>> From the CUBE Studios in Palo Alto in Boston, bringing you data driven insights from the Cube and ETR. This is Breaking Analysis with Dave Vellante. >> A better than expected earnings report in late August got people excited about Snowflake again, but the negative sentiment in the market is weighed heavily on virtually all growth tech stocks and Snowflake is no exception. As we've stressed many times the company's management is on a long term mission to dramatically simplify the way organizations use data. Snowflake is tapping into a multi hundred billion dollar total available market and continues to grow at a rapid pace. In our view, Snowflake is embarking on its third major wave of innovation data apps, while its first and second waves are still bearing significant fruit. Now for short term traders focused on the next 90 or 180 days, that probably doesn't matter. But those taking a longer view are asking, "Should we still be optimistic about the future of this high flyer or is it just another over hyped tech play?" Hello and welcome to this week's Wiki Bond Cube Insights powered by ETR. Snowflake's Quarter just ended. And in this breaking analysis we take a look at the most recent survey data from ETR to see what clues and nuggets we can extract to predict the near term future in the long term outlook for Snowflake which is going to announce its earnings at the end of this month. Okay, so you know the story. If you've been investor in Snowflake this year, it's been painful. We said at IPO, "If you really want to own this stock on day one, just hold your nose and buy it." But like most IPOs we said there will be likely a better entry point in the future, and not surprisingly that's been the case. Snowflake IPOed a price of 120, which you couldn't touch on day one unless you got into a friends and family Delio. And if you did, you're still up 5% or so. So congratulations. But at one point last year you were up well over 200%. That's been the nature of this volatile stock, and I certainly can't help you with the timing of the market. But longer term Snowflake is targeting 10 billion in revenue for fiscal year 2028. A big number. Is it achievable? Is it big enough? Tell you what, let's come back to that. Now shorter term, our expert trader and breaking analysis contributor Chip Simonton said he got out of the stock a while ago after having taken a shot at what turned out to be a bear market rally. He pointed out that the stock had been bouncing around the 150 level for the last few months and broke that to the downside last Friday. So he'd expect 150 is where the stock is going to find resistance on the way back up, but there's no sign of support right now. He said maybe at 120, which was the July low and of course the IPO price that we just talked about. Now, perhaps earnings will be a catalyst, when Snowflake announces on November 30th, but until the mentality toward growth tech changes, nothing's likely to change dramatically according to Simonton. So now that we have that out of the way, let's take a look at the spending data for Snowflake in the ETR survey. Here's a chart that shows the time series breakdown of snowflake's net score going back to the October, 2021 survey. Now at that time, Snowflake's net score stood at a robust 77%. And remember, net score is a measure of spending velocity. It's a proprietary network, and ETR derives it from a quarterly survey of IT buyers and asks the respondents, "Are you adopting the platform new? Are you spending 6% or more? Is you're spending flat? Is you're spending down 6% or worse? Or are you leaving the platform decommissioning?" You subtract the percent of customers that are spending less or churning from those that are spending more and adopting or adopting and you get a net score. And that's expressed as a percentage of customers responding. In this chart we show Snowflake's in out of the total survey which ranges... The total survey ranges between 1,200 and 1,400 each quarter. And the very last column... Oh sorry, very last row, we show the number of Snowflake respondents that are coming in the survey from the Fortune 500 and the Global 2000. Those are two very important Snowflake constituencies. Now what this data tells us is that Snowflake exited 2021 with very strong momentum in a net score of 82%, which is off the charts and it was actually accelerating from the previous survey. Now by April that sentiment had flipped and Snowflake came down to earth with a 68% net score. Still highly elevated relative to its peers, but meaningfully down. Why was that? Because we saw a drop in new ads and an increase in flat spend. Then into the July and most recent October surveys, you saw a significant drop in the percentage of customers that were spending more. Now, notably, the percentage of customers who are contemplating adding the platform is actually staying pretty strong, but it is off a bit this past survey. And combined with a slight uptick in planned churn, net score is now down to 60%. That uptick from 0% and 1% and then 3%, it's still small, but that net score at 60% is still 20 percentage points higher than our highly elevated benchmark of 40% as you recall from listening to earlier breaking analysis. That 40% range is we consider a milestone. Anything above that is actually quite strong. But again, Snowflake is down and coming back to churn, while 3% churn is very low, in previous quarters we've seen Snowflake 0% or 1% decommissions. Now the last thing to note in this chart is the meaningful uptick in survey respondents that are citing, they're using the Snowflake platform. That's up to 212 in the survey. So look, it's hard to imagine that Snowflake doesn't feel the softening in the market like everyone else. Snowflake is guiding for around 60% growth in product revenue against the tough compare from a year ago with a 2% operating margin. So like every company, the reaction of the street is going to come down to how accurate or conservative the guide is from their CFO. Now, earlier this year, Snowflake acquired a company called Streamlit for around $800 million. Streamlit is an open source Python library and it makes it easier to build data apps with machine learning, obviously a huge trend. And like Snowflake, generally its focus is on simplifying the complex, in this case making data science easier to integrate into data apps that business people can use. So we were excited this summer in the July ETR survey to see that they added some nice data and pick on Streamlit, which we're showing here in comparison to Snowflake's core business on the left hand side. That's the data warehousing, the Streamlit pieces on the right hand side. And we show again net score over time from the previous survey for Snowflake's core database and data warehouse offering again on the left as compared to a Streamlit on the right. Snowflake's core product had 194 responses in the October, 22 survey, Streamlit had an end of 73, which is up from 52 in the July survey. So significant uptick of people responding that they're doing business in adopting Streamlit. That was pretty impressive to us. And it's hard to see, but the net scores stayed pretty constant for Streamlit at 51%. It was 52% I think in the previous quarter, well over that magic 40% mark. But when you blend it with Snowflake, it does sort of bring things down a little bit. Now there are two key points here. One is that the acquisition seems to have gained exposure right out of the gate as evidenced by the large number of responses. And two, the spending momentum. Again while it's lower than Snowflake overall, and when you blend it with Snowflake it does pull it down, it's very healthy and steady. Now let's do a little pure comparison with some of our favorite names in this space. This chart shows net score or spending velocity in the Y-axis, an overlap or presence, pervasiveness if you will, in the data set on the X-axis. That red dotted line again is that 40% highly elevated net score that we like to talk about. And that table inserted informs us as to how the companies are plotted, where the dots set up, the net score, the ins. And we're comparing a number of database players, although just a caution, Oracle includes all of Oracle including its apps. But we just put it in there for reference because it is the leader in database. Right off the bat, Snowflake jumps out with a net score of 64%. The 60% from the earlier chart, again included Streamlit. So you can see its core database, data warehouse business actually is higher than the total company average that we showed you before 'cause the Streamlit is blended in. So when you separate it out, Streamlit is right on top of data bricks. Isn't that ironic? Only Snowflake and Databricks in this selection of names are above the 40% level. You see Mongo and Couchbase, they know they're solid and Teradata cloud actually showing pretty well compared to some of the earlier survey results. Now let's isolate on the database data platform sector and see how that shapes up. And for this analysis, same XY dimensions, we've added the big giants, AWS and Microsoft and Google. And notice that those three plus Snowflake are just at or above the 40% line. Snowflake continues to lead by a significant margin in spending momentum and it keeps creeping to the right. That's that end that we talked about earlier. Now here's an interesting tidbit. Snowflake is often asked, and I've asked them myself many times, "How are you faring relative to AWS, Microsoft and Google, these big whales with Redshift and Synapse and Big Query?" And Snowflake has been telling folks that 80% of its business comes from AWS. And when Microsoft heard that, they said, "Whoa, wait a minute, Snowflake, let's partner up." 'Cause Microsoft is smart, and they understand that the market is enormous. And if they could do better with Snowflake, one, they may steal some business from AWS. And two, even if Snowflake is winning against some of the Microsoft database products, if it wins on Azure, Microsoft is going to sell more compute and more storage, more AI tools, more other stuff to these customers. Now AWS is really aggressive from a partnering standpoint with Snowflake. They're openly negotiating, not openly, but they're negotiating better prices. They're realizing that when it comes to data, the cheaper that you make the offering, the more people are going to consume. At scale economies and operating leverage are really powerful things at volume that kick in. Now Microsoft, they're coming along, they obviously get it, but Google is seemingly resistant to that type of go to market partnership. Rather than lean into Snowflake as a great partner Google's field force is kind of fighting fashion. Google itself at Cloud next heavily messaged what they call the open data cloud, which is a direct rip off of Snowflake. So what can we say about Google? They continue to be kind of behind the curve when it comes to go to market. Now just a brief aside on the competitive posture. I've seen Slootman, Frank Slootman, CEO of Snowflake in action with his prior companies and how he depositioned the competition. At Data Domain, he eviscerated a company called Avamar with their, what he called their expensive and slow post process architecture. I think he actually called it garbage, if I recall at one conference I heard him speak at. And that sort of destroyed BMC when he was at ServiceNow, kind of positioning them as the equivalent of the department of motor vehicles. And so it's interesting to hear how Snowflake openly talks about the data platforms of AWS, Microsoft, Google, and data bricks. I'll give you this sort of short bumper sticker. Redshift is just an on-prem database that AWS morphed to the cloud, which by the way is kind of true. They actually did a brilliant job of it, but it's basically a fact. Microsoft Excel, a collection of legacy databases, which also kind of morphed to run in the cloud. And even Big Query, which is considered cloud native by many if not most, is being positioned by Snowflake as originally an on-prem database to support Google's ad business, maybe. And data bricks is for those people smart enough to get it to Berkeley that love complexity. And now Snowflake doesn't, they don't mention Berkeley as far as I know. That's my addition. But you get the point. And the interesting thing about Databricks and Snowflake is a while ago in the cube I said that there was a new workload type emerging around data where you have AWS cloud, Snowflake obviously for the cloud database and Databricks data for the data science and EML, you bring those things together and there's this new workload emerging that's going to be very powerful in the future. And it's interesting to see now the aspirations of all three of these platforms are colliding. That's quite a dynamic, especially when you see both Snowflake and Databricks putting venture money and getting their hooks into the loyalties of the same companies like DBT labs and Calibra. Anyway, Snowflake's posture is that we are the pioneer in cloud native data warehouse, data sharing and now data apps. And our platform is designed for business people that want simplicity. The other guys, yes, they're formidable, but we Snowflake have an architectural lead and of course we run in multiple clouds. So it's pretty strong positioning or depositioning, you have to admit. Now I'm not sure I agree with the big query knockoffs completely. I think that's a bit of a stretch, but snowflake, as we see in the ETR survey data is winning. So in thinking about the longer term future, let's talk about what's different with Snowflake, where it's headed and what the opportunities are for the company. Snowflake put itself on the map by focusing on simplifying data analytics. What's interesting about that is the company's founders are as you probably know from Oracle. And rather than focusing on transactional data, which is Oracle's sweet spot, the stuff they worked on when they were at Oracle, the founder said, "We're going to go somewhere else. We're going to attack the data warehousing problem and the data analytics problem." And they completely re-imagined the database and how it could be applied to solve those challenges and reimagine what was possible if you had virtually unlimited compute and storage capacity. And of course Snowflake became famous for separating the compute from storage and being able to completely shut down compute so you didn't have to pay for it when you're not using it. And the ability to have multiple clusters hit the same data without making endless copies and a consumption/cloud pricing model. And then of course everyone on the planet realized, "Wow, that's a pretty good idea." Every venture capitalist in Silicon Valley has been funding companies to copy that move. And that today has pretty much become mainstream in table stakes. But I would argue that Snowflake not only had the lead, but when you look at how others are approaching this problem, it's not necessarily as clean and as elegant. Some of the startups, the early startups I think get it and maybe had an advantage of starting later, which can be a disadvantage too. But AWS is a good example of what I'm saying here. Is its version of separating compute from storage was an afterthought and it's good, it's... Given what they had it was actually quite clever and customers like it, but it's more of a, "Okay, we're going to tier to storage to lower cost, we're going to sort of dial down the compute not completely, we're not going to shut it off, we're going to minimize the compute required." It's really not true as separation is like for instance Snowflake has. But having said that, we're talking about competitors with lots of resources and cohort offerings. And so I don't want to make this necessarily all about the product, but all things being equal architecture matters, okay? So that's the cloud S-curve, the first one we're showing. Snowflake's still on that S-curve, and in and of itself it's got legs, but it's not what's going to power the company to 10 billion. The next S-curve we denote is the multi-cloud in the middle. And now while 80% of Snowflake's revenue is AWS, Microsoft is ramping up and Google, well, we'll see. But the interesting part of that curve is data sharing, and this idea of data clean rooms. I mean it really should be called the data sharing curve, but I have my reasons for calling it multi-cloud. And this is all about network effects and data gravity, and you're seeing this play out today, especially in industries like financial services and healthcare and government that are highly regulated verticals where folks are super paranoid about compliance. There not going to share data if they're going to get sued for it, if they're going to be in the front page of the Wall Street Journal for some kind of privacy breach. And what Snowflake has done is said, "Put all the data in our cloud." Now, of course now that triggers a lot of people because it's a walled garden, okay? It is. That's the trade off. It's not the Wild West, it's not Windows, it's Mac, it's more controlled. But the idea is that as different parts of the organization or even partners begin to share data that they need, it's got to be governed, it's got to be secure, it's got to be compliant, it's got to be trusted. So Snowflake introduced the idea of, they call these things stable edges. I think that's the term that they use. And they track a metric around stable edges. And so a stable edge, or think of it as a persistent edge is an ongoing relationship between two parties that last for some period of time, more than a month. It's not just a one shot deal, one a done type of, "Oh guys shared it for a day, done." It sent you an FTP, it's done. No, it's got to have trajectory over time. Four weeks or six weeks or some period of time that's meaningful. And that metric is growing. Now I think sort of a different metric that they track. I think around 20% of Snowflake customers are actively sharing data today and then they track the number of those edge relationships that exist. So that's something that's unique. Because again, most data sharing is all about making copies of data. That's great for storage companies, it's bad for auditors, and it's bad for compliance officers. And that trend is just starting out, that middle S-curve, it's going to kind of hit the base of that steep part of the S-curve and it's going to have legs through this decade we think. And then finally the third wave that we show here is what we call super cloud. That's why I called it multi-cloud before, so it could invoke super cloud. The idea that you've built a PAS layer that is purpose built for a specific objective, and in this case it's building data apps that are cloud native, shareable and governed. And is a long-term trend that's going to take some time to develop. I mean, application development platforms can take five to 10 years to mature and gain significant adoption, but this one's unique. This is a critical play for Snowflake. If it's going to compete with the big cloud players, it has to have an app development framework like Snowpark. It has to accommodate new data types like transactional data. That's why it announced this thing called UniStore last June, Snowflake a summit. And the pattern that's forming here is Snowflake is building layer upon layer with its architecture at the core. It's not currently anyway, it's not going out and saying, "All right, we're going to buy a company that's got to another billion dollars in revenue and that's how we're going to get to 10 billion." So it's not buying its way into new markets through revenue. It's actually buying smaller companies that can complement Snowflake and that it can turn into revenue for growth that fit in to the data cloud. Now as to the 10 billion by fiscal year 28, is that achievable? That's the question. Yeah, I think so. Would the momentum resources go to market product and management prowess that Snowflake has? Yes, it's definitely achievable. And one could argue to $10 billion is too conservative. Indeed, Snowflake CFO, Mike Scarpelli will fully admit his forecaster built on existing offerings. He's not including revenue as I understand it from all the new stuff that's in the pipeline because he doesn't know what it's going to look like. He doesn't know what the adoption is going to look like. He doesn't have data on that adoption, not just yet anyway. And now of course things can change quite dramatically. It's possible that is forecast for existing businesses don't materialize or competition picks them off or a company like Databricks actually is able in the longer term replicate the functionality of Snowflake with open source technologies, which would be a very competitive source of innovation. But in our view, there's plenty of room for growth, the market is enormous and the real key is, can and will Snowflake deliver on the promises of simplifying data? Of course we've heard this before from data warehouse, the data mars and data legs and master data management and ETLs and data movers and data copiers and Hadoop and a raft of technologies that have not lived up to expectations. And we've also, by the way, seen some tremendous successes in the software business with the likes of ServiceNow and Salesforce. So will Snowflake be the next great software name and hit that 10 billion magic mark? I think so. Let's reconnect in 2028 and see. Okay, we'll leave it there today. I want to thank Chip Simonton for his input to today's episode. Thanks to Alex Myerson who's on production and manages the podcast. Ken Schiffman as well. Kristin Martin and Cheryl Knight help get the word out on social media and in our newsletters. And Rob Hove is our Editor in Chief over at Silicon Angle. He does some great editing for us. Check it out for all the news. Remember all these episodes are available as podcasts. Wherever you listen, just search Breaking Analysis podcast. I publish each week on wikibon.com and siliconangle.com. Or you can email me to get in touch David.vallante@siliconangle.com. DM me @dvellante or comment on our LinkedIn post. And please do check out etr.ai, they've got the best survey data in the enterprise tech business. This is Dave Vellante for the CUBE Insights, powered by ETR. Thanks for watching, thanks for listening and we'll see you next time on breaking analysis. (upbeat music)

(upbeat electronic music) >> Welcome back to everyone, to "theCUBE's" coverage here in Seattle, Washington for Amazon Web Services Partner Marketplace Seller Conference, combining their partner network with Marketplace forming a new organization called AWS Partner Organization. This is "theCUBE" coverage. I'm John Furrier, your host. We've got great "Cube" alumni here from Zscaler, a very successful cloud company doing great work. Stelio D'Alo, senior director of cloud business development and Raveesh Chugh, VP of Public Cloud Partnerships at Zscaler. Welcome back to "theCUBE." Good to see you guys. Thanks for coming on. >> Thank you. >> Thanks having us, John. >> So we've been doing a lot of coverage of Zscaler, what a great success story. I mean, the numbers are great. The business performance, it's in the top two, three, one, two, three in all metrics on public companies, SaaS. So you guys, check. Good job. >> Yes, thank you. >> So you guys have done a good job. Now you're here, selling through the Marketplace. You guys are a world class performing company in cloud SaaS, so you're in the front lines doing well. Now, Marketplace is a procurement front end opportunity for people to buy. Hey, self-service, buy and put things together. Sounds novel, what a great concept. Great cloud life. >> Yes. >> You guys are participating and now sellers are coming together. The merger of the public, the partner network with Marketplace. It feels like this is a second act for AWS to go to the next level. They got their training wheels done with partners. Now they're going to the next level. What do you guys think about this? >> Well, I think you're right, John. I think it is very much something that is in keeping with the way AWS does business. Very Amazonian, they're working back from the customer. What we're seeing is, our customers and in general, the market is gravitating towards purchase mechanisms and route to market that just are lower friction. So in the same way that companies are going through their digital transformations now, really modernizing the way they host applications and they reach the internet. They're also modernizing on the purchasing side, which is super exciting, because we're all motivated to help customers with that agility. >> You know, it's fun to watch and again I'm being really candid and props to you guys as a company. Now, everyone else is kind of following that. Okay, lift and shift, check, doing some things. Now they go, whoa, I can really build on this. People are building their own apps for their companies. Going to build their own stuff. They're going to use piece parts. They're going to put it together in a really scalable way. That's the new normal. Okay, so now they go okay, I'm going to just buy through the market, I get purchasing power. So you guys have been a real leader with AWS. Can you share what you guys are doing in the Marketplace? I think you guys are a nice example of how to execute the Marketplace. Take us through. What are you guys offering there? What's the contract look like? Is it multi-pronged? What's the approach? What do customers get if they go to the marketplace for Zscaler? >> Yeah, so it's been a very exciting story and been a very pleasing one for us with AWS marketplace. We see a huge growth potentially. There are more than 350,000 customers that are actively buying through Marketplace today. We expect that number to grow to around a million customers by the next, I would say, five to ten years and we want to be part of this wave. We see AWS Marketplace to be a channel where not only our resalers or our channel partners can come and transact, but also our GSIs like Accenture want to transact through this channel. We are doing a lot, in terms of bringing new customers through Marketplace, who want to not only close their deals, but close it in the next few hours. That's the beauty of Marketplace, the agility, the flexibility in terms of pricing that it provides to ISVs like us. If a customer wants to delay their payments by a couple of quarters, Marketplace supports that. If a customer wants to do monthly payments, Marketplace supports that. We are seeing lot of customers, big customers, that have signed EDPs, enterprise discount plans with AWS. These are multi-year cloud commits coming to us and saying we can retire our EDPs with AWS if we transact your solution through AWS Marketplace. So what we have done, as of today, we have all of our production services enabled through AWS Marketplace. What that means for customers, they can now retire their EDPs by buying Zscaler products through AWS Marketplace and in return get the full benefit of maximizing their EDP commits with AWS. >> So you guys are fully committed, no toe on the water, as we heard. You guys are all in. >> Absolutely, that's exactly the way to put it. We're all in, all of our solutions are available in the marketplace. As you mentioned, we're a SaaS provider. So we're one of the vendors in the Marketplace that have SaaS solutions. So unlike a lot of customers and even the market in general, associate the Marketplace for historical reasons, the way it started with a lot of monthly subscriptions and just dipping your toe in it from a consumer perspective. Whereas we're doing multimillion dollar, multi-year SaaS contracts. So the most complicated kinds of transactions you'd normally associate with enterprise software, we're doing in very low friction ways. >> On the Zscaler side going in low friction. >> Yep, yeah, that's right. >> How about the customer experience? >> So it is primarily the the customer that experiences. >> Driving it? >> Yeah, they're driving it and it's because rather than traditional methods of going through paperwork, purchase orders- >> What are some of the things that customers are saying about this, bcause I see two benefits, I'll say that. The friction, it's a channel, okay, for Zscaler. Let's be clear, but now you have a customer who's got a lot of Amazon. They're a trusted partner too. So why wouldn't they want to have one point of contact to use their purchasing power and you guys are okay with that. >> We're absolutely okay with it. The reason being, we're still doing the transaction and we can do the transaction with our... We're a channel first company, so that's another important distinction of how people tend to think of the Marketplace. We go through channel. A lot of our transactions are with traditional channel partners and you'd be surprised the kinds of, even the Telcos, carrier providers, are starting to embrace Marketplace. So from a customer perspective, it's less paperwork, less legal work. >> Yeah, I'd love to get your reaction to something, because I think this highlights to me what we've been reporting on with "theCUBE" with super cloud and other trends that are different in a good way. Taking it to the next level and that is that if you look at Zscaler, SaaS, SaaS is self-service, the scale, there's efficiencies. Marketplace first started out as a self-service catalog, a website, you know, click and choose, but now it's a different. He calls it a supply chain, like the CICD pipeline of buying software. He mentions that, there's also services. He put the Channel partners can come in. The GSIs, global system integrators can come in. So it's more than just a catalog now. It's kind of self-service procurement more than it is just a catalog of buy stuff. >> Yes, so yeah, I feel CEOs, CSOs of today should understand what Marketplace brings to the bear in terms of different kinds of services or Zscaler solutions that they can acquire through Marketplace and other ISV solutions, for that matter. I feel like we are at a point, after the pandemic, where there'll be a lot of digital exploration and companies can do more in terms of not just Marketplace, but also including the channel partners as part of deals. So you talked about channel conflict. AWS addressed this by bringing a program called CPPO in the picture, Channel Partner Private Offers. What that does is, we are not only bringing all our channel partners into deals. For renewals as well, they're the partner of record and they get paid alongside with the customer. So AWS does all the heavy lifting, in terms of disbursements of payments to us, to the channel partner, so it's a win-win situation for all. >> I mean, private offers and co-sale has been very popular. >> It has been, and that is our bread and butter in the Marketplace. Again, we do primarily three year contracts and so private offers work super well. A nice thing for us as a vendor is it provides a great amount of flexibility. Private Offer gives you a lot of optionality, in terms of how the constructs of the deal and whether or not you're working with a partner, how the partner is utilizing as well to resell to the end user. So, we've always talked about AWS giving IT agility. This gives purchasing and finance business agility. >> Yeah, and I think this comes up a lot. I just noticed this happening a lot more, where you see dedicated sessions, not just on DevOps and all the goodies of the cloud, financial strategy. >> Yeah. >> Seeing a lot more conversation around how to operationalize the business transactions in the cloud. >> Absolutely. >> This is the new, I mean it's not new, it's been thrown around, but not at a tech conference. You don't see that. So I got to ask you guys, what's the message to the CISOs and executives watching the business people about Zscaler in the Marketplace? What should they be looking at? What is the pitch for Zscaler for the Marketplace buyer? >> So I would say that we are a cloud-delivered network security service. We have been in this game for more than a decade. We have years of early head start with lots of features and functionality versus our competitors. If customers were to move into AWS Cloud, they can get rid of their next-gen firewalls and just have all the traffic routed through our Zscaler internet access and use Zscaler private access for accessing their private applications. We feel we have done everything in our capacity, in terms of enabling customers through Marketplace and will continue to participate in more features and functionality that Marketplace has to offer. We would like these customers to take advantage of their EDPs as well as their retirement and spend for the multi-commit through AWS Marketplace. Learn about what we have to offer and how we can really expedite the motion for them, if they want to procure our solutions through Marketplace >> You know, we're seeing an ability for them to get more creative, more progressive in terms of the purchasing. We're also doing, we're really excited about the ability to serve multiple markets. So we've had an immense amount of success in commercial. We also are seeing increasing amount of public sector, US federal government agencies that want to procure this way as well for the same reasons. So there's a lot of innovation going on. >> So you have the FedRAMP going on, you got all those certifications. >> Exactly right. So we are the first cloud-native solution to provide IL5 ATO, as well as FedRAMP pie and we make that all available, GSA schedule pricing through the AWS Marketplace, again through FSIs and other resellers. >> Public private partnerships have been a big factor, having that span of capability. I got to ask you about, this is a cool conversation, because now you're like, okay, I'm selling through the Marketplace. Companies themselves are changing how they operate. They don't just buy software that we used to use. So general purpose, bundled stuff. Oh yeah, I'm buying this product, because this has got a great solution and I have to get forced to use this firewall, because I bought this over here. That's not how companies are architecting and developing their businesses. It's no longer buying IT. They're building their company digitally. They have to be the application. So they're not sitting around, saying hey, can I get a solution? They're building and architecting their solution. This is kind of like the new enterprise that no one's talking about. They kind of, got to do their own work. >> Yes. >> There's no general purpose solution that maps every company. So they got to pick the best piece parts and integrate them. >> Yes and I feel- >> Do you guys agree with that? >> Yeah, I agree with that and customers don't want to go for point solutions anymore. They want to go with a platform approach. They want go with a vendor that can not only cut down their vendors from multi-dozens to maybe a dozen or less and that's where, you know, we kind of have pivoted to the platform-centric approach, where we not only help customers with Cloud Network Security, but we also help customers with Cloud Native Application Protection Platform that we just recently launched. It's going by the name of the different elements, including Cloud Security Posture Management, Cloud Identity Event Management and so we are continuously doing more and more on the configuration and vulnerability side space. So if a customer has an AWS S3 bucket that is opened it can be detected and can be remediated. So all of those proactive steps we are taking, in terms of enhancing our portfolio, but we have come a long way as a company, as a platform that we have evolved in the Marketplace. >> What's the hottest product? >> The hottest product? >> In Marketplace right now. >> Well, the fastest growing products include our digital experience products and we have new Cloud Protection. So we've got Posture and Workload Protection as well and those are the fastest growing. For AWS customers a strong affinity also for ZPA, which provides you zero trust access to your workloads on AWS. So those are all the most popular in Marketplace. >> Yeah. >> So I would like to add that we recently launched and this has been a few years, a couple of years. We launched a product called Zscaler Digital X, the ZDX. >> Mm-hmm. >> What that product does is, let's say you're making a Zoom call and your WiFi network is laggy or it's a Zoom server that's laggy. It kind of detects where is the problem and it further tells the IT department you need to fix either the server on which Zoom is running, or fix your home network. So that is the beauty of the product. So I think we are seeing massive growth with some of our new editions in the portfolio, which is a long time coming. >> Yeah and certainly a lot of growth opportunities for you guys, as you come in. Where do you see Zscaler's big growth coming from product-wise? What's the big push? Actually, this is great upside for you here. >> Yeah. >> On the go to market side. Where's the big growth for Zscaler right now? So I think we are focused as a company on zero trust architecture. We want to securely connect users to apps, apps to apps, workloads to workloads and machines to machines. We want to give customers an experience where they have direct access to the apps that's hidden from the outside world and they can securely connect to the apps in a very succinct fashion. The user experience is second to none. A lot of customers use us on the Microsoft Office 365 side, where they see a lag in connecting to Microsoft Office 365 directly. They use the IE service to securely connect. >> Yeah, latency kills. >> Microsoft Office 365. >> Latency kills, as we always say, you know and security, you got to look at the pattern, you want to see that data. >> Yeah, and emerging use cases, there is an immense amount of white space and upside for us as well in emerging use cases, like OT, 5G, IOT. >> Yeah. >> Federal government, DOD. >> Oh god, tactical edge government. >> Security at the edge, absolutely, yeah. >> Where's the big edge? What's the edge challenge right now, if you have to put your finger on the edge, because right now that's the hot area, we're watching that. It's going to be highly contested. It's not yet clear, I mean certainly hybrid is the operating model, cloud, distributing, computing, but edge has got unique things that you can't really point to on premises that's the same. It's highly dynamic, you need high bandwidth, low latency, compute at the edge. The data has to be processed right there. What's the big thing at the edge right now? >> Well, so that's probably an emerging answer. I mean, we're working with our customers, they're inventing and they're kind of finding the use cases for those edge, but one of the good things about Zscaler is that we are able to, we've got low latency at the edge. We're able to work as a computer at the edge. We work on Outpost, Snowball, Snowcone, the Snow devices. So we can be wherever our customers need us. Mobile devices, there are a lot of applications where we've got to be either on embedded devices, on tractors, providing security for those IOT devices. So we're pretty comfortable with where we are being the- >> So that's why you guys are financially doing so well, performance wise. I got to ask you though, because I think that brings up the great point. If this is why I like the Marketplace, if I'm a customer, the edge is highly dynamic. It's changing all the time. I don't want to wait to buy something. If I got my solution architects on a product, I need to know I'm going to have zero trust built in and I need to push the button on Zscaler. I don't want to wait. So how does the procurement side impact? What have you guys seen? Share your thoughts on how Marketplace is working from the procurement standpoint, because it seems to me to be fast. Is that right, or is it still slow on their side? On the buyer side, because this to me would be a benefit to developers, if we say, hey, the procurement can just go really fast. I don't want to go through a bunch of PO approvals or slow meetings. >> It can be, that manifests itself in several ways, John. It can be, for instance, somebody wants to do a POC and traditionally you could take any amount of time to get budget approval, take it through. What if you had a pre-approved cloud budget and that was spent primarily through AWS Marketplace, because it's consolidated data on your AWS invoice. The ability to purchase a POC on the Marketplace could be done literally within minutes of the decision being made to go forward with it. So that's kind of a front end, you know, early stage use case. We've got examples we didn't talk about on our recent earnings call of how we have helped customers bring in their procurement with large million dollar, multimillion dollar deals. Even when a resaler's been involved, one of our resaler partners. Being able to accelerate deals, because there's so much less legal work and traditional bureaucratic effort. >> Agility. >> That agility purchasing process has allowed our customers to pull into the quarter, or the end of month, or end of quarter for them, deals that would've otherwise not been able to be done. >> So this is a great example of where you can set policy and kind of create some guard rails around innovation and integration deals, knowing if it's something that the edge is happening, say okay, here's some budget. We approved it, or Amazon gives credits and partnership going on. Then I'd say, hey, well green light this, not to exceed a million dollars, or whatever number in their range and then let people have the freedom to execute. >> You're absolutely right, so from the purchasing side, it does give them that agility. It eliminates a lot of the processes that would push out a purchase in actual execution past when the business decision is made and quite frankly, to be honest, AWS has been very accommodative. They're a great partner. They've invested a lot in Marketplace, Marketplace programs, to help customers do the right thing and do it more quickly as well as vendors like us to help our customers make the decisions they need to. >> Rising tide, a rising tide floats all boats and you guys are a great example of an independent company. Highly successful on your own. >> Yep. >> Certainly the numbers are clear. Wall Street loves Zscaler and economics are great. >> Our customer CSAT numbers are off the scale as well. >> Customers are great and now you've got the Marketplace. This is again, a new normal. A new kind of ecosystem is developing where it's not like the old monolithic ecosystems. The value creation and extraction is happening differently now. It's kind of interesting. >> Yes and I feel we have a long way to go, but what I can tell you is that Zscaler is in this for the long run. We are seeing some of the competitors erupt in the space as well, but they have a long way to go. What we have built requires years worth of R&D and features and thousands of customer's use cases which kind of lead to something what Zscaler has come up with today. What we have is very unique and is going to continuously be an innovation in the market in the years to come. In terms of being more cloud-savvy or more cloud-focused or more cloud-native than what the market has seen so far in the form of next-gen firewalls. >> I know you guys have got a lot of AI work. We've had many conversations with Howie over there. Great stuff and really appreciate you guys participating in our super cloud event we had and we'll see more of that where we're talking about the next generation clouds, really enabling that new disruptive, open-spanning capabilities across multiple environments to run cloud-native modern applications at scale and secure. Appreciate your time to come on "theCUBE". >> Thank you. >> Thank you very much. >> Thanks for having us. >> Thanks, I totally appreciate it. Zscaler, leading company here on "theCUBE" talking about their relationship with Marketplace as they continue to grow and succeed as technology goes to the next level in the cloud. Of course "theCUBE's" covering it here in Seattle. I'm John Furrier, your host. Thanks for watching. (peaceful electronic music)

