. >>Okay, welcome back. This is live in Las Vegas. This is the end of day one. This is our wrap up segment of the cube at Splunk conference dot conference 2013. I'm John furrier with Dave Alante, my cohost and Jeff Kelly making an appearance in this segment has been scouring for stories, talking to all the folks, talking to the CEO, talking to all the people on the team, customers scouring the web. Guys, welcome to the wrap up. Thank you John. John guys, I gotta I gotta say I'm really impressed with what Splunk's done here. Um, and with post IPO you kind of see what people are made of when they have to do transitional things day. We know we do and I've seen companies pivot, turn on a dime. You guys certainly have helped companies, you know, get into that, into the, into the thermal growth and um, but here a companies succeeding, um, they hit a rocket ship growth. >>They go public. A lot of challenges could be distraction, but certainly, uh, my impression is no distraction here. Splunk certainly is hitting cruising altitude only getting better and stronger. Certainly the customer acquisition numbers as strong and their partner ecosystem is great. Their keynote and fan based or customers are loyal. All in all, Dave, I've got to say, you know Splunk's looking really good. Yeah, John. I mean I think you see a lot of different models. This is too broad models. I guess in the, in the it business one is the safe bet. It's, it's IBM, it's, it's HP, it's, it's EMC, it's Oracle, it's Cisco. I mean you're going to do business with those companies because you know they're going to deliver a product and they're going to stand behind it and they're going to service you and then you got the 10 X value proposition companies, that's companies like Tableau service now Workday, Splunk, these are the companies that are really transforming their irreverence. >>Steve Cohen said disruptive, they're disruptive so they got a little mojo going and I'm gone. But at the same time, customers are willing to take a chance because the value proposition is so compelling and so transformative to their business and they can't get that from their traditional it suppliers despite what the traditional it suppliers are telling them. So I love that kind of mojo at a, at a, at an event like this. Jeff Kelly, I want to go to you for a second. Let's talk about what you're finding us. Show us who you are on the, on the, uh, we had a crowd chat today w you know, preparing them for Hadoop world and big data in New York city. A quick programming note. Um, we, the Q will be in New York city for strata conference. Had duper world covering that in con in concert to the big data New York city event going on as well that week. >>Um, but you're out, you did a chat this morning about big data with Hadoop ecosystem. A lot of had doopy we had cloud era MRR Dhalla on, they have a relationship also with Hortonworks. Um, what did you find out there? What stories did you dig in? What observations did you find? Well, very much like a, the last show we were at a Tableau's customer conference. It's a really excited, uh, customer base here. These, these customers, uh, you know, are, are clapping and cheering during the keynote. It's something you don't necessarily see more than excited. They're giddy, right? I mean, right. They're there, they're getting yapping, they're hooting or hollering, right. And, and there's really a sense of community around the, around the customer base. They love to trade stories. They love to trade best practices. The hackathon, last night I was at, uh, you know, just rooms filled off the, off the corridors here at the, uh, the cosmopolitan. >>They were there till 11 o'clock at night. They were in there, you know, they had, uh, some, some, some, some TV going at, I saw a rerun of Alf playing on the big screen for some reason. I guess that's a popular with the group here. But anyways, these guys were up there all night. You know, they're coding the drinking beers, they're having a good time. Uh, they really enjoy this. You didn't, it's not something you see at eight. At one of the, a larger events, some of the mega vendors we see. Um, you know, the other thing, you know, Mike coming into this Splunk I think was really early on, uh, recognizing the, the value that providing applications that allow you to really manipulate and understand data. Really they saw the value of that very early. Obviously that's, they base their whole premise of their organization on that. >>Oh, they have re, you know, kind of written this wave, uh, of big data, all things big data. And they're one of the few companies out there that are actually selling and providing applications that allow people and make sense of, um, in this case, machine generated data, but they're expanding to other data types. Um, the key for them I think going forward is to continue innovating. You know, they've kinda got that lead, uh, I think because they were the, one of the first out of the gate to recognize the value in this. They gotta keep innovating. And I think you saw with the announcements today, clearly they are, uh, the cloud, uh, option that they unveiled today was very popular. Um, and it's going to help them, especially against some of the more nimble startups. It's