. >> Tara: Yes. >> You have data as a resource now. If you were entering the market as a young software engineer today, and you were asked to come in and make an impact, knowing what you know, how do you see the world today? Because, you know, a lot of software engineers creating value from men, and, now, a lot more women are coming on board. >> Yeah, yeah. >> It's still lower numbers, but still, software's not just that software engineer. >> Yeah. >> It's software architecture, it's software engineering, software development, UX, UI-- >> Tara: Yeah. >> Analytics, a lot of range-- >> Tara: Yeah, yeah. >> Of software opportunities. How would you attack the marketplace today if you were coming in and entering the workforce or in the middle of your career? >> Yes, you know, when I look at my career, which is a little longer than I'd like to admit, I see myself as a young undergraduate student in India. I was one of six girls in a class of about 50. I was striving to get a degree in what was called, actually, electronics and telecommunication. I was in a minority. I came over here to the United States, and I continued to be in the minority. I look at my career, which is more than 25 years old. I have also continued to stay in the minority throughout that career. The biggest difference between where I am now in my career versus where I was then is I don't care as much anymore that I'm in the minority. (both laugh) Right? What is fascinating to me, though, John, is when I look at some of the very young students, actually, we had a high school intern program for the first time this year at Clorox, which is actually interesting. We typically have college interns, but this year, Clorox, a 105-year-old company in the middle of the Silicon Valley, having the ability to see that the very, very young generation can think very differently, and bringing in the high school intern, or a set of high school interns, to help with that journey, I think, was forward-thinking for the company. And those kids, the confidence that they have? They are not shackled by knowing too much, you know? >> John: Yes. >> But they know what's relevant, they know how to make things happen, and boy, do they know how to use technology to make problems that we consider problems that would take months, happen so quickly. They were with us for four weeks. In four weeks, they developed an app, a website. They developed our logo. They developed a PR video for us. They had an innovation showcase. In four weeks, four little students. >> It's interesting, for the first time (Tara laughs) in my career, I can admit that, from a self-awareness standpoint, "Well, I really don't know what I'm talking about." These young kids have a different view, because now their experiences are different. >> Tara: Yes. >> And so, the insight coming out of this new generation really is pretty compelling. >> Tara: It is. >> They are adding a lot more because there's been a shift in expectations, there's been a shift in experiences-- >> Tara: Yes. >> For this new generation, and they're at the forefront, so it's a big wave coming. What's your thoughts on that? Because analytics is a big part of your career now, and it always-- >> Tara: Yes, yes. >> Has been, but now, more than ever-- >> Yeah. >> The younger generation, they want instant gratification, they want value. >> They do. >> They don't want to wait and be told-- >> They do. >> They want to see the immediacy. >> They do. >> Talk about this new shift, this new younger generation. >> Yeah, yeah. You know, there used to be the good old days, where we could, say, put a product out there and, you know, eventually it kind of works its way into the consumer ecosystem, and then we'd get to hear back, over the course of time. Customers would call in with a recommendation or a complaint. It's very different now. Things are out there instantaneously. We put something out there, you're getting comments and reviews, some of them good, some of them not so good. It's out there, and it's out there instantly. And that also, the modern consumer is not shy. They kind of hide behind the keyboard, and they're putting their comments out there, right? (both laugh) They're the keyboard warriors! >> John: (laughs) Yeah. >> So being able to respond to that and having not just the data, but the ability to extract insights from data and to extract insights in real time, that is crucial. And so, gone are the days where you had months to do your analytics. You have to be able to do your analytics in the flow, you have to be able to take in new information, incorporate it into your models, be able to do predictive analytics on it. So technology and the way that it is evolving is super critical for survival these days. >> So, survival, and also competitive advantage, we've heard-- >> Oh, for sure. >> From other CIOs, and also CSOs, from a security standpoint-- >> Yes, yes. >> There's business risks involved. How real-time do you see the advantage being? Obviously, near real time is pretty much what people talk about. >> Yeah. >> Real time is to the second, and self-driving cars will certainly need that. >> Yeah, yeah, yeah. >> But as a leader chasing the real-time holy grail-- >> Yeah. >> Seems to be a theme we hear. How do you react to that, and how do you view real-time data? >> There is definitely something that builds up to the richness of data that you can take advantage of in "real time." And I am saying "real time" in quotes because there is a contextuality associated with it. The wonder of modern advanced analytics and machine learning is that you have an existing model that you're tweaking and evolving with new information, and that model is serving as your guide as you receive new information. So, does it have to be reactive, or can it be proactive? You're building the insights, and then you're adding on new information as you see it. And you're using technology to help you make more holistic decisions. And at the end of the day, there is something to be said about the human aspect of it. The machine can give you guidance-- >> John: Yes. >> But the human being needs to make the decision. >> I'd love to ask you a quick question on that, because I think this is something that we talk about all the time. >> Yeah. >> Humans are critical in the equation, machines augment the humans. >> Yes. >> In the data world, if you're "data-driven," which has been (laughs) a cliche, "We're data-driven!" >> Tara: Yes, yes. >> It takes on multiple forms. >> Tara: Yes. >> I've seen multiple actors saying, "We're data-driven," but they're really just correlating data. >> Tara: Yeah. >> The causation side of it is, what's causing things, that's more of a management thing. >> Tara: Yeah. >> So causation and correlation are two different variables-- >> Tara: Yes. >> In the analytics field right now-- >> Tara: Yeah. >> That are being amplified as, you got to know the distinction between correlation, because you can correlate anything, causation is something that might be more designed towards figuring out something, and you really can't rest on one more than the other. >> Yeah. (laughs) >> Your thoughts on the balance between the two. >> You're talking to someone who worked in health care for-- (laughs) >> John: (laughs) I probably won't get you to continue. >> For almost seven years. Causation and correlation are-- >> John: More important than ever. >> Are more important than ever. And I think more and more, the boundary between what machines can do and how they can augment human beings, versus actually having the machines help you make decisions, it's getting fuzzier, and machines are able to do more and more. I mean, all of the knowledge that you could read about 24 hours a day cannot sit in your head. You have to be able to leverage machines to help you make those decisions. So as far as causation and correlation, I think the correlation is something that the machine can be the master of. It can see patterns where you may not even think to look for patterns. So I think that, let's give it up to the machines. Correlation is where-- >> John: They got that. >> The machines have got that, and you got to set them up so that they can do that for you. Causation is where the tricky area starts to happen. Because there is a lot to say, especially when you talk about doctors, about experience and working with individuals. Each individual is different. You can't say that the causation for this person is the same as that because the correlations are similar. No, you have to look, there are so many factors that go into what is causing-- >> John: Yeah. >> A disease or a condition in a person. So I think that is where the human element and experience really, really still make a difference. >> In the media business, we call it behavioral and contextual. >> Yes. >> Context is really important for really aligning-- >> It is. >> With whatever the problem statement may be. >> Yes, yes. >> Correlation, behavior, machines can do that. >> Correct. >> That's awesome, great, great, great insight there. A final question for you is, for other folks out there, CIOs or IT executives, as they look at the digital transformation journey, which, again, very cliche, but very real, there's a lot of opportunities, but also potential pitfalls if not executed properly. >> Tara: Yeah. >> Your thoughts on general roadmaps or best practices around how to tackle transformation, if they're doing it, coming in for the first time or at the beginning, or if they're in the middle of a digital transformation, and they're stuck in the mud-- >> Yeah, yeah. >> Or "Oh my God, "my head person quit. "I got to get more people." >> Yeah. >> "I need developers," or people on the back end of the transformation, different parts of the journey. What's your advice? >> Yeah, I've got a couple of, again, from the scars of my past, a couple of things that I think are important. Number one, when I joined Clorox, I had the stretch goal of actually building out their cybersecurity program. I had not done that in the previous part of my career. I was an enterprise architect, that's where I would spend most of my many years. But cybersecurity, and I hired the CSO and built out that program for Clorox, it puts a whole different lens on how you look at your transformation, and it is an important lens. And I think I would not have been rounded, as either an enterprise architect who's developing technology strategy or a digital technology innovator, if I did not have that lens of, there is risk that you need to consider. Now, the point to remember is that you can't over-rotate one way or the other. You have to consider risk and opportunity, and there's a fine line. And I think the smartest CIOs and senior executives know where that fine line exists, and are able to tell when you need to go this way or that way. So that's one thing that I would say, is don't lose that lens. Technology can do wonderful things for you, but so can the hackers from a different-- >> You got to be aware-- >> You've got to be aware. >> And then, you've got to shape it, too, as it evolves. Is that something that you see as important? >> You have to have that lens of, you're doing this wonderful, amazing thing, however, what if the unintended audience is able to access whatever you're doing? And what can they do with it? So that's one thing that I would say, is keep that balance in mind. Again, don't over-rotate one way or the other, but keep that balance in mind. The other thing that I would say is, innovation is a state of mind that needs to be nurtured and developed, and it needs to be sought from every part of the organization. The only way to scale innovation is to have everybody be an innovator in the organization. So that would be my advice, is innovation can come from the youngest high school intern, or, we actually just had someone at Clorox celebrate their 50th year at Clorox. So, you know-- >> John: Yeah. >> Innovation can come from anywhere in the organization. You have to always be ready, open-minded, and prepared to grab that opportunity when it happens. >> My final takeaway for this is in context to where we are now, we're on Sand Hill Road-- >> Yes. >> At Mayfield Fund, they're a venture capitalist. >> Yes. >> They fund early-stage and growth. >> Yep. >> The younger generation, we just talked about the insights that they can have, new shifts that are happening in experiences, expectations. The startups, more than ever, have an opportunity to have customers like Clorox. >> Tara: Yes, yes. >> What used to be, "Well, a startup, "risk, don't go through the, go through TSA, "and when you get approved, "then we'll talk to you," kind of thing. (Tara guffaws) It's a big, painful process. >> Used to be? >> Now, more than ever, startups want to land the big Clorox deals. >> Yes, yes. >> They want to show the value proposition, time to value, shortening, with cloud and other things. What's your advice to startups who want to sell to you or hope to, aspire to, be successful in the marketplace? >> You know, I love startups, and I spent a lot of time with them. What I have seen as differentiating in the startups that I have seen is, some of them, they're out there, they want your business. So they are looking at you from that, "Can I get your business?" And then there are other startups that, I'm sure they've got that lens, but they don't make it obvious to you. To them, the value is in working with you. You're a company that is well-reputed. You've got a ton of amazing data that can be used to develop your models. You've got a ton of insights and understanding of the business that you can get by just working with this "reputed" company, like Clorox. Those in itself, you can't put a tangible, material value on that, but that is what helps startups build relevant and amazing products. And that, in itself, is "payment." The money will come, but look to the experiences, look to the ability to leverage data, and, above all, look to how you can position your product in a way that it is solving a business problem. Don't do technology for technology's sake. >> So, your advice would be, don't focus on on the PO. If they're venture-backed, they probably have some runway. >> Yes. >> Focus on the value proposition. >> Absolutely, and learning how companies operate and what's important to them, take the time to do that. >> How about scale? Do you hear that a lot with startups, they want to try to use the value proposition? One, they have to get in the door and show value, so that's one. >> Tara: Of course. >> Kind of table stakes, get through the door. >> Okay, yep. >> Then it's more about how they can be operationalized. That becomes something I've seen with startups. What's your thoughts on that? Because one of the benefits of getting in the door is getting (laughs) in the door, but staying in-- >> Yeah. >> Is about operationalizing that new value proposition. How do you look at that as a leader? >> (sharply exhales) Yeah, the word operationalization is an interesting one. So, companies like Clorox, I mean, while I love to work with startups, I will tell you that I do experiments, four, six, eight weeks, we've got a metric. If we go beyond that, it's probably a project that needs to go through a different route. But we do these experiments, and we do them quickly. The thing that we do worry about is, "Okay, great startup, great product. "Is it enterprise-ready?" You know? And I think that is where a lot of startups struggle a little bit, is, can they prove to you that their product is Fort Knox, that it won't be a way through which your systems get hacked? Can they prove to you that they've got a good handle on where they are going, what their roadmap is, what capabilities they are developing in their roadmap? Can they showcase that to you in a way that makes sense to you? We're looking for companies that are not just here today and gone tomorrow, companies that are here for the long run. And then, even if they can't do all of that, show that you integrate really well with our other products. Because, guess what, if you don't work out so well for us, little startup, we want to be able to replace you. We want to have that option. And if you don't integrate seamlessly and can be plucked out and put back in again, then we're stuck with something that we can't extract from our environment. So they've got to think how we think, is what I would advise them. (laughs) >> Tara, thanks so much for this great insight. For startups out there, for folks entering their career, for other women who are looking to break into tech, we have a great inspirational leader here. >> Thank you. >> John: Thank you for spending the time, we really appreciate it. >> Thank you very much, really appreciate it. >> Thank you very much. I'm John Furrier. You're watching the People First program with SiliconANGLE and Mayfield. Thanks for watching. (upbeat electronic music)

>> From Sand Hill Road, in the heart of Silicon Valley, it's theCUBE, presenting the People First Network: Insights from Entrepreneurs and Tech Leaders. >> Hello everyone, I'm John Furrier with theCUBE. We are here for a special conversations part of Mayfield's 50th anniversary People First Network. This is a series of interviews from fault leaders around entrepreneurship, and insights. Manish Chandra, who's the CEO, Co-Founder and CEO of Poshmark, a very successful company. A serial entrepreneur that I've known for many, many years, going back to his early startups. Great to see you, thanks for spending the time today. >> Thanks for having me, John. And it's great, we were just talking about our early days when you were doing your podcast, and me, I was doing a social shopping company back then, was it, 2006? 2005 timeframe, a long time back. >> Pioneers have arrows on their back, as they always say in entrepreneurship, but if you look at the time when we were doing startups, over 14 years ago, social sharing, democratization; these were the buzzwords. This was the wave that we were all trying to ride. When 2008 hit, it kind of took the water down a little bit. But still the game didn't change, a rise comes Facebook, Twitter, social, multiple channels. The consumer's expectations changed a lot in that timeframe, and I want to get your thoughts because you've had two successful companies, Kaboodle and now PoshMark, with almost 40 million users, billion dollar valuation, hundreds and hundreds of employees, got like a hundred openings in your company. You're ramping up and you're scaling. But the expectations of users has changed. What are some of those dynamics in your business that you're seeing? >> I think the biggest sort of, uh, culmination or ignition point for social platforms came with the advent of mobile. And uh, early days of mobile were crude days, but you know, if you look back at the advent of Poshmark, sort of the idea of Poshmark reignited in my mind in 2010, and iPhone 4 had just come out. It was a couple of months after Instagram had started. And SnapChat had not even started yet. And what, I think, mobile platform did, especially with the high quality platform like iPhone 4 was, it made the process of content creation, consumption, and sharing so fast, and you finally had the device that could produce it, that uh, it just kept accelerating. And now, in the days of, you know, iPhone Excess Max and what have you, it's just so easy. At the same time, the speed expectation, the transparency expectation, and the velocity of expectation has gone up, and so what we've seen in Poshmark is, day one, our users were spending somewhere between 20-25 minutes in the app. And here today, we have billions of users, and they're still doing that same thing, so that level of deep immersion that you see is sort of unique to the mobile paradigm. >> I want to dig into the user expectation and the experiences that you're delivering. But before we start, take a minute to explain Poshmark; what you guys are doing as a core business, how it's evolved. >> So Poshmark, very simply, is a simple way to buy and sell fashion and other sort of style-based paradigm, we call it a social commerce platform because it really brings together users in a unique way. But it really allows anybody to build a business starting with their closet all the way to opening up a full-brand, wholesale engine on the platform. We provide all of the infrastructure, you know, shipping, payments, technology, and you have to bring in your inventory, so we don't touch inventory, but everything else we handle for you. >> So you're really helping people, enabling them to be successful with the ease of use; heavy lifting. >> Heavy lifting. >> It's kind of like Amazon. You don't need to provision anything, just kind of get started. E-Commerce in the era now of Google, Amazon, and Cloud technology, you see the rise of all the scale. How are you riding that trend, because that's a tailwind for you? And what is that doing for the user's expectations, I mean, I have four kids, I see them all online, they never use their laptops, except for homework, but they're on the mobile device, they're doing new things, this is the new expectation; what are some of those expectations? >> In our business, which is the business of fashion and style, what it means for people is, number one is, if they see something. Whether they see something on Instagram, or something on SnapChat, it needs to be instantly shoppable, right? And that obviously benefits a platform like us, which makes easy access to all of the different brands and things that are developing. At the same time, what social media's also doing is making the obsoleting of your products very fast, because once you've used it, you've, you know, posted a picture, you want to be able to not consume it again. >> You've been seen wearing the same outfit, I can't wear it twice! >> Exactly! And so we make that easy as well. And then the third thing is, uh, everyone is a content creator, everyone is a seller, everyone is sort of participating in this economy; people are hosting AirBnB guests in their home, people are selling on Poshmark, and the reason is because phone, and sort of this new mindset of collaboration and social makes it very easy for people to participate, so they want to be able to sell, but they don't want any hassle in that process. And so the new consumer expectation is instantaneous, deeply immersive, and constantly changing, and if you can't satisfy all of those things, then it becomes harder for you to scale. So you have to use technology, the physical world, and sort of the emotion all in the right mixture. >> One of the things I know that you're passionate about, and we've had this conversation, we feel the same way, certainly, at theCUBE is, role of community. And I see a lot of companies these days, whether they're saying we're doing an ICO using tokens to, um, getting a big bag of money from venture capitalists, oh yeah, our key strategy is to build a community. You can't buy a community. You've got to really win the hearts and minds and provide value, and you really can't, and build trust. Talk about the role of community for you guys, especially in the stylist world, where you have all this, where style's involved, a very robust community. How did