>>Welcome back everyone to the cubes coverage here in Seattle, Washington for the Avis marketplace seller conference, part of the APN partner network merging with the marketplace to form the Amazon partner organization. I'm John furrier, host of the cube Walter Wall coverage today, Christian Gor cash, who is the VP of alliances at Kong Inc. Welcome to the cube. Thanks for coming on. >>Thank you. Thank you, John. Really glad to be here. Corke exactly. Yeah. It's awesome. >>So Kong we've been following you guys for while Docker Kong cube. You've been part of our cube conversation. Also part of our, our startup showcase fast growing startup, you know, working on stuff that everyone loves APIs. I mean, APIs are so popular now that they now a security concern, right? Yeah. So like it gets squat there everywhere. I won't say API sprawl, but APIs are the connections and that are, is the web. That is the cloud. Okay. Now with cloud native developers who are now in the front lines have taken over it, everyone knows DevOps dev SecOps is now the new it and it's the developers security and data they're below they're the new ops, right? So, so this is where microservices come in, open source service MES new automation is coming down the pike. That's super valuable to businesses as they look at cloud native architecture, what are you guys doing in there? Take a minute to explain Kong's value proposition, the hot products, and then why you're here. >>Yeah. So, you know, I joined Kong now or three years ago, you know, we were still just reaching our hundred employees, mark, which is very important, very startup, but even back then, you know, Kong was relatively well known in industry, you know, so we have one of the most, well the most popular open source project in API gateway area. So con API gateway, you know, we cross now 300 million downloads, even more important is just the scale it, which the product's been used. So between our open source community and enterprise customers, we are now crossing like 11 trillion transactions per month. Now just give you comparison. Like this is like 18, 19 times more than Netflix per month. You know? So for any company that has a technology that operates it at scale, you need to hit few things outta the park. You know, as he mentions cloud data developers, they want simplicity. You know, they want automation. They also want performance and scale and security, which are all critical, you know, to how Kong, you know, start as opensource project. Now, of course we have the whole suite of enterprise products. We also have our con service mesh offering as well as our cloud offerings. >>Yeah. And this is how open source is doing it now, obviously, you know, I, I still remember, I still tell the story to the young startups. Hey, I, there was proprietary software when I was in college. Open source is now everything. Now you've got, got cloud scale. So the dynamic between open source, which has become the software industry open source success doesn't mean it's it's game over. It's the beginning. The commercialization that you guys have gone through is super important. Trillions of transactions. Now you have enterprises working with you. What's the big advantage of the seller relationship that you have with Amazon? Why are customers using it? What are they buying it for? Give the pitch of con for the marketplace customer. >>Yeah, it's actually, we are relatively new in AWS marketplace. You know, so our first transaction that we ever done was actually in July and 2021. So we are just over a year, you know, that journey, you know, when I look what Chris gross talked today, he was talking about, you know, Hey, just publishing marketplace, not enough. You know, you need to understand what's your value proposition. You need to make sure your operations already, your sales is ready. Everything is, is set. And we kind of did this for the first year and a half is spend a lot of time improving our integration with AWS overall, all the first party services relevant to con we also understood, well, what does it take to kind of fine tune our value proposition? We have like three specific sales place. And you know, when we launch our flagship product con connect enterprise and got our first transaction, that was great milestone for, for star like Kong. But then what we've seen is just that work that we've done before really paid off. I mean right now, >>Like what we'll give example. >>Yeah. So, you know, we are focusing on as measure three sales place. Money is we are focused, specific on helping customers who are modernizing and, and their application going to the cloud. And you have a lot of these, you know, lifting shift and are rearchitect and modernized, but most of the attentions on the workloads, what about the connections? You know, so a monolith application had to authentic all the users understand wheres the network and so on. When you build those, when you now decouple this built like 1,000 thousand microservices, you don't want to repeat this for every microservice. So that's where K brings the whole suite from, you know, service match to the API gate to help manage the journey and really support this environment. And we spend a lot of time to just fine tune that message. So that customers understood where, you know, how can we help them on their journey beyond what, for instance, cloud native or AWS API gateway offers them. So we can really help them from day one on the journey and accelerate. And >>I think I it's a no, it's a no braining for a customer to buyer or to come into the marketplace and say, click, I'm gonna buy some data analytics services. I'm gonna buy gateway through Kong. But when they start getting into these microservices, this automation opportunity there, there's more behind the curtain for them with Kong. So I have to ask you with the keynote we heard from Chris, the leader of the marketplace. Now he said that he wants the ISVs to be more native in the cloud. That probably resonates with you. You, >>You guys well with con's relatively simple because we were built at cloud native, you know, so very briefly the whole story of Congo. This is before Ajo, our founders were actually running the, the very popular API exchange col mesh shape. And they had to build their own gateway just to handle the scale and was built on cloud native technologies. And then when everybody's calling you, what are you using to running? This are using PGS. And so else, no, we built ourselves, oh, how can we get our hands on? That's how con actually >>Came to. And that's how the big winners usually happen too. They start build their own, solve their own problem because it's a big scale problem. Exactly. No one's had that problem. >>Yeah. And what we have seen, especially what was very, you know, through, through the pandemic, what we have seen. And it's interesting, you know, being in a startup doing pandemic is like, whoa, will the life just shut down or what we're doing? You know? But actually what we have seen customers prioritize the new business capability. For instance, you have a large parental companies that overnight, they have to understand where the assets are. Yeah. Or banks who are like 45 days of, you know, approving process for the loans. They need to reduce it for a day or two. >>Yeah. And they're adding more developers, too, exactly. To build the modern application. So they need to have that infrastructure as code aspect. Correct. >>And they >>Need in place. >>Yeah. I need to like you have, you know, I don't think that many customers still have waterfall cycles, but they have, have pre pretty long developers development cycles. And now you need to, you know, do this multiple times a day. That's >>Interesting. We talked to a lot of cloud architects and C CIO C says, and you know, the executive just hire more developers take that hill, build. It just don't build a new app. It's not that easy boss. When, when the cloud architect says we have to be fully operationally ready with cloud native infrastructure's code. So with that, you're seeing a lot more enterprises come in now that are more savvy. They getting better. We're seeing Kubernetes more and more. You're seeing containerization. You're seeing that cloud native enterprise acceptance. What does that mean for you guys in the marketplace, as you look at the value proposition, how are you guys working with the marketplace today and where do you see customers buying in the future? >>Yeah, so we as mentioned, you know, we, we are now a year into that journey. We already seen tremendous benefits just in terms of reducing the friction. You know, the whole procurement, you know, you come as a startup with some, some of the largest companies in the world, they used to buy five, 10 billion in software and they have all these processes and you're like, well, but we only have like two people in finance. Sorry. How can you, and where marketplace can really, really helps us is, you know, improve this experience, both sides because they understand like we are fast moving company. They, they want us because of our speed and, and innovation that we, the product's strong. Yeah. They don't want us to get bogged down in all these pro procurement processes either. And so, so that's the first benefit. We also are working very hard to make sure that the customers can provision Kong in AWS and automate across the board. So essentially reducing their time to value dramatically. Yeah. And another thing that we found tremendously beneficial for us is a startup is the whole concept of a standard marketplace contract. Yeah. So instead of us coming with our little MSA or come like 50 page MSA from companies, we now have a middle ground. So we can just agree. You know, there's some differences, some specifics to qu software and it's tremendously reduced costs on both sides. >>Great. For you guys great for the buyers. Yeah. You get deployed services. They're not just buying, they're managing and deploying. Yeah, >>Exactly. Great. >>Quick, final question. Put a plugin for the company. What are you working on now? What's the big news. What's the con update? >>Well, that's an interesting part because I can't tell you because next week we have our con summit. Oh right. In San Francisco. The cubes not so 28, 20 ninth. Yeah. We, we we'll, I think we are gonna fix that in the future. But anyway, this is the first time after pandemic to do this in person, we have number of very exciting announcement, our Kong products, as well as you may hear some news about our AWS partnership, >>We like con we believe that DevOps has happened. Dev sec ops, whatever you gonna call it, dev is now the developers they're in the front lines. They're in the C I CD pipeline. They're shifting left. That's the new they took over it. That's what DevOps does. It's not a title. Now you have security and data ops behind the scenes. That's gonna be middleware. That's gonna have tons of microservices. So more, more, more action coming, all API based. >>Exactly. And the more, you know, the more complexity we can take away from that, the better we, you know, the >>Whole community. Thank you. Spending the time to come on the cube here at the, a us marketplace seller conference. What do you think about the APN merging with the marketplace formed the P the Amazon partner organization. Thumbs up, thumbs down. What's your heard? >>It's excellent. We have a great friend in AP, a great friend, us marketplace. Now both of them work together with huge. >>Fantastic. Yes. Thanks for okay. Cube coverage here in Seattle. I'm John furier APN marketplace together. APOs the new organization making it easier. Of course, we got all the coverage here. Thanks for watching.

(upbeat electronic music) >> Welcome back to everyone, to "theCUBE's" coverage here in Seattle, Washington for Amazon Web Services Partner Marketplace Seller Conference, combining their partner network with Marketplace forming a new organization called AWS Partner Organization. This is "theCUBE" coverage. I'm John Furrier, your host. We've got great "Cube" alumni here from Zscaler, a very successful cloud company doing great work. Stelio D'Alo, senior director of cloud business development and Raveesh Chugh, VP of Public Cloud Partnerships at Zscaler. Welcome back to "theCUBE." Good to see you guys. Thanks for coming on. >> Thank you. >> Thanks having us, John. >> So we've been doing a lot of coverage of Zscaler, what a great success story. I mean, the numbers are great. The business performance, it's in the top two, three, one, two, three in all metrics on public companies, SaaS. So you guys, check. Good job. >> Yes, thank you. >> So you guys have done a good job. Now you're here, selling through the Marketplace. You guys are a world class performing company in cloud SaaS, so you're in the front lines doing well. Now, Marketplace is a procurement front end opportunity for people to buy. Hey, self-service, buy and put things together. Sounds novel, what a great concept. Great cloud life. >> Yes. >> You guys are participating and now sellers are coming together. The merger of the public, the partner network with Marketplace. It feels like this is a second act for AWS to go to the next level. They got their training wheels done with partners. Now they're going to the next level. What do you guys think about this? >> Well, I think you're right, John. I think it is very much something that is in keeping with the way AWS does business. Very Amazonian, they're working back from the customer. What we're seeing is, our customers and in general, the market is gravitating towards purchase mechanisms and route to market that just are lower friction. So in the same way that companies are going through their digital transformations now, really modernizing the way they host applications and they reach the internet. They're also modernizing on the purchasing side, which is super exciting, because we're all motivated to help customers with that agility. >> You know, it's fun to watch and again I'm being really candid and props to you guys as a company. Now, everyone else is kind of following that. Okay, lift and shift, check, doing some things. Now they go, whoa, I can really build on this. People are building their own apps for their companies. Going to build their own stuff. They're going to use piece parts. They're going to put it together in a really scalable way. That's the new normal. Okay, so now they go okay, I'm going to just buy through the market, I get purchasing power. So you guys have been a real leader with AWS. Can you share what you guys are doing in the Marketplace? I think you guys are a nice example of how to execute the Marketplace. Take us through. What are you guys offering there? What's the contract look like? Is it multi-pronged? What's the approach? What do customers get if they go to the marketplace for Zscaler? >> Yeah, so it's been a very exciting story and been a very pleasing one for us with AWS marketplace. We see a huge growth potentially. There are more than 350,000 customers that are actively buying through Marketplace today. We expect that number to grow to around a million customers by the next, I would say, five to ten years and we want to be part of this wave. We see AWS Marketplace to be a channel where not only our resalers or our channel partners can come and transact, but also our GSIs like Accenture want to transact through this channel. We are doing a lot, in terms of bringing new customers through Marketplace, who want to not only close their deals, but close it in the next few hours. That's the beauty of Marketplace, the agility, the flexibility in terms of pricing that it provides to ISVs like us. If a customer wants to delay their payments by a couple of quarters, Marketplace supports that. If a customer wants to do monthly payments, Marketplace supports that. We are seeing lot of customers, big customers, that have signed EDPs, enterprise discount plans with AWS. These are multi-year cloud commits coming to us and saying we can retire our EDPs with AWS if we transact your solution through AWS Marketplace. So what we have done, as of today, we have all of our production services enabled through AWS Marketplace. What that means for customers, they can now retire their EDPs by buying Zscaler products through AWS Marketplace and in return get the full benefit of maximizing their EDP commits with AWS. >> So you guys are fully committed, no toe on the water, as we heard. You guys are all in. >> Absolutely, that's exactly the way to put it. We're all in, all of our solutions are available in the marketplace. As you mentioned, we're a SaaS provider. So we're one of the vendors in the Marketplace that have SaaS solutions. So unlike a lot of customers and even the market in general, associate the Marketplace for historical reasons, the way it started with a lot of monthly subscriptions and just dipping your toe in it from a consumer perspective. Whereas we're doing multimillion dollar, multi-year SaaS contracts. So the most complicated kinds of transactions you'd normally associate with enterprise software, we're doing in very low friction ways. >> On the Zscaler side going in low friction. >> Yep, yeah, that's right. >> How about the customer experience? >> So it is primarily the the customer that experiences. >> Driving it? >> Yeah, they're driving it and it's because rather than traditional methods of going through paperwork, purchase orders- >> What are some of the things that customers are saying about this, bcause I see two benefits, I'll say that. The friction, it's a channel, okay, for Zscaler. Let's be clear, but now you have a customer who's got a lot of Amazon. They're a trusted partner too. So why wouldn't they want to have one point of contact to use their purchasing power and you guys are okay with that. >> We're absolutely okay with it. The reason being, we're still doing the transaction and we can do the transaction with our... We're a channel first company, so that's another important distinction of how people tend to think of the Marketplace. We go through channel. A lot of our transactions are with traditional channel partners and you'd be surprised the kinds of, even the Telcos, carrier providers, are starting to embrace Marketplace. So from a customer perspective, it's less paperwork, less legal work. >> Yeah, I'd love to get your reaction to something, because I think this highlights to me what we've been reporting on with "theCUBE" with super cloud and other trends that are different in a good way. Taking it to the next level and that is that if you look at Zscaler, SaaS, SaaS is self-service, the scale, there's efficiencies. Marketplace first started out as a self-service catalog, a website, you know, click and choose, but now it's a different. He calls it a supply chain, like the CICD pipeline of buying software. He mentions that, there's also services. He put the Channel partners can come in. The GSIs, global system integrators can come in. So it's more than just a catalog now. It's kind of self-service procurement more than it is just a catalog of buy stuff. >> Yes, so yeah, I feel CEOs, CSOs of today should understand what Marketplace brings to the bear in terms of different kinds of services or Zscaler solutions that they can acquire through Marketplace and other ISV solutions, for that matter. I feel like we are at a point, after the pandemic, where there'll be a lot of digital exploration and companies can do more in terms of not just Marketplace, but also including the channel partners as part of deals. So you talked about channel conflict. AWS addressed this by bringing a program called CPPO in the picture, Channel Partner Private Offers. What that does is, we are not only bringing all our channel partners into deals. For renewals as well, they're the partner of record and they get paid alongside with the customer. So AWS does all the heavy lifting, in terms of disbursements of payments to us, to the channel partner, so it's a win-win situation for all. >> I mean, private offers and co-sale has been very popular. >> It has been, and that is our bread and butter in the Marketplace. Again, we do primarily three year contracts and so private offers work super well. A nice thing for us as a vendor is it provides a great amount of flexibility. Private Offer gives you a lot of optionality, in terms of how the constructs of the deal and whether or not you're working with a partner, how the partner is utilizing as well to resell to the end user. So, we've always talked about AWS giving IT agility. This gives purchasing and finance business agility. >> Yeah, and I think this comes up a lot. I just noticed this happening a lot more, where you see dedicated sessions, not just on DevOps and all the goodies of the cloud, financial strategy. >> Yeah. >> Seeing a lot more conversation around how to operationalize the business transactions in the cloud. >> Absolutely. >> This is the new, I mean it's not new, it's been thrown around, but not at a tech conference. You don't see that. So I got to ask you guys, what's the message to the CISOs and executives watching the business people about Zscaler in the Marketplace? What should they be looking at? What is the pitch for Zscaler for the Marketplace buyer? >> So I would say that we are a cloud-delivered network security service. We have been in this game for more than a decade. We have years of early head start with lots of features and functionality versus our competitors. If customers were to move into AWS Cloud, they can get rid of their next-gen firewalls and just have all the traffic routed through our Zscaler internet access and use Zscaler private access for accessing their private applications. We feel we have done everything in our capacity, in terms of enabling customers through Marketplace and will continue to participate in more features and functionality that Marketplace has to offer. We would like these customers to take advantage of their EDPs as well as their retirement and spend for the multi-commit through AWS Marketplace. Learn about what we have to offer and how we can really expedite the motion for them, if they want to procure our solutions through Marketplace >> You know, we're seeing an ability for them to get more creative, more progressive in terms of the purchasing. We're also doing, we're really excited about the ability to serve multiple markets. So we've had an immense amount of success in commercial. We also are seeing increasing amount of public sector, US federal government agencies that want to procure this way as well for the same reasons. So there's a lot of innovation going on. >> So you have the FedRAMP going on, you got all those certifications. >> Exactly right. So we are the first cloud-native solution to provide IL5 ATO, as well as FedRAMP pie and we make that all available, GSA schedule pricing through the AWS Marketplace, again through FSIs and other resellers. >> Public private partnerships have been a big factor, having that span of capability. I got to ask you about, this is a cool conversation, because now you're like, okay, I'm selling through the Marketplace. Companies themselves are changing how they operate. They don't just buy software that we used to use. So general purpose, bundled stuff. Oh yeah, I'm buying this product, because this has got a great solution and I have to get forced to use this firewall, because I bought this over here. That's not how companies are architecting and developing their businesses. It's no longer buying IT. They're building their company digitally. They have to be the application. So they're not sitting around, saying hey, can I get a solution? They're building and architecting their solution. This is kind of like the new enterprise that no one's talking about. They kind of, got to do their own work. >> Yes. >> There's no general purpose solution that maps every company. So they got to pick the best piece parts and integrate them. >> Yes and I feel- >> Do you guys agree with that? >> Yeah, I agree with that and customers don't want to go for point solutions anymore. They want to go with a platform approach. They want go with a vendor that can not only cut down their vendors from multi-dozens to maybe a dozen or less and that's where, you know, we kind of have pivoted to the platform-centric approach, where we not only help customers with Cloud Network Security, but we also help customers with Cloud Native Application Protection Platform that we just recently launched. It's going by the name of the different elements, including Cloud Security Posture Management, Cloud Identity Event Management and so we are continuously doing more and more on the configuration and vulnerability side space. So if a customer has an AWS S3 bucket that is opened it can be detected and can be remediated. So all of those proactive steps we are taking, in terms of enhancing our portfolio, but we have come a long way as a company, as a platform that we have evolved in the Marketplace. >> What's the hottest product? >> The hottest product? >> In Marketplace right now. >> Well, the fastest growing products include our digital experience products and we have new Cloud Protection. So we've got Posture and Workload Protection as well and those are the fastest growing. For AWS customers a strong affinity also for ZPA, which provides you zero trust access to your workloads on AWS. So those are all the most popular in Marketplace. >> Yeah. >> So I would like to add that we recently launched and this has been a few years, a couple of years. We launched a product called Zscaler Digital X, the ZDX. >> Mm-hmm. >> What that product does is, let's say you're making a Zoom call and your WiFi network is laggy or it's a Zoom server that's laggy. It kind of detects where is the problem and it further tells the IT department you need to fix either the server on which Zoom is running, or fix your home network. So that is the beauty of the product. So I think we are seeing massive growth with some of our new editions in the portfolio, which is a long time coming. >> Yeah and certainly a lot of growth opportunities for you guys, as you come in. Where do you see Zscaler's big growth coming from product-wise? What's the big push? Actually, this is great upside for you here. >> Yeah. >> On the go to market side. Where's the big growth for Zscaler right now? So I think we are focused as a company on zero trust architecture. We want to securely connect users to apps, apps to apps, workloads to workloads and machines to machines. We want to give customers an experience where they have direct access to the apps that's hidden from the outside world and they can securely connect to the apps in a very succinct fashion. The user experience is second to none. A lot of customers use us on the Microsoft Office 365 side, where they see a lag in connecting to Microsoft Office 365 directly. They use the IE service to securely connect. >> Yeah, latency kills. >> Microsoft Office 365. >> Latency kills, as we always say, you know and security, you got to look at the pattern, you want to see that data. >> Yeah, and emerging use cases, there is an immense amount of white space and upside for us as well in emerging use cases, like OT, 5G, IOT. >> Yeah. >> Federal government, DOD. >> Oh god, tactical edge government. >> Security at the edge, absolutely, yeah. >> Where's the big edge? What's the edge challenge right now, if you have to put your finger on the edge, because right now that's the hot area, we're watching that. It's going to be highly contested. It's not yet clear, I mean certainly hybrid is the operating model, cloud, distributing, computing, but edge has got unique things that you can't really point to on premises that's the same. It's highly dynamic, you need high bandwidth, low latency, compute at the edge. The data has to be processed right there. What's the big thing at the edge right now? >> Well, so that's probably an emerging answer. I mean, we're working with our customers, they're inventing and they're kind of finding the use cases for those edge, but one of the good things about Zscaler is that we are able to, we've got low latency at the edge. We're able to work as a computer at the edge. We work on Outpost, Snowball, Snowcone, the Snow devices. So we can be wherever our customers need us. Mobile devices, there are a lot of applications where we've got to be either on embedded devices, on tractors, providing security for those IOT devices. So we're pretty comfortable with where we are being the- >> So that's why you guys are financially doing so well, performance wise. I got to ask you though, because I think that brings up the great point. If this is why I like the Marketplace, if I'm a customer, the edge is highly dynamic. It's changing all the time. I don't want to wait to buy something. If I got my solution architects on a product, I need to know I'm going to have zero trust built in and I need to push the button on Zscaler. I don't want to wait. So how does the procurement side impact? What have you guys seen? Share your thoughts on how Marketplace is working from the procurement standpoint, because it seems to me to be fast. Is that right, or is it still slow on their side? On the buyer side, because this to me would be a benefit to developers, if we say, hey, the procurement can just go really fast. I don't want to go through a bunch of PO approvals or slow meetings. >> It can be, that manifests itself in several ways, John. It can be, for instance, somebody wants to do a POC and traditionally you could take any amount of time to get budget approval, take it through. What if you had a pre-approved cloud budget and that was spent primarily through AWS Marketplace, because it's consolidated data on your AWS invoice. The ability to purchase a POC on the Marketplace could be done literally within minutes of the decision being made to go forward with it. So that's kind of a front end, you know, early stage use case. We've got examples we didn't talk about on our recent earnings call of how we have helped customers bring in their procurement with large million dollar, multimillion dollar deals. Even when a resaler's been involved, one of our resaler partners. Being able to accelerate deals, because there's so much less legal work and traditional bureaucratic effort. >> Agility. >> That agility purchasing process has allowed our customers to pull into the quarter, or the end of month, or end of quarter for them, deals that would've otherwise not been able to be done. >> So this is a great example of where you can set policy and kind of create some guard rails around innovation and integration deals, knowing if it's something that the edge is happening, say okay, here's some budget. We approved it, or Amazon gives credits and partnership going on. Then I'd say, hey, well green light this, not to exceed a million dollars, or whatever number in their range and then let people have the freedom to execute. >> You're absolutely right, so from the purchasing side, it does give them that agility. It eliminates a lot of the processes that would push out a purchase in actual execution past when the business decision is made and quite frankly, to be honest, AWS has been very accommodative. They're a great partner. They've invested a lot in Marketplace, Marketplace programs, to help customers do the right thing and do it more quickly as well as vendors like us to help our customers make the decisions they need to. >> Rising tide, a rising tide floats all boats and you guys are a great example of an independent company. Highly successful on your own. >> Yep. >> Certainly the numbers are clear. Wall Street loves Zscaler and economics are great. >> Our customer CSAT numbers are off the scale as well. >> Customers are great and now you've got the Marketplace. This is again, a new normal. A new kind of ecosystem is developing where it's not like the old monolithic ecosystems. The value creation and extraction is happening differently now. It's kind of interesting. >> Yes and I feel we have a long way to go, but what I can tell you is that Zscaler is in this for the long run. We are seeing some of the competitors erupt in the space as well, but they have a long way to go. What we have built requires years worth of R&D and features and thousands of customer's use cases which kind of lead to something what Zscaler has come up with today. What we have is very unique and is going to continuously be an innovation in the market in the years to come. In terms of being more cloud-savvy or more cloud-focused or more cloud-native than what the market has seen so far in the form of next-gen firewalls. >> I know you guys have got a lot of AI work. We've had many conversations with Howie over there. Great stuff and really appreciate you guys participating in our super cloud event we had and we'll see more of that where we're talking about the next generation clouds, really enabling that new disruptive, open-spanning capabilities across multiple environments to run cloud-native modern applications at scale and secure. Appreciate your time to come on "theCUBE". >> Thank you. >> Thank you very much. >> Thanks for having us. >> Thanks, I totally appreciate it. Zscaler, leading company here on "theCUBE" talking about their relationship with Marketplace as they continue to grow and succeed as technology goes to the next level in the cloud. Of course "theCUBE's" covering it here in Seattle. I'm John Furrier, your host. Thanks for watching. (peaceful electronic music)