funny, it's, Splunk is now kind of a kind of a big established company in a sense in this large, in this big data world, there are companies like om Bogley and Sumo logic who are coming at Splunk doing similar things, but doing it from a cloud perspective, well sponsored down. >>Got an answer for that. Why would I want to ask you guys about that? Because you know, John, Jeremy Burton, we, you know, made, we were there when cloud met big data and so people have been putting those two together. But you take a company like Splunk and a couple of like Tableau, not big cloud plays. What about that cloud meets big data? Is that, is that a misconception on the industry's part or not? Or is it a fundamental requirement that cloud meets big data? I think it's a fundamental requirement as you know, we were, you know, close to EMC when they put that together and we had the first cloud mobile social editorial. You guys had the first real research around those three pillars. Um, and big data just became a, came out of social and cloud and since the cloud era, you know, pun intended with Cloudera, the company, um, but you know, Dave, we saw this from day one. >>This is a fundamental economic wealth creating inflection point, meaning new companies, new brands going to emerge that are going to change the game and this is where all the chips are on the table and you're seeing the incumbent vendors like EMC changed their game and go cloud meets big data and go in there. And EMC, I give Ian, Jeremy Burton a lot of credit. He saw the work we were doing. He saw the marketplace, he came fresh into EMC and said cloud and big data. Those are the two pillars. He bet the ranch on that and the beds coming home. Jeremy is making more money than any, even not a CMO anymore. He's the executive vice president doing great just on the stock options. He made a good bet that's playing out who's also a great executive with some product shops. Absolutely. Table stakes in my opinion. >>Um, that the application market is going to be enabled by that. So, Jeff, Kelly, so I've got to ask you, there are forces that you mentioned you've got open source. Uh, you've got some new players that are or have seen the opportunity that Splunk has created, the, they're going to have to Splunk. So, so what's your prediction here? I mean, you've got, you've got a public company now, they've got more resources. They're clearly a leader in the, in the business, but you got other companies coming after him. Not only start us, you know, we were at, um, we were at HP, uh, the, the Vertica user group, they were talking about, you know, their Splunk killer. Uh, you hear it all the time. Oh, we can do that. We can do that. What does that all mean for Splunk? Well, the good news for Splunk is they're, they're, they're ahead of everybody in this game because they've been doing this for longer. >>Uh, you know, they, they, they have a, a more generally accepted among the customers, uh, you know, a better application for VMware, for instance. So they're actually ahead of a lot of these other vendors, VMware itself trying to claim Oh yeah, it'd be where it says, well now we've got a tool for monitoring that's just as good as Splunk. Well, you know, if you talk to some of the people using the Splunk app for VM ware, they'll disagree with that. So bottom line is, you know, this is a little bit simplified, but people really like the Splunk user interface in the application. It's very easy to use and that's something that you can't necessarily replicate. So, you know, it'll take, it'll take some time for some of these players to catch up. But you know, back to the point John was making this whole idea of cloud and big data and you're asking, you know, is that really, is that really the, the, the two mega trends here? >>And I think absolutely when we start talking about, uh, industrial internet, internet of things, whatever term you wanna use, we're, we're years away from that really being a, a reality I think in terms of it's an interconnected world, but clearly the two key enabling technologies are going to be big data, making sense of all those connected devices and cloud being able to connect them in a way that that makes sense. Um, where you can't do that in an on premise situation if you've got isolated data centers. Now the other thing, this company who started in 2005, it's yet another Silicon Valley success story. John, I mean it's just Silicon Valley is just running the table. What's your take on the Valley action going on here? I think Silicon Valley is going to continue to do well and, and um, and rule the road here and on IPOs and success. >>Silicon Valley is the ecosystem that drives a lot of wellness to wall street of startups. However, there are, there are a lot of successes outside of Silicon Valley. This is just another string of, of successes. Um, but Dave, this is an absolute poster child in my opinion, of a venture that could have gone the wrong way. I mean, Splunk was not a shining star when it got funded. It took two visionary venture capitalists, Nick and David Hornick, Nick from, uh, he'd know the ignition and uh, David Hornik from August capital made the bet. They bet on technical founders, they bet on the right product guys. It was in small