you do it? How did you foster a community, and how did you nurture it? And how has that played out for you guys? >> So community is a foundation of Poshmark. And community's our value, not just our customer, but also what we are, and uh, community is what I'm more passionate about, even more passionate than fashion; and that was sort of, in my previous company, the thing that was really highlighted for me. And so we did it very slowly, actually. During the first year of our company, we only had a hundred users, but these hundred users were immersed. And then we went from a hundred to a thousand. Then thousand to five thousand. But very deliberately and slowly. So the end of the first 18 months of our company's life, we had maybe ten thousand users, right? And then we went from ten thousand to 300,000 in the next seven months, then we went from 300,000 to 12 million in the next two years. And today we went from 12 million to 40 million in the next few years, because, once you have sort of figured out how the community is created, it can scale very fast, but the early days if you compromise in how the community is being created, it's very powerful. For example, in the first, probably, eight or nine months in the company, I answered every single customer service email. And today, I probably interact with 80-100 customers directly everyday. Really keeping the pulse in sort of servicing. And service and love are sort of two of our core values, and it is very important that's built into the system. The second thing is, the community has to be authentic. You cannot fake a community. Which means, there is conversations that will happen in the community, there is, which may be antithetical to what you think is your brand, but if you don't let that authenticity happen, then what ends up happening is the community sort of withers away, because people are not going to tolerate anything inauthentic. The third thing, as you mentioned, is trust. And so from day one, we created not just trust in the way platform was built, but also in the economics. So day one we said, hey, if you're going to be part of this platform, there's two things that you're going to pay for; one, is, as a buyer, you're going to pay for shipping, and as a seller, you're going to revenue share with us, and we're not going to charge you any other money. Nothing. And so we shared, started from day one, a 20-80 partnership with our sellers, and today, here we are six or seven years later, and we have the exact same partnership. On the buyers, we started by charging them $7 for shipping, today our shipping is $6.49, at that time our shipping was 3 pounds to 5 pounds. Everything was priority, today everything is priority. So in six to seven years, if you think of any other marketplace in the world, not just in the country, how many times have they raised their fees? How many times have they changed their paradigm, changed their shipping paradigm? For us, it was very important. In the early days, it felt, people were saying, why are you charging so heavily? I said, I don't want to charge anything different tomorrow that I'm charging today, and by the way, there's no additional fees we've ever imposed on the platform, so, we don't have any marketing fees, any promotion fees, any credit card fees, and so that trust that's created ultimately leads to a lot of loyalty. And so today, you see our consumers growing, our users growing, and every single cohort we have continues to grow in revenue more like SAAS businesses, as opposed to e-commerce businesses. And that, to me, is the power of community if you do it right. >> And that's an interesting point. There's a lot of things you said in there, I think, that are worth doubling down on. One, I just want to highlight it, if you're creating value, and you're certainly scaling, passing that down in cost savings, and reducing cost and adding value, that's a secret formula. You see, we know one company that does that really well: Amazon! And that's worked. And they recognize the value of keeping people in there engaged, and so I think that's almost a take away for anyone watching is that if you're not adding value and reducing the costs while you're scaling, you're probably doing your math right. >> Absolutely. >> The second thing I want to talk about, and get your reaction to is you know about community and slowing it down at first. That's almost counter-intuitive. The, almost the answer is put the pedal to the metal, let's get some numbers; you took a different approach. You decided to take your time. Was that to get a feeling for the community, build the trust, understand the dynamics? Talk about why you went slow at first. >> The key is that the first two, three years, you're perfecting a lot of things, right? You have to make sure things are getting right. And in the first year, it was all about getting the product right, right? Then we scaled. Then we quickly realized that that scaling was breaking everything, was breaking our shipping system, was breaking our technology's office; I actually, Mayfield, which was an early investor in Poshmark, was on the board, and I went to my board, and I said you know, I'm actually going to slow down growth by 60%. And if you can imagine a venture board hearing that from their CEO, in the early days, it's challenging. >> It's a tough conversation. >> Yes. But I think one of the things that I value about Mayfield and my early investors is their focus on partnership, at a people level, a human level, with me. And uh, trust, and so we actually cut down our marketing budget by 80%, filled out the systems, got the partnership with USPS where we created the country's first fashion shipping label called Poshpost, and built up our technology and infrastructure, built out our payment partnership with BrainTree and Paypal, and by sort of, early-to-mid 2014, we started scaling and have never stopped. And in fact, I had told my investors early on, that first two or three years of building this business will be challenging, so hopefully you are prepared to go on this journey with me; but once we build it, it will accelerate. And what you see with us is, the business continues to accelerate every quarter, and we are seeing hyper growth, six, seven years into the business, which is even faster than the growth we saw in the first few years. And part of it is that, network business, which are built around true sort of networks, continue accelerating and connects later on in the process, but if you haven't created the right foundation in the early days? They fall apart. >> I think that's a lesson that entrepreneurs can learn, because you got to go slow to go fast. In Cloud based businesses where you have network effects, if there's a crack in the foundation, it can come crumbling down. >> It can come completely crumbling down, and it did, I mean, there were times in 2013 when people were literally doing things and just, the data would get lost in other things. We had to fix many of those, the broken pieces. We had USPS come to our offices and say hey, either you pay us a multi-million dollar fine or we have the right to arrest you. We had to renegotiate our contract with them. There's a bunch of things that happen in that scaling, and you hear things like blitz scaling and stuff these days, and their great terms, but at the same time, if you don't fix what's broken, you can't build that super scalable business. >> You got to be ready to blitz scale. As you know, Reid Hoffmann's famous channel, Masters of Scale, points out, which, by the way, is a great program, but, if you're not ready, you can crash and burn big time. That's a good point. You know, I have conversations a lot with a lot of senior people, one of them Theresa Carlson, who runs Amazon Web Services Public Sector Cloud business, she talks about doing the hard work upfront. And, you know, she's using public sector, so you have to get those kind of certifications, it sounds like this is a lot of things that you had to do. How did that test your entrepreneurial spirit? I know you, and you're hard-charging, but you're pragmatic and we can see that. But taking the time to do the work can sometimes test the patience of the team and the entrepreneur themselves. What's your reaction to that? >> Um, I would say that, you know, when we started Poshmark, the mission was that can we serve a hundred million people. In the country, you know, not even around the world. In our way we have 40 million people. From day one what we saw was deep engagement in the platform, because of the level of usage we had, because of the level of, sort of, activation we had, we knew we were on to something. I'll share a small episode with you, which convinced us that we've touched a deep nerve within the community is, in May of 2012, we were barely, you know, six, seven months into our app being launched in the public space, and we had maybe five or ten thousand users. At that time, we were adjusting our shipping for the first time, and uh, literally we announced the, we had launched the product with a small discount on the shipping, we were going to take it back, and we just said, you know, we're going to take it back. We got 200 plus emails which ranged from, you know, you're going to take away my entire set of clothing, and my entire business and we barely thought we were even launched, and so we knew we were servicing something very deep. That commitment to servicing the community where you are, really helping people at a deep level, allowed us to ride through these crazy ups and downs. And there was a point of time we went along the valley, even though we had the initial funding, in the mid stages of it we got over 200 rejections in the paradigm; sometimes multiple by the same investors. And so, it was definitely not a smooth ride in the middle of building this company. But that sort of passion for community and what they were experiencing kept us going. >> Let's talk about People First and venture capital. And one of the things I'm impressed on with this program we're doing with Mayfield is, and theCUBE has newer effect as well in the community, it's a people-centric culture. We lived through the social media early days when social and democratization was happening. More than ever now, you're seeing the role of people, because we're all connected. So there's rapid communications, there's frictionless, for people to yell and/or raise their hand and give accolades as well. So you have now a social dynamic with the fabric around the world. People can transact and communicate, complain, you know, applaud. This is changing everything. How is that change your outlook on life, because you have to recruit people, they want to work for a company that's people-centric, they want to work for a mission-driven company. These are the new dynamics we're starting to see in this generation; how has People First impacted your core mission? >> So for me, life is all about people. This company's all about people. We serve people, people is one of our core values. And my connection with Mayfield, which is through Navid, started back, actually, in my previous company. At the very beginning of that journey, '04/'05, uh, and we tried to partner up but the timing was never right, so when we were starting Poshmark, Navin was the first one with a term sheet, even before he'd sort of seen the business idea. And to me, that was a huge belief in me and the team I could put together. And I have the same sort of feelings about the people we bring on into the company, where uh, many of my team members here, including two of my co-founders, were involved with me in Kaboodle. One of them was a co-founder in Kaboodle. The first 20, 30, 40 people, I think, in the company, are still here seven or eight years later. They were people who are now playing very senior roles in the company, where they've gone through their ups and downs and we are always behind, two or three people left and we recruited them back into the company. So I think at the end, life, anywhere, but particularly in today's world, is so much about people and relationships. And it's the same thing we did to our community. I mean, uh, we just finished our sixth annual user conference, which was six times bigger than our first one. What was amazing was, they were so many people who were there in the first conference who had been coming to all the six conferences, and they are now like mini-celebrities in the community. And so, it's just amazing to see how a focus on people can be both rewarding at a business level, but also very gratifying at a personal level. >> It's nice to see you hit that tipping point. Congratulations on your success, it's great to see. You're a great entrepreneur. I want to ask you the question around funding, because I know, we've both been through venture capital fundings, we've been through this point building this great company you run now, and you've actually hit massive growth to a whole other level, your challenge today and going forward. This is, given it's Mayfield's 50th anniversary, you've seen a lot of changes in venture capital. A rounds used to be A rounds, now there's B and pre-C, there's all kinds of nuance, and now you have alternative funding now and global landscape you're seeing block chain and cryptocurrency, although ICO's have taken a bath because of the regulatory issue. Issues around regulation, some scams out there, actually. But venture capital's been tried and true. What's changed in venture capital the past 25 years in your view? >> I think, two things, which have happened, particularly in the last seven or eight years is there's a lot of it. And secondly, it favors the mighty more than the weak. And so, those are sort of the two big changes that have happened in the venture capital business. I think you were just mentioning is the people I used to work with, a whole range of investors, are now investing in post-growth stage funds. I mean, the same company. So everyone is sort of leveled up and leveled up and then leveled up, you know? You see venture capitalists raising two, three, four billion dollar funds; I mean, that's not venture capital, there's no way you can deploy that at the venture stage. A company is staying private much longer at different scales, which I think is probably more sort of a sign of the times. And finally, I think, it is the metrics and the scale that your business can achieve, that these are obviously very aware of, is an order of magnitude bigger than it has ever been. In fact, sort of, in some ways, unicorn, being the unicorn is uh, as sometimes as people joke, sometimes an insult. You need to be a deca-unicorn these days. So the feeling of not being enough is constant. >> And that's challenging, too, for the venture industry, because, you know, there's still the classic building blocks of entrepreneurship and venture architecture, which is, you start with an idea and you get a prototype, and certainly it's easy to get on the Cloud computing certainly, a great win for the entrepreneur; so I can see maybe some acceleration. But at the end of the day, it's still the classic blocking and tackling with building your company. >> Yes. >> Building a durable company. >> Absolutely. And you and I have both seen the '98, '99, 2000 timeframe, you know, everyone believes nothing repeats, and, you know, we certainly see, maybe not exactly the same thing, maybe it's an order of magnitude less, but there's definitely some level of exuberance we see today. But if you're building a fundamentally good business, that has robust economics, that can scale, and is based on foundational principles, with a large sort of market, I don't think that we are wrong in terms of deploying massive amounts of capital up against it. But at the same time, um, I think it also creates certain socioeconomic, as well as responsibility challenges, that I don't think we are fully facing up to, as an economy, and as a Valley. >> You've raised over a hundred million plus, so you have done some funding. A lot of funding, you have a lot of cash you've raised. When you had to go through those exercises of looking at the fundraising, 'cos, you don't want it to die on the mind, you're building a durable business, you have to go through multiple rounds of fundings. What were the key decision points for you as you started to look at this fundraising process to build your business? >> See, in the early days it was literally just about survival, I mean, there were times where I ran the business on negative balance sheets, right? So it isn't that it's been easy. I was only, I would say, the last funding round was the one that was easy, where we got multiple term sheets proactively, and the first couple of them. In between--. >> When things are scaling things are great, you know? >> In the middle of it, every single round was effectively zero to one term sheets. Every single time. We were lucky to have Mayfield as a partner, and some of our early investors like Inventus and Menlo who sort of supported us through each of these pieces of the journey. Mayfield as an anchor point. But it was really, really hard. And part of it is that, what we were doing was challenging, so many things still are, that even to process our cohort data is hard. Do you think of it as used, do you think of it as buying, do you think of it as selling, what is it? It looks like a bird, but it moves like a plane, you know? What is it? It's Superman or Superwoman, right? So that being a challenge, uh, only in the last round did we have the freedom, we could raise no money, some money, all of the money, and um, most of the focus for us, for that capital, was really to have the deep pockets that would be required for global expansion. We had actually scaled the business, at that point in time, that we didn't need too much money for domestic expansion. And in fact, not only have we not touched any money from that round, we have not touched any money from the previous round, so far; most of the money from the previous round. And so, again, part of it is you need muscle to compete in a bigger world, but at the same time, if you build a fundamentally sound business, then over time you can scale with or without money. >> And you got SAAS, sellers and service, and network effects booming and great community. That's a great tailwind for you guys, for sure. >> It is a phenomenal tailwind, and in fact, um, I was just in my management team meeting this morning, and I said, you know, we are growing, but we can grow even faster at this point, because the level of network effect we are seeing in the community is an extraordinary effect, where there's sort of second order; our community is opening up Instagram accounts to promote Poshmark to sort of go out to YouTube, so there's sort of this wild, organic movement that's happening across the country, which is just bringing out a whole different level of growth that we've ever seen. >> Yeah, there's a whole new dynamic it seems. It's interesting, I'm seeing, and not a lot of people writing stories about it are documenting it, but Masters of Scale has a whole different perspective, but no one's really talking about something that you guys are touching upon, and we're seeing it in our business. Creating an environment that has network effects, and community, and good content in this case, product for your end. Um, creates a flywheel. And what's interesting is, in this new era of people who can create value, with the ability to capture it, is really a unique formula, and I think this is the new kind of management discussion. Certainly lower prices, increased value, that's an Amazon effect. That's a, lacking the words, good example, well-documented, you do that, you're good, you're doing it, but now you have the ability for people to create value. Who can then capture it. This is almost a whole 'nother big wave. Your reaction? >> I think the power of people today is at a very unique level, right? And it can go in the negative direction, but when you harness it from a positive perspective, it's phenomenal. And to me, you know, we've started added a fifth core value recently, is that at the end, the true happiness comes from service of others, right? And if you service everyone, in our job, you're servicing our community, who's then servicing other people, and that creates an amazing sort of paradigm. And if you remove the conversation of money, because it's taken care of, it's built into the platform, then it just keeps sort of circulating. And I think that's something that people underestimate. And one of the things that you, you know, you see is that, for example, open source software, right? You start by focusing on community and then it becomes all about money, and then you forget about the community and you see many of the larger open source companies slow down, because they forget the fact that what brought them there was the community. And to me, I think--. >> If they get greedy, the project's fail. >> Exactly, exactly. And so, the hardest thing at scale to balance is how do you make sure that you're still focused on the community? >> Great stuff! Final question for you. You know, these days, with venture capital, the question always is, where's the value at? Talk about your experiences with Mayfield, and what differentiates a value add versus a value subtract investor? When should an entrepreneur feel it? What's the tell signs of someone's got a value add, and partner is not? >> I think, I think Mayfield is so aligned in so many ways with our core values, which is focus on people and focus on service, that it's just been an amazing partnership with them. You know, even in our lowest moments, I knew that we would get funded; I didn't know how it is, because I knew that Navid and Mayfield would figure out a way, so I never sort of worried about the capital after I brought in Navid and saw him in action for a year and a half. And if you're a venture capitalist, you need to provide capital! And forget about any of the services, many VCs fail that one task, which is to provide capital when you most need it, right? But beyond that, it's been a great resource. I mean, I met my co-founder through Mayfield. Tracy and I were first introduced via Mayfield. Many of our recruiting of the top executives have come from Mayfield, but they're always available as a sounding board across the pieces, so I do think that they take their service paradigm to a whole new level. >> And they support you, too, right? The support's there? >> Support and they have an HR partner who's helped, I think, with some of the recruiting issues, hiring the recruiting partnerships, et cetera. PR, other areas as we needed it. Somebody that you could call on, too, even if it was just talking about searching for a general counsel, and Mayfield has been great, even in that. Help, at this late stage of a company, so it's fantastic. >> It's a great network; people, value, paying it forward. Manish, thanks for coming on, sharing your insights, here as part of theCUBE's 50th People Network with Mayfield. Thanks for sharing your experience. >> Thanks for having me! It's been a pleasure and joy to see you after so many years as well! >> This is theCUBE here on Sand Hill Road at Mayfield for their 50th Anniversary as a Venture Capital Firm, sharing insights and ideas from entrepreneurs, and tech executives. I'm John Furrier, thanks for watching! (electronic music)