>>from around the globe. It's the Cube with digital coverage of AWS reinvent 2020 sponsored by Intel, AWS and our community partners. Everyone welcome back to the cubes coverage of a Davis reinvent 2020. It's a virtual conference this year. This is the Cube virtual. I'm John for your host. We're not in person this year. We're doing it remote because of the pandemic, but it's gonna be wall to wall coverage for three weeks. We've got you covered. And we got a great interview signature interview here with Two Cube alumni's Matt Garment, vice president of sales and marketing at AWS, formerly head of the C two and, of course, Sanjay Poon in CEO of VM Ware. Both distinguished guests and alumni of the Cube. Good to see you, Sanjay. Matt. Thanks for coming on. Uh, let's just jump into it. How are you guys doing? >>Great. Exciting. Excited for reinvent and, uh, excited for the conversation. So thanks for having us on. >>Yeah, I'm great to be here. We are allowed to be 6 ft away from each other, so I came in, but super excited about the partnership. Matt and I have been friends for several years on. You were so excited about another reinvent, the different circumstances doing all virtual. But it's a fantastic partnership. >>You know, I look forward to reinvent one of my most favorite times of the year, and it's also kind of stressful because it's backs up against Thanksgiving. And but, you know, you get through it, you have your turkey and you do the Friday and you guys probably Kino, perhaps, and all things going on and then you go to Vegas is a few celebration. We're not doing it this year. Three weeks eso There's gonna be a lot of big content in the first week, and we're gonna roll that out. We're gonna cover it, But it's gonna be a different celebrations so mad. I know you're in front center on this, Uh, just real quick. What are what do you expect people to be doing on the system? What's your expectations and how is this all going to play out? >>Yeah, you know, it's gonna be different, but I think we have Justus much exciting news as ever. And, you know, it's gonna be over a three week period. I think it actually gives people an opportunity to Seymour things. I think a lot of times we heard from, uh, from customers before was they love the excitement of being in Vegas, and we're not gonna be able to exactly replicate that, but But we have a lot of exciting things planned, and it'll enables customers to get two more sessions Seymour of the content and really see more of the exciting things that are coming out of AWS. And there's a lot s over the three weeks I encourage folks toe to dive in and really learn things is a This is the opportunity for customers to learn about the cloud and and some really cool things coming out. We're excited. >>Well, congratulations on all the business performs. I know that there's been a tailwind with the pandemic as people wanna go faster and smarter with cloud and on premise and Sanjay, you guys have a great results as well. Before I get into some of my point. Of course, I have a lot of I know we don't a lot of time, but I want to get a nup date on the relationship we covered in three years ago when, uh, Andy Jassy and team came down to San Francisco with Pat Gelsinger, Raghu, Sanjay. All this went down. There were skeptics. Relationship has proven to be quite strong and successful for both parties because you guys take a minute so you will start with you and talk about the relationship update. Where you guys at, What's the status? The relationship people want to know. >>Yeah, I think John, the relationship is going really well. Uh, it's rooted in first off, a clear understanding that there's value for customers. Um, this is the best of the public cloud in the private cloud in a hybrid cloud journey. And then, secondly, a deep engineering effort. This wasn't a Barney announcement. We both decided Matt in his previous role, was running a lot of the engineering efforts. Uh, we were really keen to make this a deep engineering effort, and often when we have our connected Cube ers, we're doing one little later this afternoon. I often can't tell when a Amazon personal speaking when a VM ware person speaking we're so connected both the engineering and then the go to market efforts. And I think after the two or three years that the the solution has had to just state and now we have many, many customers started to get real value. The go to market side of the operations really starting take off. So we're very excited about it. It is the preferred and the best offering. We think in the market, Um, and for Vienna, where customers. We message it as the best place for Vienna workload that's running on V sphere to move into Amazon. >>Matt, what's your take on the relationship update from your >>standpoint, I agree with Sanjay. I think it's been it's been fantastic. I think like you said, some folks were skeptical when we first announced it. But But, you know, we knew that there was something there and I think as we've gotten even deeper into this partnership, Onda figured out how we can continue Thio integrate more deeply both with on Prem and into the cloud. Our customers have really guided us and I think that's that's enabled us to further strengthen that partnership, and customers continue to get more excited when they see how easy it is to move and operate their VM where in their V sphere workloads inside of a W S on how it integrates well with the AWS environment, Um on they can still use all of the same functions and capabilities that they they built their business on the inside of the sphere. We're seeing bigger and bigger customers really just embrace us, and the partnerships only grown stronger. I think you know, Sanjay and I, we do joint sales calls together. I think that the business has really, really grown. It's been it's been a fantastic partnership. >>I was talking about that yesterday with being where in eight of us teams members as well. I want to get your thoughts on this cultural fit. Sanjay mentioned e think the engineering cultures air there. The also the corporate culture, both customer focused. Remember Andy Jassy told me, Hey, we're customer focused like you're making big. You make big, big statements Public Cloud and now he goes toe hybrid. He's very reactive to the customers and this is a cultural thing for me, was an VM where what are the customers saying to you now? What are you working backwards from this year? Because there's a lot to work backwards from. You got the pandemic. You got clear trends around at modernization automation under the covers, if you will. And you got VM Ware successful software running on their cloud on AWS. You got other customers. Matt, what's the big trends right now that are highlighted in your in your world? >>Yeah, it's a good question. And I think you know, it really does highlight the strength of this this hybrid model, I think, you know, pre pandemic. We had huge numbers of customers, obviously kind of looking at the cloud, but some of the largest enterprises in the world, in the more traditional enterprises, they really weren't doing a lot, you know, they were tipping their toes in, and some of the forward leaning enterprises were being really aggressive about getting into the cloud. But, you know, many people were just, you know, kind of hesitant or kind of telling, saying, Yes, we'll go learn about the cloud. I think as soon as the pandemic hit, we're really starting to see some of those more traditional enterprises realize it's a business imperative for them. Toe have ah, big cloud strategy and to move there quickly, and I I think our partnership with VM Ware and the VMC offering really is allowing many of these large enterprises to do that. And we see we see big traditional enterprise is really accelerating that move into the cloud. It gives them the business agility they need that allows them to operate their environment in uncertain world that allows them to operate remotely on DSO. We're seeing all of those trends, and I think I think we're going to continue to see the acceleration of our joint business. >>Sanjay, your thoughts. Virtualization has hit ah, whole nother level. It's not like server virtualization like it's cultural, it's societal. What's your take? >>Yeah, I think you know, virtualization is that fabric that connects the private cloud to the public cloud. It's the basis for a lot of the public cloud infrastructure. So when we listen to customers, I think the first kind of misconception we had to help them with was that it had to be choice between one or the other and being able to take Vienna Cloud, which was basically compute storage networking management and put that into the bare metal capabilities of AWS, an engineer deep into the stack and all the services that Matt and the engineering team were able to provide to us now allows that sort of application that sitting on premise to move like a house on wheels into a W s. And that's a beautiful experience we've even shown in in conferences, like a virtual reality moving of a workload, throwing a workload into a W s and a W s catches it. It's a good metaphor in a good way to think of those things that VM were like like the most playing the customers like like the emotional moves nicely. But then the other a misconception we had thio kind of illustrate to our customers was that you could once you were there, uh, let's take that metaphor. The house and wheels renovate the house with all the I think there's probably $200 services that Amazon AWS has. Um, all of a I data services be I I o t. Whatever. You have all the things that Andy and Matt kind of talk about in any of the reinvents. You get to participate and build on those services so it has. It's not like you take this there, and then it's sort of a dead end. You get to modernize your app after you migrated. So this migrate and modernize motion is something that we really start to reinforce with our customers, and it doesn't matter which one you do. First, you may modernize first and then migrate or migrate first and modernize. And in the modernized parts we've also made some significant investments and containers and Tan Xue. We could talk about that at this time and optimizing that for both the private cloud world and the public cloud world like Amazon. >>You know, Matt, this is something that we're talking about a lot this week. These few weeks with reinvent going on this everything is a service trend has a lot of things under it, like automation. Higher level services. One of the critics would say, Three years ago, when this announcement relationship between VM Ware enables came out was, Oh, Amazon's is going to steal all of their customers and VM we're screwed. Turns out that's not the case. You guys are both winning and rising. Tide floats all boats because VM Ware has an operator kind of market. People are operating their business with VM ware and they're adding higher level services with Cloud native, So it Xan overall win, so that was proven false. So clearly the new trend You guys are gaining a large enterprises that wanna go faster, have that existing operator kind of legacy stuff or pre conditions of the enterprise like VM ware. So how do you guide the technology teams and how do you look at this? Because this is where customers are like saying, Hey, I cannot operate my business house on wheels, modernize it in real time, come out a covert with the growth strategy and go faster your interview on all that. >>So I think you're exactly right. I think we see a lot of customers who see I don't want to necessarily lose what I have. I want to add on top of that, And so whether that's adding machine learning and kind of figuring out how they can take their data from various different data silos and put them into a large data lake and gets the machine learning insights on top of that, whether they want to do analytics, um, whether they want to d i o T. Whether they want to modernize two containers, I think there's there's a whole bunch of ways in which customers are looking at that. But you're absolutely right. It's not a I'm gonna go from a to B. It's I'm gonna take a and add B to it and, um, we see that's that's over and over again. I think what we've seen from customers doing it and, um and they're really taking advantage of that, right? And I think customers see all the announcements that we're making a reinvent over the next three weeks, and they wanna be able to take advantage of those things right? It's it's they want to be able to add that onto their production environment. They want to take a lot of the benefits they've gotten from their VM Ware environment, but also add some of these innovations from AWS. And I think that Z that really is what we focus on is what our engineering teams focus on. You know, we have joint engineering efforts to figure out how we can bridge that gap, right, so that they BMR environments can very easily reach into their A W s environment and take advantage of all the new services and offerings that we have there. So, um, that's that's exactly what our joint teams really pushed together. >>Sanjay, I wanna get your thoughts on this and we talk. Two years ago, we had a conversation with Cuba. I ask you since this is a great move for VM Ware because it simplifies the messaging and clears up the whole cloud strategy. And you had said something that I'm gonna bring this back today. You said it's not just simplifying the messaging to customers about what we're gonna do in the cloud. It's going to simplify their life is gonna make things easier. Have them set up for better bitterness. Goodness down the road. Can you take him in to explain what that what that goodness was? What came out of the simplicity of the messaging, the simplicity of solution? Where are we now? How does that all kind of Italian together? Can you take him in to explain that? >>Yeah, I think when the history books are written, John, um, this partnership will be one of the most seminal partnerships because from VM Ware's perspective, maybe a little from Amazon Let Matt talk about if you feel the same way. This is a headwind turning into a tailwind. I think that's sort of narrative that VM ware in Amazon were competing each others that maybe was the early story. In the early days of A W s Progress and VM, we're trying to build our own public cloud and then divesting that, uh, Mats, a Stanford grad. I'm a Harvard grad. So one day there'll be a case study. I think in both schools about how this partnership we have a strong partnership with deadlines, sometimes joke. That's a little bit of an arranged marriage we don't have. We didn't have much saying that because AMC Bardhyl so that's an important partnership. But this one we have to work hard to create. And I tell our customers, Del on AWS are top partners. And as you think about what we've been able to do here, the simplicity to the customer for you, as you describe this, is being able to really lower cost of ownership in any process, in terms of how they're building and migrating APs to be the best optimization of hardware, software and services. And the more you could make that better, simpler, cheaper through software and through the movement to the cloud. Um, I think customers benefit, and then you know, Of course, the innovation machine of both companies. Uh, Amazon's really building. I mean, every time I go to read and I'm just amazed at the Yeah, I think it's a near 200 services that they're building in all of these rich layers. All of those developers, services and, I don't know, two million customers. The whatever number of people that have it reinvent this year get to participate on top of all the applications and the virtualization infrastructure we built over the 20 years of our history. Uh eh. So I hope, you know, as we continue do this, this is all now, but customers success large and small customers being able to. And I'm very gratified to three years since we announced this that we're getting very good customer traction. And for us, that's gonna be a key focus to the reinvent, uh, presence we >>have at their show. It really just goes to show you when you built, when you invest in relationships up and down the spectrum from engineering Ah, product and executive. It kind of does pay off. Congratulations to you guys on that matter. I want to get your thoughts on where this kind of going because you're talking about the messaging from VM ware in the execution that comes behind it is the best, you know, Private public cloud hybrid cloud success. There's momentum there. What are the customers saying to you when you look at customer proof points? Um, what do you point to? Because you're now in charge of sales and marketing, you have to take now the installed base of Amazon Web services, which is you got the Debs and startups and, you know, cloud scale to large enterprises. Now you got the postcode growth. Go fast, cloud scale. You've got a huge customer base. You've got a target. These guys, you gotta bring this solution. What are they saying about the VM ware AWS success? Can you share some? Some >>days I'd be happy to, I think I mean, look, this this is what gets, uh, us excited. I know Sanjay gets just as excited about this. It's and it's really it's resonating across our customer base. You know, there's folks like S and P Global who's a large enterprise, right? They had, uh, they had a hardware procurement cycle. They were looking at them on front of implementation and they looked at a WSMV I'm wearing. They said, Look, we want to migrate. All of our applications want to migrate. Everything we have into the cloud, I think it was 150 critical financial applications that they seamlessly migrated with zero downtime Now all running on BMC in the cloud. Um, you look at governments, right? We have thing folks like the Scottish government on many government customers. We have folks that are like Penny Mac and regulated industries. Um, that really took critical parts of their application. Andi seamlessly migrated them to to A W S and BMC, and they looked at us. And when we talk to these customers, we really say, like, where is the best place for us to run these v sphere workloads? And, um and the great thing is we have a consistent message. We we know that it's the right that that aws nbn where's the best place to run those VCR workloads in the cloud? And so as we see enterprises as we see regulated industries as we see governments really looking to modernize and take advantage of the cloud, we're seeing them move whole swaths of their applications. And this is not just small parts. These are the critical really mission critical applications that they know that they need to get out flexibility on, and they want to get that agility. And so, um, you know, there's been a broad swath of customers like that that have really moved large large pieces of their application in date of us. So it's been fun to see. >>And John, if I might add to that what we've also sought to do is pick some of those great customers like the ones that Matt talked about and put them on stage. Uh, VM world. In previous, we had Freddie Mac and we had, you know, I h s market and these are good examples in the few that Matt talked about. So I'm super excited. I expect there'll be many more reinvent we did. Some also be in world. So we're getting these big customers to talk about this because then you get the 10 phenomenon. Everyone wants to come to this, tend to be able to participate in that momentum. The other thing I'm super excited about it started off as a US phenomenon. Just the U s customers, but I'm starting to see riel interest from European and a p J customers. Asia Pacific customers in countries Australia, Japan, U. K, France, Germany. So this becomes a global phenomenon where customers understand that this doesn't have to be just the U. S centric customers that are participating. And then that was, for me a very key objective because the early customers always gonna start in the Geo where, um, you know, there's the most resonance with the public cloud. But now we're starting to see this really take off in many parts of the world. >>Yeah, that's a great point at something we can talk about another conversation. Maybe we will bring you guys into some of our live check ins throughout the three weeks we're doing here. Reinvent. But this global regional approach Matt has been hugely successful. Um, we're on Amazon. We have Q breaches because by default, we're on top of Amazon. You're seeing companies build on top of Amazon. Look a snowflake. The largest I po in the history of Wall Street behind VM Ware. They run Amazon, right? And I will probably have other clouds to down the road. But the point is you guys are enabling this. >>Yeah, global. And it's it is one of the things that we hear from customers that they that they love about running in the cloud is that, you know, think about if you had Teoh, you know you mentioned snowflake. Imagine if your snowflake and you have to go build data centers everywhere. If you had to go roll out toe to Europe and then you have to build data centers in Germany and then you have to build data centers and the U. K. And then you had to go build data centers in Australia like that would be an enormous cost and complexity, and they probably wouldn't do it frankly, at their early stage, Um, you know, now they just they spin up another stack and their ableto serve their customers anywhere around the world. And we're seeing that from our VM or customers where, you know, they actually are spinning up brand new vmc clusters, uh, where they weren't able to do it before, where they either had toe operate from a single stack. Um, now they're able to say, you know what? I'd love to have Ah, vm or stack in Australia, and they're able to get that up and running quickly. And so I do think that this is actually enabling new business it z, enabling customers to think about. How do they put their computer environment close to where their end users are or where they need that computer environment to be sometime just close to end users? Sometimes it's for data residency requirements, but it really kind of enables customers to do that. Where think about in a cove in world, if you have to go launch a data center in a new country, you probably just I mean, maybe it wouldn't even be possible to do that way are today. And now it's just FBI calls. So >>I mean, your point about going slows in an option. The imperative we have, you know, even expression here inside silicon and on the Cube team. Is there a problem? Yes. Is it important? Yes. What are the consequences if you don't solve the problem? Can you quantify those consequences? And then you gotta look at solutions and look at the timing. So you got timing. You got cost. You got the consequences of not doing it. And speed all those things. No. No one's gonna roll out of data center in six months if they if they tried so again, Cloud. And I'm trying to come into play here. You gotta operate something. It's a hand in the glove, its's. I'm seeing the cream rise to the top with covert. You're seeing real examples of riel scale riel value problems that you solve that important that have consequences that can be quantified. I mean, it's simple. Is that >>you know, John, I was gonna say, in addition to this via McLeod on aws were also pretty, you know, prominent AWS customer for some of our services. So some of the services that we've seen accelerate through Covic Are these distributed workforce security capabilities? Eso we resume internally, that obviously runs on AWS. But then surrounding that with workspace one and carbon like to secure the laptop that goes home. Those services of us running A W. S two. So this is one of those places where we're grateful that we could run those cloud services because we're also just like Snowflake and Zoom and others. Many of the services that we build that our SAS type services run on Amazon, and that reinforces the partnership for us. Almost like a SAS customer. >>Well, gentlemen, really appreciate your insight. As always, a great conversation. We could go for another hour. You guys with leaders of your organizations, you're at the front lines as managing through the pandemic will have you guys come into our check ins throughout the three weeks now here during reinvent from or commentary. But I'd like to end this segment by sharing. In your opinion, what is the most important thing that the audience should pay attention to this year at Reinvent? I know there's a lot of things going on. It's three weeks, not four days. It's so it's longer, but still there's a lot of announcements, man, on your side vm where you got the moment and you got your announcements. What should customers pay attention to this reinvent Virtual 2020. >>So, do you wanna go first? >>No, man, it's your show. You go first. E >>I would encourage folks toe Really think about and plan the three weeks out. This this is the opportunity to really dive in and learn. Right? Reinvent is as as many of you know, this This is just a different type of conference. It's not American Conference. This is a learning conference, and and even virtually that doesn't change. And so I encourage. Look across the broad swath of things that we're doing. Learn about machine learning and what we're doing in that space. Learn about the new compute capabilities or container capabilities. Learn about you know what, what is most relevant to your business if you're looking about. Hey, I have an on premise data center, and I'm looking about how I extend into the cloud. There's a lot of new capabilities around BMC and AWS that makes sense, but there's also a lot of cool announcements around just other services. Um, that could be interesting. We have a ton of customers. They're giving talks. And learning from other customers is often the best way to really understand how you can get the most value out of the cloud. And so I encourage folks toe really kind of block that time. I think it's easy when your remote to get distracted by, you know, watching Netflix or answering emails or things like that. But this is this is a great opportunity to block that schedule. Find the time that you have to really spend time and dive into the sessions because we have a ton of great content on a lot of really cool launches coming up. >>Yeah, I'm just very quickly. I would like one of things I love about Amazon's culture and were similar. VM Ware is that sort of growth mindset. Learn it all and I'm looking forward myself personally to going to reinvent university. This is three weeks of learning, uh, listening to many of those those things. I learned a ton and I've tried to have my own sort of mindset of have being a learn it all as opposed to know it. Also these air incredible sessions and I would also reinforce what Matt said which is going find pure customers of yours that are in your same vertical. We're seeing enormous success in the key verticals Vienna plays in which itself called financial services public sector healthcare manufacturing, CPG retail. I mean, whatever it is so and many of those customers will be, uh, you know, doing virtual talks or we have case studies of use cases because often these sort of birds of a feather allow you to then plan your migration of modernization journey in a similar >>fashion, Matt Sanjay, always great to get the leaders of the two biggest companies in our world A, W s and VM where to share their perspectives. Uh, this year is gonna be different. I'm looking forward to, you know, really kinda stepping up and leaning into the virtual because, you know, we're gonna do three weeks of cube coverage. We have, like, special coverage days, Tuesday, Wednesday, Thursday for each of the three weeks that we're in. And we're gonna try to make this fun as possible. Keep everyone engaged on tryto navigate, help people navigate through the virtual world. So looking forward to having you guys back on and and sharing. Thanks for coming. I appreciate it. Thank you very much. Okay, this is the cubes. Virtual coverage of virtual reinvent 2020. I'm John for your host. Stay with us. Silicon angle dot com. The cube will be checking in with our live coverage in and out of the sessions and stay with us for more wall to wall coverage. Thanks for watching. Yeah,

>> Announcer: Live from San Francisco, it's theCUBE, covering RSA conference 2020 San Francisco, brought to you by SiliconANGLE Media. >> Hey, welcome back, everybody. Jeff Frick here with theCUBE. We're at the RSA 2020 show, here in Moscone in San Francisco, it's Thursday, we've been going wall to wall, we're really excited for our next guest. We've been talking about some kind of interesting topics, getting a little bit into the weeds, not on the technology, but some of the philosophical things that are happening in this industry that you should be thinking about. And we're excited welcome, Laurence Pitt, he is the cyber security strategist at Juniper Networks. Laurence, great to meet you. >> Thank you very much, hi. >> Yeah, so before we turn the cameras off, we've been talking about all kinds of fancy things, so let's just jump into it. One of the topics that gets a lot of news is deepfakes, and there's a lot of cute funny things out there of people's voices and things that they're saying not necessarily being where you expect them to be, but there's a real threat here, and a real kind of scary situation that just barely beginning to scratch the surface, I want you to get share some of your thoughts on deepfakes. >> I'm going to think you made a good point at the start. There's a lot of cute and funny stuff out there, there's a lot of fake political stuff you see. So is it seen as being humorous some people are sharing it a lot. But there is a darker side that's going to happen to deepfakes, because a lot of the things that you see today that go out on video, the reason that it is what it is, is because you're very familiar with the person that you're seeing in that video. Is a famous politician, is a movie star, and they're saying something that's out of character or funny and that's it. But what if that was actually the Chief Financial Officer of a major company, where the company appears to have launched a video, very close to the bell ringing on the stock market, that makes some kind of announcement about product or delay or something to do with their quarterly figures or something like that? You know that one minute video, could do a huge amount of damage to that organization. It could that somebody's looking to take advantage of a dip at that point, video goes out, their stocks going to dip, buy it out, then they could profit, but it all could also be much darker. It could be somebody who's trying to do that to actually damage their business. >> So, would you define a very good text base phishing spear phishing as a deepfake, where they've got enough data, where they're, the relevance of the topic is so spot on, the names that are involved in the text are so spot on 'cause they've done their homework, and the transactions that they're suggesting, are really spot on and consistent with the behavior of the things that their target does each and every day. >> So I'm not sure I defined that as a deepfake yet, obviously you've got two types of a phish, you've got a spear phish, which is the the perfected version, the work has gone into target, you as a specific, high value individual for some reason in your organization, but what we are seeing is in the same way that deepfakes are leveraging technology to be able to manipulate somebody, things like the fact that we're all on Instagram, we're all on Facebook, we're all on Twitter, means that social manipulation is a lot easier for the bad guys to be able to create, phishing campaigns that appear to be very much more targeted, they can create emails because they know you've got a dog. They know roughly where you live, because you're this information is coming up in pictures and it's a metro on the internet. And so they can generate automated messaging and emails and things that are going to go out. That will appear to be from whomever you expect to receive it from, using words that you think that only they would know about to make that appear to be more realistic. >> Right. >> And that's actually something, we sort of seen the start of that, but still the thing to spot is that the grammar is very often not very good in these if they haven't perfected the language side of it. >> But that's coming right, but that's coming right. >> But they all getting much more accurate yeah. >> We is an automated transcription service to do all the transcription on these videos. And you know, It's funny you can you can pay for the machine or you can pay for the human, we do both. But it's amazing, even only in the last six months to see the Delta shrink between the machine generated and the person generated. And this is even in, you know, pretty technical stuff that we get in very specific kind of vocabulary around the tech conferences that we cover. And the machines are catching up very, very fast. >> They very much are. but then if you think about, this is not new. What's happened, it's been happening in the background for a while things like quite a lot of legal work is done. If you look at a state agency, for example, conveyancing it's not uncommon for the conveyancing to be done using machine learning and using computer generated documentation because it's within a framework. But of course, the more it does that, the more that it learns. And then that software can more easily be applied to other other areas to be able to do that accurately. >> Right. So another big topic that gets a lot of conversation is passwords. You know, it's been going on forever, and now we're starting to get The two factor authentication, you know, the new Apple phones, you can look at it and identify it, you say now you have kind of biometrics. But that can all be hacked, too, right? It's just a slightly different, a slightly different method. But, you know, even those, the biometric is not at all. >> Well. >> That's secure. >> I think the thing is, you see that when you're logging into something, there's two pieces of information you need. There's there's what you are you as a person and then there's the thing that you know, a lot of people confuse biometrics, thinking of biometric authentication is their password, we're actually the biometric is is the them. And so you still should back things with strong passwords, you still should have that behind it. Because if somebody does get through the biometric that shouldn't automatically just give them access to absolutely everything. It's you know, these are technologies that are provided to make things easier to make it so that you can have less strong passwords so that so that you do know where you're storing information. But People over people tend to rely on them too much, it is still very, very important to use strong passwords to think about the process for how you want to do that. Taking statements and then turning those statements into strange sentences that only you understand maybe having your own code to do that conversion. So that you have a very strong password that nobody's ever going to pick up, right? We know that common passwords, unfortunately, are still 1234567 password, its horrific. >> I know, i saw some article that you're quoted in and it had the worst 25 passwords for 2018 and 2019. And it's basically just pick and pick a string. >> They just don't change. >> But you know, but it's interesting cause, you know, having a hard Prat, you know, it's easy to make, take the time and go ahead and create that, that that strong password. But then, you know, three months later. Salesforce keeps making me do a new one or the bank keeps making me do a new one. What's your opinion in some of these kind of password managers? Because to me, it seems like okay, well, I might be doing a great job creating some crazy passwords for the specific accounts. But what if I could hacked on that thing right now they have everything in the same a single place. >> Yeah. So this is where things like two factor authentication become really, really important. So I use passwords manager. And I've been I'm very, very careful with the how my passwords are created and what goes in there so that i know where certain passwords are created for certain types of account and certain complexities. But I also turned on two factor. And if somebody does try to go into my online password account, I will get an alert to say that they've tried to do that a single failed authentication and I will get an alert to say that they've done it an authentication that happens where I'm not I you know, then I will get a note say I've done that. So this is where there's that second factor actually becomes very important. If you have something that gives you the option to use two factor authentication. Use it. >> Use it. >> You know, it may, you know, we it is a pain when you're trying to do something with your credit card and you have to do One time text. But it'd be more of a pain if you didn't and somebody else was to use it. And to fill it up nicely for you wouldn't right. >> Right. You know, it's funny part of the keynote from Rowan was talking about, you know, as a profession, spending way too much time thinking about the most kind of crazy bizarre, sophisticated attacks. At the at the fault of, you know, not necessarily paying attention to the basics and the basics is where still a lot of the damage was done right. >> You know what? This is the thing and then there's, you know, there's a, there's a few things in our industry. So exactly what you just said. Everybody seems to believe that they're going to be the target of the next really big complex, major attack. The reality is they aren't. And the reality is that they've been hit by the basic slight ransomware, phishing spearphishing credential stuffing all these attacks are hitting them all the time. And so they need to have those foundational elements in place against those understanding what those are and not worry about the big stuff because the reality is if your organization is going to be hit by a nation state level complex attack. Or you can do fight against that as well, it's going to happen. And that's the thing with a lot of the buzzwords that we see in in cyber today as Matt. >> And and with smaller companies SMB's, I mean is really their only solution to go with, you know, cloud providers and other types of organizations and have the resources to get the people and the systems and the processes to really protect them because you can't expect you to just flowers down down off fourth street to be have any type of sophistication needed. But as soon as you plug that server in with a website, you're instantly going to get, get attacked , right. >> So the thing is, you can expect that, that guy to be an expert. He's not going to be an expert in cybersecurity and the cost of hiring someone is going to outweigh the value who's getting back. My recommendation that case is to look for organizations that can actually help you to become more cyber resilience. So an organization that I work with, it's actually UK and US basis, the global cyber alliance. They actually produce a small business toolkit. So it's a set of tools which are not chargeable is put together. And some of it might be a white paper, a set of recommendations, it might actually be a vendor developed tool that they can use to download to check the vulnerabilities or something like that. But what it does is it provides a framework for them. So they go through and say, Okay, yeah, I get this. This is English, simple language. And it helps to protect me as a small business owner, not a massive enterprise where actually none of those solutions fits what i one's to. So that's my recommendation to small businesses, look for these types of organization, work with someone like that, listen to what they're doing and learn cyber from them. >> Yeah, that's good tip. I want to, kind of of double click on that. So that makes sense when it's easy to measure your ROI on a small business. I just can't afford the security pros. >> Yeah. >> For bigger companies when they're doing their budgeting for security. To me, it's always a really interesting as i can, it's insurance at some point, you know, wouldn't be great if i could ensure 100% coverage, but we can't. And there's other needs in the business beyond just investing in, in cyber security, how should people think about the budgets relative to, as you just said, the value that they're trying to protect? How do you help people think about their cyber security budgets and allocations. >> So then there needs to be and this is happening, a change in how the conversation works between the security team and the board who own those budgets. What tends to happen today is that there's a cyber team wants to provide the right information to the board that's going to make them see how good what they're doing is and how successful they are and justifies the spend that they've made and also justifies the future investments that they're going to need to make. But very often, that falls back on reporting on big numbers, statistics, we blocked billions of threats. We turned away millions of pieces of malware. Actually, that conversation needs to narrow down and the team should be saying, Okay, so in the last two months, we had Five attacks that came in, we actually dealt with them by doing this, this is the changes that we've made, this is what we've learned. However, if we had had this additional or this switched on, then we would have been more successful or we'd have been faster or we could have turned down the time on doing that. Having that risk and compliance type conversation is actually adding value to the security solutions they've got and the board understand that they get that conversation, you're going to be happy to engage. This is happening, this is something that is happening. And it will, it's going to get better and better. But that's that's where things need to go. >> Right. Cause the other hard thing is it's kind of like we've joked earlier, it's kind of like an offensive lineman, they do a great job for 69 plays. And on the seventh seventh play, they get a holding call. That's all anybody sees . And you know, there's, again, that was part of robots, keynote that we can't necessarily brag about all the DDoS taxes that we stopped cause we can't let the bad guys kind of know where we're, we're being successful. So it's a little bit of a challenge in tryna show the ROI. Show the value when you can't necessarily raise your hand and say, hey, we stopped the 87. Tax. >> Yeah, >> Cause it's only the 88. That really is the one that that showed up in the Wall Street Journal. >> I think the thing with that is when organizations are looking at security solutions, specifically, we're very aware of that. As you know, organizations struggle to get customer references, you'll see a lot of the references are major financial, large manufacturing organization, because companies don't want to step up and say, I implemented security, they did this because the reverse of that is, she didn't have it before then >> Right right, or we'll go in that door not that door. >> Yeah and so, but there are a lot of good testing organizations out there that actually do take the security solutions, and run them through very, very stringent tests and then report back on the success of those tests. So you know, we work closely with NSX labs, for example, we've had some very good reports that have come out from there, where they do a drill down into how fast how much, how many, and then that's the kind of You can then take to the board. That's the kind of thing that you can publicize to say, the reason that we're using Juniper X or x firewalls is because in this report, this is what it said, this is how good that product was. And then you're not admitting a weakness. You're actually saying we're strong because we did this work in this research background. >> Right, very different kind of different approach. >> Yeah, yeah. >> Yeah well, Lawrence really enjoyed the conversation. We'll have to leave it here. But I think you have no shortage of job security, even though we will know everything in 2020 with the benefit of hindsight. >> Really, yeah thank you very much for that. >> All right. Thanks a lot. Alright, he's Lawrence. I'm Jeff. You're watching the cube. We're at RSA 2020 in Moscone. Thanks for watching. We'll see you next time.