tools and it was at the time it was, wasn't the trendy thing. This is pre big data. This is log files. They saw a problem, they saw a good team. Now this thing could've gone off the rails, right? >>If you look at today's market, this is what I worry about all this startup environment is that all the different funding dynamics, all of this crowd sourcing this, that you've got to have good investors. This is a great example of great investors back in their guys back on their team because this thing could have been off the rails in the fourth year. Okay. Product strategy, debate, board room dynamics, people not paying attention, uh, asleep at the switch as we say. And this is, this is an example of a company done right. They hit the growth curve, big data swooped in, they had a great product, happy customers and incrementally move the ball down the field. And finally, you know, scored the big long ball with the touchdown with big data. And I think, you know, it's classic. These are football analogies, you know, first down, first down, first down, and then big data comes down. >>They throw the ball in the end zone, touchdown home run. There it is. That's the IPO. That's the success story. There's a fine line between. Good and great here. Isn't there though? I mean, like you say, I mean who even Steven Cohen was saying, uh, uh, uh, not, not Steve Sorkin, sorry. Steven. I was saying that he didn't, could've never predicted, you know, where they'd be today, the IPO, et cetera. So there is a fine line. You could go, well, this is the thing, this is my point. If you look at Splunk, right? Dave, they could have, no one was buying their stuff initially. Right, and so except for some tech geeks, no one was kind of get it, but the recession hit and people weren't spending in 2008 that was a big surge and you saw the spending and Splunk became a great solution because for very little cash you can come in and create business value. >>That was a really, really important moment in the company's history, David, and what's also happened is they believed in their own product. You heard from the people here culture, they're Everett, they're disruptive, they use their own product and they focused on the customer. Those two things, good timing still is, you know, comes to people who are prepared. I mean it's not an, I mean, it's not enough to just have a big market. It's not enough to just have a lot of capital behind you. You need other ingredients obviously to succeed. I'm afraid the younger generation doesn't understand the startup world is you can't just magically put pixie desk and get the home run. You got some times really be in a good position as they say in basketball and be ready for the rebound off the rim. In this case it log file tool with good technology moves into the big data world and hello, they're got an enterprise customers. >>Part of, I think part of it is, look, you've got to admit, part of it is luck and timing. You've got to have that on your side. But they've also got a really good product and they're smart enough when that, when those opportunities present themselves to take them. I think they are. Again, timing is fantastic for them right now. We've been talking about the, uh, the year of the big data application and we're really still waiting for that. They are in a really good position right now to really take advantage of all the interest in, you know, SQL on Hadoop, interactive analytics on Hootsuite. Well guess what, they've got a product and hunk a cute name, but a good product that allows you to get right in there as a business user and start analyzing, searching data using a circular base. I gotta tell you it's a very good looking product and people are looking for this. >>People are like, well, how am I going to get all that value product? I'm going to get all that value out of Hadoop sense bugs in answer hunk. You got the naming convention, interesting names, but nevertheless they've got a, they've got a play right now in an area that's got a lot of interest and they've got, they've got the track record in the log data to actually show they've got, they know how to, they know what they're doing. I don't remember Mike Olson to cloud Hadoop worlds ago, announced the the application tsunami. That kind of never came the way they said. We said the analytics was a killer app. In the meantime, as the market kind of catches up, we still haven't seen that application framework, but yet still analytics is the killer app, right? It's definitely the killer app. I think. Well, the analytics for the masses is the, is the killer app and that's the Holy grail that everybody's going after. >>And I'm not, I'm not declaring Splunk is there. I don't think Splunk is there. I don't think anybody's there yet. You talk to a Tableau customers, you talk to Splunk customers, they're not there yet, but they're closer than the BI crowd ever was. They're certainly closer than the traditional BI players. And they, and then that's because they don't have that legacy architecture to deal with. But there's also a cultural issue. It's not just the technology of the products, it's getting business users to understand how to look at data and look at it as, as an asset and something that you can actually drive. Timing's