>> From Sand Hill Road in the heart of Silicon Valley, it's theCUBE. Presenting, the People First Network; insights from entrepreneurs and tech leaders. >> Hello everyone, we are here for CUBE conversation in San Francisco. I'm John Furrier with siliconANGLE media theCUBE. We are in San Francisco with John Zimmer, who is the co-founder of president of Lyft, the famous ride sharing company that's dominating the world and changing the game in transportation. We all use Lyft, we love it. John, great to see you here for this People First Network special conversation. Thanks for spending the time. >> Thanks for having me. >> I know you're super busy, you guys are growing, billions of dollars in raised capital. You guys are growing like a weed on a rocket ship. A lot of things happening. But, you know, it's interesting, you guys are not that old of a company and the growth has just been fantastic. So, as you continue to ride the wave here, there's a lot of lessons that you've learned. So, tell the story about how you guys got started. You and your co-founder have a great relationship, and this has been a part of the culture at Lyft. How did it all get started? >> Yeah, so I'll start with Logan, my co-founder. He grew up in L.A. surrounded by traffic and he hated that. And he wanted to find a better way to get around. So when he went to college, he went to UC Santa Barbara, he did not take his car. He rode the bus, he car pooled, he had friends with cars. And then he went to start a car sharing program before Zipcar was around on college campuses. He got the attention of the local transit board, he got elected as the youngest member ever on the transit board. And he fell in love with the promise of public transportation. Affortable, accessible transportation for everyone. But frustrated by the reality that it was dependent on tax money. So, he wanted to create a better solution and he started coding his own website, named Zimride, named after a trip he took to Zimbabwe, for long distance car pooling. My own journey was I was on the east coast. I did not know Logan, was in love with hospitality, making people happy through great service. So I went to Cornell Hotel School, I took a city planning course, and I saw that the most important hospitality experience we have in society today is the city itself, and yet unfortunately we've designed cities for cars, and not people. What I mean by that is most of our cities are paved over. There's roads, there's parking lots, and if you design a city instead for people, pedestrians, safe places to bike, and don't need people to own cars in order to get around, then you could have a much more durable place to live. So we came together in 2007 to work on Zimride. And then a few years later, in 2012, we launched Lyft. >> So this is a transportation problem, ultimately, to solve. But the itch you guys were scratching was just the need for transportation. You saw it as more of a convenience thing as well. The hospitality thing kind of comes together, boom, Lyft is born. Then you guys enter the market, and the transportation problems are still there, and then you have the growth of mobile, so sort of a perfect storm coming together. What is the biggest challenge and exciting things that you guys see in this transportation scheme? Is it it's antiquated and inadequate? Is it a technical thing? What are some of the challenges that you guys are exited about? >> Well I think the biggest thing is this fact that the American dream has almost become, or been, historically, synonymous with a car in every garage. And that everyone should own a car. And that was your sense of freedom. But the reality is not quite that. American families spend more on their car than they do on food. It's the second highest household expense. A new car costs, on average, an American family $9,000 per year to own and operate. And so, there's a lot of ingrained behaviors, and designs of cities so that it does cater to needing to own a car. So we're trying to break that down piece by piece and making progress. But we're about 1% of the way there. >> Yeah, it's a cultural change too. But I also want to get to that in a second about culture, both with Lyft and and into your audience, which is the cities and the environments you guys deploy in, but also the users. But the founding and the story of you guys growing is interesting, because startups are all about execution and culture. You've had an interesting relationship with your co-founder. And this is the secret sauce of startups. It's documented somewhat, but it's a people first mindset, where you get a good team early on, you kind of feel your way through those first couple of years. Talk about that relationship with the founders, because this is something that's important. It's not just a number on a cap table, it's a little more than that. Talk about the relationship. >> I mean Logan has become my best friend. We actually carpool to work, still. Almost every day. And we weren't friends prior. So, a lot of times you have friends that start a company together. We were two people that were incredibly passionate about our mission, which is to improve people's lives with the best transportation. So we shared this passion, we share this vision, and we're two completely different people. So our approaches were different. His approach is often product-oriented and my approach is often hospitality-oriented. And the fact is, for transportation, you need to combine those two pieces. So it worked out really well for us. So I think having a co-founder is a massive advantage, because you can have two different people and then you want to find the thing in common, which is the thing you're fighting for, within our case the mission. >> How did you guys work together to play off each other, to get that innovation spark. Because when you get into the ride sharing, certainly it's a brand new category, huge demand, and there's a lot of build up, a lot of things you've got to stand up for the business. At the same time, you also want to differentiate and be innovative. You're kind of a first mover, with Uber, these guys are out there too. You guys are building a business, and growing really fast. So, how do you guys nurture that innovation? How do you put a twist on it? How do you keep it alive, versus the blocking and tackling and standing up the basic business activities? >> Well I think because we, you know at the beginning, we created a new category. We're the first to do peer-to-peer ride sharing. Uber existed, but they were doing cabs and limos. And we said, that may work for 1% of the population, but we wanted to use this under-utilized asset, which is the car that's sitting in everyone's parking spot or garage. And so that DNA of innovation, that DNA of being the underdog, the challenger, has always been true to us, but also the people that we we've brought on and hired. People and the hiring is something that, over the last ten years, is probably the one activity we've spent the most time on. Because that's the best way to keep those values, keep that focus on vision. >> And certainly these days, people want to work for a company that has a purpose. And that has a mission. When you hear the word people first, what pops into your head? >> Obvious. It just feels, in everything I've tried to do as a person, whether that was studying- like hospitality is the business of people first. How do you give people a great service and a great experience. And so I think often times, when people think about technology, they think about the what, which is I made this phone, I made this device, or I made this app, when way more important to that, is the why. Why did you do that? Who are you doing that for? And so we try to start everything we do with the person we're trying to- you know our mission is to improve people's lives with the world's best transportation. It's not to build the worlds best transportation. >> So that's your why. I was talking about how you guys scaled to a world-class organization. You guys have build a world-class team, certainly got great investors, Floodgate, Mayfield and then the rest is all on the web. You guys raised a lot of money, but you can't just throw money at the problem, you have to have that foundation and culture. How do you scale up a world-class organization? What's the learnings, can you share your perspective? >> Yeah, so first having clarity on the mission, which we've talked about, but also having clarity on core values. So we have three core values that have been true for a very long time. So, one is to be yourself. It also sounds very simple, like people first, but a lot of corporate environments have made spaces where people aren't comfortable being themselves, where there's group think, where people don't feel comfortable bringing their full self, and therefore their most productive self, to work. So be yourself, respecting the diversity of our team, has been critical from the beginning. The second is uplift others. So we use that both internally and externally. Life's short, we spend a lot of our time working. We might as well enjoy what we're doing. Again, all these values are both the right thing to do, make for a better place to work, and lead to better productivity and business success. And the last is make it happen. That's pretty self explanatory. Be an owner, go out and take action and get stuff done. And so with those three simple core values, looking for amazing, talented people, who also care about our mision. People are mission oriented, people want to care about what they're working on. And if you're fortunate to have a choice where you work, what we've seen is that people will follow a mission. >> Yeah, it's totally true. I can see that in culture here. And I've also seen you guys got kind of a cool factor too in the way I've seen some of your activations out in the marketplace. You kind of got a cool factor going on as well. But I think what's interesting, and I want to get your reaction to this, I think this points to some of the cultural discussions, just recently during the elections I saw you guys really wanted to make an effort to help people to get to the polls. Here in California, the disasters of wildfires are really tragic. You guys are doing some work there. This speaks to the culture. You say, hey, Lyft's available, and you're helping people out. Talk about what that means to you and the team here, and the culture at Lyft. >> Yeah, at the end of the day, when we look back on the work we've done, we want to make sure it has improved people's lives. And when we see opportunities to take our ability to provide transportation that will benefit people in a meaningful way, whether it was, you know, in the last- not this most recent election, but in the last election, in the last presidential election, I believe it was about 15 million people listed transportation as a reason why they couldn't vote. >> They've got a way, hey! >> Yeah, let's solve that. We can. When you think about unfortunate natural disasters, if we can help people get to safety, or help a horrible situation, then we should do that. I think that's just a moral and civic responsibility. It allows us to be aware and proud of the solution we've created, and I think it keeps our team extremely motivated. >> And I think it's one of those intangibles in terms of the mission, changing the transportation industry sounds academic and corporate. But here, you're changing lives by one, the voting, and two, saving lives potentially, with the disasters. So, great job. Okay, so what I thought, let's talk about the growth okay. I had a great conversation with the CEO of Amazon Web Services, Andy Jassy, a few years ago, talking about the early days of AWS. You have to be misunderstood for a while, and get through that early on, if you're going to be successful, because most big things are misunderstood. He also made a point about the key learnings during the early days. When you're trying to do stuff, things going so fast, that there's learnings that come out of it. And if you can persevere through it, that sets the culture. Share a story around something that you guys have been through at Lyft, where you persevered through it. It might have been some scar tissue. It might have been you got a little bloody, a little dirty. But you got through it and you learned from it. You applied it, and changed the culture. >> Well I think there's two main ones that come to mind. So, you know, people may think Lyft, in the last five years, has really come out of nowhere, but Logan and I have been working together for eleven years. And the first idea was Zimride, was long distance car pooling. And we built a team of 20, 25 people, we got this to break even. That's actually the company that Mayfield invested in, or the product. But it didn't have product-market fit in a massive way. It wasn't a massive success. And then so we tried to reinvent ourselves five years later, and that was Lyft. And at this point, that was a crazy idea. To have people riding in what everyone thought of as a stranger's other vehicle. And so that was a reinvention, an acknowledgement that the first solution we created did not fully work in the way that we wanted it to. The second was about four to five years ago, we wake up and Uber raises three billion dollars. And we have a hundred million dollars in the bank and about five months left. And everyone said Lyft is done. There is no way that they can survive this, it's a winner take all market, Uber is way more aggressive. And we proved that wrong. By focusing and staying true to our values and to our mission. By having an incredible team. An amazing community of drivers providing great service to our customers, we've gone from the early days of single digit market share to nearly 40% market share, amidst that pressure and belief that we couldn't survive. >> Game's on. Either rally or fold, right? It's a cultural test really. What's your mindset around the capital market. I know, I've done a lot of startups myself, I know a lot of fellow entrepreneurs, and when you raise that money, and you guys had that product-market fit, post the first venture, where you got through that. Then you get lightning in a bottle, whoa, let's double down on this. I want to go back to the early stages when you were thinking about investment. Was there any cautions around VC, cause a lot of startups have that conversation. What was the narrative for you guys at that time? Hey, let's go to Mayfield, should we raise money, should we bootstrap and make it cashflow positive. What was your mindset as founders, at that time when you were doing the venture round? >> Well, I think we knew that we needed a certain amount of capital to get to a scale that was interesting to us. So, not every business needs as much capital. But for they type of transportation infrastructure that we wanted to change, the type of scale we wanted to get to, we knew that it was important to raise VC money. So, money that was substantial and also understood the level of risk we were taking. So, at that point, we were fortunate to have a firm like Mayfield believe in us. And what we were looking for was people that care about who we were, cared about our mission, and understood what it was like to be an entrepreneur and an operator, not just an investor. >> What's the rallying call now for the team as you guys look out a6nd continue to have this growth? Obviously you guys cleared the runway in a big way. And there's still a lot more work to do, the market's still early. You know, you think about transportation and the regulatory environment and how technology and policy are coming together. A lot of forces out there, you got some tailwinds and some headwinds. How do you guys look at the future? What's the next mountain you're going to climb? >> Yeah, so, we've now done a billion rides. Since inception. And we're focused on providing a full alternative to car ownership. So I don't think people grasp that. The idea is not to provide an alternative to a taxi, or a late ride home. It's to completely replace car ownership. And so, we are 1% of the way there. Those that are joining our team and our mission get to be there for the 99% rest of that. And at the same time, as we go towards the next billion rides, we want to stay focused and rally around the individual stories behind each ride. So, every single week, we have over ten million rides happening, where two people are coming together. They could be two people that helped each other have a better day. They could be a Democrat and a Republican sitting next to each other and finding common ground. And so to us, yes we have big milestones and big opportunities ahead, but also care about each ride that's happening on the platform. >> And the other thing I love about your background in hospitality is you're bringing an experience as well. Not just math, in terms of the bottom line numbers. There's a lot of people doing the math and saying hmm, should I have a car? But I got to ask you a question. So what you learned at school, Cornell great school, great Lacrosse team, great Ivy League school, they teach you the textbook, the old hospitality. This is a new era we're living in. What is happening in your world that they don't teach you in the textbook from a hospitality standpoint? As you look at the experience of ride sharing and transportation for users, what is different, what's the twist in hospitality that has not yet been written in the textbooks, that you're exploring or thinking about? >> I actually think the old basics are more important than ever. There's all this flashy technology and opportunity to do it at larger scale, and to use data, that's new. To use data in ways that help inform providing great service. But, the basics of human interaction, communication, and treating people with respect, can get you pretty far. >> And happy customers, right? Final question, I know you got to go, I appreciate your time. Share a story or something about Lyft that people might not know about. First of all, everyone knows about your brass, you guys are doing a great job out there with the market share. But tell a story about Lyft, or something a datapoint, anecdotal piece of information, that they might not know about, that they should know about. Share an inside story or factoid about Lyft, that people should know about that they might not know about. >> I think it's really deep, deep in the mission. That people may not understand what gets us out of bed in the morning. You know, every time I have a new hire orientation, I try to talk to every new hire that comes to the company and really emphasize the importance of every driver, every passenger. And I read a story about a driver and passenger that really helped each other. And don't really want to provide the details because they're private to those individuals, but it's incredibly powerful to hear about. And so, I would just, we may look like a big company or brand at this point, but we care deeply about each individual that's on the platform. >> The fabric of society is being changed by you guys, really appreciate the work you've done, and congratulations, and a lot more work to do. Thanks for the conversation. >> Yeah, thanks. >> I'm John Furrier, here in San Francisco at Lyft's headquarters, talking with John Zimmer, who's the co-founder and President of Lyft, sharing his stories and successes, and a lot more work to do here at the People First conversations. With theCUBE, and Mayfield, I'm John Furrier, thanks for watching. (outro music)