>> [Disembodied Voice] From New York, it's the cube. Covering escape 19. >> Welcome back to the Cube's coverage here in New York City for the inaugural multi-cloud conference called Escape 2019. This is a conference dedicated, first conference dedicated to conversations and content and people around the trend of multi-cloud, which I've been critical of, I've called BS in the past. But it is multi-vendor it's developing and the architecture for true multi-cloud is on the horizon. Where well, we will be relevant. Our next guest is Daniel Wall, senior Distinguished Engineer at Red Hat, working on a lot of the technology around what Kubernetes and containers is create a lot of buzz around and that is the abstraction layer around working across clouds. Daniel, welcome to The Cube. >> Thank you for having me. >> I'm sure I butchered what you do, but I know you make a lot of tools. You make containers work. Talk about your role at Red Hat real quick. >> So my role at Red Hat is I am the technical lead of container technology, everything basically underneath Kubernetes main projects over the last few years is to look at what Docker did and then split them into individual tasks. I believe that Docker should be broken into four different main tasks move and container images around playing with containers, building container images, and running containers in production. And then we can run different security realms around each one of them. So we have tools to do that a Scopio, Podman build, and CRI-O is the one we use for Kubernetes. >> And how's it going? Good? >> It's going great. Yeah, we're getting great up. A lot of community support. A lot of people are really excited about some of the security features for so you can run full containers where you traditionally would do a darker you can run a totally non routes and much more secure. >> Well, I'm really interested in your talk you're giving here because the folks that follow The Cube know some of my tirades I've been on the past. I've been saying for a long time that there's been a very non-selection of clouds outside the big three, >> Right. >> And you had a power law that has, know who the big guys and a long tail of people creating their own little niche services. But income, the essentials and the global size and channel part is people using cloud. We have a video cloud, we're building more and more clouds for our media business. This, I was talking about the rise of these new clouds right?. >> Right. >> You're actually put some structure around this around, You're talking about Walmart clouds and niche clouds. Could you explain so this is really important. I want you to take some time to explain that. >> Okay, so my talk today I call it the Walmart clouds, although the analogy is when Walmart first started showing up in the United States and different areas, all of the department stores basically went out of business because Walmart was able to out-commoditize everything in the universe. And so, all these major vendors, district department stores went out of business. The one thing that didn't go out of business was sort of like specialty stores. So, I always kid around and say my wife has me every weekend sitting out front of these specialty stores that she loves to stop shop at. So if I look at the way the clouds have happened is basically most people say there's three major clouds, although I think they ignore one. So you look at Amazon, you have Google and you have Microsoft Azure, although I think Alibaba is going to become important in the future. And I call those the Walmart clouds, because basically, their whole goal is to commoditize and get rid of all the other, >> And scale up and provide more and more departments more services, >> But basically it they will always be rushing to get to the cheapest price. But there were a bunch of other cloud vendors out of the specialty cloud vendors like you talking about the Cube one, you this might be the best one to do in video. So I might want to put part of my workload in the Microsoft cloud or the Amazon cloud to get the cheapest price but I want to run certain certain workloads inside the U.S. We look at another example that is Nvidia right? and there's the Nvidia cloud and they might put the best GPUs in there. And you might want to do your machine learning your AI technologies might want to go in there because they might work better. IBM, who obviously bought Red Hat, but but IBM, you look at what they're doing in their cloud, they can have power series, they can have, mainframe workload z series. They might even have, some of their future, super duper computers type things in it. And then you have Oracle and Oracle would have database, they're probably going to do databases, they've massive database technologies inside of their cloud. So when you really >> Well, they think they're one of the big clouds. But they're not. >> They do. >> But their specialty Database Cloud. >> Basically, I believe that they are. I believe IBM, I think all of them are niche, especially clouds. But the bottom line is you need an API to move between these clouds so you can put workloads in different instances. And I believe that the Walmart clouds the the AWS and Microsoft and Google, their whole goal is to get you into their cloud. They might talk a little bit about on prem cloud and supporting your data centers. But their real goal is to get you off your data centers into their cloud, so they can start making money. They won't have no interest in supporting these, sort of the specialty cloud vendors. But if you look at open shift, which Kubernetes, from Red Hat, our goal is to basically make moving your cloud instances around and keep commodity and stability and move to clouds around. >> Let's take it through a working example. So there's couples and use cases that I see happening, I want to get your reaction. One is our cloud. We're (mutters intelligibly) which we do have. It's coming out. It's on Amazon. So we were small, self funded, company growing having fun. We're building on Amazon. We don't do any work in Azure our solutions on Amazon. Another use case might be a vendor that says hey I have proprietary software, I'm going to stand up my own cloud infrastructure and do all that and build it from the ground up. Is there a difference between the two? Because one is co-locating essentially on Amazon. leveraging the cheap commodity, but building differentiated niche on top of it, versus the standing up a full cloud? >> Well, what I would argue, first of all is is I would want you are your cloud, the one that you're saying is in say, Amazon, it what is the chance of you guys basically getting an offer from Azure to a nickel less per hour. >> Pretty high!(laughs amusingly) >> To be able to move your cloud over, >> It might be high. >> And the problem I would see is if your cloud inside of Amazon cloud starts to take advantage of Amazon's features, then all of a sudden it gets harder and harder for you. the cost of moving off is going to get harder and harder. If you use open source solutions, pure open source and not tied to individual cloud vendors. Then it would become much easier for you to move around. So you could take advantage of, commodity, right? And that you mean, another analogy I use with the big cloud vendors is Hansel and Gretel right. They all want you to come on in and come on in have some of our candy, have some our candy. And next thing you know, you're inside the cage. And, you know, but if you stick to open source, right, this is in a lot of ways the major cloud vendors is a major threat to open source, and that they're trying to lock everybody in right there. We lost it. >> Okay so what's the path? So I told it, by the way, I'm getting what your saying. So I say great I'll take advantage of the cheap I as the infrastructure service layer. But then what an open source toy usually open shift, I still got to build my app, I got to still host it. >> Right. So you build you build your app on top of it. So let me define what open shift is. And so open shift is basically Red Hat's enterprise version of Kubernetes. So if you look at Kubernetes, Kubernetes in some ways is just a higher level distribution of software. So when when Red Hats got into Linux business, there were lots and lots of Linux distributions. And what Red Hat did is they picked a whole kernel and a whole bunch of packages and joined them together and created a distribution that everybody could agree on and build on. So with open shift we're doing is we're taking Kubernetes, but there's a whole bunch of CNCF projects, and we're joining them all together and then testing them and making enterprise so that ready. But really Kubernetes is the key factor here in that if you build everything Kubernetes you CNCF open source projects, for your, save your storage, put it on staff, so Gloucester, one of the network based file systems in the open source world, instead of diving directly into Amazon, now you have the flexibility to be able to get out of the- >> So here's an Architectural question. So I got to ask you as multi-cloud conversation starts to heat up, and by the way, I think people have multiple clouds. It's just not multi-clouding. Right, right, right. Yeah, but it's coming. So architecturally what do someone have to think about architecturally for multi cloud? What's in the mind of the technical architect out there? >> What's on them? What are they should be thinking about from an architecture because you don't want to forclose the future. But I also want to get the best what I can get today from the clouds. >> I mean, I keep keep on hammering on it, but stick to the open source projects to do this as the CNCF projects just to allow you flexibility. A lot of it, the real problem with a lot of this technology right now is it's developing so fast. I mean, I think we have a Kubernetes version every two weeks, it seems at least in my team and see it feels like it. >> So you think Red Hat's of good vendor for the supplier for that person. >> Obviously >> Yeah you know some stuff is hard to deal with so it (mutters) look I'm so busy, these guys, I'm trying to get the transformation going. I don't have time to keep track of what's going on in CNCF. >> Yeah, well, we're a co worker of mine talks about your Red Hat and open shift is a plumbing tool or an electric we're building the foundation of your house and we put the electrical systems and the plumbing empties into your house, but we still need applications to run so we need you you need a toast or you need a toilet, you need a sink. And the applications and one of the one of the differences between Red hat and sort of the cloud vendors is we try not to get into the product, the lab and product business. So we want to support open source projects and other products running in our environment. If you compare that to running inside a cloud, you know if you become incredibly successful inside of Amazon, your video cloud business wants to prevent Amazon to say, oh, we'll just do video will steal everything they're doing and all a sudden we'll do the video inside of Amazon and then put your your cloud out of business. And, your only option then is now you're competing Amazon in Amazon against Amazon. How do you get out of Amazon >> That's called 3D chess.I think. Or maybe 4D chess. >> So if you you know My point being if you have an opportunity to get out and compete against Amazon say on Microsoft compete on your local compete on one of the niche clouds So any vendor that basically ties totally to Amazon, >> This is this is absolutely why I'm here because I believe multi-vendor, that was the buzzword in the 80s and 90s. Is everyone wants to they want to homogeneous they want a heterogeneous network. So multi-vendor will be around multi-cloud has to survive, it will survive. But right now we are in the foundational stages. The second interview, he has talked about plumbing and streets, and that's what we're at. So I guess the final question for you is, as we're setting the foundational infrastructure for multi-cloud, what's the big takeaway that you see that you could share? You mentioned get involved in open source what specifically architecturally should should folks think about in terms of foundational. >> I think, look at what the CNCF that cloud cloud native foundation is doing for open source projects, depends on what level you want to come in. And the bottom line is, built on top of Kubernetes use open standards to do it. Don't fall for the Hansel and Gretel effect of eating the candy because you will find yourself in a cage. >> Well, multi cloud is arrived and it's being thought through by industry leaders from entrepreneurs. We just had the former CEO of Sierra on, now running AVA trace, industry veteran, lot of tech chops in here, laying down the lines, if you will. A lot of good stuff Kubernetes is a key part of the containers. >> Okay, huge part of it. Thanks for coming on. >> Thanks for having me. >> And thanks for sharing the insights here on The Cube. We're in New York City for the inaugural multi-cloud conference Escape 19. I'm John Furrier back with more after this short break (pulsating music) (pulsating music)

>> Announcer: Live from Boston, Massachusetts, it's theCUBE! Covering IFS World Conference 2019. Brought to you by IFS. >> Welcome back to Boston, everybody. This is Dave Vellante with my cohost Paul Gillin. We're winding down day one of the IFS Conference, the World Conference here at the Hynes Auditorium in Boston. Paul Helms is here as the senior vice president of customer success at IFS, something that we've been talking about a lot, and Stefano Mattiello who's the senior vice president and the global head of consulting, also from IFS. Gentlemen, welcome to theCUBE. >> Thank you. >> Thank you very much. >> All right, Paul, let me start with you. So, kind of a loaded question. How do you define customer success? >> It's a question I get very often, and customer success, you can make out of it what you want to. The way IFS looks at it, it's not only me but IFS look at it is, how do we take our involvement into our customer's business outcomes beyond the go live. Okay, so, they buy software, they implement the software, they go live, and then what? So customer success is really looking into what is the quality of the relationship we have with our customers, and how deep and how integrated we are in that relationship. Understanding what success means to our customers because it's different for every customer. And then how do we back this up with the quality of service to really build that success and mine the value that is in the solution to the benefit of our customers. So it's this long-term relationship driven by business outcomes, that is customer success. So, historically in the software business success was defined as we're live. You know, service now bakes a cake, hey, success. That's not how you guys are defining success. >> No, I mean, it goes way beyond the go live. In fact, I mean we're talking about success as actually starting even before the implementation even starts, which is capturing what success means to that particular customer. In your business situation, what does success mean? Feed that in, we obviously want to get the customer live as quickly as possible, it's the time to value, and that talks to ROI. But that's just the beginning of the game, that's not the end of the game. So it's about what are we doing after the go live phase, what are the interventions that we're running in aid, delivering on that promise that we made right up front that says what does success mean, let's make sure that we deliver on that. But then more importantly is how do we kind of maximize that success. As the market dynamics are changing, as there's more pressure coming on your business, your business is changing, right? So how do we evolve your business model because success today might have a particular shape and a particular color, but in nine months or 12 months time it'll change, it'll morph into something else, so it has a different definition. So it's about that lifelong engagement, you know, how do we keep redefining success? >> So what stage does this success discussion begin? >> It's very much as I said in the early stages of what we would call the pre-sale cycle. So when we first start talking to a customer, is we really want to understand what are your business imperatives. All right, let's try to capture that. It's fundamental that we're not just selling technology for the sake of technology, but we're there to drive a business agenda. So it's really as early as we can do it, I think that's where we can capture and maximize the delivery of that success. What does it really look like? So, the sooner we do it, the better. >> And also looping that actually back into what do we see in our customers and the way they use the software and the way their business is changing in their environment, so to say, and bringing this back all the way into the product, okay. And how do we shape the roadmap of the product using the insights into how customers are being successful using our products. So, we are not there yet, but that is the ultimate goal, that we will build better products based on our customer success insights, and then turning this into a mature cycle to really drive and maximize customer value over their lifecycle. So it goes beyond just the service, it really is all the way back into the product, how that adds value, how do we deliver this, and all the way back again. >> And I always argue, I mean, unless you're sort of a nonprofit or, you know, if you're a hospital, you want to save lives, but if you're a for-profit company you want to increase revenue, you want to cut costs, you want to drop money to the bottom line, you want to rip the face off your competitors, and you want to do some good for your community. So I mean, you can take all these other factors whether it's better customer satisfaction, better productivity, et cetera, and it usually boils down to those things. Is that fair? >> Yeah, I mean, that's pretty much, you know, those are your business imperatives, yeah, that's what success looks like to you. But it's an iterative process, right. So what I was saying earlier is it doesn't start and stop there. I mean, things will change and the approach we want to take is let's not just do it once, let's keep revisiting this because once you've captured those objectives and you're actually on top of those, or you think you're on top of those, then as we improve the product, as the market dynamics change, then you'll have different priorities. So let's keep revisiting. And the way we're looking at it is a project is no longer just the start and a stop, single-time event, it's an iterative process. >> Are you seeing priorities change, or maybe you don't have enough data to speak to this, but we saw 160 CEOs recently signed a petition, or a proclamation, if you will, that it's not all just about shareholders, there are multiple stakeholders they have. Are you seeing priorities with customers change over time? >> I think when, the conversations are changing, so when we talk about 10 years ago probably you talk about optimization, it was purely for getting more bang for your buck. So, how do I take cost out? How do I become more efficient, more effective? The conversation is changing now to how do I become more sustainable? You still need to optimize. You still need to deliver better and operate better. But it's not only for profit, it's also on how do I become more sustainable, how do I leave an environment for the youngsters in my company, that they still have a company by the time that they are at our age. (laughs) >> Benny often is very outspoken about that. >> Yes, he is. >> As you know, I'm just waiting for the day when the CEO misses three or four quarters in a row and says, "Yeah, but we're doing all this "great tech for good." But I do agree. Especially with millennials coming into the workforce, they want to see that their companies are doing good, they're giving back to the community and paying it forward. Question on swim lanes, you got I think 400 partners. What are the swim lanes between the services that you provide and your partners provide, and what's the overlap there? >> So this is the transition that we're in at the moment, is that historically IFS was trying to be an all things to all customers, right, so we'll do everything from A to Z. What we're doing now is we're saying, well, let us focus on what we do best which is our product. That's really what we do best. So what we want to do is we want to try and help the ecosystem, we want to help our partners in driving those efficiencies and actually implement as quickly as possible and drive value for our customers. So what we're doing is we're now moving into a position where we say, let us rather drive a value assurance discussion with our customers, let's safeguard projects, so we're working in a symbiotic relationship with partners, we're not competing with them, right. So we know what we do, we know what they do. >> So you have some new services, IFS Select, IFS Success, IFS tools and methodologies. So, there's knowledge transfer then between you guys and your partners, is that right? How does that work? I mean, this takes investment, it's got to be more than just a press release obviously. >> Yeah, yeah. We want our partners to know everything that we know, and we're a software company, we're not a services company, and we don't want to compete in the services space. We want to use services to enable software, and more software, because the faster we grow our software business the better for us as a company 'cause that is our core business. So there's no competition with partners. We want to share what we know. We put in tools and methodologies. We standardize knowledge. We share knowledge, we bring this out. We put our partners through the same training we put our own people, there's no secret little room back there where we give them the real stuff, (laughs) our own people. So we are very open with knowledge and experience and sharing them, and helping them enabling this. So we will work with a partner to say, okay, the first ones that you do you might not be that confident so let's be there in a more intense way, and as you go along and you build your confidence and you build your competence we can take a step back. And therefore we can still ensure quality for our customers while scaling through the ecosystem. So this is, you know, it sounds strange, but we really do not want to do the services business. We want to do the services business that we have to do, not as much as we can do. >> And I mean, just picking up on that as well, is it's not only about enablement, we're actually actively sharing our tools and methodologies with our partners. So whatever we use ourselves we're making available to our partners. And that's fundamental, right? That's exactly what Paul says, is we want the partners to do exactly what we're doing, to the same level of quality and the same standard. >> And we have a stated vision that says that the customer experience should not differ whether they use IFS as their partner or they use a service provider as partner in their journey because it's about the experience around the product, not around the service, that should make the difference for them. >> I think you have a dog fooding booth here. I call it dog fooding, I know that's kind of a pejorative, but you know, your champagne, drink your own champagne, but, you know, IFS runs IFS. It's sort of a big theme here. >> Right behind us. >> So you guys have implemented, and this is what you're talking about, the tools and methodologies you use for your own business. What have you seen in your own business? What kind of business impact has IFS had on your business? (guests laugh) >> So we implemented our own, as you say, we drank our own champagne within six months. We came from an environment which was quite disparate, historically speaking. Many different systems in different locations and regions, and we brought this and consolidated this into a global template. This was hard. Harder than we probably thought it was going to be. Not technology-wise. Technology-wise it was, yeah, technology is what technology is, but from a change management point of view, and from a impact to the business, and to people's daily operations it was bigger than you thought. So that's a learning, we've captured this in our lessons learned. We have made some changes and brought in some new tools and methodologies and insights that we will share with our partners. But if you would now look at afterwards we're live, the impact it has on our business, it's transformational. It is giving us insights which we never had before. Given the efficiencies which we never had before. It opens up new things that we consider as doing as business and operating as a business which we never had before. So, yes, was it hard? Yeah, it was hard, that's not-- >> What were you transitioning from? >> All sorts. (laughs) >> So we had a-- >> One of everything? >> Yeah, I mean we literally had a cluster of independent systems that had all been modified, and I think this is another point, is that the historical approach to a lot of ERP installations is tell me what you want and I'll develop it for you, right? And even-- >> A lot of snowflakes. >> Yeah, exactly, and even if it means that we're actually going to build a square wheel, which is not, you know, not the best model, but that's what you want, so we're going to give you that. Whereas the approach we're taking now is, you know what, we've got enough capability and standard functionality from all of the years of experience that we have, go with kind of best, you know, best-in-breed approach. It's more than enough than what you need and it'll give you that ability to switch it on and go live and run with it immediately, rather than customizing it and spending three years and trying to get that square wheel, which is actually not what you really need. >> That seems to be the karma at the company, we've been hearing that all day about the value of not customizing. >> Correct, exactly. >> And the product itself and our solutions are very rich and we take this one step further and say, well actually, how can we get our customers to adopt quicker depending on the industry that they are in because we have to accept that the way you do a certain thing in one industry is not exactly the same as its best practice in another industry, for very good reason. So there's differentiation on how processes live in different industries. So, Stefano and team has been very busy building what we call the accelerators, and how do we bring those industry best practices together in two things, one is as a quick start. So, you know, here it is just use it and run with it and you're up and running in a very quick way. So that's our knowledge and experience that we share and we make it available through our partners as well. And secondly, it will allow us to keep that up to date as sort of the reference architecture for your industry to, as you go forward, you might, you know, be going one way with your implementation, we say this is industry best practice, and how do you derive value between the gap by adopting the gap between what is standard best practice and what you have in your solution. So, driving that value over the lifecycle as part of the success engagement. >> So you guys are senior executives at a global company, you talk to a lot of customers, so I wonder if I could get your take on sort of the macro from a spending standpoint. I mean, we see in the US, we're in the 10th year of a boom cycle. The IPO market here is kind of, the window's closed, I think at least for now, and Wall Street's rewarding growth, they don't care if you make profits. You know, things like cash flow, EBITDA, (laughs) they don't seem to matter. And so that's been going on now for the better part of a decade. When you look at Europe, it looks like it's softening, it's kind of overbanked, financial services, and no, you're exposed in financial services, certainly not in a big way. But, so what are you seeing across the globe just in terms of spending on tech and what does it mean for your business? I mean, you're a share gainer, you're taking share, so you should be somewhat insulated from any kind of flattening or softening, even though the softening is not precipitous. But I'm just wondering if you guys could give us your kind of anecdotal take on what's going on in the marketplace? >> You answer that? >> No, go for it. >> So I think, two things that we see happening. We see many more new customers coming on with us. So you saw this morning as well in the keynote, more than 50% of our revenue comes from net new customers to IFS. That is amazing. There's not another similar company that can claim that. We're outgrowing the market by more than three times the average. But that's one part of the story, the install base is the other part of the story. So the install base, what we see there is they are spending on the digital transformation, on getting ahead in their game. Tech is disrupting a lot of industries and it's enabling a lot of disruptors to enter markets that previously, and industries that previously were closed to them. In financial services you see that a lot, but also in the other industries, we see these young and upcoming disruptors coming. So, we see a lot of people and companies investing into the digital transformation, opening up new channels, opening up new markets that were not there before, but now with tech, and the tech that is available, is there. At the same time they need to create space in an investment, you know, nobody has unlimited resources. So they're looking at optimizing what they have so that they can free up some cash and capital to invest into some of these disruptive things. So it's really an exciting time to be part of the industry and really exciting time to be part of a challenging and a challenger company like IFS that really goes out and focuses on its industries, focuses on its tech stack where it matters. We're not trying to be everything to all men all of the time. We're really going after what we know we are good at and I think the numbers show for themselves that's-- >> Half of the transactions are new adoption of IFS, right? That's enormous. >> Paul Gillin: Capital license revenue. >> Paul Helms: That's from our license revenue. >> Okay, yeah. I mean unless there's a huge proportion leaving your install base which it doesn't sound like that's happening, that if people are just even spending flat with you guys it's a growth story. >> It's very, I mean, my opinion is it's all about choice. Customers want choice. They want an alternative, right? And what I think we're doing right, well at least, what I like to think we're doing right, is that we focused on business outcomes. That's really what it's about. We're talking their language, talking to their agenda, and we're giving them an alternative. >> And we're not forcing them to go into the cloud. We give them the option to go into the cloud if they want to, but they can also stay on-premise. We don't force them to go subscription model. The option is there, but they can also choose full perpetual. So it's really about giving them choice, talking to the customer business outcomes, and engaging in a really customer-centric and customer-intimate way along their journey. And it's working. >> So given the success you're having in, specifically in Europe, how do you feel about your ability to export that success to North America? >> Well, we're doing that already, I mean it's happening, and we're seeing growth globally, right? Yes, I mean, in certain regions it's accentuated and larger but there definitely is, it's a global phenomenon, we are seeing that. And I think a lot of it is also coming back to our focus. And I think you made the point to this, we're not trying to be all things to all people. Where we focus, that's where we really excel. So, the kind of answer to your question is less about the geography, is it more about the industry, is that what you want to focus on regardless of where they are? That's the approach we're taking. >> And also the capabilities we're bringing into the field. So there's management, has been a very healthy growth area for us. You saw this morning, again, we just announced the acquisition of Astea that will further enhance our capabilities in this place, they're really a leader in what they're doing. So that level of focus makes us win in our industry and our marketplace. >> I mean, that looks like a good acquisition. That starts to lever a relatively small company but, and you picked it up from what I can tell pretty cheaply, but the impact to your business is significant. So, that's good, congratulations. All right, gents, I know we're probably keeping you from important customer dinners and touring Boston, so thanks very much for coming on theCUBE, It was great to have you, we really appreciate it. >> Thank you. >> Thank you very much for having us. >> All right, thank you for watching. Paul, it's great working with you, and that's a wrap here. >> As always, Dave. >> From IFS World in Boston, and this is theCUBE. Go to siliconangle.com for all the news. Go to thecube.net for all these videos. And we'll see you next time. (futuristic music)