right for that. Absolutely. So I want to wrap up and ask you guys some follow up questions at the close, the segment out, first impressions of day one and what are you looking for for day two? Jeff, we'll start with you. >>I am first impressions. You know, like I said, very excited, uh, base of customers here and you know, 18,000, 1800, excuse me. Plus customers, 18,000. That'll be a few years. But, uh, nevertheless a good showing here. Uh, I think tomorrow, you know, on the cube, we're going to look for certainly some more customer stories. Um, you know, it's always interesting to hear from customers because they are on the front lines. They're using the product every day. So I expect to see a lot more of that. Um, and really tomorrow I think is going to be a lot about, a lot about uh, these customers networking with one another and I'm hoping to get out there. Let's add on the question to, uh, to you then, then to Dave. Same thing. What's the challenges for Splunk as well? I think the challenge for me is from, from my perspective is to continue and make the, make the cloud play real, continuing to invest in that, uh, and that product and that approach. >>Um, as we met, as I mentioned a minute ago, I think cloud and big data are critical to really leveraging industrial internet, the internet of things. And if Splunk wants to be a key player there, they've got to really fill out that portfolio of cloud based capabilities. I know you said David, go first. Sorry for me. For me, John, we heard from the executives today, very strong story. We heard very solid product lineup. It's very clear in talking to customers that there's, there's passion here, there's real traction. Um, it's substantive. To me. The big thing is ecosystem. I feel as though the ecosystem here at Splunk is, is, is good, but I feel like it's not been as deliberate as it can be. I think Splunk has a ways to go there. I think that is one of the leverage points that this company really has to focus on. >>Because like today we talked about earlier, 45% of Splunk sales goes through the channel. I think it's gotta be way, way, way higher than that. Now they're making great progress, but I think that they've got to have a goal of getting to 70% and that comes through the ecosystem. It's gonna take some time. It's going to take some investment. That's really where, to me, the big upside is for this company and my impression is I'm very impressed with Splunk. I'm very impressed with the ecosystem. I'm impressed by the rabid fan base of their customers who are proud of the private name getting exemplifies my point about startups having a great product focus products will win. Again, you know, the four P's of marketing, they teach you in marketing one Oh one one of those products. Um, but the challenge is, Dave, I would, I would agree with you. >>The ecosystem is a challenge. Good news is they have a great turnout here. Um, you're not, there's no lightweights out there, all heavyweights in terms of what they're doing with tech and their value proposition. So, you know, gray star for the ecosystem. So I think it's looking good off the tee to use the golf analogy, um, landing in the fairway. So, so that's one. My big, my big thing on the challenges for Splunk and that I'm watching is the cloud. I think moving to the cloud is not as easy as it appears, although that's the value proposition. So to move the DNA of the company with the pressure to drive revenue, luckily the market's kind of moving to them right now. So it might be a, a rising tide floats all boats. Moving to the cloud is very, very difficult. And I think that's gonna be a key challenge. >>We're going to keep watching them look at what SAP has challenged the cloud. They've had multiple restarts and misfires. Now they've seen them get their groove back with HANA. I think this could be a big challenge for Splunk and we're going to, I'm going to watch their cloud and that's going to be my focus then tomorrow. I would agree with that. I would just say on the ecosystem point, um, I, I think they would actually, I think they do have more work to do Dave, but I think they're in a really good position because some of the Hudu players, for instance, knees, Splunk, I think more than Splunk means to them right now. Okay. We're going to close down what the government is closing down right now. So, you know, that's, uh, that's, uh, we'll be back tomorrow because we work for free open source content, um, programming node. >>Next weekday we're gonna talk about big data and internet of things. I'll be interviewing the CEO of GE. Um, I'm really proud of you, John, for, uh, being selected out of the zillion people that they could choose. They chose you to, to host this panel. Yeah, that's fantastic. It might be my last, but we'll see. Moving some Q mojo to the GE event, industrial internet next week in Chicago. Minds and machines, another player to watch. Guys. Great day and great wrap up here. And that's day one. Wrap in the books tomorrow here when we go to the party tonight, find out what's going on here at, at, uh, inside the cube, inside a Splunk conference. Dot conference. 2013. I'm John furrier with Dave Alante and Jeff Kelly Wiki bond with back tomorrow. Goodnight. And, and join us tomorrow.