>> From Sand Hill Road in the heart of Silicon Valley, it's theCUBE. Presenting, the People First Network, insights from entrepreneurs and tech leaders. >> Hello everyone I'm John Furrier with theCUBE, we are here in Sand Hill Road up at Mayfield Venture Capital Firm for their 50th anniversary, their People First Network series, produced with theCUBE and Mayfield, I'm John Furrier, with Bill Schlough, the Chief Information Officer of the San Francisco Giants, CUBE alumni, great to see you thanks for joining me today for this People First Series we're doing with Mayfield's 50th anniversary, thanks for coming in. >> Good to be here, John. >> So, been a while since we chatted, it's been a year, A lot's happening in tech, you can't go a year, that's like seven dog years in tech, lot happening, you're managing, as the CIO for the Giants, a lot of things going on in baseball, what's the priorities for you these days, obviously, you guys, great social, great fan experience, what's new for you, what's the priority? >> Man, there's always something new. It's what I love about it, this'll be my 20th season with the Giants comin' up. And, it never gets old, there's always new challenges. On the field, in the seats, off the field, you name it. As we look toward next year, really excited about bringin' in a new video board, which we haven't publicly announced, maybe I just did publicly announce, we're breaking news on theCUBE today. So we're puttin' in a new video board, it'll be over three times the size of the one we have today. That's big news, we're doing a lot of exciting things in the ticketing world. The ticketing world is really transforming right before our eyes in terms of the way fans buy tickets. It's changed a lot. Once up on a time you could call a game a sellout, and we sold out 530 straight games at AT&T Park, but really there's no such thing as a sellout anymore I mean, at any point you can get a great ticket, so we have to adapt to that and change the product that we're delivering to fans, so making some changes on the ticketing front, the fan experience, the ballpark with the video board, and another thing that's changing a lot is the way fans consume our game when they're not at the ballpark. It's rare that you're going to see somebody sit on a couch for three plus hours and watch a game continuously anymore. Fans are consuming through mobile devices, streaming, catching clips here and there, all different methods, and it's fun to be a part of that, because, fans still love the game, but they're just consuming it in different ways. >> Yeah, I love having chats with you on theCUBE because one of the things that have always been the same from nine years doing theCUBE is, the buzzword of consumerization of IT has been out there, overused, but you're living it, you have a consumer product, the ultimate consumer product, in Major League Baseball, and the Giants, great franchise, in a great city, in a great stadium, with a rabid fanbase, and they know tech, so you have all the elements of tech, but the expectation of consumers, and the experiences are changing all the time, you got to deliver on the expectations and introduce new experiences that become expectations, and this is the flywheel of innovation, and it's really hard, but I really respect what you guys are doing over there, and that's why I'm always curious, but, always, the question comes back to, is, can I get faster wifi in the stadium? (laughs) It's always the number one question >> It's funny that you ask that because it is AT&T Park, you know, so, honestly, we got to check that box, and we've had to for years, all the way back to when we first rolled it out, way back in 2004 when we first rolled out wifi in the park, people weren't asking for it then, people were coming to the ballpark with a laptop and plugging a card into it, and there were about a hundred of them that were accessing it, but today, what's interesting is, who knows what next, but we're not talkin' about wifi as much, wifi is just kind of, expected, you got to have it, like water. You're talkin' about 5G networks, and new ways to connect. Honestly, this past season, our wifi usage in terms of the number of fans that use wifi, what we call the take rate, the percentage of fans, was actually down 30% from the previous year. Not because we had less fans in the stadium, because this is the take rate, a percentage of fans in the stadium, went down, because AT&T made some massive investments in their cellular infrastructure at the ballpark, and if you're just connecting, and you got great bandwidth, you don't feel the need to switch over to wifi, so who knows what the future will hold? That's a great point, and you see the LTE networks have so much more power, it used to be you needed wifi to upload your photos, so you'd go in, log in, and if they auto login that's cool, but people don't need to. >> Not with photos, what they need it now for is when we see it really maxing out is events, like our Eagles concert, or Journey concert, or a really big game, like opening day, or honestly, Warriors playoffs game, 49ers football games, that's when folks are streamin' to video. For streamin' to video, they're still goin' to that wifi. Yeah, that's the proven method, plus they don't want to jack up their charges on the AT&T site, but I won't go there, Let's talk about innovat-- Most say unlimited, I will go there, most say unlimited these days. >> Really, I got to find that plan, my daughter's killin' me with her watchin' Netflix on LTE, I tell her. Innovation is changing, I want to get your thoughts on this, 'cause I know you're on the front end of a lot of innovations, you do a lot of advising here at Mayfield. The VC's always trying to read the tea leaves, you're living it, what's the innovation formula look like now for you 'cause as you're sittin' in your staff meetings, as you look at the team of people around you, you guys want to foster, you do foster, innovation culture. What's the formula, what do you guys do when you have those meetings, when everyone's sitting around the table sayin', what do we do next? "How do we create a better experience? "How can we get better fans, and better product "in their hands as fast as possible?" What's your strategy? >> You know, it's funny, people talk about the secret sauce for innovation, what's the formula? I would say, for us, it's really a symbiotic relationship with a lot of things, first of all, where we are, geographically, we've got folks like Mayfield, down the street, and many others, that we can talk to, that are, when innovation is happening, when the startups are incubating, they're being funded by these guys, a lot of times they are here, and our phones are ringing off the hook with a lot of folks so my formula for innovation is answer the phone and take the meetings, but, to be honest, that creates its own problems, because there's so many great ideas out there, if you try to do all of them, you're going to fail at all of them. You got to pick a very small few to try to experiment with, give it a shot, we just don't have the bandwidth, we only have 250 full-time staff on the business side. For us, geographically, you have to really be laser-focused and say okay, there are so many great ideas out here, which are the three or four that we're going to focus on this year, and really give it a try, that's really going to drive, propel our business forward, enhance our product on the field, whatever it might be, but I'll tell you where it really truly starts. It's from the top with our CEO. And, I've had a few different bosses over the years, but with the Giants, our CEO is singularly focused on all of us doing things folks have never done before regardless of what business unit you're in. Whether you're in ticketing, finance, marketing, sales, what drives him, and drives all of us, is innovation. And his eyes glaze over when I talk to him about cost-cutting, and his eyes can glaze over really fast. But when I talk to him about doing something no one's ever done before, that's when he sits forward in his chair, he gets engaged, and I just have a great boss, Larry Baer, he's been with us for 25 years wit the Giants, and he is the driver for it, he creates the culture from the top, where all of us, we want to impress him, and to impress him, you got to do sometin' nobody's ever done before, and what's even more interesting is there are some challenges and some changes talking place across our industry, as I said before, ticketing and other areas, and I've sat in meetings with him where somebody might raise their hand and say, "But this is happening across the industry, "so it's just a macro trend," and he'll get upset, be like, "I don't care about macro trends. "We are here in the Bay Area, "we're the San Francisco Giants, "we're going to do it our way." >> And so when you do it your way, he promotes risk-taking, so that's a great culture. What are some of the things you have tried that were risky, and/or risque, or maybe an experiment, that went well, and maybe ones that didn't go well, can you share some color commentary around that? >> Sure, over 20 years we've had some of all of those. I would say, I've had some real scary moments, our culture is collaborative, but I wouldn't call it combative, but we all have strong opinions, a lot of us have been there a long time, and we have strong opinions and so we'll battle, internally, a lot, but then once the battle is over, we'll all align behind the victory. Thinking back, one of the most stressful times for me at the ballpark was related to wifi, when we decided to take our antennas and put 'em under people's seats. No one had ever done that before, and there were two major concerns with that. One is, honestly are people going to get cancer from these antennas under their seats, it's never been done before, what's going to happen, and whether it's going to happen or not, what's the perception of our fans going to be, because, these are, the bread and butter is, the golden goose here, all the fans, so, yeah it's great that they're going to be, have faster connection here at AT&T Park, but if they think they're going to get cancer, they're going to cancel their season ticket plans, we got to problem. Number two is, we're taking away a little storage space also, under the seats, so it was very controversial internally, we did all of our research, we proved that having a wifi antennae under your seat is the equivalent to having a cell phone in your pocket, most people do that, so we're pretty safe there, and from the storage space perspective, honestly, it actually elevates your stuff, if somebody spills a Coke behind ya, it'll fall all around your purse, which is sitting on top of that wifi antenna so we came up with a good solution, but that was an example of something that was really controversial >> So beer goes on the antennae not your bag. (laughs) >> Exactly, your bag stays dry, we found a way to spin that but, there have been so many, I can go way back in time, back to the days when it was the PalmPilot that ruled the day instead of the apple >> Well you guys also did a good job on social media, I got to give you guys props, because, you're one of the first early adopters on making the fan experience very interactive. That was, at that time, not viewed as standard. Yeah, built the @Cafe at our ballpark, which is still there really to try to bring social media to the fans. >> I think you're the first ballpark to have a kale garden, too, I think. >> That's a little off topic, but yes, driven by one of our players, who's a big kale fan, yeah, the garden out in center field. >> So sustainibility's certainly important, okay, I got to ask the question around your role in the industry, because one of the things that's happening more and more in Major League Baseball and certainly as it crosses over to tech her at Mayfield Venture Capital, there's a lot of collaboration going on, and it's a very people-centric culture where, it used to be people would meet at conferences, or you'd do conference calls, now people are in touch in real time, so these networks are forming. It takes a village to create innovative products, whether you're inside the Giants, or outside in the ecosystem, how have you personally navigated that, and can you share some experiences to the folks watching, how you became successful working in an environment where it's collaborative inside the walls of the San Francisco Giants, but also outside? >> %100, the topic is near and dear to my heart, and from when I started with the Giants, that's what I love about our industry We compete on the field, and only on the field. When you look at who the Giants competitors are, from a business perspective, honestly the Dodgers are not a competitor from a business perspective. The A's are barely a competitor from a business perspective. We got a lot of competitors and very few of them are in our actual industry, so we collaborate all day, and it's been amazing, I can count on one hand, across all of sports, folks who have not been collaborative. There's a very small group of teams, your favorite team, the Boston Red Sox, are not on that list, they are very collaborative, but their arch rival, well there's a few others out there that may be less collaborative, but most of them are highly collaborative, from top down, and so, what I did from when I first started the first trip I made, was to Cleveland. And this was many years ago, Cleveland Indians had a reputation of being very progressive so I called up my counterpart there, I said, "I'm new to the industry, can I come out, "can I learn from you?" And that's where it started, and ever since, every year, we travel to two cities, I take at least four of my staff, to two cities each year and we meet with all the sports teams in those cities. This year, we went to Milwaukee and we met with the Brewers, and we did the Packers as well. Every year, over the 20 years we've visited pretty much every professional sports city, and we just go through it again, and always, red carpet, open door, and you build those face-to-face relationships, that you can pick up the phone and make the call, in a few weeks we're all going to get together in Denver at our MLB IT Summit, my job at the IT Summit every year is I host the golf classic, so I bring all the golfers, the hackers, the duffers out, and we have a great time on the golf course and build those relationships and again, the only thing that we don't really talk about that much is the technology we use to enhance the product on the field. Everything else is fair game. >> So share the business side, but the competitive advantage, where the battle's really having Dodger and Giants obviously on the field, highly competitive-- >> But what's cool about that is then I can meet with the other sports teams to talk about that, so I'll leave the teams nameless, but we've had some awesome collaborative discussions with NBA teams especially to talk about what they're doing to assess talent, and there's no competition there. >> So there's kind of rules of the road, kind of like baseball, unwritten rules. >> Right. >> So talk about the coolest thing that you guys have done this year, share something that you personally feel proud of, or fans love, what were some of the cool things this year that pops out for you? >> Sure, the technology that we invested in this year that I thought was a game-changer, we saw, we experimented with last season, but this year, we've been experimenting with VR and AR a little bit. But, a technology that we thought was really cool is called 4DReplay, it's a company out of Korea. And we saw them, we did an experiment with them, and then we implemented them for the full season this year and we've seen them at some other venues as well, the Warriors tried them at the Playoffs, but we had 'em full year and what we did was they put in about 120 cameras, spaced approximately five feet apart, between the bases. 120 of 'em, and they focus on the pitcher and the batter, so when you have a play, you can 3D, or 4D, 4D rotate around that play and watch the ball as it's moving off the bat, and get it from that full perspective, it's awesome for the fan experience, it gives them a perspective they never have, I love watching the picture, because you can see that hand, in full 4D glory pronating as it comes through on every pitch, if you can watch that hand carefully you can predict what kind of pitch it is, it's something that a fan has never had access to before, we did that for the first time this year. >> I had a new experience, obviously you see Statcast on TV now, a lot of this overlayed stuff happening, kind of creates like an esports vibe to the table. Esports is just coming. >> And it's just the beginning >> Your thoughts on esports, competitor, natural evolution, baseball's going to be involved in it, obviously, thing in the emerging technology's looking interesting, and the younger generation wants the hot, young... Sure, we feel like our game has been around a long time, and it still is, the rules haven't changed that much, but fans still enjoy it, but they just consume it differently and our game can be incredibly exciting in moments, but, there's also some gaps in there when you can build relationships. Some of the younger generation may fill those gaps with watching somethin' else, or two other things on their devices, but that's okay, we embrace that at the ballpark, but in terms of the emergence of esports, and the changing demographic of our fanbase, what we're trying to do is just package our game differently. One thing I'm really excited about, and startin' to see, we're in the early days, I consider with virtual reality, we experiment with it, maybe two or three years ago we've been doing some stuff with it, but I'd say it feels like we're in the second or third inning with virtual reality, where we're really going, and I've seen Intel doin' some of this stuff, I was out working with Intel in Pyeongchang, at the Olympics this past year, working with their PR team, and where it's going I can already visualize what this is going to be like, this concept of volumetric video. Where, it's not about having that courtside seat, in basketball, or that seat right behind home plate, it's about being wherever you want to be, anywhere in the action. And to me it's not about doin' it live, because in baseball, you don't know where the ball's going to go, it's about doin' it, replay, right after, okay, that ball was shot to Brandon Crawford, he made the most amazing diving play, picked it up, gunned it to first, where do you want to watch that from? Everybody's different, some people might want to watch it from right behind first base, some people might want to watch it right Brandon Crawford, behind the batter, with volumetric video and the future of VR, you'll be able to do that, and this esports generation, this fan's instant gratification want, unique experiences, that's what's going to deliver it. >> This is such an immersive environment, we're looking at this kind of volumetric things from Intel, and you got VR and AR, immersion, is a new definition, and it's not, I won't say putting pressure, it's evolving the business model, who would've thought that DraftKings and these companies would be around and be successful, that's gambling, okay, you now you got that, your VR so the business model's changing, I've been hearing even token and cryptocurrency, maybe baseball cards will be tokenized. So these are kind of new, crazy ideas that might be new fan experience and a business model for you guys. Your thoughts on those kind of wacky trends. >> That's why I love working with companies like Mayfield 'cause they're seeing the future before we see it, and I love being where we are, so we can talk to them, and learn about these companies. Another example, along those lines is, how are fans going to get to the ballpark five years from now, and how do we adapt to that because we're doing a major development right adjacent to the ballpark, we've got 4,000 parking spaces. Are we going to need those five years from now? Well we're going to build out that whole parking lot, we're going to put a structure in there. But five, ten years from now, we're building that structure so it can be adaptable, because, is anyone going to need to park? Is parking going to be like typing, you know on a typewriter, 10, 15 years now because everybody is in either self-driving cars, or ride shares, and the cars just, poof, go away, and they come back when you need 'em. >> Like I said, everything that's been invented's been on Star Trek except for the transporter room, but maybe they could transport to the game. >> We could use that in San Francisco. >> Bill, got to ask you about your role with Mayfield, because one of the things I've always been impressed with you is that you always have a taste for innovation, you're not afraid to put the toe in the water or jump in the deep end where the technology is, these guys are lookin' for some trends, too. How do you advise some of these guys, how do you work with Mayfield, what's the relationship, how are they to work with, what's the intersection between Mayfield and you? >> Well the one thing that Mayfield does is they put together a conference, each Summer, that I love comin' down to, and I get to meet a lot of my counterparts and we talked about meeting with my counterparts in sports, but I love meetin' with my counterparts across all industries, and Mayfield makes that possible, they bring us all together with some really interesting speakers on a variety of topics not all directly tech related, so it's a great opportunity for me to just get outside of the daily routine, get outside the box, open my mind, and I just have to drop down the road to do it. So that's an example, another thing is, Mayfield, and other firms will come to me, and just say, "Hey, here's a technology we're evaluating, "they think it would be a great fit in sports, "what do you think?" And so, I can give them some valuable feedback, on company's they're evaluating, companies will come to us, and I might throw them their way, so it's really a two way street >> Great relationship, so you're a sounding board for some ideas, you get to peek into the future, I mean, we've interviewed entrepreneurs, successful entrepreneurs here, it's a seven, eight year build out, so it's almost like an eight year peek into the future. >> Yeah, and it's super valuable, especially given where we are geographically and our inclination toward being on the leading edge. >> I want to just end the segment by sayin', thanks for comin' in, and I want you to show the ring there, 'cause I always, can't stop starin' at the hardware, you got the ring there, the world champion. >> It's a few years old at the moment, we're going to have to get a new one sometime soon. >> We got to work on that, so is there any cutting edge technology to help you evaluate the best player, who you lookin' at next year, what's goin' on? What's the trades goin' on, share us-- >> Are we off the record now, 'cause I have a feeling you're asking this for personal reasons, for your squad, so. >> I'm a Red Sox fan of the AL, obviously, moved here 20 years ago, big fan of the Giants, I love comin' to the games, you guys do a great job, fan experience is great, you guys do great job and I'm looking forward to seeing a great season. >> Thanks, yeah, hope springs eternal this time of year, we always block off October and expect to be busy, but when we have it back, it just gives us an opportunity to get a head start on everybody. >> Well Bill, thanks for coming in, Bill Schlough, CIO for the San Francisco Giants, here on Sand Hill Road talkin' about the 50th anniversary of Mayfield, and this is the People First Network, getting ideas from entrepreneurs, industry executives, and leaders. I'm John Furrier with theCUBE, thanks for watching. (electronic music)