>> Narrator: Live from Anaheim, California it's theCUBE covering Nutanix .NEXT 2019, brought to you by Nutanix. >> Welcome back, everyone, to theCUBE's live coverage of Nutanix .NEXT. We are wrapping a two-day show. I'm your host, Rebecca Knight, along with my co-host, John Furrier. We saved the best for last. We have Ben Gibson, Chief Marketing Officer and Monica Kumar, SVP Products and Solutions at Nutanix. Thank you both so much for coming on theCUBE. >> Thank you for having us. >> Yeah. >> So congratulations on a great show. 6,500 attendees and 20,000 were live streaming. We had Mark Hamill, Jessica Abel is speaking next. Energy, a great vibe. Congratulations, you both get a well-deserved vacation after this. But I want you to, Ben, close out the event and tell us a little bit about what you hope the attendees is come away with. >> Yeah thanks, and thanks to theCUBE for joining us here-- >> You are welcome. >> It's a long marathon, right, over the last two days. And thank you for the great coverage you provide for this event. Yeah, we're thrilled with the event, and for us, it really starts with getting even deeper, more connected with our customers, right? And so we do great keynotes and there's a lot of new product announcements which I know have been covered in good detail throughout the last two days. But at the core of it, it's how do we make our customers better positioned for how they do their jobs. So it's training and certification and networking with their peers, and you hear that all over the place. And so as excited as I've been over the last three days with the event and the grandeur of it all, the thing that really gets me pumped up the most is when I see these ad-hoc groups that just come together in a hallway, and they sit down. I go over and say, what're you guys up to? and we're like, well, this is like our AHV mashup group, and we get here and we talk about key challenges we have, key opportunities, best practices tips, and so it's that network effect for me above anything else is what is at the heart of this show. >> One of the highlights we pointed out yesterday and today in our intro was the community vibe you have here. You have a great loyal customer base, Net Promoter Score of 90 which is a monster number, congratulations. But it's a small intimate event, you guys were able to not make it a trade show but a conference that was intimate, content driven, content value with nice tracks. Lots of comments on the tracks. So a lot of good highlights. So my question to you Ben and Monica, what's your highlight so far? >> You know, I'll take this one. As a newbie, I'm one of the newest members of the team at Nutanix and this is my first .NEXT. Even though you say it's a small event, it's still 6,500 plus people and about 20,000 attendees online right. So I think it's still sizable, but the beauty is that we're still able to maintain that community feeling. And so for me the most exciting part was not only meeting with customers like our SisAdmins, DevOps folks, developers, IT directors, CIOs, partners, our own employees, we're like bringing everybody together here to discuss how we can make things better for the customers, and what are things that are working and how can we improve. So I think to me that's one of the biggest thing I'm taking away as I go back, is what we can take as a feedback and how we can do things better in how we bring products to the market. >> Ben, highlights for you? >> Yeah for me, well first of all, I got to interview my boyhood idol, Mark Hamill. (laughter) >> Pretty cool. >> And that was a lot of fun, right. And we've just gone through in an hour and half of great content, our Nutanix Mine announcement, that was great, we announced AHV support on frame. So that was exciting to me and then, the cool thing about our show is we like to mix it up with something that's really fun. And in my case and I know with many people in the arena, and I saw the meet and great afterwards, to bring out Mark Hamill. I had to contain myself because I am a big Star Wars geek at my core, and we had a great conversation. And you know when you feel the room, I felt the room of 6,500 hanging on his every word, right? And he talked about persistence in his career, how he started out, all the rejection he got earlier on. We talked about his career journey, so on a really fun way, it kinda connects with a lot of journeys we have with the professionals in the room that are going through a lot of change and rejection or taking a risk or a chance on new disruptive technology. >> Yeahm it's really been a home run. First of all, the theme of having of Star Wars and Mark here was really great because the demographic, we all love Star Wars, so nice connection-- >> Who doesn't? >> Nice connection to the tech audience but your customers consistently say in theCUBE and off theCUBE, in the hallways and other conversations that they took a bet with Nutanix and it paid off. And that's the rebel kind of mindset inside these cultures of pre-existing legacy, vendors, and so you guys are breaking through. This is a big part of the marketing, is to enable those rebels to be now the mainstream. >> Yeah it's, you know you're right, it's rebellion, you know, that's spreading and growing, but as a marketer here, there's plenty of conversation about how we differentiate, right, and the outcomes we create for the customers but then when I see one of our early customers, and we opened the conference, he shared a picture where he was flying in a Cessna plane over the Grand Canyon, and he had his iPhone, he was managing his clusters with Prism on his iPhone. And what he said was the outcome for me, yeah there's total cost of ownership, yes, there's high performance levels, you can go through the traditional outcomes that IT folks look at. But at the end of the day he said, I'm able to spend more time with my family, and that sounds kinda cheesy, but it's real, and you sense that and you learn about that when you're here with customers. And with Monica coming on board, yeah, we've always been great, I think, at marketing and communicating our technology advantage but it's about more than that, right? >> Yeah. >> Talk about about your role, you have a stellar career, you're now new to Nutanix, you're not new to the industry. What's your focus? What you're gonna be working on? >> As with everything we do at Nutanix, it's all about the customer, so we are obsessed with making sure that the customer has the best experience, whether it's with product quality or how we take our products to market. How we message it to connect to what problem that they need to solve. So I think the biggest challenge we have as a company, the opportunity is, we know the customers are moving to the cloud. Customers are embarking on journeys to a modernized infrastructure. They are embarking on journeys to be able to use multiple different clouds. There is a lot of complexity out there, so our opportunity is to simplify that complexity for the customer. So that's what I am going to undertake with Ben here, is come up with right solutions, the right packaging, the right messaging, the right offers for our customers that can make it easy for them to get on their journey that they choose to get on to the cloud. >> Rebecca and I were talking about on the kickoff yesterday, 10 years old, CUBE's ten years old, so we've been following you guys for a long time as well. You're growing up. You're still a young company, you've said you're a billion dollar startup. >> Yeah. >> That's the culture. What's next for you guys? What's the goal? What's the objective? Because you've built a great community organically, your content is on the mark at the conferences, also digitally, there's nice organic kind of discovery for your customers, are learning about Nutanix. Word of mouth is big, network effect you mentioned, new cultural, younger generation. So you got a lot of things working for you. What's next? >> Well, thank you. I agree with those things, (laughter) but I tell you, here's one thing I've been thinking about towards the opportunity. So if you look at the past year, and I talked about this in our recent investor day, that if you look at the amount of IT Spin tied to traditional three-tier data center architecture, storage, network, compute, running in separate silos, hundred billion plus in annual spin. Hyper conversions, great new modernizing infrastructure play, the market spend on that this year is probably five billion. So if you think about that, I think about only 5% of the legacy world been modernized. And I am not claiming a 100%, but I am claiming well north of an opportunity, well north of 5% to get there. So fundamentally, the first thing what's next is there's a lot of green field left to take advantage of here and for customers to understand the value, human value, as well as financial and operational value, of what we're up to here with our customers. And so that's next, and then at a higher level, and I know it's something Dheeraj and Sunil talk a lot about, it's, we've hyper-converged infrastructure, made that essentially invisible, much grander ambition, how do you hyper-converge clouds, how do you take the complexity Monica was just talking about and provide a lot of simplicity for App Mobility and the like and take that to the next level. So to me, there's still the core mission. We're just getting started right. >> You know I asked Sunil that question, I said, how do you make that happen? And he had a great comment. We weren't on camera, I wish he had said that on theCUBE. We were off theCUBE before. He said, "Well, people tasted Amazon, they tasted cloud, "and now they are gonna bring that "mojo to the enterprise on the premises, "because they realize the benefits of cloud by itself. "But they can't get everything to the cloud. "So they gotta get modernized on premises "and operating model, not so much a refresh." >> To add to that, if you think about the role of technology right, the role is to make our lives easier, whether it's at work or in our personal lives, so I think the next big frontier is all around automation. I think this whole move to the cloud is because people want to automate a lot of the mundane tasks, we've talked about that in the past with data and such. I think the same applies to infrastructure, so you're gonna see us really focused a lot more on, how can we help IT automate? A lot of the, you know, keeping the lights on type of tasks which could actually be easily be done by the machine or in the cloud or by the software, human beings then can focus on more important things. >> Right whether it's being over the Grand Canyon with your children or meaty tasks of our jobs. >> Exactly so it's about making IT become a service provider rather than a cost center. I think that's what we're gonna enable with our softwares, we continue to go forward. >> I'd love you to comment on Ayanna Howard, Dr. Ayanna Howard's keynote this morning, where she talked about actually smart machines working together with smart humans, and how that's really the collaborative AI, and that's really where the future is heading. How do you think about that, and how do you message that, and how do you approach that within Nutanix? >> Yeah I totally agree, it's not human versus the machine. It really is human plus the machine. It's the combination which is gonna be most powerful in how we adopt technology to make things better for us. Like I said, whether in our personal lives or work lives. I know a lot of examples in my own personal life that I can see how machines or softwares changed the things I used to do before which I don't do anymore. There's lots of examples, I know when growing up in India, we washed our clothes by hand and now we have, when I moved to U.S., we have the laundry machine, right? I mean, there's lots of small, small things that are happening now, we talk to our Alexas and we can command people, to call people, to turn the music on, to turn the lights off and what not. And I actually have benefited from those, my parents, I'll give you an example, I have older parents who live at home, and now it's amazing, my mom can say, Alexa turn off the light, or turn on the light if they have to wake in the middle of the night, guess what it's not dark anymore, the light gets turned on, it's a real use case, you know. (laughter) They won't trip and fall. So I'm like thank you Alexa (laughs). So I do think that power of machine and human is the combination where we're going next, and I think Sunil touched on it somewhat in his keynote too. We're talking about autonomous data centers, right. That's exactly what it is. We are injecting more of machine learning, more of AI technology in how we are analyzing the operations, and then how we act on the predictive intelligence that we're getting from the operations to fix things before they break. >> Ben, I want to ask you a question on the marketing side because one of the things that came out of the top stories that we identified here at the show was the move to software. It's a big part of Nutanix next generation shift and growth is gonna come from just software, not hardware, just a software company. And also Dheeraj mentioned that he has a new customer, Wall Street, (laughter) and so he has to manage that. He had a great answer on how he's gonna balance the short term Wall Street-ers and the long game that you guys play at the Nutanix, so you got the software transition, the middle of it, different economics, software economics are much more stronger than process improvement, box changing, changing boxes in a data center. So software's going to be a nice impact across the long game, but Wall Street may not understand that software, and as you guys go to the next level, from hiring and marketing software, how are you guys thinking about that? I know it's about a year under your belt now with software, what's the orientation? What's your posture for to the marketplace with the software play? >> That's a good question. I'm sure, you know, Dheeraj likes to talk about Wall Street and Main Street, right, and how do you balance the two. And yeah we are disrupting along established market. We are moving from hardware to software now rapidly in subscription-based consumption models, and we're doing all that at the same time we're growing at the rates we're growing. And so it's a lot of juggling in the air, right? >> And I'll throw channel in there too, you gotta channel the merging, your partner strategy is looking really good. The HPE relationship is I think a great signal, potentially, in more local expansion, more breadth channel marketing on the table (laughs). New things. >> I mean, the way I think about it, as a marketer here, is, you know, and Monica touched on this, how do we create and provide offers to market that take advantage of the freedom of choice of consumption of Nutanix, right. And then how do you take those to market through your sale organization, how do you increasingly take new offering and capability to market through the product itself, which is a well-worn practice in the SaaS world. And then the channel partners is a key part of this because the partners that really, and I met with many here this week that really on top of this, they want to build that value-added practices that are about providing new services and offerings on top of that software, and then to be able to offer it in effective ways. The marketer has think about how do we incentivize, how do we package, how do we message to bring these to the market. It's candidly a transition for us, but it's an exciting one. At the end-- >> And you guys, and you were open about it too, you recognize that it's happening. >> Yeah, and I see it, you know, those moves can be challenging, but those are also moves I think that Wall Street likes. >> Evaluational increase. >> So we're nearly finished with this conference, but we're already think ahead to the next one in Copenhagen. So talk a little about that, and then Nutanix Americas in 2020. >> Well good, so we're looking forward to taking the show across the pond to Copenhagen. We had a great, our Europe event last year in London was amazing, right. We had record turnout. We had close to, for a user conference, 35% of attendees were not even customers of Nutanix yet. And often for these conferences you see more existing users and then maybe some, and we so expect that trend to continue. We have a lot of traction across Europe, Copenhagen is a beautiful city. There'll be plenty new to announce there, so I can't leak anything early on that front yet. But that's gonna be exciting show. >> Come on. (laughter) >> It's taste. >> We won't tell anyone. >> And I'm sure he's gonna be hobnobbing with yet another celebrity in Copenhagen. I've renamed his title. He is the Chief Celebrity Officer at Nutanix now. >> Well, he and Mark Hamill are-- >> That's right. >> But we're best friends now. (laughter) >> And he was with Magic Johnson earlier. I have a long list of people he's been-- >> You're killing us. >> No, he is. (laughter) >> Yeah, Freddie Jackson. >> Well you know, all joking aside, it's customer experience. And if it's all business, it's all product and all technology, right, then you know, that's a certain level of experience, but part of this is the community and the happiness that we see in our customers is we make them happy, both in the technology we deliver, the partnership we enjoy with them, but then also some fun experiences we deliver to them. And that's the spirit of this show. >> Yeah you guys do a great job. I want it like highlight and also get your thoughts, and I want you to share with folks watching 'cause you guys do a great job on the content programs at your events, the mix and match up of the core meat on the tech bone, the solutions, but balance of guest hosts, guest celebrities kind of blend in the theme. What's the secret sauce? What's the playbook? What's the thinking behind lot of the content and how's that gonna translate digitally because you guys mix it up, it's not just all Nutanix all the time. You got partners, you got people from outside the industry, seems to reinforce, the threads kinda connect together. What's the, how do you guys think about that? >> Yeah well, the secret sauce at the core of this, Julie O'Brien, a woman named Erin Alonso on my team. We have a strong, small but mighty, very creative events team that understands that at the end of the day this is about learning, but it's also about show business too, right. And people want to come to relax, to learn, and to have fun too, and I think it's balancing the two. But it's not just, okay it's Mark Hamill, because he was in Star Wars. It's because we knew Mark had such a tight, iconic connection with our core demographic, in terms of the core customers we have, and I saw our customers, some with tears in their eyes when they were able to meet him afterwards. And so, okay there's, and I was joking hyper-convergence, I was talking to Mr. Hamill, I said, hyper-convergence, hyper-space, right, there's ways to connect the two together. But there's technology at the heart of both of that. So it's just a new and unique and surprising way, and one thing, I close with, we endeavor in marketing here when we run our campaigns, when we do our events, surprise and delight. Surprise and delight. It's inherent in the product with one click, and everything we do there, and we'd like to think it's inherent in our marketing and also an event like this. Surprise and delight. >> So Monica who'd your hero be up there on the stage? Who do you want to see at the next-- you boss is right here, (laughter) this is your chance to influence-- >> Oh my god, okay. If you really wanna know (laughs), he'll have to fly in from Bombay India, the movie star Shah Rukh Khan. He's got known as SRK. But he is a world-famous icon. So there you go, next one SRK. Talk to Sunil about it, he knows about SRK. >> We hear you. >> Note, noted. >> Well then Monica, thank you both so much for coming on theCUBE, always a pleasure. >> Thank you. >> Thank you. >> Thank you very much. >> I'm Rebecca Knight for John Furrier. You've been watching theCUBE's live coverage of Nutanix.NEXT (techno music)

>> Announcer: Live from Anaheim, California. It's theCUBE, covering Nutanix.NEXT, 2019. Brought to you by Nutanix. >> Welcome back the theCUBE's live coverage of Nutanix.NEXT here in Anaheim California. I'm your host, Rebecca Knight. Along with my co-host John Furrier. Here we are, we're at day two, John, this conference, I gotta say it's pretty cool. 6500 people, we're steps away from Disneyland, and, you go to a lot of these things every year. I also do about a dozen or so for theCUBE. So in other words, we're veterans of this kind of thing. This does seem to have a different vibe and I think it really gets to the kind of company Nutanix is, and where it is in its journey. >> Nutanix is still a small company even though they're 10 years old, as Dheeraj talks about. The numbers aren't massive, I mean, we go to a lot of other shows where it's 15,000, Amazon Web Services just had an event in London, Dave Vellante was out there covering, Stu was covering Red Hat summit in Boston this week, tons of events going on. Amazon Web Services' summit in comparison was 12,500 people, 22,000 registered, that's a summit in London. It's not the re:Invent main conferences like 30,000 people. And that's always sold out, so they got a lot, in terms of attendees numbers they're still in the entry level, mid range growth. But I think that's okay, they like that culture and I think the story here at this show is intimacy, they would rather err on the side of better content and more intimate opportunities for their customers to really get the straight scoop. And I think it's less of a conference slash trade show, more of an intimate relationships where they can provide feedback, for customers to give feedback, and for Nutanix to figure out with the customers how to connect to them. So, I think the story here is, Nutanix is growing up as a company, they're 10 years old and they gotta go the next level and the management team has technical chops, and they have a long term view. They have that 20 mile stare, they can see out and they're trying to figure it out. I still think that the numbers are light on their forecast I still think that there's some sandbagging going on there, I'm not saying they're sandbagging, but I mean, I think, you look at Essentials, which is the enterprise and then multi-cloud, the numbers that we're seeing at Wikibon are much bigger, and Amazon reflects that. So I think they're being cautious but smart about how they execute off their success they've had in the first 10 years to go the next 10 to 20 years and I think that's clear in the management team, that they wanna build a durable company. >> Well exactly, and I think that that's what's really coming through, is that this is, as you said, they're growing up. This is a real coming of age moment for them, they've celebrated the 10 years. Okay, so what kind of company are we? Who do we want to be? And what's coming through is that from the technology side, they get it. They say, I'm sort of reminded of the Henry David Thoreau quote, our life is frittered away by detail, simplify simplify simplify, that's what customers want. They want this one click data recovery, they want their credentials to be assumed. You know who I am, I'm safe to be in here. Fixing things, dealing with that. So I think that they get that, that simplicity is key. They also get customer service. I mean their Net Promoter scores, as we've noted, are in the 90s, that's just unheard of. >> It's monster, monster numbers. >> It really is and so they get it. We need to be responsive to customers, we need to have a personal relationship with these, because it's not just organizations, it's people at the other end of these transactions. >> I mean, I think Nutanix, one of the stories that's popping out in the hallways as I walk around and talk to customers and people and the company and partners, is that Nutanix has a lot of headroom in their growth. I think Wall Street is interesting and you heard Dheeraj talk about that yesterday, about having a new customer, you asked him about his management style and he said quote, I have a new customer called Wall Street. And I have to balance that against mainstream enterprise which is his core business. And so he as a CEO and the company are dealing with this new stakeholder called public company customer retail stock buyers. That's a short term cycle and I think, if you look at their stock, they had a big knife edge drop in the past quarter. And I think the shorts are circling, it's a whole nother dynamic, it's a whole nother theater for Nutanix to deal with, and I think that's something that they gotta get used to. And he was clear, he said I'm addressing it, we're gonna balance it, but they gotta be thinking long term because this company has a lot more to do and their customer base are risk takers. Because everyone we talk to has this different style or persona. They're smart, they're usually engineering oriented, they love engineered solutions. And they're taking chances. And everyone who's taken the chance with Nutanix, has paid off. That seems to be the theme. And as we were talking before we came on camera, Mark Hamill, Jedi knight, you know, Star Wars, was on stage giving the keynote, their customer base, is a lot like the Jedi order, right? I mean they see themselves as, elite, technically, they're not afraid to take organizational risks and push that DevOps culture. And we heard that from Sunil, the chief product officer that they're really looking at, this new way to do things, like they did with hyperconvergence, they pioneered that, set the table on that and foundationally built that. They wanna take that same playbook of HCI, hyperconverged infrastructure, and apply it to the cloud. And provide an abstraction layer advantage and I think that is clearly their strategy and that's, to me, the top story here. >> I couldn't agree more and I also think that, what is also coming through is this idea of we don't wanna be safe. What's clear is that, consumer technologies have leapfrogged IT enterprise vendors. The things that we hold in our pockets are so much more sophisticated than what businesses and organizations, multi-billion dollar businesses and organizations, are using, what their employees are using on a day to day basis. So we expect a certain kind of design and ease of use, in our personal lives and they're bringing it to enterprises and think that that is really what's exciting and interesting about this company. >> What's interesting about their story is that, the consistent theme about the customers is that it's kind of a consolidation story but that's not the real story because back in the old days of IT, consolidation was the strategy. Consolidate vendors, consolidate footprint to reduce cost, clearly a cost reduction. With Nutanix what they get is they get consolidation, and they enable advantages so the real value of Nutanix is to be positioned for those new kinds of app developers, so. This is like, you get consolidation as a side benefit for enabling the value, and that's the theme that's coming out of all the customer testimonials and interviews is, we gotta do more, we gotta create more enablement for the app developers and we gotta provide more performant storage servers and software for the customers. And that's their main focus and they consolidation as a benefit. That's gonna scare a lot of people and customers that I've talked to said, hey I got all the stuff but I can't just throw it away tomorrow, I gotta move it out over time, so, this is the Nutanix sales challenge, how do you move faster with all that incumbent, legacy stuff in these datacenters, while enabling the multi-cloud capability? >> And we're gonna be talking about that more today with Chris Kaddaras on the show. We have a lot of great guests, we have the CIO, Wendy Pfeiffer, I was reading an article about her today, she answered an ad as a teenager to work for NASA. She had an idea for NASA and so we're gonna hear much more about her story, we've got a lot of great guests. >> Well what's your take? I mean, you've been here, you're getting immersed in. What's your take of the show, what's your analysis? >> Well, what's really interesting to me is that we're having this conversation against this backdrop where, the technology industry is really under fire. I mean, we heard Ayanna Howard here on the show yesterday and then she was up on the main stage today, talking about the good, the bad, and then the really scary elements of AI and how it really has these powers that can do a lot of wonderful things and help children with special needs and help workers be more productive and engaged and collaborate. But yet, there's also this much darker side that AI's really only as good as its creators. And then the other difficulty is that, because we have become so trusting of these machines, we disregard our own intuition. And that is a really scary element, so. What I think is exciting, and it goes back to this risk taking mentality, that Nutanix has, is, we're gonna talk about these things. We're just going to forget about them or they're gonna be a sideshow, this is really on the main stage, let's talk about our values, let's talk about the humanity of technology and this is really an important part of the conversation. >> It's interesting, the culture, we talked about the culture a lot yesterday. And you can see from the mix of the guests we've had here and how they're putting their content together across the show portfolio, it's not just speeds and feeds. There's a lot of tech for good angle but they're not tech for good stories like hey, look, here's a tech for good story. Look how good we are because we promote it. They're authentic people that have a great story that has a tech involvement. But it's not a pure Nutanix messaging kind of thing. >> Right, and it goes to back to their values, the humble, hungry, honest, and have a lot of heart. I mean I think that that is, you really see how important culture is, when it is top down. When Dheeraj embodies certain characteristics and traits, you see that employees then look up and they say okay, this is what we're about, this is who we are. >> You know, we also talked yesterday about our analysis in the keynote, what's interesting about culture is, there's also a culture shift going on inside their customer base. And again, it's back to this kind of Star Wars theme, Jedi knights and the revolution continuing for Nutanix, their opportunity is to continue to stay on the course, and this is gonna be a big bet for them, they gotta make some big bets on the technology side, which they're making, but also they have an opportunity because a lot of their installed base are rebels, right? So you have this rebellion IT guy, generational shift where you have DevOps coming in and Gene Kim who wrote the book on DevOps, runs the biggest DevOps event in the world, series of events, DevOps Enterprise Summit, he's even saying it's about 3% changeover. So I think there's a big tailwind coming for Nutanix. Around DevOps, operating models, in the enterprise and cloud where, the convergence of those two worlds coming together, and it's gonna be a younger generation, it's gonna be a different world. If that happens, I think that's gonna be something that Wall Street might not see. I think that's kind of an area. And that's gonna be a good tailwind for Nutanix. The other notable thing that I would point out from this show is, the presence of VMware visibly in the conversation. And I think Dheeraj was talking about, hey we don't mind talking about VMware because they validate the marketplace, they're the big 800 pound gorilla. And we're gonna continue to innovate around them. We don't need their Hypervisor, customers don't need to pay their vTax, that's his messaging, so that was a key notable. The other one was the challenge that Nutanix has, this is, again, might be a Wall Street insight for some of the Wall Street folks out there is that, their challenge has been getting new logos. Their cost to sales is a little bit high because they require POCs and once they get in there they usually win. And then their cost per sales, cost per order dollar on the sales side once they have a customer, is very low, they get more renewals and they have more net contract value so they have great customer economics on that side. The Hewlett Packard Enterprise deal for them, could bring them a tsunami of new logos. That could give them a lot of leverage and bring their customer base well above their 12,000 number now. And bring them up into a whole nother level. So I think the HPE deal will be a tell sign on the numbers, and if they can get more new logos in there, the big accounts that HP has through their channel, that's a big story. So VMware, HPE, culture, all the main story here. >> And of course we had HPE on the show yesterday, talking about that very development, so. We have lots more great content, great guests to come today, this has been just a ball hosting with you, so I'm really for another day. >> Very intimate show, I mean, Nutanix are a very intimate show they don't really care about the big numbers, they want the right numbers and that speaks to their culture. >> And they know their people. Because as we talked about many times, Mark Hamill, up on the stage yesterday, so, they know their community. Please stay tuned for more of the coverage from theCUBE of .NEXT here in Anaheim. I'm Rebecca Knight for John Furrier, stay tuned. (electronic music)

>> Announcer: Live, from Anaheim, California, it's theCUBE, covering Nutanix .NEXT 2019, brought to you by Nutanix. >> Welcome back, everyone to theCUBE's live coverage of Nutanix .NEXT here in Anaheim, California. I'm your host, Rebecca Knight, along with my co-host, John Furrier. We are so excited to welcome back to the program, Dheeraj Pandey, the co-founder/CEO and Chairman of Nutanix. Thank you so much for coming back on theCUBE. >> Thank you for pronouncing my name diligently. >> You are welcome. >> John: Gotta work on that. >> So, Dheeraj, it was a poignant moment in the keynote when you got up there with many of the people who were sort of employee number one, two, and three, four at Nutanix. They are the builders, the dreamers, the visionaries, the innovators, the disruptors of this company, a company that you started. So I'd love you to just start out by reflecting a little bit on your journey and sort of how Nutanix has evolved. >> Yeah, I mean it's a poignant 10 years, you know. The moment itself is poignant and it brought a lot of nostalgia, you know, for just looking at the early folks and how we had to huddle together in the smallest of technical blips that you'd find in our thesis, because our thesis was very bold. It was, like, hey, we can put a lot of hardware into your software. It's, like, the way Apple would say, we'll get rid of the camera and make it into an app. Like, what? There's no need for a camera anymore. So that's what we had to do with data center infrastructure. So, those moments are memorable, they're etched in history and my memory, and every time you get a tough moment now, we actually invoke a lot of those tough moments from the past and say, look, the more things change, the more they remain the same. >> The beautiful thing about theCUBE, is our 10th year as well, we've been following your journey as well. We actually have soundbites of the early interviews, and one of the things I was always impressed with you guys was you stayed the course, you didn't waver on what was fashionable at the time. HCI was an early category. You were misunderstood at the beginning and then the numbers started to show and you guys built a great business. But now, you're 10 years old, you're public. All the numbers are out there. You gotta go the next level. This is your challenge with the team. What's the focus? What's the strategy? What's the marching orders for the team now, as you go past 10 years old? You got competitive pressure. There's marketplace. The numbers are there. It's a big piece of the pie there. >> Yeah. You know, I go back to everything I just said in my last answer as well. The more things change, the more they remain the same. The friction hasn't changed. Five years ago we were a much smaller brand. We didn't have a customer base. We didn't have money in the bank and we still had to keep raising money to fund ourselves. Today, we are running this business, spending, you know, a billion dollars every year now. But it's a free cash flow neutral business, and we have told the Street that we gonna keep running it like that, but just go back to the basics. The basics of this company are what made it come to here. The same basics will need to take it from here to the next 10 years. 10 years is the new zero. I mean, I said, look, we've reset the clock and it's a very metaphorical thing to say, but it's the new zero for us, you know. So going back to the basics are the three Ds I talked about. Data, we are greater data. And we continue to be amazing at data. Reliable, highly available, high performance data management. A greater design. You know, just making things simple, and we're really really really good at delivery and when we suck at it, we go and improve and are very resilient in delivering things, you know, so whenever some things falter within our customer success, customer service, the way we delivering things with your software and subscription, I think nobody can touch us in these three Ds. >> As you guys have proven a great loyalty, customer basis, very loyal on the product. As you have to go multi-cloud, as the Enterprise gets modernized, this is a big part of your current business. What are some of the things that you're looking at, in terms of these new products? Because you don't want to open the door up for either a competitor or a misfire on you guys. You gotta continue to provide product leadership. >> Well, the most important thing is honesty and vulnerability. The fact that these things are not awesome big products yet, but they are awesome nonetheless. So how do you really have the small wins? You know, I go back in time to, Look, it took 10 years for Amazon Prime to become Primetime. It took six years for YouTube to even start to figure out who YouTube is really gonna be, and you know, Google bought Writely, which was the company that became Google Docs. Five years, they didn't know what they were doing with those things, so what's really important for the new products is this long-term greed. You know, the fact that you really have this 10 year view of a multi-product portfolio, but the most important thing is how they gell well together, how they really integrate well together, because if we don't integrate these products, and we just throw it out as things, as opposed to an experience. Customers are, like, I can buy things from Best of Breed. So how do you really make these multi-product look like an experience is where the real Nutanix design value is actually shown. >> One of the things that you guys have a good customer reaction to is the simplicity and how you can integrate well and reduce all these manual tasks, which is, people talk about automation and everything, but you guys have customers saying, "I went from 24 racks to six. "I now run everything with the push of a button. "Not there yet with the one-click but pretty close." That sounds like the multi-cloud game right now, where it is kinda hodge-podge. No one's actually figured out how to bring it all together and orchestrate it. >> That's the money statement, John. That's where the money is. Complexities where we go in and really figure out how to really save money for our customers, make money for our partners and make money for ourselves. >> And the partner-side, HPE, a big announcement that you guys have been part of. They're gonna be coming on today. How's that going? Give us the update on the HPE. >> You know, the energy levels are high, but there's a bell curve of people, you know. You can't have everybody really be an innovator, an early adopter. We're looking for innovators and early adopters. Some great discussions happening with HP account managers. They're our account managers of very large accounts, and the word-of-mouth has to basically play its powerful game actually. >> I wanna ask you about innovation. Earlier, on a CUBE conversation, you talked with our own John Furrier, and you said, we disrupt ourselves, but you also just talked about these products being these sort of long-term play and really thinking about what the, more of a holistic view of what the customers need. I wanna hear about the Nutanix innovation process and sort of how you have kept that culture of a tech start-up now that you are a company with a market cap in the multiple billions. >> You know, as I said before, we are like a billion dollar start-up, you know. And it's not easy, because everybody wants you to grow up, like, behave and grow up, and I saw one of my slides in there taking real potshots of the sand and we haven't changed much, you know. So in many ways, we're reminding everybody that it's still Day Zero and Day One. Is the great cultural gravitas that we need to keep, retained in the business, actually, in the company? You know, having the kind of humor that we had, and you know, keeping it personal and personable with everybody, as opposed to, you know, stiff upper lip, and suits and mahogany tables and corner offices. Those are things that are the antithesis of what Nutanix is. And just keeping it humble, you know. Like, the fact that even though we have layers of management in the middle, how do you go six levels deep and really have a conversation as technical as you wanted it to be and as business incisively as we want it to be? And you know, there's a lot of things you can do by going six levels deep that otherwise were not possible if you just said, look, I just talked to my next level action team, and to us, that's the engine of innovation. >> And how is your leadership changed? >> I have a new customer called Wall Street. >> That's true. >> 'Cause you know, they buy my product. It just happens to be a retail product that you folks can buy, too. It's called NTNX, the ticker. So I have Main Street customers and then I have Wall Street as a customer, and I need to figure out where to really keep them balanced, because I sell products to both of them, and it's a journey. You know, it's never easy, because there's a customer that actually wants instant success. There's another customer that says we are with you for the long haul, and what I need to find in this Wall Street customer is the ones who are actually for the long haul. My leadership, actually, is about balancing the two together. >> So let's talk about the Wall Street thing for a second, because I think that's interesting. You've always said to me, you're gonna play the long game and you do. We've kinda proved that, but Wall Street, they're very short sighted right? So the earnings come out, you gotta deal with the shot clock, as a public company. As you go to Wall Street, how are they looking at the long game? Because there's major examples. Microsoft stock's at an all-time high. They were in the 20s a few years ago. Cloud obviously is validated, so you got a cloud vision, this cloud marketplace. You're in the core enterprise, which has been revitalized with private cloud. Again, proves your thesis originally. So you're in good position and you got the cloud game right there. What are they missing? What's Wall Street missing? >> I think the biggest thing is that in any transformation is actually messy. Look at all the transformations in the last 20 years. The good thing is that those that took the tough call of transforming themselves, they really have done well, you know. And this is not just Microsoft alone, but Adobe, where I sit on the board. There is Autodesk and there is Parametric PTC and Cadence and many many other companies that have gone through this transition of getting out of the box to being software and subscription actually, and that's the journey that we said we couldn't punt and postpone 'cause we wanna be a hybrid cloud company. How can we not have subscription on prem? If subscription is gonna be the off prem, it has to have on prem subscription as well. And I think it requires communication, constant communication, watch, don't be stupid, with Wall Street as well. >> Well, Wall Street likes those valuations. If you look at the SaaS companies, or subscription-based companies, their valuations are really on a multiple, much higher than, >> I mean, look, valuation, to me, is not an end in itself. If you do it right by Main Street, I think this Wall Street thing will take care of itself. >> Awesome. On the long game with your innovation, I gotta ask you about how you're gonna look at the partnerships and integrating in, because the competitor out there in the middle of the room there is VMware and Dell Technologies. They want to go end-to-end and they want to own everything end-to-end. You guys are taking a different approach. Could you share your competitive strategy in terms of how you guys are different than that, because you're partnering? You're competing in a different way. >> Yeah, as we go into becoming a bigger company and yet, having a real child-like brain, I think it's important, really, that we are in this cooperative world and every competitor is also a company we cooperate with. Look, I mean, we run on top of VMware and more than half our customers still use VMware underneath us. We are an app on their platform. So we are a platform company. We are also an app company and our platform should run all apps and our apps should run on all platforms and that's the way we look at it. That's the reason why Microsoft is relevant again, 'cause they're still looking at, rather than a single stack strategy, how do you really look at yourselves as living two lives actually, you know? And to compete, you just have to go back to the three Ds I talked about. If you just keep doing a really good job of data, disrupting the biggest hardware players out there in data, and be really really good with design and elegance and friction-less delivery, I think we'll be in good shape. >> One of the compliments that the analysts on theCUBE always pay to you, Dheeraj, is that you have a really good sense of the wave. You really know which way the technological and economic winds are blowing. I wanna know, what do you read? Who do you talk to? What signals are you paying attention to? Or is it just this innate sense you have that the rest of us can't hope to ever achieve? >> Well, thank for that compliment, first of all. I'm honored. But I just have this simple mantra which is, the more things change, the more they remain the same. So I bring a lot of things from my consumer life because I read a lot about consumer life and I have a little bit of an artist in me and even though I am supposed to be a geek, I was telling somebody I was trying to recruit the other day that, look, I'm really, at heart, an artist, more so than an engineer, and I think a lot of what you see in this conference and this company and the product portfolio, it's really the empathy for the other side. You know, that really brings out a lot of the innovation, and obviously, I don't innovate alone, but the people that are with us in this company, I just try to tell them about the empathy that I invoke for everybody else and I read a lot of history, I'm a big history buff, and not just the last 30 years of IT, which I invoke a lot, but I'm deep into, like, the history of humans, you know. Like, last two weeks, I spent a lot of time reading about Neanderthals and the hybrid Neanderthals with humans, modern humans, and there's another ones that they found in these caves of Denisova. They call Denisovans, you know. So I read a lot of history and that gives me a lot of perspective and a lot of courage and I bring a lot of those things into this new life, that's again, as I said, it's the same as the old one, with some new color. >> You're an entrepreneur. That's what entrepreneurship is all about. What entrepreneurial thing are you working on right now? 