>> From Sand Hill Road in the heart of Silicon Valley, it's theCUBE presenting the People First Network, insights from entrepreneurs and tech leaders. >> Everyone, I'm John Furrier with theCUBE. We are here for a special conversation on Sand Hill Road at Mayfield's 50th anniversary, part of their People First Network. I'm here with Jonah Goodhart, co-founder and CEO of Moat, now with Oracle, sold their company in 2017, entrepreneur, serial entrepreneur. Thanks for joining me today. >> Thanks for having me, John, excited to be here. >> So we're talking before you came on camera. You've been an entrepreneur since you were a small kid doing all kinds of hustles and side things. What's happening with you now? Obviously, you sold your company in 2017, part of Oracle. Oracle not known for the entrepreneurial activity, but you brought that company in, still goin' on. Give us an update. >> So I started Moat back in 2010. Like you said in 2017, Oracle decided to make us an offer, and we decided to sell our company. And it's been frankly exciting for me to be part of a company that has a 40-year history in Oracle. To have a company that has played a pretty pivotal role in Silicon Valley. We're sitting here right in the heart of Silicon Valley, and to be a part of a company that I think is... So important to the future development of software and databases and hardware. I think is interesting and exciting. And certainly not the path that I thought I would be on, but I'm excited to be here today. >> It's always nice to have an entrepreneurial success the level you guys had. Great exit, the numbers that was reported almost close to a billion dollars in value to Oracle, sorry, the company you started. But you got a unique journey. You started with your brother. Was in New York. Take us through that journey. What were some of the things that you did? And how did it get started? What was the main drive? >> Sure, so I got to take us back a little bit. So I've been in business with my brother, Noah, for 20 years. So we started a company in the late 1990's when I was an undergrad at Cornell. And the Internet was going crazy. E-commerce companies were going public. And the first of everything was starting, the first Internet credit card, the first of x, y, and z, fill in the blank. And so we decided, sort of haphazardly at the time, that we would start a business. And we started by helping companies acquire customers using the Internet. And so we really built, I think in sort of looking back on it now, it was somewhat of a marketing agency but at the time we were building-- >> What year was that? >> This is '98, '98, '99. >> So sort right in Internet boom. Things are going crazy. >> Things are going crazy. We're in college. We were building email lists. We were essentially trying to figure out how do you tell stories and advertise online, but we didn't know we were doing that. We were just trying to simply make some money. I was working for $5 an hour at the Computer Center in Ithaca, New York at Cornell, and I didn't own a computer. So I'm sitting there. Part of the reason I worked for the Computer Center was 'cause I got 24-hour access to the Internet and to a computer. And so we started our first business there. And things went really well almost out of the gate. So '98, '99, and then 2000 happened. And 2001 happened, and the world changed. Business certainly changed. The so-called sort of bust of a lot of, I think, the ideas that people had. I think people realized that there was going to have to be real business that were built. And eventually those businesses were built in many cases. But I think it didn't happen the way that people expected. And we were certainly surprised by it. We were 21-year-old, I was 21 at the time. My brother was two years older than me. And so we had this business that was going really well, and then we sort of ran off of a cliff. And so were profitable, growing, on top of the world, and then hit a challenge. And it was one of the first business lessons that I really learned back in 2000, 2001, which is that you have to have something that is sticky. That's going to be able to stick around through the tough times. It can't only work when things are going up. It can't only work when people are spending money. And so we learned a lot of lessons about how do you build a long-term sustainable business. In 2002, someone that we had done business with for a couple years called me. And he said, "I'm going to start a new business. "And I think there's an opportunity to build a business "to trade digital advertising and to do it more effectively "and efficiently than has been done to date." This guy said, "I think there's something to be done. "I think now is the time to do it." My brother and I decided to partner with him. We decided to write a check to become his first client and to help him start a company that he started in 2002 called Right Media. Right Media ended up becoming a big success. It was the first big ad exchange. The first platform to trade digital advertising inventory. Yahoo! ended up acquiring the company in 2007. And so we were sort of on our way as entrepreneurs slash now investors, but enter the world of 2008. Once again, the economy changes. The world changes. And we start to think, "Alright, maybe when the market "goes down, when everything crashes, maybe that's the time "to start thinking about starting a new business. "Maybe when competition dries out a little bit "it's the right time to get back into building companies." And so Noah and I, my brother and I, decided, "Alright, let's go start a new business." And we got started with Moat in 2010. And it's been a pretty fun ride. >> And how long did you work on Moat for? How many years? >> So we started in 2010. We spent a year or two trying to figure out what we would do. Really got started in earnest in 2010. Raised, invested the initial amount of money ourselves through myself, and Noah, and our third partner, Mike Walrath, the guy from Right Media. And in 2011, raised the friends and family round. 2012, we're fortunate to get Mayfield to invest. And at that point was when our business really took off. So we ran the company from 2010 to 2012 with zero dollars in revenue. Mayfield invested in us when we had zero dollars in revenue. And things started to go off from there. So from 2012 to 2017 when we sold the company, we built a pretty sizable SaaS business. >> So interesting experiences as to Mayfield, no revenue, that's the way they like it. Like to build businesses. Take a piece of the action. You also did that early on. But I think what's interesting about your story, and I want to get your thoughts on this is that entrepreneurs sometimes they hit a wall and sometimes they can't get back up. You hit multiple kind of market timings. I'll say the bubble crash, 2001-2002 time frame. You mentioned 2008. Seeing transitions is a big part of having that entrepreneurial antenna, if you will, having a feeling for the market, knowing what the wave is, when to start, when to invest, invest in down markets. As you grew from that first venture and you're on top of the world, college, that first crash, how did you figure out the market transition kind of dynamic? What was, did it jump out at you? Was it just scar tissue? What was some of the feelings there? >> Yeah, I mean my view is that so the market changed, and we had all these expectations about our revenue was going to continue to grow forever, and our profits were going to continue to grow forever. And when the market changed and outside dynamics changed our business. This is Colonize. I'm talking about our first company. All of a sudden we went, "Uh oh, what do you now?" And I think it was more having lived through that experience that we said, "Alright, we need to figure out "when we build businesses, how do we build them "to be sort of fool-proof? "Or as much fool-poof as we can be. "How do we have something that's sticky, sustainable, "that can't simply be turned off with the ebb and flow "of the market?" And I think it, for me, taught me something which was you need to build something that's long-lasting. Something that is not driven by market conditions. If your business is driven by external market conditions, that should be a big signal that there's potentially a problem, 'cause if those conditions change you're going to be in a tough spot. And so we decided then and there, "Alright, we need "to really build businesses that are here for the long run." We sat on the board of Right Media, helped start the company, but we didn't operate it. Mike ran this company, and we watched. We watched very closely and carefully, and he did something else that was interesting. It's that he learned how to story tell. He learned how to think about where we were going as a business in Right Media not where we were. And so I combined, with my brother, these two themes. Sustainable, sticky business with storytelling. Think about where you're going not just where you are. And I think as we created Moat, we thought, "Alright, how do you actually turn that "into a long-term business?" And part of the way you do it is by trying to project forward, trying to think, "Alright, not what are we doing today? "But where are we going into the future?" And that really became a critical part of product development, a part of our vision, of where we wanted to be as a business. And I think it was a critical part of our success. >> What can other entrepreneurs learn from that? Because I think I see a lot of entrepreneurs here in Silicon Valley and around the world, now that entrepreneurship's kind of gone global, is they get stuck in with dogma and like, "We got to make this work." And sometimes they might not be self-aware that they might have to just take their head up and look around and get a feel for what's goin' on around them. What's your advice for those guys? >> I think you have to be honest with yourself. You know, as an entrepreneur, in your heart of hearts is what's happening to you real? You know, you should know I think, whether or not what's happening to you is because of some conditions, because of one customer that's doing something that's good or bad, or because of a broader trend or a broader movement. I try to ask questions about not just what does it look like a year from now or two years from now or three years from now? I think about the world ten years from now. What do I know to be the case ten years from now? I think this is something that Jeff Bezos talks about. Which is what do you for sure know is going to be the case with your business ten years from now? If you can plan towards that, you can build something that's sustainable. And so we knew ten years from now marketers are still going to want to reach people. They're still going to want to story tell. They're still going to want to measure how effective it was to actually reach those people. And so we knew that wouldn't change. What might change are the mechanisms. How they reach people, how they story tell, what platforms they do it on, whether it's Facebook or Snapchat or Pinterest or whatever the next new platform is, that may change. But the fact that marketers will need to reach people won't. And so we felt really confident that ten years from now that's going to still be the case. And I felt if you know that then you can build towards this vision and so-- >> Medium and the channels are all going to change all the time, but the stories need to be told. >> That's right, and interestingly, I think that when you start a business you come up with a theme. You come up with a vision. And so for us it was how do marketers tell their stories increasingly in a world that's digital? That's not something that's going to change overnight. And I felt like over the long haul that's not going to change very quickly. Increasingly we're going to be digital consumers, and marketers are going to have to tell their stories. Now the business that we started at Moat in 2010 ended up changing dramatically. We started a crowd-sourced creative marketplace. We ended as a measurement and analytics company. Pretty different place from creative. The vision was still the same. The vision was still about helping companies, marketers, tell their stories in a world that's increasingly digital. And if you look at successful businesses, they tend to have the same vision from when they started. Now the underlying business may change. Hopefully, the underlying business iterates and finds the right path, but the overall, the high level of where you're going ideally doesn't change. And I think that's part of the key to success. >> That's a great point. I think, I always get in a debate here among entrepreneurs and investors. The word pivot versus adjusting. When you have a North Star or a mission, you just got to kind of tack with the wind and make it a tailwind not a headwind versus a full pivot which might be, "Hey, there's no business here. "We have to do something different." Can you talk about the nuances between what a pivot is? And how you find that tailwind, the wind in the sails if you will, for the entrepreneur to hit that vision? >> Yeah, so first of all, any successful business that I've ever seen never starts off how it ends. In other words, there are always iterations that go through. Pick any company that you can think of right now. They've iterated. They've started off with one theme, and they've gone this slight different path. So I would argue that every good business is going to iterate. Now whether you want to call it a pivot or not, I think is more nomenclature or semantics. My view is you're going to iterate. They key is having that North Star. So in ten years, what do we believe to be the case? Forget about what do we believe, what do we know to be the case? What do we know this is going to be the case ten years from now? And if you're right about that then it can qualify as your North Star. By the way, if you don't know ten years from now this is going to be the case then maybe that shouldn't be your North Star. Maybe that shouldn't be the guiding light for your business. Once you get that part right then it almost frees you to be flexible. It frees you to say, "Okay, so if the world's moving "this way or that way, I'm going to adjust." One of the things that I learned from Moat was actually somebody gave me advice early on. They said, "Go have a thousand meetings. "Go have a thousand meetings in your industry, "in your category. "Go meet with every single person in the business." And I did that. It took me probably 18 months, but I went out and met with everyone who would take my meeting. What I learned from that is that in the B2B world we have an advantage. You can talk to your customers. Your customers will literally tell you, "Here are the issues we're having. "Here are the things we're trying to solve for. "If you can help us solve for this, we will pay you money "to provide a service to us to actually solve this problem." And so I learned, "Wow, that's pretty amazing!" If you actually meet with enough people, you get a sense of the market. You get a sense of what people are buying. You get a sense of the trends. As my oldest brother says, "The world kind of slows down "a little bit." Markets move in slow motion when you really get into it. And so if you go out and have a thousand meetings in your industry, you actually learn what's happening in that business. And you can tweak your business accordingly. I walked away with Moat feeling like if you're not in a meeting talking your story, telling your pitch, telling your vision, and they're not nodding their head going, "Yep, yep, yep, 100% on the same page." Then you're not in the right place. >> I love that comment about slowing the game down. Reminds me of baseball batters up there slowing that game down, watch that ball come in, really slow. And I think that's good advice because you want to slow it down. You want to make sure you're kind of capturing the right things that's happening at the right time, not try to go too fast. >> That's right. Things don't happen overnight. I think oftentimes when you're not in the industry, and you just read the headlines, you think, "Oh my God, that's crazy that this thing happened "and that thing happened!" When it's your space, it doesn't move quite that fast. There's work that has to be done. Contracts that have to be put in place. You see it evolving. And so I always tell people when you want to get to know an industry, read every single piece of content there is about the industry, read every article that comes out about it, and take as many meetings as you can possibly take in the space. And it'll slow down. It'll move at a pace that you can kind of go, "Got it! "It feels like if we do this and this then we can actually "start to build a business here." And again, I think there's a bright line test in B2B if you walk into a meeting and you start telling your story, and you're not getting the nods, and you're not getting the, "Yep, yep, yeah, "that's an issue for us." If that's not happening, then you're not in the right space. Doesn't mean your North Star is wrong, but it means you got to iterate a bit. >> You got to find your groove. I want to change gears a little bit and talk about this People First Network concept that I love because you hear, "Mobile first, cloud first." And the notion of people first, we live in a very social world now, you're seeing a lot of stuff happening where we're connected now almost with digital 100%. Everyone's kind of got mobile even in emerging countries you got connections. Yet there's a lot of new dynamics emerging on the social scene and checking around you're well-known for networking. You're known for connecting with people certainly in your area and beyond. And so there's two things I want to get your thoughts on. One is networks. Who to work with. How do I make decisions on? How do you want to spend your time with other entrepreneurs or other peers? And social entrepreneurship, there's a lot of emphasis around mission-driven things. These are people dynamics where you're starting to see the role of the relationships between people start to take a really important role in entrepreneurship not just, "Let's hire and fire fast." Certainly some basic business knowledge that's common sense. But as you're starting to see this next generation of entrepreneurs emerge, there's an eye on social, mission-driven, but spending time with the right people. What's your thoughts on that? >> So first of all, businesses are about people. In the end of the day, you want to do business with people that you like, with people that you trust, with people that you want to hang out with. That was one of the lessons I learned somewhat early on, and I think it's critical. Businesses are not automated. Businesses are about, "Alright, a group of people "come together with a shared idea of what they can do. "And they can hopefully go support a group of other people "who are trying to get their vision done." And so once you realize that, you realize it's about people. You want to build relationships. You want to build connections. You want to figure out, "Alright, how can I help people? "And hopefully with good karma something will happen "in my favor at some point." And so I always operate under the idea that you just try to do good, you try to help people, and hopefully as a result, good things will happen. In terms of social entrepreneurship what I would tell you is that having a mission that you feel deep down inside of you that is not just, "We're going to make money. "And we're going to deliver on behalf of shareholders." Yes, of course that's important. But when you wake up, and you go to work or you get online, you want to feel something for it. You want to feel like, "Alright, this is something "that I feel good about doing." When you do that, when you know that you've done it right, it doesn't feel like work. It doesn't feel like a job. It feels like you want to wake up, and you can't get enough of it. And I think that's when you know you've done something right. So I think the more that we can lead mission-driven businesses, mission-driven lives, the better that will be. In the end of the day, I think that life and business converge. I think in the end of the day when you do it right, it doesn't feel like work, and it doesn't feel like you're working or not working. It just feels like you're trying to do good, you're trying to help other people, and hopefully good things happen. >> Great stuff. The thing I love about digital is you start to see that blending of analog and digital where lives are now part of each other. If you could go back and be 18 and 20 again with all the tools that we have out there now, open-source at a whole new level, you have everyone's connected, what were some of the things that you would do? If you had to go back and talk to your 18-year-old self going into Cornell with your brother, a lot more on the table to play with. Certainly, it's easier to do ventures, easier to come up with ideas, maybe more lean. What are some of the things that you would do if you were in your 20's? >> Yeah, I guess if I went back I would tell myself to make big bets and make them on where you know the future is going to be ten years from now. I think oftentimes, particularly when I was a young entrepreneur, you were living day to day or week to week where you were going, "Alright, we need to get this thing done by this day "so that we can do this tomorrow." And so we need to fly and stay up all night and end up eating and sort of doing things that are not the best sort of health-wise in order just to try to get things done or what you thought would just get things done. I think I would play a longer game, and I would encourage myself to think about, "Alright, what do I know to be the case "ten years from now and how can I focus on that?" If we go back 20 some years, two or three of the biggest companies in the world were really created in Amazon, in Apple, in Google. And I think the opportunity existed back then. So if I could go back to my-- >> You'd buy some Apple stock for sure. (laughs) >> I don't know if I would bought Apple stock, but certainly I would've made longer term bets. What those companies do that I think is phenomenal is they think about where the world's going not where the world is today. >> I think that's great advice. And it's interesting, too. You go back, and you always, everyone has those experiences in life where they would say, "I could've been there "or there." Looking forward is the key. And I think one of the interesting things about your journey is you had the time in college, make some money, put some dough in your pocket. Then you go out and you have some cash. You make an investment. You ride the wave with Right Media, and then you go the venture-backed startup. Talk about the dynamics. Specifically the venture-backed startup, because now the dynamics are changed. I mean, hell, I might go do an ICL and suddenly get subpoenaed if I did that. But you got all kinds of new opportunities to get funded, either to venture capital, either with Mayfield. Different venture architecture there you mentioned, no revenue, but funding to go build it out. What was different about doing a venture-backed startup versus the other ones? >> Yeah, I guess what I would say is first of all we have to step back and realize that when we're in these industries, we have a hard time understanding what they're doing. What venture capitalists do is just what any money manager does. They're doing allocation of capital so that they can get returns for their investors. And so in the end of the day, they're trying to make bets. Now the bets that a venture capital makes are different from someone who's buying public equities for sure, but the same sort of ideals are there which is they want to make bets on the right companies, on the right people so that they can drive profits and returns and hopefully make a difference. In the case of Moat, we were really impressed by Mayfield. We were impressed by the way that they approached the conversation with us, the way that they leaned forward. I tell entrepreneurs when you have venture capitalist meetings if three out of ten of them go well, you're in the Hall of Fame. It's like baseball. Most of the time you're not going to get that perfect chemistry. You're not going to get that feeling where, "Ah, there's something interesting here." The other thing I tell entrepreneurs is if they're not leaning forward, if they're not going, "You know what we could do? "We could do this, this, and this. "I could connect you with so and so. "We could build a business doing this. "You should think about this." If they're not doing that, they're probably not the right fit. I think about it. I'm happily married for many years with four kids. When you meet your spouse you tend to know that that's the right person. If you have to go home and say, "Alright, why don't you "send me some reasons to try to justify "why you might be the right fit for me," maybe that's not the right spouse. I think it's the same thing with venture capitalism. You ultimately want to have chemistry. Again, it comes back to people. And so Mayfield I think does a really good job of thinking about people and putting people first in that conversation. >> And it's also a team environment almost because you want to have a spouse and a venture partner who's going to be there for the good, bad, and the ugly. >> That's right. >> And be there. And that's, I think a lot of people don't get that. They want the valuation, "Oh, I got a better deal." There's no better deal when you look at the long run impact of potentially making the wrong decision. >> One of the first things that Navin Chaddha from Mayfield said to me when I first met with him is he said, "This is going to take you seven to ten years "to build this business." And I thought, "Wow, that sounds like a long time!" >> I'm going to do it in three. >> Yeah, that seems crazy. (John laughing) But he was right, and one of the things that he said to me after they invested and we had gone through a couple quarters of working. I came in and I actually had pretty high expectations of what we could do as a business. I said, "Well, if we really push the accelerator "I think we could do this number instead of this number." And he said, "Relax. "We have plenty of time. "Don't try to knock it out of the park, "and you'll make mistakes if you do that. "Just try to deliver on the numbers that you think "you can deliver realistically. "And focus on building the business." And he was right. Having that approach is smart. It's not about, "Can I make this work next quarter?" It's about, "Can I make this work over the long run?" And I learned a lot in that process. >> Well, Jonah, I really appreciate the conversation. You're an inspiration to a lot of entrepreneurs out there. And congratulations on all your great success. I guess the question is what's next for you? You got that ten year vision. What's going to happen in the next ten years? Which wave will you be riding? >> Well, I think, increasingly, we're going to live in a connected society where data is information, and data is knowledge. And I think for me I'm excited about a future world where will we use more or less data to make decisions. I think more. Will we make smarter decisions over time? Hopefully smarter decisions over time. Will we be able to catch diseases earlier? I think so. Will we be able to leave longer lives? I think so. And so some of those things end up being themes-- (no audio) >> Great, Jonah Goodhart, at Oracle now, first a founder, entrepreneur, serial entrepreneur, here as part of theCUBE's People First Network series. I'm John Furrier. Thanks for watching. (upbeat electronic music)