'Cause I've known, You've gotta have your hands in some new things. What's the new entrepreneurial thinking or project that you're taking on? >> Well, the one that is very interesting one for operating a business is Capital Allocation, and it's a difficult one because you have to, basically, be somebody who really balances content and delivery, you know, and content is products and delivery is go to market, and when you go to market, it's marketing and sales. So as a company, we were tested in the last nine months to really understand Capital Allocation. I'm a big fan of the book, The Outsiders. I just read this probably a year ago, and you could see that there was some themes in The Outsiders about running the business on free cash flow, which is nothing new. It's not like Amazon invented it. They've been doing it for those 40, 50 years. Second one is Decentralized Decision Making. The third one is a really good capital allocation. So as an entrepreneur, I'm learning to actually understand what it means to decentralize decision making, and do a really good job of capital allocation, and finally, go and tell the Street about why free cash is the way to run a business as opposed to profitability and a gap way, because a lot of our dollars are sitting in the balance sheet, and they aren't in the P&L. So I think really running the business where growth matters, which is about free cash flow, about making sure that we can really create more CEOs in the company, independent decision making, and finally, this idea that you want to run this business as if it was a bunch of businesses, actually. >> Great. >> Awesome. >> One of the things you keep talking about in this interview is balance. You're balancing the needs of Main Street and Wall Street, the needs of your cloud customers, the needs of your employees, while also growing this business. How do you balance at all? As the CEO of this fast-growing company? You said you're an artist. And you read a lot of history. >> Honestly, I'm not a very balanced person. If you ask me, like, work and life, family and work, is because of my wife that I find a balance there. >> So you owe it all to her? >> Yeah, I think you can say that again, and the same thing is true for, like, one of my team members, our COO, David Sangster. He says, "Look, our health, family, and work, "in that order," and honestly, mine is in the reverse right now. So I need to really go and, These kind of conversations remind myself that it's important to actually have some balance. >> Great, well, Dheeraj, always a pleasure having you on theCUBE. >> Pleasure. >> I'm Rebecca Knight, for John Furrier. We'll have so much more from Nutanix next coming up on theCUBE just after this. (techno music)

>> Live from San Francisco, it's theCUBE! Covering the RSA Conference 2019. Brought to you by ForeScout. >> Hey, welcome back everybody, Jeff Frick here with theCUBE. We're at RSA at Moscone at downtown San Francisco. We're in the ForeScout booth, our first time in the ForeScout booth, we're really excited to be here and we're talking about cyber security, I don't know what the official number is this year, probably 45 thousand professionals walkin' around, talkin' about security. And we've got our next guest on, he is Russell Jones, partner on cyber risk services for Deloitte. Russell, great to meet you! >> Same to meet you as well. >> So, I asked him before we turned on, what's getting you excited these days and he said, everything! So, this is a crazy busy space. What have you been working on lately, what's kind of your take away from the first couple days at the show? >> Yeah, it is a crazy, busy space and if you look at the cyber landscape, everything's moving at the speed of the internet, so it's this cat and mouse game in terms of attackers trying to find new ways to get into systems that is driving the industry. When you talk about health care though, the issue is these systems, like medical devices, often times are connected to people. >> Right. >> And so, the implications of a hack against, let's say, a MRI machine or a fusion pump, could be devastating to an actual person connected to it. And that's really what's driving a lot of innovation in terms of some of the technologies you see, like ForeScout, and also, a lot of what's going on from a regulatory perspective, and also the hospitals and the health care system themselves. >> Right. >> Trying to solve that problem, managing cyber risk as it relates to clinical technology. >> And a lot of that stuff wasn't connected before, right? There weren't IP addresses on every MRI machine or all these pump machines or, you know, you have a pacemaker, all these things. How are they looking at kind of the risk reward from a connected device that gives you all kinds of benefits-- >> Yeah. >> but it does open up this attack surface that previously had maybe an air gap there? >> That's a great point, bottom line is the life saving, life extending attributes of these medical technologies and medical devices far outweighs the risk of cyber, however, we got to be smart about managing that risk. So, we're going to see more connectivity, not less. Train's left the station, in terms of what's coming and in the future of the healthcare, connecting more of, not only the medical devices, but the information in them and being able to share that and then bring it together and aggregate it in ways that, you know, with analytics on top of it allows doctors and researchers in the clinical community to connect dots in ways that solve cancer, solve some different maladies that have plagued us forever. >> Right. >> So I think, on the one hand, it's great, this connectivity is extending healthcare out to people in rural locations and it's also bringing together a lot of different data from everything from your Fitbit to your pacemaker to apps that you have on your phone in a way that's going to benefit us. >> Right, right, so, one of the things about healthcare is they're way out in front of, kind of, not healthcare in terms of regulations. >> Yeah. >> You know, and HIPAA's been around for a long time, GDPR just went into place in Europe last year, so when you look at it from a regulatory environment, which people have to consider, there's not only the complexity of the machines, there's not only the complexity of the security, but you also have regulatory environment. >> Yeah. >> How is the cyber security in healthcare, with their very unique regulations, kind of impacting the way people should think about the problem, the way they should implement solutions? >> That's a good question, I think we've thought about, in the cyber community, forever. We talk about confidentiality, integrity, availability, right, the triangle. When you think about healthcare and clinical technology and medical devices, you need to flip that triangle upside down and the focus is integrity and availability, those things together equal patient safety. So, in other words, as we're connecting more of these devices to each other, to electronic health record systems, to the cloud, the integrity of the information in there, which is being used by doctors and other folks to make decisions about treatment, about surgical procedures, about medicines, it's crucial that that information and the integrity of it is maintained. And then the availability of the device is critical, right? If you're going in to get an MRI and it's down because it's been hacked, there's usually not a spare MRI and so there's a profound impact for patients that are scheduled back to back to back to back to go get that procedure, that MRI that's going to be used by a doctor to do some surgery or some other kind of a treatment plan >> Right. >> So integrity and availability are huge in the cyber world. And, if you look at the regulations, depending on which one we're talking and which part of the world, right? You mentioned HIPAA, we've got security and privacy, you've got GDPR, you've got the FDA that have guidance around what they want the manufacturers to do, building security into the devices. >> Right. >> They all have an impact on cyber and how it's going to be addressed, how we're going to manage cyber risk in the healthcare world. >> Right. >> In that environment. >> And then there's this whole new thing, I went to the Wall Street Journal Health Conference a couple weeks back, I don't know if you were there, but there was two people up where you now you can take your genetic footprint, right? >> Yeah. >> You can take your 23andMe results and after you figure out where your family's from, you can actually sell it back into a research market-- >> Yeah. >> so that doctors and clinicians and people doing trials on new drugs can now take your data in kind of a marketplace, back into a whole nother application so it's kind of outside of the core healthcare system, if you will. >> That's right. >> But I mean, it's basically, it's me, right? (laughs) In the form of my DNA footprint. >> Yup. >> It's crazy, crazy amounts of strange data that now is potentially exposed to a hack. >> That's right, and so the implications there, obviously, privacy, right? That's a huge issue, I think, that we're going to have to address and that's why you see GDPR and that's why you see the California Consumer Privacy Act. >> Right. >> There's a recognition that, again, the train's left the station, there's a lot of good things that come out of sharing data and sharing information, there's a lot benefits that can come out of it for the consumers, patients. There's a dark side as well and that has to be managed. That's why we have the privacy regulations that we have, we're probably going to see more, probably going to see more things like the California Consumer Privacy Act. >> Right. >> More states and eventually-- >> Right. >> probably a federal act for the US. >> Do you think that the healthcare industry is better equipped to deal with GDPR and the California Healthcare Act because of things like HIPAA and they kind of come from that world? Or is this just a whole new level of regulation that they now have to account for? >> I think it's probably a mixed bag. On the one hand, healthcare has been dealing with privacy for a long time, even before HIPAA, right. And then HIPAA has very specific requirements around how you have to manage that information and consent and notifying the patient of their rights. On your other hand, you look at some of the new things, like GDPR, it goes way beyond HIPAA, and I think-- >> It goes way beyond HIPAA? >> Goes way behind HIPAA, like for example, this whole notion of the right to be forgotten. >> Right. >> Right, that's a requirement on the GDPR. That means, me as a patient, if I tell my doctor, I want you to get rid of all my medical records, everything in your system everywhere about me, I want it gone. Not that it makes sense-- >> Right, right. >> but, at least in Europe, if they ask to do that, you have to be able to comply. From a technology perspective and a medical device perspective, some of these devices are very complex, ecosystem of devices, components that make up the product. >> Right >> That's a very difficult thing to do. There's no one delete button-- >> Right. >> that you hit that can delete you from all different instances, downstream from where you came into the healthcare system. >> Right. >> And so, when you think about it from a cyber perspective, it gets to be very challenging. >> The other thing, right, is health care's always under tremendous kind of price pressure from the insurers and the consumers and a bad medical event can wipe-- >> Yeah. >> people out, right? >> Yeah. >> Especially when they're later in life and they're not properly insured, when they're making kind of an ROI analysis on cyber investments versus all the other things they can spend their money on, and they can't spend it all on security, that's not possible, how are they factoring in kind of the cyber investment, it's kind of this new layer of investment that they have to make because all these things are invested versus just investing in better beds and better machines and better people? >> That's the million dollar question. (laughs) I would say, some hospitals and health systems are doing it better than others, so maybe a little bit more further along and mature about thinking about the total cost of ownership and also, the patient factor, right? What has to be balanced, obviously, is not just the costs, but at the end of the day, what's best for the patient. And you hear this term, patient centricity, a lot today. And there's a recognition from all the players in the echo system, it's all about the patient. >> I'm so glad you say that 'cause I think a lot of people probably think that the patient sometimes gets lost in this whole thing, but you're saying no. >> There is an acknowledgement over the last few years and it's called patient centricity, it's an acknowledgement that the way we're going into the future of healthcare and the kinds of medical devices and technology and cloud solutions that are becoming part of the healthcare fabric, they're all being built and geared towards the patient being the center of the equation, not the doctor, not the hospital, it's the patient. >> Right, right, right, that's good to hear. >> And so, to answer your original question, we're in early days and really trying to balance the patient and patient centricity versus we've got vulnerabilities in our environment that could impact the patient and we've only got limited people and costs. >> Right, right. >> Making decisions that kind of balance all of those things. >> Right, alright Russell, last question, we're sitting here in the ForeScout booth. >> Yes. >> Obviously you have a relationship with them, talk about kind of what their solution adds to some of the stuff that you're workin' on. >> So, ForeScout, one of the reasons that we're working closely with ForeScout, their solution, really, they've taken an approach that's holistic around these issues that we're talking about, right, managing cyber risk, complex environment, a lot of different devices that are connected to each other and to the cloud and to the internet. They have built a solution that focuses on ability to have visibility into those devices that are on your network, some of which you may not even know exists, and then being able to kind of build an asset inventory around that visibility that allows you to do things like detect, based on policy, activity that suggests that you might be hacked or there might be some internal processes or players that are doing things that are going to put patients at risk or have you in non-compliance with GDPR, HIPAA and the rest. >> Right. >> And then their solution goes beyond ability to kind of visibility and detect, but to actually do something actionable, right? Security controls and orchestration with other technologies, like Simp Solutions and SOAR Solutions. Being able to orchestrate, hey, I know that I detected some activity on this infusion pump that suggests that we may being hacked, let me send an alert out, but then let me also, maybe, quarantine that part of the network. So, it's the ability to orchestrate between different security technologies that exist in a hospital environment, that's what we like about ForeScout. >> I'm just curious, when they run their first kind of crawl, if you will-- >> Yeah. >> are people surprised at the results of what's on there, that they had no clue? >> I mean, yes and no. >> Yes and no, okay. >> I think, most of the big hospitals that we work with, they know that, what they don't know, and especially when-- >> They know what they don't know. >> you're talkin' about a health system that maybe has a 100 thousand connected medical devices across the health system, they know what they don't know. They're looking for solutions to help them better manage and understand the things that they don't know, that they don't know. >> Right. >> Versus what they do know about. >> Right. >> And I think that's what we bring to the table in terms of kind of cyber risk services Deloitte brings, and then that's what ForeScout brings with their solution to be able to kind of help solve those problems. >> Well Russell, thanks for taking a few minutes out of your day to share those stories, super-- >> Thank you. >> super important work, you know, it's one thing to steal a few bucks out of the bank account, like you said. >> Yeah. >> It's another thing to start taking down machines at the hospital, not a good thing. >> Not a good thing. >> Alright >> Thank you. >> He's Russell, I'm Jeff, you're watchin' theCUBE, we're at RSA in Moscone in the ForeScout booth, thanks for watching, we'll see you next time. (techno music)

(upbeat music) >> Live from San Francisco. It's theCUBE covering RSA Conference 2019, brought to you by Forescout. >> Hey welcome back everybody. Jeff Frick here with theCUBE. We're at RSA North America at the newly opened and finally finished Moscone Center. We're here in the Forescout booth, excited to be here. And we've got our next guest who's been coming to this show for a long, long time. He's Dan Burns, the CEO of Optiv. Dan, great to see you. >> Great to see you too, Jeff. Appreciate you having me on the show. >> So you said this is your 23rd RSA. >> Yeah, somewhere right around there. It's got to be and I don't think I've missed any in between. I've missed some Black Hats in there now and again but RSA is just one of those that that I feel like you got to go to. >> Right, right, so obviously the landscape has changed dramatically so we won't go all the way back 23 years. But in the last couple of years as things have really accelerated with the internet and IoT and OT and all these connected devices, autonomous cars. From a threat perspective and from where you sit in the captain's seat, what are you seeing? What are your, kind of your impressions? How are you helping people navigate this? >> Yeah I appreciate that question, Jeff. So it has changed dramatically. There's no doubt about it. So I got into security in 1996. And that was a long time ago so it's really in the infancy of security. And back in '96 when I remember really studying what security was, and by the way back then it was called information security. Now it's cyber security. But it was really straightforward and simple. There were probably two or three threats and vulnerabilities out there right? Some of the early on one so that's one part of the equation. The second part there were probably two or three regulations and standards out there. No more than that. And then when you went over to kind of the third part of the triad and you talk about vendors and technology there were maybe five or six right? You have McAfee, you have Check Point and you had some of the early, early stage companies that were really addressing kind of simplistic things, right? >> Right. >> Firewalling, URL filtering and things like that. And now you fast-forward to today and it's night and day, so much different. So today when we talk about threats and vulnerabilities there are hundreds of millions, if not billions, of threats and vulnerabilities. Number one, big problem. Number two, regulations standards. There's hundreds of them globally. And number three when you look at our great technology partners here and I think there's probably about 3,500 technology partners here on the floor today. Night and day >> Right. >> Nigh and day from '96 to 2019. And that's created a lot of issues, right? A lot of issues which I'm happy to talk about. >> Yeah, complexity and but you've been a great quote of one of the other things I saw doing the research for this interview. You talked about rationalization >> Yeah. >> and how does a CSO rationalize the world in which you just described because they can't hire their way out of it. They can't buy their way out of it. And at some point you're going to have to make trade-off decisions 'cause you can't use all the company's resources just for security. At the same time, you don't want to be in the cover of the Wall Street Journal tomorrow because you have a big breach that you just discovered. >> Yeah >> How do you help >> it's a balancing act >> How do you help them figure this, navigate these choppy waters? >> Yeah so we think Optiv is in a prime space to do that and place to do that. No doubt about it. So let's talk about the complexity that's out there. Now you look at the landscape. You look at the 25, 35 hundred different technology companies out there today. And when we talk to a typical client and we ask a question. How many vendors, how many OEMs do you have to deal with on an annual basis and the response, of course, depending on the size of the organization but let's just take your average small, mid-sized, enterprise client, the response is somewhere between 75 and 90 partners. And then of course we've got shot on our face. >> Just on the security side? >> Just on the security >> That's not counting all their CRM and all their >> That's not IT, that's not anything. That is just to solve >> 75? >> and build their own security programs. And the next response we get from them is we can't do it, we just can't do it. We spend about 90% of our time acting as if I'm the CSO right now, 90 plus percent of our time working with all of these wonderful, great technologies and partners just to establish those relationships and make sure we're going the right things by them and then by us. And so given this complexity in the marketplace, everything that's going on, it's just a prime scenario for what we call ourselves is a global cyber security solutions integrator, right? Being able to, for a lack of a better term, be the gatekeeper for our clients and help them navigate this complexity that's out there in the space. And so the value that we bring, I talk about it in terms of an equation, right? We're all mathematical in nature, typically people in cyber and so when I think about cyber, I think about equations. And the first equation I think abut is a very simplistic one. It's people, it's process and technology. And you need equal focus on all three of those parts of the equation to truly balance things in a matter where you're building a very effective security program. And historically CSOs have really leaned towards the technology side of that equation. >> Right. And now what we're seeing is a balance like we've got to worry about people, right? We've got to find people with that intelligence and knowledge and know-how and wherewithal, right? And we've got to find companies that have that process expertise, the processes, a means to an end. How do I get to a certain outcome? And so what we bring is the people process and technology. All sides of the equation with the ability in masses to help clients plan, build and run their entire security program or parts of it. >> So how, how is it changed with a couple things like cloud computing. >> Yeah. >> So now I'm sure the bad guys use the cloud just like the good guys use the cloud. So the type of scale and resources that they can bring to bear are significantly higher. Just the pure quantity of and variability using AI and machine learning and as we saw in the election really kind of simple Facebook targeting methods that most marketers use, that work at REI to get you to buy a sleeping bag if you looked at tents on your last way in. So how is the role of AI and machine learning now going to impact this balance? And then of course the other thing is all we see is so many open security jobs. You just can't hire enough people. They're just not there. So that's a whole kind of different level of pressure on the CSO. >> Yeah definitely no doubt about it. And there are few companies that can truly build that have enough budget to address cyber on their own. And those today are typically the large financial right? They're typically given massive budgets. >> Right. >> They have massive teams and they're able to minimize the partnerships and really handle a lot of their own stuff internally and go out for special things. But you look at the typical company, small, mid, even some of the large enterprise companies. No, they can't find the resources. They can't get the budget. They can't address everything. And to your point around digital transformation and what's going on in the world there. And that's probably what continues to support 3,500 technology companies out here. >> Right. >> Right? It's the continuous change >> Right. >> That we see in the industry every single day and of course cloud is one of the most recent transformations and obviously a real one which opens up other threat factors and other scenarios that create new vulnerabilities, and new threats and so that the problem just keeps getting bigger exponentially >> So you come in for another 20 years? Is that what you're saying? (laughing) >> How you're, come for another 20 years. I think though eventually, Jeff, I can remember I kind of poke fun at this a little bit. I can remember I think it was Palo Alto, there was a first company that said, hey we're a platform company. And I think that started happening whatever, it was roughly seven years ago. We're a platform company. And I can remember so many people kind of pooh-poohing that. Right, you're not a, nobody's a platform company. Fair enough, fair enough back then. But I'm going to say, fast-forward to today and that's what it's going to happen, have to happen in this industry, Jeff. >> Right, right. >> Eventually we will have to have some large platform companies that can address multiple things within a client's environment, right? And then there will always be the need to to fill gaps with some of the other great new emerging technologies out there so maybe we won't have 3,500 vendors in ten years. Maybe it's 2,000 so there will be consolidation. There will be the platform play >> Right. >> that happens. >> But then you have the addition of public cloud, right? So now a lot of, a lot of infrastructures, they've got some stuff in public cloud. They still have some stuff on their data center, right? So this is kind of hybrid world. Then you add the IoT thing and the OT connectivity back to the IT which is relatively new. So now if you've got this whole other threat factors that you never had to deal with before at all. It's the machines down on the factory floor. You had been pumping out widgets for a long time that are suddenly connected the infrastructure. So the environment that you're trying to apply security to is really evolving at a crazy pace. >> That is, it's a great industry to be in. (Jeff laughs) Every day I wake up, pitch myself I think all our guys do. >> Right. >> What's amazing, I don't see that slowing down, right? So I think that's why some of that balance continues to be there in the future. One of the things that we're seeing in our industry is companies really trying to take this inside-out approach as opposed to this outside-in approach. And I'll tell you the difference. The outside-in approach is it's all of this chaos, right? It's all the chaos that's behind us and we see it right here. It's everybody telling you what you need >> Right. >> and you build it, you building a security program around what's being fed to you externally as opposed to really taking a step back looking at your organization understanding what your company's initiatives and priorities are, right? And your own company's vision, mission and strategy. And I tell people all the time, I don't care if they're part of our company or any company, first thing you should do is understand the vision and the mission and the strategy of the organization you work for. And so that's part of the inside-out approach. Understanding what your company is trying to accomplish and is a security practitioner really wrapping your arms in your mind around that and supporting those initiatives and aligning your security initiatives to the business initiatives >> Right. >> And then doing it through a risk management type of program and feeding that risk management dashboard and information directly to the board >> Right. >> So. >> So I'm curious how the how you approach the kind of the changes now we have state-sponsored attackers. And how, what they're trying to get and why they're trying to get it has maybe changed and the value equation on your assets, that clearly some assets are super valuable and for some information and some things that are kind of classical but now we're seeing different motivations, political motivations, other types of motivations. So they're probably attacking different repositories of data that you maybe didn't think carry that type of value. Are you seeing >> Yeah. >> kind of a change in that both in the way the attacks are executed and what they're trying to get and the value they're trying to extract then just kind of a classic commercial ransomware or I'm just going to grab some money out of your account. >> Yeah I think, I think you are right. And it kind of goes back to the earlier part of the conversation, the number of devices that the attackers can attack are almost infinite right? >> Right. And especially with the edge right? With IoT it's created this thing we call the edge. Devices on street lights. Devices on meters. Devices here, devices there. >> Right, right. >> So the number of devices they can go for is ever increasing, right? which continues to support the need >> Right. and the cause that we all are a part of. And in the ways they're going to do that is going to change as well. There's no question about it. Yeah, so we've seen different ways of doing it. Yes there's no question about it. Back to the state-sponsored it's kind of stuff the way I look at cyber and probably one of my biggest personal concerns is I think about us, people and family right? We all have family is that cyber and ultimately cyber warfare has created this levity, or equalness in terms of countries, right? Where a country like the U.S. or Russia or somebody with massive resources around physical weapons are now no longer necessarily as powerful as they were. So brevity it's just created this field, leveling playing field. So countries like North Korea, countries like Afghanistan and others have a new opportunity to create a pretty bad situation. >> Right, right. And we haven't seen cyber warfare quote and unquote yet. We would call it something a little because they haven't really used it as a mass weapon of destruction but the threat of that being there >> Right. is creating a more of a even playing field. >> Right. >> And that's one of my biggest concerns like what's the next step there. >> Right, and the other thing is really the financial implications. If you don't do it right, it's beyond being embarrassed on the Wall Street Journal. But right GDPR regulations went into place last year. It's now the California data privacy law that's coming into place. >> Yeah. >> People are calling it kind of the GDPR of California. And that may take more of a national footprint as time moves on. It's weird on one hand we're kind of desensitized 'cause there's so many data breaches right? You can't keep track. We don't actually flip past that page on the wall. >> I can't keep track. But on the other hand there is this kind of this renewed, kind of consumer protection of my data that's now being codified into law with significant penalties. So I wonder how that plays into your kind of risk portfolio strategy of deciding how much to invest. How much you need to put into this effort because if you get in trouble, it's expensive. >> Yeah it is. So can be and it will be and it will get even more expensive. And we're still waiting for the lawmakers to levy some pretty heavy fines. We've seen a few but I think there's going to be more and I think you do have to pay more attention to regulations and compliance. But I think it is a balancing act. Back to our inside-out approach that I was talking about. A lot of companies when PCI came out, as you know, Jeff, a lot of companies were guiding their security program by PCI specifically >> Right. >> and only, and that's a very outside-in approach, right? That's not really accounting for the assets that you were talking about earlier. Not all of them. >> Right. >> Some of them. And so I think that's a great point, right? As a CSO, the first thing you've got to understand is what are your assets? What are you trying to protect? >> Right. And our friends here at Forescout do a great job of giving you the visualization of your network, understanding what your assets are. And then I think the next step is placing a dollar value on that. And not many people do that, right. They're, oh here's my assets. >> You're paying >> This one's kind of important >> This one's kind of important. But to get buy-in from the rest of your organization, you need to force the conversation with your counterparts, with your CFO, with your CMO, with anyone who's a partial owner of those assets >> Right. and make them put a dollar amount on. How much do you think that the data on the server is worth? How much do you think the data on this server, how much do you think, and inventory that is part of the asset inventory. And then I think you've got a much better argument as it relates to getting budget and getting buy-in. >> Right. >> Getting buy-in. And I see it a lot where CSOs tend to be, most tend to be a little bit introverted right? >> Right. >> They'd rather hang out there on the second floor and be there with their team. Take a look at the latest threats. Take a look at what's going on, with their (coughs) logs and their data and trying to solve really critical problems. But my recommendations to CSOs is man, build tight relationships across the entire organization and get out there, be out there, be visible. Get buy-in. Do lunch and learns on why cyber is so critical and how our employees can help us on this journey. >> Right, right. Dan you trip into a whole other category that we'll have to leave for next time which is, what is the value of that data 'cause I think that's changed quite a bit over the last little while. But thanks for taking a few minutes >> Absolutely, Jeff. and hopefully have a good 23rd RSA. >> Thank you very much. >> All right. >> I appreciate it. >> He's Dan, I'm Jeff. You're watching theCUBE. We're at RSA in North America at Moscone at the Forescout booth. Thanks for watching. See you next time. (upbeat music)