Sand Hill Road to the heart of Silicon Valley it's the cute presenting the people first Network insights from entrepreneurs and tech leaders when I'm John Ferrari with the cube I'm the co-host also the founder of Silicon angle me we are here on Sand Hill Road at Mayfield for the people first conversations I'm John furry with the cube weird Allen being global CTO and IT of innovation at Procter & Gamble formerly the same position at coca-cola has done a lot of innovations over the years also a reference account back in the day for web methods when they call on the financing of that one of the most famous IPOs which set the groundwork for web services and has a lot of history going back to the 80s we were just talking about it welcome this conversation on people first network thank you for inviting me so the people first network is all about people and it's great to have these conversations you're old school you were doing some stuff back on the 80s talking about doing RPA 3270 you've been old school here yeah I go back to APL as my first programming language went through the the third generation languages and of course the old 30 to 70 emulation which is what we know today is our PA one of the cool things I was excited to hear some of your background around your history web methods you were a reference call for venture financing of web methods which was financed on the credit card for the two founders husband and wife probably one of the most successful I appeals but more importantly at the beginning of the massive wave that we now see with web services this is early days this was very early days when I was at DHL we were looking at what we're gonna do for the future and in fact we built one of the first object-oriented frameworks in C++ at the time because that was all that was available to us or the best was available we rejected Corbis and we said look if we're gonna go this direction and one of my developers found web methods found philip merrick it was literally at the time working out of his garage and had this technology that was going to allow us to start moving into this object-oriented approach and I remember the day Robin Vasan form a field called and said hey I'm thinking about investing in web methods what do you think about it and not only was it one of the first startups that I ever worked with but it's actually the first time I met anybody in the venture community way back in nineteen I think 1997 is what had happened and that was a computing time in computer science and then the rest is history and then XML became what it became lingua franca for the web web services now Amazon Web Services you see in cloud computing micro services kubernetes service meshes this is a new stack that's being developed in the cloud and this is the new generation you've seen many waves and at Procter & Gamble formerly coca-cola you're the same role you have to navigate this so what's different now what's different say 15 20 years ago how are you looking at this market how you implementing some of the IT and infrastructure and software development environments I think what's change is you know when we got into the the early 2000s Nicolas car came out and said IT doesn't matter and I think anybody that was an IT had this very objectionable response initially but when you step back and you looked at it what she realised was in many cases IT didn't matter and those were those areas that were non-competitive those things that could be commoditized and it was completely right the reality is IT has always mattered that technology does give you a competitive advantage in certain markets and certain capabilities for a company but back then we had to go out and we had to purchase equipment we had to configure the equipment there was a lot of heavy lifting in corporations just did not want to invest the capital so they outsource the stuff wholesale I think General Motors was the first one that just out sourced everything and was followed by other companies including Procter & Gamble the decision at that time was probably right but as we go forward and we see what's happened with corporations we see the valuations of corporations the amount of return on equity based on the on the capital that's being invested we can see that data is important we can see that agility flexibility is key to competing in the future and therefore what's changing is we are now moving into an age of away from ERP so we're moving into an age away from these outsource providers on a wholesale basis and using it selectively to drive down costs and allowing us to free up money in order to invest in those things that are most important to the company so you're saying is that the folks naturally the server consolidation they've bought all this gear all this software over you know 18-month rollouts before they even see the first implementation those are the glory days of gravy trains for the vendor's yeah not good for the practitioners but you're saying that the folks who reinvested are investing in IT as a core competency are seeing a competitive advantage they certainly are you know I think I made the statement front of a number of the vendors and a few years ago and people were not comfortable with it but what I said was like you gone are the ears of these 10 20 million dollar deals gone are the ears of the million two million dollar deals we're in the ear of throwaway technology I need to be able to use and invest in technology for a specific purpose for a specific period of time and be able to move on to the next one it's the perfect time for startups but startups shouldn't be looking at the big picture they should be looking at the tail on these investments let me try things let me get out in the market let me have a competitive advantage in marketing which is most important to me or in supply chain those are the areas that I can make a difference with my consumers and my customers and that's where the investments have to go so just in constant of throwaway technology and you know you'd also be said of you know being more agile though interesting to look at the cloud SAS business model if Amazon for us I think that's the gold standard where they actually lower prices on a per unit basis and increase more services and value but in the aggregate you're still paying more but you have more flexibility and that's kind of a good tell sign so that you're seeing that ability to reuse either the infrastructure that's commoditized to shift the value this is are people having a hard time understanding this so I want to get your reaction to how should I tea leaders understand that the wave of cloud the wave of machine learning what a I can bring to the table these new trends how how should leaders figure this out is there a playbook as there are things that you've learned that you could share you know that there's really a playbook it's still early on everyone's looking for one cloud fits all the reality is whether it's Google whether it's Amazon whether it's Microsoft whether it's IBM all clouds are different all clouds have our special are purpose-built for different solutions and I think as an IT leader you have to understand you're not going to take everything and lift and shift that's what we used to do we're now in the position where we have to deconstruct our business we have to understand the services the capabilities that we want to bring to market and not lock ourselves in its building blocks its Legos we're in the period of Legos putting these things together in different manners in order to create new solutions if we try to lock ourselves in the past of how we've always financed things how we've always built things then we're not going to be any better off in the new world than we were in the old alan i want to get your reaction to to two words our PA and containers well as i said earlier our PA is 3270 emulation from the 1980s and for those of us that are old enough to remember that i I still remember scraping the the old green screens and and putting a little process around it it what's nice though is that we have moved forward machine learning and AI and other other capabilities are now present so that we can do this I actually played around with neural nets probably back in 1985 with an Apollo computer so that tells you how far back I go but technologies change processing speeds change everything the technology trends are allowing us to now to do these things the question that we have is also a moral dilemma is are we trying to replace people or are we trying to make improvements and I think that you don't look at our PA as a way simply to replace work it's a way to enhance what we're doing in order to create new value for the customer or for the consumer in our case I think in the in the area of containers you know again been around for a while been around for a while it's just another another approach that we're not we don't want lock in we don't want to be dependent on specific vendors we want the portability we want the flexibility and I think as we start moving containers out to the edge that's where we're gonna start seeing more value as the business processes and the capabilities are spread out again the idea of centralized cloud computing is very good however it doesn't need to be distributed what's interesting I find about the conversation here is that you mentioned a couple things earlier you mentioned the vendors locking you in and saying here's the ERP buy this and with this you have to have a certain process because this is our technology you got to use it this way and you were slave to their their tech on your process serve their tech with containers and say orchestration you now the ability to manage workloads differently and so an interesting time there's that does that change the notion of rip and replace lift and shift because if I a container I could just put a container around it and not have to worry about killing the old to bring in the new this is on the fundamental kind of debate going on do you have to kill the old to bring in the new well you need to kill the old sometimes just because it's old it's time to go other times you do need to repackage it and other times I hate to say it you do need to lift and shift if you're a legacy organization they have a long history such as most of the manufacturing companies in the world today we can't get rid of old things that quickly we can't afford to a lot of the processes are still valid as we're looking to the future we certainly are breaking these things down into services we're looking to containerize these things we're looking to move them into areas where we can compute where we want to when we want to at the right price we're just at the beginning of that journey in the industry I still think there's about five to seven years to go to get there now I'll talk about the role of the edge role of cloud computing as it increases the surface area of IT potentially combined with the fact that IT is a competitive advantage bring those two notions together what's the role of the people because you used to have people that would just manage the rack and stack I'm provisioning some storage I'm doing this as those stovepipes start to be broken down when the service area of IT is bigger how does that change the relationship of the people involved you know you win with people at the end of the day you don't win with technology you know a company of such as Proctor and Gamble and I think what's happened if you look at historically the ERP vendors came out probably 99 2000 and it used to be and remember these I'm old to be honest with you but I remember that we used to have to worry about the amount of memory we were managing we had to be able to tune databases in all of this and the vendors went ahead and they started automating all those processes with the idea that we can do it better than a human and a lot of people a lot of the technology talent then started leaving the organizations and organizations were left with people that we're focusing on process and people a process excuse me process and the the the business which is very good because you need the subject matter experts going forward we have to reinvest in people our people have the subject matter expertise they have some technology skills that they've developed over the years and they've enhanced it on their own but we're in this huge change right now where we have to think different we have to act different and we have to behave differently so doubling down on people is the best thing that you can do and the old outsource model of outsourcing everything kind of reduces the core competency of the people yeah now you got to build it back up again exactly I mean we when we left at P&G 15 years ago about 5,000 people left the organization when we outsource them when we outsource the technology to our partner at that time now it's time we're starting to bring it back in we've brought the network team back in and stood up our own sock in our own NOC for the first time in years just this past year we're doing the same thing by moving things out to the cloud more and more is moving to the cloud we're setting up our own cloud operations and DevOps capabilities I can tell you having been on both sides of it it's a lot harder to be able to bring it back in than it is to take it out and you know interesting proctoring games well known as being a very intimate with the data very data-driven company the data is valuable and having that infrastructure NIT to support the data that's important what's your vision on the data future of the data in the world well I think data is has a value to itself but when you tie it to products you tie it to your customers and consumers it's even more valuable and we're in the process now of things that we used to do completely internally with our own technology or technology partners we're now moving all of that out into the cloud now and I must say cloud its clouds plural again going back to certain clouds are better for certain things so you're seeing a dramatic shift we have a number of projects underway that are in the cloud space but for customers and consumers number of cloud projects in the way for our own internal employees it's all about collecting the data processing the data protecting that data because we take that very seriously and being able to use it to make better decisions I want to get your reaction on two points and two quite lines of questioning here because I think it's very relevant on the enterprise side you're a big account for the big whales the old ERP so the big cloud providers so people want to sell you stuff at the same time you're also running IT innovation so you want to play with the new shiny new toys and experiments start up so if startups want to get your attention and big vendors want to sell to you the tables have kind of turned it's been good this is a good it's a good buyers market right now in my opinion so what's your thoughts on that so you know start with the big companies what do they got to do to win you over well they got to look like how they got to engage and for startups how do they get your attention I think the biggest thing for either startup or large companies understanding the company you're dealing with whether it's Procter & Gamble whether it's coca-cola whether it was DHL if you understand how I operate if you understand how decisions are made if you understand how I'm organized that's gonna give you an a competitive advantage now the large corporations understand this because they've been around through the entire journey of computing with these large corporations the startups need to step back and take a look and see where do I add that competitive advantage many times when you're selling to a large corporate you're not selling to a large corporate you're selling two divisions you're selling two functions and that's how you get in I've been working with startups as I said back since web methods and it was just a two-person company but we brought them in for a very specific capability I then took web methods with me when I left DHL I took them to GE when I left GE I took them to ing because I trusted them and they matured along the way I think finding that right individual that has the right need is the key and working it slowly don't think you're gonna close the deal fast if you're start-up know it's gonna take some time and decide if that's in your best interest or not slow things down focus don't try to boil the ocean over too many of them try to boy you're right Jimmy people try to boil the ocean get that win one win will get you another one which will get you another win and that's the best way to succeed get that beachhead Ellen so if you could go back and knowing what you know now and you're breaking into the IT leadership's position looking forward what would you do differently can do a mulligan hey what would you do differently well you know I think one of the one of the dangers of being an innovator in IT is that you really are risk taker and taking risks is counterculture to corporations so I think I would probably try to get by in a little bit more I mean someone once told me that you know you see the force through the trees before anybody else does your problem is you don't bring people along with you so I think I would probably slow down a little bit not in the adoption of technology but I'd probably take more time to build the case to bring people along a lot faster so that they can see it and they can take credit for it and they can move that needle as well yeah always sometimes early adopters and pioneers had the arrows on the back as they say I've had my share now thanks for sharing your experience what's next for you what's the next mountain you're going to climb well I think that as we're looking forward latency is still an issue you know we have to find a way to defeat latency we're not going to do it through basic physics so we're gonna have to change our business models change our technology distribution change everything that we're doing consumers and customers are demanding instant access to enhanced information through AI and m/l right at the point where they want it and that means we're now dealing with milliseconds and nanoseconds of having to make decisions so I'm very interested in looking at how are we going to change consumer behavior and customer behavior by combining a lot of the new technology trends that are underway and we have to do it also with the security in mind now before we security was secondary now as we're seeing with all of the hacks and the malware and everything that's going on in the world we have to go in and think a little bit different about how we're gonna do that so I'm very much engaged in working with a lot of startups I live here in the Silicon Valley I commute to Cincinnati for Procter & Gamble I'm spending time and just flew in from tel-aviv literally an hour ago I'm in the middle of all the technology hotspots trying to find that next big thing and it's a global it's global innovation happens everywhere and anywhere the venture community if you look at the amount of funds it used to be invested out of the Silicon Valley versus the rest of the world it continues to be on a downward trend not because the funding isn't here in the Silicon Valley but because everyone is recognizing that innovation and technology is developed everywhere in the world Alan Bain was the CTO global CTO and IT innovator there at the cube conversation here in San Hill Road I'm John for a year thanks for watching you