[Music] when welcome to the special exclusive cube conversation here in Palo Alto in our studios I'm John for your host of the cube we have a very special guest speaking for the first time around some alleged alleged accusations and also innuendo around the Amazon Web Services Jedi contract and his firm c5 capital our guest as Andre Pienaar who's the founder of c5 capital Andre is here for the first time to talk about some of the hard conversations and questions surrounding his role his firm and the story from the BBC Andre thanks for a rat for meeting with me John great to have me thank you so you're at the center of a controversy and just for the folks who know the cube know we interviewed a lot of people I've interviewed you at Amazon web sources summit Teresa Carl's event and last year I met you and bought a rein the work you're doing there so I've met you a few times so I don't know your background but I want to drill into it because I was surprised to see the BBC story come out last week that was basically accusing you of many things including are you a spy are you infiltrating the US government through the Jedi contract through Amazon and knowing c-5 capital I saw no correlation when reading your article I was kind of disturbed but then I saw I said a follow-on stories it just didn't hang together so I wanted to press you on some questions and thanks for coming in and addressing them appreciate it John thanks for having me so first thing I want to ask you is you know it has you at the center this firm c5 capital that you the founder of at the center of what looks like to be the fight for the big ten billion dollar DoD contract which has been put out to multiple vendors so it's not a single source deal we've covered extensively on silicon angle calm and the cube and the government the government Accounting Office has ruled that there are six main benefits of going with a sole provider cloud this seems to be the war so Oracle IBM and others have been been involved we've been covering that so it kind of smells like something's going along with the story and I just didn't believe some of the things I read and I want to especially about you and see five capitals so I want to dig into what the first thing is it's c5 capital involved in the Jedi contract with AWS Sean not at all we have absolutely no involvement in the Jedi contract in any way we're not a bidder and we haven't done any lobbying as has been alleged by some of the people who've been making this allegation c5 has got no involvement in the general contract we're a venture capital firm with a British venture capital firm we have the privilege of investing here in the US as a foreign investor and our focus really is on the growth and the success of the startups that we are invested in so you have no business interest at all in the deal Department of Defense Jedi contract none whatsoever okay so to take a minute to explain c5 firm I read some of the stories there and some of the things were intricate structures of c5 cap made it sound like there was like a cloak-and-dagger situation I want to ask you some hard questions around that because there's a link to a Russian situation but before we get to there I want to ask you explain what is c5 capital your mission what are the things that you're doing c5 is a is a British venture capital firm and we are focused on investing into fast-growing technology companies in three areas cloud computing cyber security and artificial intelligence we have two parts our business c5 capital which invests into late stage companies so these are companies that typically already have revenue visibility and profitability but still very fast-growing and then we also have a very early stage startup platform that look at seed state investment and this we do through two accelerators to social impact accelerators one in Washington and one in Bahrain and it's just size of money involved just sort of order magnitude how many funds do you have how is it structure again just share some insight on that is it is there one firm is there multiple firms how is it knows it work well today the venture capital business has to be very transparent it's required by compliance we are a regulated regulated firm we are regulated in multiple markets we regulated here in the US the sec as a foreign investor in london by the financial conduct authority and in Luxembourg where Afonso based by the regulatory authorities there so in the venture capital industry today you can't afford to be an opaque business you have to be transparent at all levels and money in the Western world have become almost completely transparent so there's a very comprehensive and thorough due diligence when you onboard capital called know your client and the requirements standard requirement now is that whenever you're onboard capital from investor you're gonna take it right up to the level of the ultimate beneficial ownership so who actually owns this money and then every time you invest and you move your money around it gets diligence together different regulators and in terms of disclosure and the same applies often now with clients when our portfolio companies have important or significant clients they also want to know who's behind the products and the services they receive so often our boards our board directors and a shell team also get diligence by by important clients so explain this piece about the due diligence and the cross country vetting that goes on is I think it's important I want to get it out because how long has been operating how many deals have you done you mentioned foreign investor in the United States you're doing deals in the United States I know I've met one of your portfolio companies at an event iron iron on it iron net general Keith Alexander former head of the NSA you know get to just work with him without being vetted I guess so so how long a c5 capital been in business and where have you made your investments you mentioned cross jurisdiction across countries whatever it's called I don't know that so we've been and we've been in existence for about six years now our main focus is investing in Europe so we help European companies grow globally Europe historically has been underserved by venture capital we on an annual basis we invest about twenty seven billion dollars gets invested in venture capital in Europe as opposed to several multiples of that in the US so we have a very important part to play in Europe to how European enterprise software companies grow globally other important markets for us of course are Israel which is a major center of technology innovation and and the Middle East and then the u.s. the u.s. is still the world leader and venture capital both in terms of size but also in terms of the size of the market and of course the face and the excitement of the innovation here I want to get into me early career because again timing is key we're seeing this with you know whether it's a Supreme Court justice or anyone in their career their past comes back to haunt them it appears that has for you before we get there I want to ask you about you know when you look at the kind of scope of fraud and corruption that I've seen in just on the surface of government thing the government bit Beltway bandits in America is you got a nonprofit that feeds a for-profit and then what you know someone else runs a shell corporation so there's this intricate structures and that word was used which it kind of implies shell corporations a variety of backroom kind of smokey deals going on you mentioned transparency I do you have anything to hide John in in in our business we've got absolutely nothing to hide we have to be transparent we have to be open if you look at our social media profile you'll see we are communicating with the market almost on a daily basis every time we make an investment we press release that our website is very clear about who's involved enough who our partners are and the same applies to my own personal website and so in terms of the money movement around in terms of deploying investments we've seen Silicon Valley VCS move to China get their butts handed to them and then kind of adjust their scenes China money move around when you move money around you mentioned disclosure what do you mean there's filings to explain that piece it's just a little bit so every time we make an investment into a into a new portfolio company and we move the money to that market to make the investment we have to disclose who all the investors are who are involved in that investment so we have to disclose the ultimate beneficial ownership of all our limited partners to the law firms that are involved in the transactions and those law firms in turn have applications in terms of they own anti-money laundering laws in the local markets and this happens every time you move money around so I I think that the level of transparency in venture capital is just continue to rise exponentially and it's virtually impossible to conceal the identity of an investor this interesting this BBC article has a theme of national security risk kind of gloom and doom nuclear codes as mentioned it's like you want to scare someone you throw nuclear codes at it you want to get people's attention you play the Russian card I saw an article on the web that that said you know anything these days the me2 movement for governments just play the Russian card and you know instantly can discredit someone's kind of a desperation act so you got confident of interest in the government national security risk seems to be kind of a theme but before we get into the BBC news I noticed that there was a lot of conflated pieces kind of pulling together you know on one hand you know you're c5 you've done some things with your hat your past and then they just make basically associate that with running amazon's jedi project yes which i know is not to be true and you clarified that joan ends a problem joan so as a venture capital firm focused on investing in the space we have to work with all the Tier one cloud providers we are great believers in commercial cloud public cloud we believe that this is absolutely transformative not only for innovation but also for the way in which we do venture capital investment so we work with Amazon Web Services we work with Microsoft who work with Google and we believe that firstly that cloud has been made in America the first 15 companies in the world are all in cloud companies are all American and we believe that cloud like the internet and GPS are two great boons which the US economy the u.s. innovation economy have provided to the rest of the world cloud computing is reducing the cost of computing power with 50 percent every three years opening up innovation and opportunities for Entrepreneurship for health and well-being for the growth of economies on an unprecedented scale cloud computing is as important to the global economy today as the dollar ease as the world's reserve currency so we are great believers in cloud we great believers in American cloud computing companies as far as Amazon is concerned our relationship with Amazon Amazon is very Amazon Web Services is very clear and it's very defined we participate in a public Marcus program called AWS activate through which AWS supports hundreds of accelerators around the world with know-how with mentoring with teaching and with cloud credits to help entrepreneurs and startups grow their businesses and we have a very exciting focus for our two accelerators which is on in Washington we focus on peace technology we focus on taking entrepreneurs from conflict countries like Sudan Nigeria Pakistan to come to Washington to work on campus in the US government building the u.s. Institute for peace to scale these startups to learn all about cloud computing to learn how they can grow their businesses with cloud computing and to go back to their own countries to build peace and stability and prosperity their heaven so we're very proud of this mission in the Middle East and Bahrain our focus is on on female founders and female entrepreneurs we've got a program called nebula through which we empower female founders and female entrepreneurs interesting in the Middle East the statistics are the reverse from what we have in the West the majority of IT graduates in the Middle East are fimo and so there's a tremendous talent pool of of young dynamic female entrepreneurs coming out of not only the Gulf but the whole of the MENA region how about a relation with Amazon websites outside of their normal incubators they have incubators all over the place in the Amazon put out as Amazon Web Services put out a statement that said hey you know we have a lot of relationships with incubators this is normal course of business I know here in Silicon Valley at the startup loft this is this is their market filled market playbook so you fit into that is that correct as I'm I get that that's that's absolutely correct what we what is unusual about a table insists that this is a huge company that's focused on tiny startups a table started with startups it double uses first clients with startups and so here you have a huge business that has a deep understanding of startups and focus on startups and that's enormous the attractor for us and terrific for our accelerators department with them have you at c5 Capitol or individually have any formal or conversation with Amazon employees where you've had outside of giving feedback on products where you've tried to make change on their technology make change with their product management teams engineering you ever had at c5 capital whore have you personally been involved in influencing Amazon's product roadmap outside they're just giving normal feedback in the course of business that's way above my pay grade John firstly we don't have that kind of technical expertise in C 5 C 5 steam consists of a combination of entrepreneurs like myself people understand money really well and leaders we don't have that level of technical expertise and secondly that's what one our relationship with AWS is all about our relationship is entirely limited to the two startups and making sure that the two accelerators in making sure that the startups who pass through those accelerators succeed and make social impact and as a partner network component Amazon it's all put out there yes so in in a Barren accelerator we've we formed part of the Amazon partner network and the reason why we we did that was because we wanted to give some of the young people who come through the accelerator and know mastering cloud skills an opportunity to work on some real projects and real live projects so some of our young golf entrepreneurs female entrepreneurs have been working on building websites on Amazon Cloud and c5 capital has a relationship with former government officials you funded startups and cybersecurity that's kind of normal can you explain that positioning of it of how former government if it's whether it's US and abroad are involved in entrepreneurial activities and why that is may or may not be a problem certainly is a lot of kind of I would say smoke around this conversation around coffin of interest and you can you explain intelligence what that was it so I think the model for venture capital has been evolving and increasingly you get more and more differentiated models one of the key areas in which the venture capital model is changed is the fact that operating partners have become much more important to the success of venture capital firms so operating partners are people who bring real world experience to the investment experience of the investment team and in c-five we have the privilege of having a terrific group of operating partners people with both government and commercial backgrounds and they work very actively enough firm at all levels from our decision-making to the training and the mentoring of our team to helping us understand the way in which the world is exchanging to risk management to helping uh portfolio companies grow and Silicon Valley true with that to injuries in Horowitz two founders mr. friendly they bring in operating people that have entrepreneurial skills this is the new model understand order which has been a great source of inspiration to us for our model and and we built really believe this is a new model and it's really critical for the success of venture capitals to be going forward and the global impact is pretty significant one of things you mentioned I want to get your take on is as you operate a global transaction a lots happened a lot has to happen I mean we look at the ICO market on the cryptocurrency side its kind of you know plummeting obsoletes it's over now the mood security children's regulatory and transparency becomes critical you feel fully confident that you haven't you know from a regulatory standpoint c5 capital everything's out there absolutely risk management and regulated compliance and legal as the workstream have become absolutely critical for the success of venture capital firms and one of the reasons why this becomes so important John is because the venture capital world over the last few years have changed dramatically historically all the people involved in venture capital had very familiar names and came from very familiar places over the last few years with a diversification of global economic growth we've seen it's very significant amounts of money being invest invested in startups in China some people more money will invest in startups this year in China than in the US and we've seen countries like Saudi Arabia becoming a major source of venture capital funding some people say that as much as 70% of funding rounds this year in some way or another originated from the Gulf and we've seen places like Russia beginning to take an interest in technology innovation so the venture capital world is changing and for that reason compliance and regulation have become much more important but if Russians put 200 million dollars in face book and write out the check companies bright before that when the after 2008 we saw the rise of social networking I think global money certainly has something that I think a lot of people start getting used to and I want on trill down into that a little bit we talked about this BBC story that that hit and the the follow-on stories which actually didn't get picked up was mostly doing more regurgitation of the same story but one of the things that that they focus in on and the story was you and the trend now is your past is your enemy these days you know they try to drum up stuff in the past you've had a long career some of the stuff that they've been bringing in to paint you and the light that they did was from your past so I wanted to explore that with you I know you this is the first time you've talked about this and I appreciate you taking the time talk about your early career your background where you went to school because the way I'm reading this it sounds like you're a shady character I like like I interviewed on the queue but I didn't see that but you know I'm going to pressure here for that if you don't mind I'd like to to dig into that John thank you for that so I've had the I've had the privilege of a really amazingly interesting life and at the heart of at the heart of that great adventures been people and the privilege to work with really great people and good people I was born in South Africa I grew up in Africa went to school there qualified as a lawyer and then came to study in Britain when I studied international politics when I finished my studies international politics I got head hunted by a US consulting firm called crow which was a start of a 20 years career as an investigator first in crawl where I was a managing director in the London and then in building my own consulting firm which was called g3 and all of this led me to cybersecurity because as an investigator looking into organized crime looking into corruption looking into asset racing increasingly as the years went on everything became digital and I became very interested in finding evidence on electronic devices but starting my career and CRO was tremendous because Jules Kroll was a incredible mentor he could walk through an office and call everybody by their first name any Kroll office anywhere in the world and he always took a kindly interest in the people who work for him so it was a great school to go to and and I worked on some terrific cases including some very interesting Russian cases and Russian organized crime cases just this bag of Kroll was I've had a core competency in doing investigative work and also due diligence was that kind of focus yes although Kroll was the first company in the world to really have a strong digital practice led by Alan Brugler of New York Alan established the first computer forensics practice which was all focused about finding evidence on devices and everything I know about cyber security today started with me going to school with Alan Brolin crawl and they also focused on corruption uncovering this is from Wikipedia Kroll clients help Kroll helps clients improve operations by uncovering kickbacks fraud another form of corruptions other specialty areas is forensic accounting background screening drug testing electronic investigation data recovery SATA result Omar's McLennan in 2004 for 1.9 billion mark divested Kroll to another company I'll take credit risk management to diligence investigator in Falls Church Virginia over 150 countries call Kroll was the first CRO was the first household brand name in this field of of investigations and today's still is probably one of the strongest brand names and so it was a great firm to work in and was a great privilege to be part of it yeah high-end high-profile deals were there how many employees were in Kroll cuz I'd imagine that the alumni that that came out of Kroll probably have found places in other jobs similar to yes do an investigative work like you know they out them all over the world many many alumni from Kroll and many of them doing really well and doing great work ok great so now the next question want to ask you is when you in Kroll the South Africa connection came up so I got to ask you it says business side that you're a former South African spy are you a former South African spy no John I've never worked for any government agency and in developing my career my my whole focus has been on investigations out of the Kroll London office I did have the opportunity to work in South Africa out of the Kroll London office and this was really a seminal moment in my career when I went to South Africa on a case for a major international credit-card company immediately after the end of apartheid when democracy started to look into the scale and extent of credit card fraud at the request of this guy what year was there - how old were you this was in 1995 1996 I was 25 26 years old and one of the things which this credit card company asked me to do was to assess what was the capability of the new democratic government in South Africa under Nelson Mandela to deal with crime and so I had the privilege of meeting mr. Mandela as the president to discuss this issue with him and it was an extraordinary man the country's history because there was such an openness and a willingness to to address issues of this nature and to grapple with them so he was released from prison at that time I remember those days and he became president that's why he called you and you met with him face to face of a business conversation around working on what the future democracy is and trying to look at from a corruption standpoint or just kind of in general was that what was that conversation can you share so so that so the meeting involved President Mandela and and the relevant cabinet ministers the relevant secretaries and his cabinet - responsible for for these issues and the focus of our conversation really started with well how do you deal with credit card fraud and how do you deal with large-scale fraud that could be driven by organized crime and at the time this was an issue of great concern to the president because there was bombing in Kate of a Planet Hollywood cafe where a number of people got very severely injured and the president believed that this could have been the result of a protection racket in Cape Town and so he wanted to do something about it he was incredibly proactive and forward-leaning and in an extraordinary way he ended the conversation by by asking where the Kroll can help him and so he commissioned Kroll to build the capacity of all the black officers that came out of the ANC and have gone into key government positions on how to manage organized crime investigations it was the challenge at that time honestly I can imagine apartheid I remember you know I was just at a college that's not properly around the same age as you it was a dynamic time to say the least was his issue around lack of training old school techniques because you know that was right down post-cold-war and then did what were the concerns not enough people was it just out of control was it a corrupt I mean just I mean what was the core issue that Nelson wanted to hire Kroll and you could work his core issue was he wanted to ensure the stability of South Africa's democracy that was his core focus and he wanted to make South Africa an attractive place where international companies felt comfortable and confident in investing and that was his focus and he felt that at that time because so many of the key people in the ANC only had training in a cold war context that there wasn't a Nessy skill set to do complex financial or more modern investigations and it was very much focused he was always the innovator he was very much focused on bringing the best practices and the best investigative techniques to the country he was I felt in such a hurry that he doesn't want to do this by going to other governments and asking for the help he wanted to Commission it himself and so he gave he gave a crawl with me as the project leader a contract to do this and my namesake Francois Pienaar has become very well known because of the film Invictus and he's been he had the benefit of Mandela as a mentor and as a supporter and that changed his career the same thing happened to me so what did he actually asked you to do was it to train build a force because there's this talk that and was a despite corruption specifically it was it more both corruption and or stability because they kind of go hand in hand policy and it's a very close link between corruption and instability and and president Ellis instructions were very clear to Crowley said go out and find me the best people in the world the most experienced people in the world who can come to South Africa and train my people how to fight organized crime so I went out and I found some of the best people from the CIA from mi6 the British intelligence service from the Drug Enforcement Agency here in the US form officers from the Federal Bureau of Investigation's detectives from Scotland Yard prosecutors from the US Justice Department and all of them for a number of years traveled to South Africa to train black officers who were newly appointed in key roles in how to combat organized crime and this was you acting as an employee he had crow there's not some operative this is he this was me very much acting as a as an executive and crow I was the project leader Kroll was very well structured and organized and I reported to the chief executive officer in the London office nor Garret who was the former head of the CIA's Near East Division and Nelson Mandela was intimately involved in this with you at Krall President Mandela was the ultimate support of this project and he then designated several ministers to work on it and also senior officials in the stories that had been put out this past week they talked about this to try to make it sound like you're involved on two sides of the equation they bring up scorpions was this the scorpions project that they referred to so it was the scorpions scorpion sounds so dangerous and a movie well there's a movie a movie does feature this so at the end of the training project President Mandela and deputy president Thabo Mbeki who subsequently succeeded him as president put together a ministerial committee to look at what should they do with the capacity that's been built with this investment that they made because for a period of about three years we had all the leading people the most experienced people that have come out of some of the best law enforcement agencies and some of the best intelligence services come and trained in South Africa and this was quite this was quite something John because many of the senior officers in the ANC came from a background where they were trained by the opponents of the people came to treat trained them so so many of them were trained by the Stasi in East Germany some of them were trained by the Russian KGB some of them were trained by the Cubans so we not only had to train them we also had to win their trust and when we started this that's a diverse set of potential dogma and or just habits a theory modernised if you will right is that what the there was there was a question of of learning new skills and there was a question about also about learning management capabilities there was also question of learning the importance of the media for when you do difficult and complex investigations there was a question about using digital resources but there was also fundamentally a question of just building trust and when we started this program none of the black officers wanted to be photographed with all these foreign trainers who were senior foreign intelligence officers when we finished that everyone wanted to be in the photograph and so this was a great South African success story but the President and the deputy president then reflected on what to do with his capacity and they appointed the ministerial task force to do this and we were asked to make recommendations to this Minister ministerial task force and one of the things which we did was we showed them a movie because you referenced the movie and the movie we showed them was the untouchables with Kevin Costner and Sean Connery which is still one of my favorite and and greatest movies and the story The Untouchables is about police corruption in Chicago and how in the Treasury Department a man called Eliot Ness put together a group of officers from which he selected from different places with clean hands to go after corruption during the Probie and this really captured the president's imagination and so he said that's what he want and Ella yeah okay so he said della one of the untouchables he wanted Eliot Ness exactly Al Capone's out there and and how many people were in that goodness so we asked that we we established the government then established decided to establish and this was passed as a law through Parliament the director of special operations the DSO which colloquy became known as the scorpions and it had a scorpion as a symbol for this unit and this became a standalone anti-corruption unit and the brilliant thing about it John was that the first intake of scorpion officers were all young black graduates many of them law graduates and at the time Janet Reno was the US Attorney General played a very crucial role she allowed half of the first intake of young cratchits to go to Quantico and to do the full FBI course in Quantico and this was the first group of foreign students who've ever been admitted to Quantico to do the full Quantico were you involved at what score's at that time yes sir and so you worked with President Mandela yes the set of the scorpions is untouchable skiing for the first time as a new democracy is emerging the landscape is certainly changing there's a transformation happening we all know the history laugh you don't watch Invictus probably great movie to do that you then worked with the Attorney General United States to cross-pollinate the folks in South Africa black officers law degrees Samar's fresh yes this unit with Quantico yes in the United States I had the privilege of attending the the graduation ceremony of the first of South African officers that completed the Quantico course and representing crow they on the day you had us relationships at that time to crawl across pollen I had the privilege of working with some of the best law enforcement officers and best intelligence officers that has come out of the u.s. services and they've been tremendous mentors in my career they've really shaped my thinking they've shaped my values and they've they've shaved my character so you're still under 30 at this time so give us a is that where this where are we in time now just about a 30 so you know around the nine late nineties still 90s yeah so client-server technologies there okay so also the story references Leonard McCarthy and these spy tapes what is this spy tape saga about it says you had a conversation with McCarthy me I'm thinking that a phone tap explain that spy tape saga what does it mean who's Lennon McCarthy explain yourself so so so Leonard McCarthy it's a US citizen today he served two terms as the vice president for institutional integrity at the World Bank which is the world's most important anti-corruption official he started his career as a prosecutor in South Africa many years ago and then became the head of the economic crimes division in the South African Justice Department and eventually became the head of the scorpions and many years after I've left Kroll and were no longer involved in in the work of the scorpions he texted me one evening expressing a concern and an anxiety that I had about the safety of his family and I replied to him with two text messages one was a Bible verse and the other one was a Latin saying and my advice name was follow the rule of law and put the safety of your family first and that was the advice I gave him so this is how I imagined the year I think of it the internet was just there this was him this was roundabout 2000 December 2007 okay so there was I phone just hit so text messaging Nokia phones all those big yeah probably more text message there so you sitting anywhere in London you get a text message from your friend yep later this past late tonight asking for help and advice and I gave him the best advice I can he unfortunately was being wiretapped and those wiretaps were subsequently published and became the subject of much controversy they've now been scrutinized by South Africa's highest court and the court has decided that those wiretaps are of no impact and of importance in the scheme of judicial decision-making and our unknown provenance and on and on unknown reliability they threw it out basically yeah they're basically that's the president he had some scandals priors and corruption but back to the tapes you the only involvement on the spy tapes was friend sending you a text message that says hey I'm running a corruption you know I'm afraid for my life my family what do I do and you give some advice general advice and that's it as there was there any more interactions with us no that's it that's it okay so you weren't like yeah working with it hey here's what we get strategy there was nothing that going on no other interactions just a friendly advice and that's what they put you I gave him my I gave him my best advice when you when you work in when you work as an investigator very much as and it's very similar in venture capital it's all about relationships and you want to preserve relationships for the long term and you develop deep royalties to its people particularly people with whom you've been through difficult situations as I have been with Leonard much earlier on when I was still involved in Kroll and giving advice to South African government on issues related to the scorpius so that that has a lot of holes and I did think that was kind of weird they actually can produce the actual tax I couldn't find that the spy tapes so there's a spy tape scandal out there your name is on out on one little transaction globbed on to you I mean how do you feel about that I mean you must've been pretty pissed when you saw that when you do it when when you do when you do investigative work you see really see everything and all kinds of things and the bigger the issues that you deal with the more frequently you see things that other people might find unusual I are you doing any work right now with c5 at South Africa and none whatsoever so I've I retired from my investigative Korea in 2014 I did terrific 20 years as an investigator during my time as investigator I came to understood the importance of digital and cyber and so at the end of it I saw an opportunity to serve a sector that historically have been underserved with capital which is cyber security and of course there are two areas very closely related to cyber security artificial intelligence and cloud and that's why I created c5 after I sold my investigator firm with five other families who equally believed in the importance of investing private capital to make a difference invest in private capital to help bring about innovation that can bring stability to the digital world and