(upbeat music) >> From Sand Hill Road in the heart of Silicone Valley, it's theCube, presenting the People First Network, insights from entrepreneurs and tech leaders. >> Hello everyone, I'm John Furrier with theCube. We are here in Sand Hill Road at Mayfield office here talking about entrepreneurship, People First, this is our co-created program with Mayfield. I'm John Furrier, your host, we're with Mitchell Hashimoto, who's the co-founder and co-CEO at HashiCorp. Great to see you, good to keep alumni, you're back on theCube . Thanks for joining me today. >> Yeah, thanks so much, I was here so long ago. (John laughs) >> Like five or six years ago. >> So, we've been really psyched about the program that Mayfield's put together called People First. They're celebrating their 50th anniversary as a venture capital firm, which is historic in the sense that it's kind of still a young industry. Think about it. And love to have entrepreneurs come on because you've been very successful. We talked years ago. I think, the first year you were formed and Cloud certainly has happened. Open Source continues to pump more value. I mean, you get things out there coming out of Google, some ridiculously amazing... The goodness in Open Source is certainly driving a lot of great software development. You've been a part of that so thanks for joining us. So I got to ask you, you guys are growing right now, you're Venture backed, you got a unique culture. Explain HashiCorp, 'cause you guys have a unique business. You're in Open Source, you're in Cloud, you're a distributed workforce. Take a minute to explain what you guys are doing. >> Yeah, so we are trying to build or have been building, sort of infrastructure software of the future. We've been saying that since we were founded and what's been interesting is the future has changed quite a bit in the past six years so there's been Cloud, that was the big thing when we were founded and then containers and now schedulers and Kubernetes and things like that. And while we're doing that, we're also sort of building what I think is sort of the company of the future, which is over 90% of our workfoce is fully distributed. Basically, unless there's legal reasons not to be distributed, we are distributed and we're in multiple countries, we're in over 40 states. All of our process is built remote first so everything happens, Slack, all our meetings are Zoom. Even our all hands, we present behind a camera, and things like that so I think that's all very unique, but only for now, I think that-- >> How do you do the all hands? That's interesting. Do you have a camera to a zoom or is it a camera live streaming? How do you do the all hands? >> Yeah, so we set up sort of an AV setup in our office because we have a few of the executives in the office that often are presenting on the all hands and we set up a camera feed so that whether you actually decide to go into the office or whether you're at home, we want that experience to be authentic to both sides. We don't want a great in-room experience and then one corner camera that makes it really hard to hear and stuff like that so yeah, you have to walk up to the camera and be part of the zoom to really be part of the all hands. >> So that people feel present and connected? >> Right, exactly, and we force questions to come through Slack. There's no in-person questions. You have to ask on Slack so everyone can see them and things like that, so-- >> That's awesome. Talk about the journey as you started. You have a co-founder. You guys have an interesting relationship. How did this all get started? What was the beginning genesis of HashiCorp like and take us through some of the early days. >> Sure, so I'm very lucky, I have a co-founder who before the company, we were best friends and after the company or during the company, we're still best friends so (laughs) which it isn't always the case, but in terms of HashiCorp itself, we're super lucky 'cause we went to the University of Washington, up in Seattle, and this was in sort of the mid-2000s and this is a good time to be up there, 'cause Cloud was starting to emerge and we were sort of equidistant geographically, across the lake, if you will, to Amazon, Google, and Microsoft and so, we were getting early access to what they thought was sort of the Cloud at the time and it was rapidly changing. We were getting access to the servers, with the APIs, and all this stuff and being a university without a lot of funding, my job there was sort of to help us utilize all these resources and so in the mid 2000s, Armand and I were already realizing, we're on the same team, Armand and I were already realizing that this is not a solved problem by any means, I mean this is a new problem and that eventually, years later, became the genesis-- >> and what was that problem that you saw immediately? >> It was sort of like multi-Cloud, resource management, deployment, security, it's funny 'cause it's... Over 10 years later and it's... It is the problem that Enterprise are hitting right now. >> Think about the early days of Amazon. I still have these memory flashbacks of EC2, long URLs, it's like, okay, now how to I redirect my web servers to this, like, so it was easy to stand up on EC2 instance, put a little S3 to it, then it's like, okay now what? >> Yeah, we're at the-- >> Little red scale, I put this in there, what's kind of there. So again, a little early, kind of build your own kind of a junkyard. You build a car out of some spare parts. But then it had to mature really fast. >> Yeah, we're are the Day Zero state then and now we're firmly in like Day Two. >> And so what was the next step. Can you peg the journey for us, because obviously, they grew up really fast and then they really kind of hit a tipping point around 2010, 11, 12, 13, and kind of grew like a weed >> Yup, yeah, so around that time frame you just painted to 2012 is when Enterprise was sort of adopting it. And I think a lot of that was single Cloud focus. There was very much like, this is our first Cloud so we're going to land purely on Amazon or something and focus on that and we're at the point now, about six years later, 2018, where the maturity around operating the Cloud is sort of well understood and companies are now starting to sort of use what's best for the job and also realized that there's multiple Clouds and we're keeping our private data centers and also, there's new things coming on the scene above Cloud sort of higher level, like Kubernetes, and how we're going to manage all this and so, we like to describe it as sort of the mindset is like the Cloud operating model. It's like you can't operate your resources in the Cloud the same way you do on Prim and people are starting to get that. That's like automation, very people-focused workflows, things like that, and companies are getting that and so now the challenge is these heterogeneous environments. >> So, the top conversation in our office and everyone loves when I bring this up, I want to get your definition and opinion, >> Okay. >> Is Kubernetes. >> Sure. >> Kubernetes, just, a lot of people love it. I've been having Kubernetes dreams these days 'cause there's so much Kubernetes conversation. (Mitchell laughs) you got Kubernetes, you got the notion of Service Mesh is right around the corner, StateFul applications with net problems really hard to work on. Stateless has been around for awhile. What's the importance of Kubernetes? What's the impact, in your opinion, expert opinion, why is Kubernetes important and what's the impact of Kubernetes? >> Yeah, I think the more abstract answer is the scheduler idea and Kubernetes are built on that and really, it's the idea of like, let's move away from looking at the individual machine and let's start moving higher level to just assuming resources are there. It's sort of like when you write, the transition of when you were writing software from having to know how much memory you had to just, let's just assume it's infinite and put whatever in there and it's someone else's problem and we're sort of moving into that data center, it's like, let's just assume we always have compute and storage and network and let's just deploy and what freedom does that give you and I think that's really what Schedulers give you and also, when you sort of take away huge operability challenges of placing the application and giving that to a computer to put in the right spot, you can now deploy so many more applications because-- >> so you're freed up? >> You're freed up in a lot of ways. It introduces a lot of new challenges, but that's a good problem. You want new challenges, you want to solve the old ones. >> What are some of the new challenges that you see emerging that kind of keep the evolution going? >> I think Service Mesh is a great example we could jump into, which is that the challenge of, we like to describe Service Mesh as three fundamental problems, which is discoverability, configurability, and secure connectivity. If you have two services, that is not a problem because you could hard-code the IPs, you could hard-code the configuration, and you could just hard-code TLS certificates, make it work. When you have thousands of services that are coming and going and people are trying new services all the time, that has to all be automated so the idea of Service Mesh is automating that and making it invisible, automatic, free, and that's new, that's a new problem. >> And that's a huge concept. This is a scalable, scale out, huge concept, and super important. >> Yes, yeah. >> This changes the game at many levels. What would you see that changing? What would some of the, for folks who are just now understanding, what does it change downstream or down the road for enterprises and for businesses? >> I think the biggest change is a mind shift change from sort of perimeter or host-based security to identity and service-based security. So, traditional sort of networking and security is very IP Space focused, it's like does this rack talk to this rack or no and things like that. And that has to all go away because that's restricting the placement, that's not allowing apps to go anywhere. We have to move towards this service can or can't talk to this service, don't care where it is or anything and sort of move from a perimeter to just the perimeter being the app itself so we have to sort of firewall and protect right at the app layer and that's hard to transition, that's tooling change, that's education change, that's team change. >> I want to ask you, I could talk about this forever, Cloud Automation is, I think, one of the most important things. That's only going to make AI more powerful and the data behind it, and as new data emerges, but I got to ask you about some of the new blood coming into the market place because traditionally, if you think about Service Mesh, oh it's a software problem, we'll just solve the software, but you actually got to have networking shops, you got to have to have a computer science or computer engineering. A new skill sets developing really fast in this new, I don't want to, maybe call it under the hood, I don't know what to call it, but maybe, it's an engineering mindset, where people, there's a huge demand for skills in automating. It's not your classic application developers, there's great role for that and there's tons of apps being built, but, I'm talking about a new kind of operator. >> Yes. >> What's your take on this new skill, this new opportunity for people to learn and develop a career? >> Yeah, I think the real way to look at it, I like to look at it, is sort of the difference between creating, sort of doing something once and creating a process to do something. And there's sort of two different tasks, righ. It's like when you get promoted for the first time from you know, to manager. It's like the big challenge is learning how to teach others process and enforcing consistent process, versus actually, you know, doing it yourself. And I think that's the difference between someone who is used to the slinging, let's go back to like the server automation, someone who's used to just manually clicking or slinging bass scripts to do one off task, you could be a wizard at that, but then, try to do that repeatably, safely, 9000 times out of 9000 times and now, that's a resiliency challenge. That's sort of understanding failure modes. It's very different and I think that's the biggest skill set to adopt is, I always sort of push anybody in their job to just what, how do you not do your job? Like, how do you move on to the next problem? >> How do you eliminate your job? >> Yeah, basically/ >> That's almost, like the way I think about it. >> Yeah, what's the process. Is it possible right now? And if it's not possible, what's sort of blocking it? >> So I want to ask you a question and I love this one, going to move on just from the business side in a second, but I want to get your thoughts because I've been having conversations lately with Cloud folks and engineers and developers around two words, replicating and reproducing. >> Okay. >> They're kind of two different concepts. Reproducing is doing the same thing over again. Make that spaghetti sauce, do it again, but did I write it down? Is there a recipe? Or I could just hand you the recipe and say, you make it yourself or automating it. So I think, replicating, I'll say has scale, reproducing requires the same components. Do you see dev ops evolving to a point where, do it once and it's replicated? Or is there some reproduction involved, reproducing things? Where is that, where do you see the tech happening? >> I think inevitably, you're sort of doing both, but my sort of dream world, where I think it'll be still, but I think it's sooner than we expect, but I think sort of like 10 years from now is a safe, sort of stage, it's sort of like every, it doesn't matter if you're Fortune 500 or a new company, sort of the way it infrastructure server management goes is you just start with one server. I like to call it the stem cell server. You just start with one server, you say what you want and just let it go and it's going to either replicate or reproduce, it's either creating something new or it's like creating more copies of itself, but it'll turn into any sort of scale face, book level scale that you would want in theory and I think that, that's sort of my long, you know, fence post, guiding fence post, that I always think about the problem. >> Talk about the culture of your company, you guys have a new CEO, you have a partner you've been best friends with so-- >> I don't think he's that new? >> Yes he is. (both laugh) Okay, he's been around for awhile? >> Couple years, yeah. >> Couple years, so you've had a co-founder dynamic. Did you guys look at each other and say hey, we got to bring a CEO in . Some people like to have one of the founders be the CEO. Talk about that dynamic 'cause that's a struggle for a lot of entrepreneurs to have the self awareness and or the need to do that. >> Yeah so Armand and I made the decision to look for a CEO, if possible, I think three and a half or four years ago, it took us almost two years to find Dave and our motivation is really, it's a few things, one was something our investors told us, which is, long term, you want to do for the company you want to give the company the biggest value you can and like, what do you bring to the company? For us, as founders, our skill set was product vision, engineering, sort of industry strategy, things like that and it wasn't the executive management, financing, building various teams like sales marketing, building out the corporate structure, that wasn't us and so we looked at it and thought, we could learn it, probably, but we would make mistakes and it would be hard, it's just not our passion, it's not what we want to do, or we could try to find someone who aligns with our culture and gets our vision, gets open source, things like that, bring them in and sort of scale to a way where we're giving our startup the best chance it has, which means we give it the value we do, which is engineering and product vision and the new person coming in gives it that sort of corporate maturity and that's exactly what Dave did. >> That's awesome and it's always hard to do that because you got to have real maturity to make that happen so congratulations. >> Thanks, yeah. >> You know, a lot of us have that problem. (chuckles) and then one of my startups like, I need a new CEO, the venture guys were pushing it on you, but it's a challenge, you know, you got to think about, you know... That we didn't have a business model back then, but it's different stories, but that's always a tough one. Now let's talk about the culture around where you started from and where you are now because a lot of the stories around entrepreneurship is team, culture, and how you're going to set up your future of work, which you guys have a good structure. Iterating and figuring out where the tail wind is. Are you at the spot where you thought you'd be at a few years ago when we first met? How has it evolved, where there a little bit of zigs and zags you had to make. What was that like and share some of the journey color commentary with us. >> Sure, I mean, as a company sizes, we're nowhere near where I thought we'd be. I think Armand and I came into it expecting failure most likely and so anything beyond that was just surprise. So that's great. I think the place we are where we thought we'd be is sort of the company culture and stuff and that's something we've been very fiercely protective of and we define our culture sort of as we published them, we call the principal of HashiCorp, which sort of revolve around kindness, honesty, humility, things like that, so it's who would we want to work with and let's put words to it because we don't want to be this nebulous thing and so we've held to that really strongly. We're over 300 people now and every... Something Armand says, which I totally agree with, is I come into work, come into work, I go to my remote office, but I come into work and I'm excited to work with everyone at HashiCorp, which is, in past jobs we've had, we'd come into work and we're excited to work with like two out of 10 people, you know, and that's not a good ratio to have and I think that's what I'm most proud of from the culture side, that the ways we've done that is like we have the principles. We also have something called The Tal, which has been incredibly successful for us, both internally and externally, which is how we view product development and design and that helps sort of align the type of engineer who could get behind our vision and put some words to our vision so it's not again nebulous, whatever the founders think. >> So they have expectations of what's going to be like? >> Mhmm. >> From a coding standpoint, contribution? >> Yeah, from how do you, I like to describe it as how do you build product and how do you... How do you handle people? We have the two sides totally published and we're pretty explicit about it. >> That's awesome. Talk about the role of open source and lots of changing and you're seeing a lot of things like the Linux Foundation, CNCF, massively commercialized, there's tons of money coming in there, but Linux Foundation has done a good job of keeping that pretty pure. Success in entrepreneurship and open source go hand in hand now, it's almost... It's really the perfect storm for creators. >> Yeah. >> But, there's a playbook, there's a way that's changed. Share your vision of how you think open source is today and where it needs to maintain and what could be changed for the better? >> Yeah, I think, so open source today is pretty much a default, expected, accepted, sort of a pattern, which is really nice. It gives you community so you could, you know, Groundswell, anyone could adopt your software, without having to go through a sales person or something like that, which is really important, anyone can contribute and make their mark on the software. It's a great way to sort of get careers started. I think it brings a level of transparency to software that is, you know, you could hide behind closed source. It's like we like to tell our customers, it's like if you don't believe us, not only try it, but go look at how it works. We're telling you the truth. And I think that's really important. I think there's still a lot of challenges around how do companies sort of build successful businesses around it? I think we're doing alright and things like that, but there's still low number of data points. >> Always the challenge is, from looking at your reaction on this, is that as companies get involved, the classic reaction was, oh we got the big companies now in this open source project, it's going to be land grabbed, they're going to put their fingers in there, need better governance. >> Yup. >> Things fracture. Where ideally, it's an upstream project, where everyone contributes for the better good and then people pull it downstream. I mean, that's the basic ethos of open source. That's the main, that's the playbook that we want and that's what you believe, that's the ideal scenario? >> I think that yeah, I think shared ownership is really important, but I also think that sort of unified vision is equally important. So, that's a healthy tension to me, which is that you have a huge community that wants to pull the project in different directions and I think if you don't, if you have a governance that's totally fair, what ends up happening, in my opinion, is you end up getting camels instead of horses, right, like you'd start pulling in all these different directions. You sort of need a slightly unfair governance model so there is somebody that says, this is the direction we're going. And that person needs to be someone that's trusted by the community. >> And Linux was very successful with that too, I mean, you know. >> Right, and I think Linux is an example of a project that like reaches a point where that's, the vision is obvious and clear and it reaches a point where, you know, Linux could step down for a bit and take a break and it still runs fine, but it's a-- >> in the early days, you need a benevolent dictator to say, look, we got to do this. >> Yeah, right, Linux is a 25, 30 year old project versus, you know, some of these CNCF projects are two or three years old and I think that's where you absolutely need strong leadership versus-- >> But we'll see. We'll look at the contribution. We look at that, we obviously follow that pretty heavily and learn to appreciate the Kubernetes commentaries. We think that's super important too. Obviously containers, it's pretty much voted, it's open now so. >> Yes, yeah, yeah. >> (laughs) We know that. Okay, so I got to ask you the final question. As an entrepreneur, access to capital is super important. How did you guys go about it? How did you raise money? How should people raise money today? I'll say your an entrepreneur in the ecosystem, you're out in the front lines building a company. >> Mhmm. >> How did you guys access the capital? How should people figure this out? >> Yeah, I mean you just, you got to tell people why, you know it's a marketing problem, in away, but you got to tell people why what you're working on matters because it's so obvious to you as the founder, that's easy, it's about how do you articulate that and tell people how and why it's important and not just to you, but to the market and how it's going to help people and we did that and I think our biggest challenge was we had to do that across six or seven products, which is, we had a lot of pressure to like, why don't you just do one thing, but it was because for us, what was important was not just what the product did, but the greater vision behind why are we doing six things. And we just, you'd say that and you'd find people who believe it and they help you. >> And as you guys, a great example of you're on a big wave with Cloud and Open Source. How should entrepreneurs and what do you guys do to do this, maybe it's more of advice or anecdotal observation, as you have the dynamics with investors, advisors, service providers, how do you get the most out of them and how do you manage that board dynamic, because when you have an emerging market, there's a danger of saying, we got to lock in a business model. >> Yeah. >> So in Open Source, I'll see a little bit more freedom there 'cause you're open source, but that's always a danger and it's that much more you got to balance that, okay, we got to move the needle, but let's not overdrive too hard. How should entrepreneurs handle the... Taking advantage of their investors and board and how should they manage them or work with them? >> Yeah, I think on one side you need sort of, it's like multiple pillars and on one pillar you need a strong vision, so you need, what won't you sacrifice on, sort of? What's the fence post in the distance and maybe the journey there is slightly different, but you know where you're sort of heading towards so that always grounds you. I think the second thing is sort of a level of pragmatism, like you need to have that vision, but you need to meet your customers where they are and so, you need to figure out what you need to give them today, but still head towards that vision. And when you have those two things, you have a board that is on board with both of those things, you have founders that are dedicated, and you have employees, as well, and everything sort of moves in the right direction. >> But you got to lay that out. >> You have to be pretty explicit about it, yeah. >> Alright, well, congratulations on all your success and looking forward to following up and seeing how you guys are doing. Thanks for coming in and sharing your thoughts today. Appreciate it. >> Thank you. I'm John Furrier here at Mayfield for the 50th anniversary, part of our People First network coverage. I'm John Furrier, thanks for watching. (upbeat music)

(futuristic electronic music) >> From Sand Hill Road in the heart of Silicon Valley, it's theCUBE presenting the People First Network, insights from entrepreneurs and tech leaders. >> Alright, I'm John Furrier with theCUBE. We are here in Sand Hill Road at Mayfield for their 50th anniversary content program called the People First Network, co-created with theCUBE, and with Mayfield and their network. I am John for theCUBE, our next guest is Pradeep Sindhu who is the former co-founder of Juniper Now, the co-founder and CEO of Fungible, a start-up with a super oriented technology we're going to get into, but first, Pradeep, great to see you. >> It's great to see you again, John. >> For a 50th anniversary, there's a lot of history. And just before we get started, we were talking almost 10 years ago, you and I, we did a podcast on the future of the iPhone, only about a year in, maybe half a year. You had the vision, you saw the flywheel of apps, you saw the flywheel of data, you saw mobile. That's actually exchanges to IoT that we're seeing today, that world that's playing out. So, obviously, you're a visionary and an amazing entrepreneur. That's actually happening, so. You saw it and how did you adjust to that? What was some of the things that you did after seeing that vision? >> Well, some of the things that I did, if you recall our conversation, a big piece of that was data centers and the fact that the ideal computer is centralized. There are other things I want to make distributed, but it was obvious back then that people would build very large data centers. And the same problem that happened with the internet, which is how do you connect billions of people and machines to each other, was going to come to data centers themselves. So that is the problem that I prepared myself for, and that's the problem that we're trying to solve at Fungible as well. >> And one of the things we've been having great conversation was as part of this 50th anniversary, People First, is the role of entrepreneurship. What motivated you to do another start-up? You had that itch you were scratching? You were also at Juniper Network, huge success, everyone knows the history there and your role there. But this is a wave that we've never seen before. What got you motivated, was it an itch you were scratching? Was it the vision around the data? What was the motivator? >> It wasn't necessarily an itch I was scratching. I'm a restless person. And if I'm not creating new things, I'm not happy. That's just the way I'm built. And I also saw simultaneously the ability, or this potential, to do something special a second time for the industry. So I saw a big problem to which I could contribute. >> And what was that problem? >> So that problem really was, back then, I would say 2012, 2013, it was obvious that Moore's law was going to flatten out. That this technology called CMOS, on which we've been writing now for 35, 40 years, was not giving us the gain that it once was. And that, as a result of that, transistors that one people thought were plentiful are going to become precious again. And one result of that would be that general purpose CPUs which were doubling in performance, or had been doubling in performance every couple of years, would stop doing that. And the question I ask myself is, that when that happens, what next? And so it's in the pursuit of what next is what led me to start my second company, Fungible. >> So what's interesting, we've been seeing a lot of posts out there, some cases criticizing Intel, some saying Intel has a good strategy. You see Nvidia out there doing some great things. The earnings are doing fantastic. The graphics, my kids want the new GPU for their games. Even their being bought for the people who are doing cryptocurrency mining, so the power of the processor has been a big part of that. Is that a symptom or a bridge to a solution, or is that just kind of the bloated nature of how hardware's going? >> It's not so much the bloated nature of hardware as it is the fact that, see, general purpose microprocessors or general purpose computing was invented by John Mo-noy-man in the late 1940s. This was just a concept that you could conceive and build something which is Turing-equivalent, which is completely general. In other word, any program that any computer you could conceive could be run by this one general purpose thing. This notion was new. The notion for programmable computer. This notion is incredibly powerful and it's going to take on all of the world. And Intel today is the best proponent of that idea. And they're taking it to the limit. I admire Intel hugely. But so many people have worked on the problem of building general purpose processors, faster and faster, better and better. I think there's not a lot in left that tank. That is the architecture is now played out. We've gone to multi-core. Further, the base technology on which microprocessors are built, which is CMOS, is now reaching, is beginning to reach it's limits. We think, actually general concessions in the industry, and I particularly also think, that five nanometers is probably the last CMOS technology because technology's getting more and more expensive with every generation, but the gains that you are getting previously are not there anymore. So, to give you an example, from 16 nanometers to seven, you get about a 40% improvement in power but only about a 5% improvement in performance and clock speed, and, in fact, probably even less than that. And even the increase in the number of transistors, generation to generation, is not what is used to be. It used to be doubling every couple of years, now it's maybe 40%-50% improvement every two to three years. So with that trend and the difficulty of improving the performance of general purpose CPUs, the world has to come up with some other way to provide improved performance, power performance, and so on. And so those are the fundamental kinds of problems that I am interested in. Prior to Juniper, my interest in computing goes back a long ways. I've been interested in computing and networking for a very long time. So one of the things that I concluded back in 2012, 2013, is that because of the scarcity of Silicon performance, one of the things that's going to happen is people are going to start to specialize computing engines to solve particular problem. So, what the world always wants is, they want agility, which is the ability to solve problems quickly, but they also want the ability to go fast. In other words, do lots of work per unit time, right? Well, those things are typically in conflict. So, to give you an example, if I built a specialized hardware engine to solve one and only one problem, like solving cryptocurrency problems, I can build it to be very fast. But then tomorrow if I want to turn around and use that same engine and do something different, I cannot do it. So it's not agile, but it's very fast. >> It's like a tailor-made suit. >> It's like a tailor-made suit. >> You're only wearing one-- >> It does one thing. >> You put on a little weight, you got to (chuckles), you get a new one. >> Exactly. So this trade off between agility and performance is fundamental. And so, general purpose processors can do any computation you can imagine, but if I give you a particular problem, I can design something much better. So now as long as Silicon was improving the performance every couple of years, there's no incentive to come up with new architectures. General purpose CPUs are perfect. Well, what you are seeing recently is the specialization of the engines of computing. First was GPUs. GPUs were invented for graphics. Graphics, the main computation of graphics is lots and lots of floating point numbers where the same arithmetic applies to an array of numbers. Well, people then figured that I can also do problems in AI, particularly learning and inferencing, using that same machinery. This is why Nvidia is in a very good place today. Because they have not only an engine, called a GPU, which does these computations very well, but also language that makes it easy to program, called CUDA. Now, it turns out that in addition to these two major types of computing engines, one which is general purpose compute, which is invented a long time ago, and the other one which is called a signal instruction multiple data type of SIMD engine. This was invented maybe 30 years ago in mainframes. Those are the two major types of engines and it turns out that there's a third type of engine that will become extraordinarily useful in the coming world. And this engine we call the DPU, for data processing unit. And this is the engine that specializes in workloads that we call data-heavy. Data intensive. And, in fact, in a world which is going from being compute-centric to data-centric, this kind of engine is fundamental. >> I mean, the use cases are pretty broad, but specific. AI uses a lot of data, IoT need data at the edge. Like what the GPU did for graphics, you're thinking for data? >> That is correct. So the DPU, let's talk about what the DPU can and cannot do. And maybe I can define what makes a workload data-centric. There's actually four characteristics that make a workload data-centric. One is that the work always comes in the form of packets. Everybody's familiar with packets. Internet is built using packets. So that one is no surprise. Second one has a given server. Typically serves many, many hundreds, maybe thousands, of computations concurrently. So there's a lot of multiplexing of work going on. So that the second characteristic. The third characteristic is that the computations are stateful. In other words, you don't just read memory, you read and write memory, and the computations are dependent. So you can't handle these packets independently of one another. >> I think that's interesting because stateful application are the ones that need the most horsepower and have the most inadequacy right now. APIs, we love the APIs, restless APIs, no problem. Stateless. >> Stateless. Stateful, by the way, is hard. It's hard to make stateful computations reliable. So the world has made a lot of progress. Well, the fourth characteristic, which is maybe even a defining one, but the other ones are very important also, is that if you look at ratio of input/output to arithmetic, it's high for data-centric calculations. Now, to give you-- >> Which high, I is higher, O is higher, both? >> I/O, input/output. >> I/O, input and output? But not just output? >> Not just input, not just output. Input/output is high compared to the number of instructions you execute for doing arithmetic. Now, traditionally it was very little I/O, lots of computation. Now we live in world which is very, very richly connected, thanks to the internet. And if you look inside data centers, you see the same, it's a sort of Russian dolls kind of thing. And the same structure inside which is you have hundreds of thousands to maybe millions of servers that are connected to each other, that are talking to each other. The data centers are talking to each other. So the value of networks as we know is maximized at large scale. The same thing is happening inside data centers also. So the fact that things are connected east-west and is any-to-any way, it is what leads to the the computations becoming more data-centric. >> Pradeep, I love this conversation because I've been banging my head on all my CUBE interviews for the past eight years saying that cloud is horizontally scalable. The data world has been not horizontally scalable. We've had data warehouses. Put it into a database, park it over there. Yeah, we got Hadoop, I got a data lake, and then what happens? Now you got GDPR and all these other things out there. You got a regulatory framework that people don't even know where their data is. But when you think about data in the way you're talking about it, you're talking about making data addressable. Making it horizontally scalable. And then applying DPU to solve the problem, rather then try to solve it here in the path of, or the bus if you will, I don't know what to call it, but-- >> The thing to call it is, it's the backplane off a data center. So the same way that a server, a mainframe, has a backplane where all the communications go through. Well, inside a data center, you have this notion of a network which is called a fabric of the data center. It's the backplane off the data center. >> So this is a game changer, no doubt. I can see it, I'd love to get, I can't wait to see the product announcements. But what is the impact to the industry, because now you're talking about smaller, faster, cheaper, Which has been kind of the Moore's law. Okay, the performance hasn't been there but we've had general purpose agility. Now you have specialism around the processor. You now have more flexibility in the architecture. How does that blend in with cloud architectures? How does that blend into the intelligent edge? How that fit into the overall general architecture? >> Great question. Well, the way it blends into cloud architecture is that there's one and one thing that distinguishes cloud architectures from previous architectures, and that's the notion of scale-out. So let me just maybe define scale-out for the audience. Scale-out essentially means having a small number of component types like storage servers and compute servers, identical. Put in lots of them because I can't make individual one faster, so the next best thing is to put lots of them together. Connect them by very fast network that we call a fabric, and then have the collection of these things provide you more computing and faster computing. That's scale-out. Now scale-out is magical for lots of reasons. One is that you deliver much more reliable services because individual things failing don't have an effect anymore, right? The other thing is that the cost is as good as it can get because you're doing, instead of building very, very specialized things, a few of them, you're building many, many, many things, which they are more or less identical. So those two things, the economics is good, the agility is great, and also the reliability is great. So those three things is what drive cloud architecture. Now the thing that we talked about, which is specialization of the engines inside cloud. So we had, up until now, the cloud architecture was, is homogenous scale-out servers, all x86 based. What we're entering is a phase that I would call heterogeneous specialized scale-out engines. So you are seeing this already, x86, GPUs, TPUs, which are tensor flow processors, FPGAs. And then you're going to have DPUs coming, and in this ecosystem, DPUs are going to play two roles. One which is to offload from x86 and GPUs those computations that they don't do very well, the data-centric computations. But the second one is to implement a fabric that allows these things to be connected very well. Now you had asked about the edge. Specialization of computing engines is not going to be sufficient. We have to do scale-out more broadly in a grander sense. So in addition to these massively scalable data centers, we're going to have tens of thousands of smaller data centers closer to where the data is born. We talked about IoT. There's no reason to drag data thousands of miles away if you don't have to. >> Latency kills. >> Latency kills for some applications, it's in fact deadly. So putting those data centers where both computing and storage is near the source of data is actually very good. It's also good from the standpoint of security. At least it makes people feel good that, hey, the data is located maybe 10, 20 kilometers away from me, not 10,000 kilometers away where maybe it's a different government, maybe I won't have access to my data or whatever. So we're going to see this notion of scale-out play in a very general way. Not just inside data centers, but also in the sense that the number of data centers is going to increase dramatically. And so now you're left with a networking problem that connects all these data centers together. (John chuckles) So some people think-- >> And you know networking? >> I know a little bit about networking. So some people say that, hey, networking is all played out, and so on. My take is that there is pressure on networking and network equipment vendors to delivery better and better cost per bit per second. However, networking is not going out of style. Let's be very clear about that. It is the life blood of the industry today. If I take away the internet, or DCIP for example, everything falls apart, everything that you know. >> Well, this often finds-- >> So, the audience should know that. >> Yeah, well, we didn't really bang on the drum. We seen a real resurgence in networking, in fact, I covered some of Cisco's events and also Juniper's as well, and you just go back a few years, all these network engineers, they used to be the kings of the castle. They ran the show. Now they're kind of like, cloud-natives taking it over, and you mentioned serverless. I mean, heterogeneous environment, it's essentially serverless, Lambda and other cool things are happening, but what we're seeing now is, and again, this ties back to your apps conversation 10 years ago, and your mention about the DPU and edge, is that the paradigm at the state level is a network construct. You have a concept of provisioning services, you have concepts of connectionless, you have concepts of state, stateless, and that right now is a big problem with things like Kubernetes, although Kubernetes is amazing, enabling a lot of workloads to be containerized, but now don't talk to each other. Sounds like a network problem. >> Well, it is-- >> These are network problems. Your thoughts. >> When you look, so networking is really fundamental, at one level, so as I've said, there are three horsemen of infrastructure. There is compute which is essentially transforming information in some way. By doing some form of arithmetic. I don't mean one plus one gets two. I mean generalized manipulation of data. You have some input, you do some computation, you get some output. That's one entity. Another entity is storage, which is general purpose storage. I put something in there, I want to come back later and retrieve it. And it needs to be resilient, ie. resistant to failures. The third piece of the puzzle is networking, and the kind of networking that is the most useful is any-to-any networking, which is what TCIP gives you. So, essentially these three things are three sides of the same coin, and they work together. It's not as if one is more important than the other. The industry may have placed different values, but if you look down at the fundamentals, these three things go hand in hand. >> What's interesting to me and my observations, we have an internal slide that we used in our company, it's a content, our content pillars, if you will, and they're concentric circles. Data center, cloud, AI, data, and BotChain crypto. Data being like big data now, AI. Right in the middle is IoT, security and data. You're inventing a new category of data. Not classic data. Data warehousing-- >> This is agile data. At the end of the day, what we want to build is engines and platform for data processing, taken to it's limit. So, to give you an example, with the engines that we have, we should be able to store data with arbitrary levels of reliability. I really mean that. >> Stateful data. >> Stateful data, that is, I put data in one place, I can keep it securely, in other words, it's cryptographically, it's encrypted. It is resilient, and it's distributed over distance so that I could come back a hundred years later and find it still there, and nobody can hack it. So these are the things that are absolutely necessary in this new world, and the DPUs going to be a key enabler of providing-- >> So just to tie it all together is the DPU, the data processing unit, that you're inventing. Is the glue layer in the heterogeneous world of cloud architecture? Because if you're offloading and you have a fabric-- >> That's one role. That's one role. The glue layer that enabling a fabric to rebuild is one of the roles of the DPU. The second role, which is really, really important, is to perform data-centric calculations that CPUs and GPUs do not do very well. So, on data-centric calculations, the four things that I told you about, we're about 30 times better price performance and power performance compared to either GPU or TPU, on those calculations. And to the extent of those calculations are really important, and I think they are, the DPU will be a necessary component. >> Pradeep, I've been getting a lot of heat on Twitter, well, I'm on social media, I know you're not, but I've been saying GDPR has been a train wreck. I love the idea, we want to protect our privacy, but anyone who knows anything about storage and networking knows that storage guys don't know where their databases are. But the use cases that they're trying to solve are multi-database. So, for instance, if you do a retail transaction, you're in a database. If you're doing an IoT transaction in your self-driving car that need data from what you just bought, the idea of getting that data is almost impossible. They would have to know that you want the data. Now that's just two databases, imagine bringing-- >> Hundreds. >> Hundreds of databases. Everything, signaling in. It's a signaling process problem. Part of the problem. >> Part of the problem is that data is kept in many, many, many different formats. I don't think one can try to come up with a universal format for data, it won't work. So generally what you need to do is be able to ingest data in multiple formats. And do it in real time, store it reliably, and then process it very quickly. So this is really the analytics problem. >> Well, congratulations, the future of Silicon Valley is coming back as a chip, a chip that you're making? >> We are making a chip. What's very important for me to say is that this chip is, or it's a series of chips, these are programmable. They're fully programmable. But they're extraordinarily powerful. >> Software-defiant chip sets coming online. Pradeep, thanks for spending the time. >> You're welcome. >> I'm John Furrier, here at Sand Hill Road for the People First Network, theCUBE Presents. I'm John Furrier, thanks for watching. (futuristic electronic music)