that's the mission of c-5 before I get to the heart news I want to drill in on the BBC stories I think that's really the focal point of you know why we're talking just you know from my standpoint I remember living as a young person in that time breaking into the business you know my 20s and 30s you had Live Aid in 1985 and you had 1995 the internet happened there was so much going on between those that decade 85 to 95 you were there I was an American so I didn't really have a lot exposure I did some work for IBM and Europe in 1980 says it's co-op student but you know I had some peak in the international world it must been pretty dynamic the cross-pollination the melting pot of countries you know the Berlin Wall goes down you had the cold war's ending you had apartheid a lot of things were going on around you yes so in that dynamic because if if the standard is you had links to someone you know talked about why how important it was that this melting pot and how it affected your relationships and how it looks now looking back because now you can almost tie anything to anything yes so I think the 90s was one of the most exciting periods of time because you had the birth of the internet and I started working on Internet related issues yet 20 million users today we have three and a half billion users and ten billion devices unthinkable at the time but in the wake of the internet also came a lot of changes as you say the Berlin Wall came down democracy in South Africa the Oslo peace process in the time that I worked in Kroll some of them made most important and damaging civil wars in Africa came to an end including the great war in the Congo peace came to Sudan and Angola the Ivory Coast so a lot of things happening and if you have a if you had a an international career at that time when globalization was accelerating you got to no a lot of people in different markets and both in crow and in my consulting business a key part of what it but we did was to keep us and Western corporations that were investing in emerging markets safe your credibility has been called in questions with this article and when I get to in a second what I want to ask you straight up is it possible to survive in the international theatre to the level that you're surviving if what they say is true if you if you're out scamming people or you're a bad actor pretty much over the the time as things get more transparent it's hard to survive right I mean talk about that dynamic because I just find it hard to believe that to be successful the way you are it's not a johnny-come-lately firms been multiple years operating vetted by the US government are people getting away in the shadows is it is is it hard because I almost imagine those are a lot of arbitrage I imagine ton of arbitrage that you that are happening there how hard or how easy it is to survive to be that shady and corrupt in this new era because with with with investigated with with intelligence communities with some terrific if you follow the money now Bitcoin that's a whole nother story but that's more today but to survive the eighties and nineties and to be where you are and what they're alleging I just what's your thoughts well to be able to attract capital and investors you have to have very high standards of governance and compliance because ultimately that's what investors are looking for and what investors will diligence when they make an investment with you so to carry the confidence of investors good standards of governance and compliance are of critical importance and raising venture capital and Europe is tough it's not like the US babe there's an abundance of venture capital available it's very hard Europe is under served by capital the venture capital invested in the US market is multiple of what we invest in Europe so you need to be even more focused on governance and compliance in Europe than you would be perhaps on other markets I think the second important point with Gmail John is that technology is brought about a lot of transparency and this is a major area of focus for our piece tech accelerator where we have startups who help to bring transparency to markets which previously did not have transparency for example one of the startups that came through our accelerator has brought complete transparency to the supply chain for subsistence farmers in Africa all the way to to the to the shelf of Walmart or a big grocery retailer in in the US or Europe and so I think technology is bringing a lot more more transparency we also have a global anti-corruption Innovation Challenge called shield in the cloud where we try and find and recognize the most innovative corporations governments and countries in the space so let's talk about the BBC story that hit 12 it says is a US military cloud the DoD Jedi contractor that's coming to award the eleventh hour safe from Russia fears over sensitive data so if this essentially the headline that's bolded says a technology company bidding for a Pentagon contract that's Amazon Web Services to store sensitive data has close partnerships with a firm linked to a sanctioned Russian oligarch the BBC has learned goes on to essentially put fear and tries to hang a story that says the national security of America is at risk because of c5u that's what we're talking about right now so so what's your take on this story I mean did you wake up and get an email said hey check out the BBC you're featured in and they're alleging that you have links to Russia and Amazon what Jon first I have to go I first have to do a disclosure I've worked for the BBC as an investigator when I was in Kroll and in fact I let the litigation support for the BBC in the biggest libel claim in British history which was post 9/11 when the BBC did a broadcast mistakenly accusing a mining company in Africa of laundering money for al-qaeda and so I represented the BBC in this case I was the manager hired you they hired me to delete this case for them and I'm I helped the BBC to reduce a libel claim of 25 million dollars to $750,000 so I'm very familiar with the BBC its integrity its standards and how it does things and I've always held the BBC in the highest regard and believed that the BBC makes a very important contribution to make people better informed about the world so when I heard about the story I was very disappointed because it seemed to me that the BBC have compromised the independence and the independence of the editorial control in broadcasting the story the reason why I say that is because the principal commentator in this story as a gentleman called John Wheeler who's familiar to me as a someone who's been trolling our firm on internet for the last year making all sorts of allegations the BBC did not disclose that mr. Weiler is a former Oracle executive the company that's protesting the Jedi bidding contract and secondly that he runs a lobbying firm with paid clients and that he himself often bid for government contracts in the US government context you're saying that John Wheeler who's sourced in the story has a quote expert and I did check him out I did look at what he was doing I checked out his Twitter he seems to be trying to socialise a story heavily first he needed eyes on LinkedIn he seems to be a consultant firm like a Beltway yes he runs a he runs a phone called in interoperability Clearing House and a related firm called the IT acquisition Advisory Council and these two organizations work very closely together the interoperability Clearing House or IC H is a consulting business where mr. Weiler acts for paying clients including competitors for this bidding contract and none of this was disclosed by the BBC in their program the second part of this program that I found very disappointing was the fact that the BBC in focusing on the Russian technology parks cocuwa did not disclose the list of skok of our partners that are a matter of public record on the Internet if you look at this list very closely you'll see c5 is not on there neither Amazon Web Services but the list of companies that are on there are very familiar names many of them competitors in this bidding process who acted as founding partners of skok about Oracle for example as recently as the 28th of November hosted what was described as the largest cloud computing conference in Russia's history at Skolkovo this is the this is the place which the BBC described as this notorious den of spies and at this event which Oracle hosted they had the Russian presidential administration on a big screen as one of their clients in Russia so some Oracle is doing business in Russia they have like legit real links to Russia well things you're saying if they suddenly have very close links with Skolkovo and so having a great many other Khayyam is there IBM Accenture cisco say Microsoft is saying Oracle is there so Skolkovo has a has a very distinguished roster of partners and if the BBC was fair and even-handed they would have disclosed us and they would have disclosed the fact that neither c5 nor Amazon feature as Corcovado you feel that the BBC has been duped the BBC clearly has been duped the program that they broadcasted is really a parlor game of six degrees of separation which they try to spun into a national security crisis all right so let's tell us John while ago you're saying John Wyler who's quoted in the story as an expert and by the way I read in the story my favorite line that I wanted to ask you on was there seems to be questions being raised but the question is being raised or referring to him so are you saying that he is not an expert but a plant for the story what's what's his role he's saying he works for Oracle or you think do you think he's being paid by Oracle like I can't comment on mr. Wireless motivation what strikes me is the fact that is a former Oracle executive what's striking is that he clearly on his website for the IC H identifies several competitors for the Jedi business clients and that all of this should have been disclosed by the BBC rather than to try and characterize and portray him as an independent expert on this story well AWS put out a press release or a blog post essentially hum this you know you guys had won it we're very clear and this I know it goes to the top because that's how Amazon works nothing goes out until it goes to the top which is Andy chassis and the senior people over there it says here's the relationship with c5 and ATS what school you use are the same page there but also they hinted the old guard manipulation distant I don't think they use the word disinformation campaign they kind of insinuate it and that's what I'm looking into I want to ask you are you part are you a victim of a disinformation campaign do you believe that you're not a victim being targeted with c5 as part of a disinformation campaign put on by a competitor to AWS I think what we've seen over the course of this last here is an enormous amount of disinformation around this contract and around this bidding process and they've a lot of the information that has been disseminated has not only not been factual but in some cases have been patently malicious well I have been covering Amazon for many many years this guy Tom Wyler is in seems to be circulating multiple reports invested in preparing for this interview I checked Vanity Fair he's quoted in Vanity Fair he's quoted in the BBC story and there's no real or original reporting other than those two there's some business side our article which is just regurgitating the Business Insider I mean the BBC story and a few other kind of blog stories but no real original yes no content don't so in every story that that's been written on this subject and as you say most serious publication have thrown this thrown these allegations out but in the in those few instances where they've managed to to publish these allegations and to leverage other people's credibility to their advantage and leverage other people's credibility for their competitive advantage John Wheeler has been the most important and prominent source of the allegations someone who clearly has vested commercial interests someone who clearly works for competitors as disclosed on his own website and none of this has ever been surfaced or addressed I have multiple sources have confirmed to me that there's a dossier that has been created and paid for by a firm or collection of firms to discredit AWS I've seen some of the summary documents of that and that is being peddled around to journalists we have not been approached yet I'm not sure they will because we actually know the cloud what cloud computing is so I'm sure we could debunk it by just looking at it and what they were putting fors was interesting is this an eleventh-hour a desperation attempt because I have the Geo a report here that was issued under Oracle's change it says there are six conditions why we're looking at one sole cloud although it's not a it's a multiple bid it's not an exclusive to amazon but so there's reasons why and they list six service levels highly specialized check more favorable terms and conditions with a single award expected cause of administration of multiple contracts outweighs the benefits of multiple awards the projected orders are so intricately related that only a single contractor can reasonably be perform the work meaning that Amazon has the only cloud that can do that work now I've reported on the cube and it's looking angle that it's true there's things that other clouds just don't have anyone has private they have the secret the secret clouds the total estimated value of the contract is less than the simplified acquisition threshold or multiple awards would not be in the best interest this is from them this is a government report so it seems like there's a conspiracy against Amazon where you are upon and in in this game collect you feel that collateral damage song do you do you believe that to be true collateral damage okay well okay so now the the John Wheeler guys so investigate you've been an investigator so you mean you're not you know you're not a retired into this a retired investigator you're retired investigated worked on things with Nelson Mandela Kroll Janet Reno Attorney General you've vetted by the United States government you have credibility you have relationships with people who have have top-secret clearance all kinds of stuff but I mean do you have where people have top-secret clearance or or former people who had done well we have we have the privilege of of working with a very distinguished group of senior national security leaders as operating partisan c5 and many of them have retained their clearances and have been only been able to do so because c5 had to pass through a very deep vetting process so for you to be smeared like this you've been in an investigative has you work at a lot of people this is pretty obvious to you this is like a oh is it like a deep state conspiracy you feel it's one vendor - what is your take and what does collateral damage mean to you well I recently spoke at the mahkum conference on a session on digital warfare and one of the key points I made there was that there are two things that are absolutely critical for business leaders and technology leaders at this point in time one we have to clearly say that our countries are worth defending we can't walk away from our countries because the innovation that we are able to build and scale we're only able to do because we live in democracies and then free societies that are governed by the rule of law the second thing that I think is absolutely crucial for business leaders in the technology community is to accept that there must be a point where national interest overrides competition it must be a point where we say the benefit and the growth and the success of our country is more important to us than making commercial profits and therefore there's a reason for us either to cooperate or to cease competition or to compete in a different way what might takes a little bit more simple than that's a good explanation is I find these smear campaigns and fake news and I was just talking with Kara Swisher on Twitter just pinging back and forth you know either journalists are chasing Twitter and not really doing the original courting or they're being fed stories if this is truly a smear campaign as being fed by a paid dossier then that hurts people when families and that puts corporate interests over the right thing so I think I a personal issue with that that's fake news that's just disinformation but it's also putting corporate inches over over families and people so I just find that to be kind of really weird when you say collateral damage earlier what did you mean by that just part of the campaign you personally what's what's your view okay I think competition which is not focused on on performance and on innovation and on price points that's competition that's hugely destructive its destructive to the fabric of innovation its destructive of course to the reputation of the people who fall in the line of sight of this kind of competition but it's also hugely destructive to national interest Andrae one of the key stories here with the BBC which has holes in it is that the Amazon link which we just talked about but there's one that they bring up that seems to be core in all this and just the connections to Russia can you talk about your career over the career from whether you when you were younger to now your relationship with Russia why is this Russian angle seems to be why they bring into the Russia angle into it they seem to say that c-5 Cable has connections they call deep links personal links into Russia so to see what that so c5 is a venture capital firm have no links to Russia c5 has had one individual who is originally of Russian origin but it's been a longtime Swiss resident and you national as a co investor into a enterprise software company we invested in in 2015 in Europe we've since sold that company but this individual Vladimir Kuznetsov who's became the focus of the BBC's story was a co investor with us and the way in which we structure our investment structures is that everything is transparent so the investment vehicle for this investment was a London registered company which was on the records of Companies House not an offshore entity and when Vladimir came into this company as a co investor for compliance and regulatory purposes we asked him to make his investment through this vehicle which we controlled and which was subject to our compliance standards and completely transparent and in this way he made this investment now when we take on both investors and Co investors we do that subject to very extensive due diligence and we have a very robust and rigorous due diligence regime which in which our operating partners who are leaders of great experience play an important role in which we use outside due diligence firms to augment our own judgment and to make sure we have all the facts and finally we also compare notes with other financial institutions and peers and having done that with Vladimir Kuznetsov when he made this one investment with us we reached the conclusion that he was acting in his own right as an independent angel investor that his left renova many years ago as a career executive and that he was completely acceptable as an investor so that you think that the BBC is making an inaccurate Association the way they describe your relationship with Russia absolutely the the whole this whole issue of the provenance of capital has become of growing importance to the venture capital industry as you and I discussed earlier with many more different sources of capital coming out of places like China like Russia Saudi Arabia other parts of the world and therefore going back again to you the earlier point we discussed compliance and due diligence our critical success factors and we have every confidence in due diligence conclusions that we reached about vladimir quits net source co-investment with us in 2015 so I did some digging on c5 razor bidco this was the the portion of the company in reference to the article I need to get your your take on this and they want to get you on the record on this because it's you mentioned I've been a law above board with all the compliance no offshore entities this is a personal investment that he made Co investment into an entity you guys set up for the transparency and compliance is that true that's correct no side didn't see didn't discover this would my my children could have found this this this company was in a transparent way on the records in Companies House and and Vladimir's role and investment in it was completely on the on the public record all of this was subject to financial conduct authority regulation and anti money laundering and no your client standards and compliance so there was no great big discovery this was all transparent all out in the open and we felt very confident in our due diligence findings and so you feel very confident Oh issue there at all special purpose none whatsoever is it this is classic this is international finance yes sir so in the venture capital industry creating a special purpose vehicle for a particular investment is a standard practice in c-five we focus on structuring those special-purpose vehicles in the most transparent way possible and that was his money from probably from Russia and you co invested into this for this purpose of doing these kinds of deals with Russia well we just right this is kind of the purpose of that no no no this so in 2015 we invested into a European enterprise software company that's a strategic partner of Microsoft in Scandinavian country and we invested in amount of 16 million pounds about at the time just more than 20 million dollars and subsequent in August of that year that Amir Kuznetsov having retired for nova and some time ago in his own right as an angel investor came in as a minority invest alongside us into this investment but we wanted to be sure that his investment was on our control and subject to our compliance standards so we requested him to make his investment through our special purpose vehicle c5 raised a bit co this investment has since been realized it's been a great success and this business is going on to do great things and serve great clients it c5 taking russian money no see if I was not taking Russian money since since the onset of sanctions onboarding Russian money is just impossible sanctions have introduced complexity and have introduced regulatory risk related to Russian capital and so we've taken a decision that we will not and we can't onboard Russian capital and sanctions have also impacted my investigative career sanctions have also completely changed because what the US have done very effectively is to make sanctions a truly global regime and in which ever country are based it doesn't really matter you have to comply with US sanctions this is not optional for anybody on any sanctions regime including the most recent sanctions on Iran so if there are sanctions in place you can't touch it have you ever managed Russian oligarchs money or interests at any time I've never managed a Russian oligarchs money at any point in time I served for a period of a year honest on the board of a South African mining company in which Renova is a minority invest alongside an Australian company called South 32 and the reason why I did this was because of my support for African entrepreneurship this was one of the first black owned mining companies in South Africa that was established with a British investment in 2004 this business have just grown to be a tremendous success and so for a period of a year I offered to help them on the board and to support them as they as they looked at how they can grow and scale the business I have a couple more questions Gabe so I don't know if you wanna take a break you want to keep let's take a break okay let's take a quick break do a quick break I think that's great that's the meat of it great job by the way fantastic lady here thanks for answering those questions the next section I want to do is compliment

(bright classical music) >> Hi, I'm Peter Burris and welcome to another CUBE Conversation from our studios here in Palo Alto, California. We've got another great conversation today, specifically we're going to talk about some of the trends and changes in data catalogs, which were emerging as a crucial technology to advance data-driven business on a global scale. And to do that, we've got Alation here, specifically Stephanie McReynolds who's the Vice-President of Marketing at Alation. Stephanie, welcome back to theCUBE. >> Thank you, it's great to be here again. >> So Stephanie, before we get into this very important topic of the increasing, obviously role or connection between knowing what your data is, knowing where it is, and business outcomes in a data-driven business world, let's talk about Alation. What's the update? >> Yeah, so we just celebrated, yesterday in fact, the sixth anniversary of incorporation of the company. And upon, reflecting on some of the milestones that we've seen over those six years, one of the exciting developments is we went from initially about seven production implementations a couple years after we were founded, to now over a hundred organizations that are using Alation. And in those organizations over the last couple of years, we've seen many organizations move from hundreds of users, to now thousands of users. An organization like Scout24 has 70 percent of the company as self-servicing analytics users and a significant portion of those users now using Alation. So we're seeing companies in Europe like Scout24 who's in Germany. Companies like Pfizer in the United States. Munich Reinsurance in the financial services industry. Also hit about 2000 users of Alation, and so it's exciting to look at our origins with eBay as our very first customer, who's now up to about 3000 users. And then these more recent companies adopt Alation all of them now getting to a point where they really have a large population that's using a data catalog to drive self-service analytics and business outcomes out of those self-serving analytics. >> So a hundred first-rate brands as users, it's international expansion. Sounds like Alation's really going places. What I want to do though, is I want to talk a little bit about some of the outcomes that these companies are starting to achieve. Now we have been on the record here at circling the angle with theCUBE wiki bomb for quite some time, trying to draw a relationship between business, digital business, and the role that data plays. Digital business transformation, in many respects, is about how you evolve the role the data plays in your business to become more data-driven. It's hard to do without knowing what your data is, where it is, and having some notion of how it's being used in a verified trusted way. How are you seeing your company's start to tie the use of catalogs to some of these outcomes? What kind of outcomes are folks trying to achieve first off? >> Yeah, you're right. Just basic table stakes for turning an organization into an organization that relies on data-driven decision-making rather than intuitive-decision making requires an inventory. And so that's table stakes for any catalog, and you see a number of vendors out there providing data inventories. But what I think is exciting with the customers that we work with, is they are really undertaking transformative change, not just in the tooling and technology their company uses, but also in the organizational structure, and data literacy programs, and driving towards real business impact, and real business outcomes. An example of an Alation customer, who's been talking recently about outcomes, is Pfizer. Pfizer was covered in a Wall Street Journal article, recently. Also was speaking at TABLO Conference, about how they're using a combination of the Alation data catalog with TABLO on the front end, and a data science platform called Data IQ, in an integrated analytics workbench that is helping them with new drug discovery. And so, for populations of ill individuals, who may have a rare form of heart disease, they're now able to use machine learning and algorithms that are informed by the data catalog to catch one percent, two percent of heart disease patients who have a slight deviation from the norm, and can deliver drugs appropriately to that population. Another example of the business outcome would be with an insurance company; very different industry, right? But, Munich Reinsurance is a huge global reinsurance company, so you think about hurricanes or the fires we had here in the United States, they actually support first line insurers by reinsuring them. They're also founding new business units for new types of risks in the market. An example would be a factory that is fully controlled by robots. Think about the risks of having that factory be taken over by hackers in the middle of the night, where there's not a lot of employees on the floor. Munich Reinsurance is leveraging the data catalog as a collaboration platform between actuaries and individuals that are knowledgeable in the business to define what are the data products that could support an entirely new business units, like for cyber crimes. And investing in those business units based on the innovation they're doing using the data catalog as a collaboration platform. So these are two great examples of organizations that, a couple years ago started with a data catalog, but have driven so many more initiatives than just analyst productivity off of that implementation. >> Oh, those are great outcomes. One of them talking about robots in the factory, automated factory, one thing, if they went haywire, would make for some interesting viral video. (gently laughs) >> That's right. That's right. >> But coming back, but the reason I say that is because in many respects, these practices, these relations with the outcomes, the outcomes are the real complex thing. You talked about becoming more familiar with data, using data differently, becoming more data driven. That requires some pretty significant organizational change. And it seems to me, and I'm querying you on this, that the bringing together these users to share their stories about how to achieve these data driven outcomes, made more productive by catalogs and related technologies. Communities must start to be forming. Are you seeing communities form around achieving these outcomes and utilizing these types of technologies to accelerate the business change? >> So what's really interesting at an organization like Munich Reinsurance or at Pfizer, is there's an internal community that is using the data catalog as a collaboration platform and as kind of a social networking platform for the data nerds. So if I am a brand new user of self-service analytics, I may be a product manager who doesn't know how to write a sequel query yet. Who doesn't know how to go and wrangle my own data. >> Yeah, may never want to. (playfully laughs) >> May never want to. May never want to. Who may not know how to go and validate data for quality or consistency. I can now go to the data catalog to find trusted resources of data assets, be that a dashboard to report that's already been written or be that raw data that someone else has certified, or just has used in the past. So we're seeing this social influence happen within companies that are using data catalogs, where they can see for the data catalog pages, who's used, who's validated this data set so that I now trust the data. And then, what we've seen happen, just within the last year and-a-half or so, is these organizations, the sponsors of the data of these organizations, are starting to share best practices naturally with one another, and saying, hey >> Across organizations. >> Across organizations. And so there has been a demand for Alation to get out into the market and help catalyze the creation of communities across different organizations. We kicked off, within the last two months, a series of meetings that we've called RevAlation. >> R-E-V-A-L >> That's right >> A-T-I-O-N >> R-E-V-A-L-A-T-I-O-N And the thing behind the name is, if you can start to share best practices in terms of how you create a data-driven culture across organizations, you can begin to really get breakthrough speed, right? In making this transformation to a data-driven organization. And so, I think what's interesting at the RevAlation events, is folks are not talking just about how they're using the tool, how they're using technology. They're actually talking about how do we improve the data literacy of our organizations and what are the programs in place that leverage, maybe the data catalog, to do that. And so they're starting to really think about, how does, not just the technical architecture and the tooling change in their organizations, but how do we close this gap between having access to data and trusting the data and getting folks who maybe aren't, too familiar with the technical aspects of the data supply chain. How do we make them comfortable in moving away from intuitive decisions to data-driven decisions? >> Yeah, so the outcome really is not just the application of the tool, it's the new behaviors in the business that are associated with data-driven. But to do that, you still have to gain insight and understand what kinds of practices are best used with the tool itself. >> That's right. >> So it's got to be a combination. But, you know, Alation has been, if I can say this. Alation's been on this path for a while. Not too long ago, you came on theCUBE and you talked about trust check. >> Right. >> Which was an effort to establish conventions and standards for how data could be verified and validated so that it would be easy to use, so that someone could use the data and be certain that it is what it is, without necessarily having to understand the data. Something that could be very good for, for example, for folks who are very focused on the outcome, and not focused on the science of the data associated with it. >> That's right. >> So, is this part of, it's RevAlation, it's trust check. Is this part of the journey you're on to try to get people to see this relation between data-driven business and knowing more about your data? >> It absolutely is. It's a journey to get organizations to understand what is the power that they have internally, within this data. And close the gap on, which is in part organizational, but in part for individuals user's psychological and how do you get to a trusted decision. And so, you'll continue to see us invest in features like trust check that highlight how technology can make recommendations; can help validate and verify what the experts in the organization know and propagate that more widely. And then you'll also see us share more best practices about how do you start to create the right organizational change, and how do you start to impact the psychology of fear that we've had in many organizations around data. And I think that's where Alation is uniquely placed, because we have the highest number of data catalog customers of any other vendor I'm familiar with in this space. And we also have a unique design approach. When we go into organizations and talk about adopting a data catalog, it's as much about, how do our products support psychological comfort with data as well as, how do they support the actual workflow of getting that query completed, or getting that data certified. And so I think we've taken a bit of a unique approach to the market from the beginning where we're really designing holistically. We're not just, how do you execute a software program that supports workflow? But how do you start to think about how the data consumer actually adopts that best practices and starts to think differently about how they use data in a more confident way? >> Well I think the first time that you and I talked in theCUBE was probably 2016, and I was struck by the degree to which Alation as a tool, and the language that you used in describing it was clearly designed for human beings to use it. >> Right. >> As opposed to for data. And I think that, that is a unique proposition, because at the end of the day, the goal here, is to have people use data to achieve outcomes and not just to do a better job of managing data. >> And that doesn't mean that, I mean we have a ton of machine learning, >> Sure. >> And AI in the products. That doesn't take away from the power of those algorithms to speed up human work and human behavior. But we really believe that the algorithms need to compliment human input and that there should be a human in the loop with decision-making. And then the algorithms propagate the knowledge that we have of experts in the organization. And that's where you get the real breakthrough business outcomes, when you can take input from a lot of different human perspectives and optimize an outcome by using technology as a support structure to help that. >> In a way that's familiar and natural and easy for others in your organization. >> That's right. That seems, you know, if you go back to. >> It makes sense. >> When we were all introduced to Google it was a little bit of an odd thing to go ask Google questions and get results back from the internet. We see data evolving in the same way. Alation is the Google for your data in your organization. At some point it'll be very natural to say, 'Hey Alation, what happened with revenue last month?' And Alation will come back with an answer. So I think that, that future is in sight, where it's very easy to use data. You know you're getting trusted responses. You know that they're accurate because there's either a certification program in place that the technology supports, or there's a social network that's bubbling this information up to the top, that is a trusted source. And so, that evolution in data needs to happen for our organizations to broadly see analytic driven outcomes. Just as in our consumer or personal life, Google had to show us a new way to evolving, you know, to a kind of answering machine on the internet. >> Excellent. Stephanie McReynolds, Vice-President of Marketing Alation, talked to us about building communities, to become more of a, to achieve data-driven outcomes, utilizing data catalog technology. Stephanie, thanks very much for being here. >> Thanks for inviting me. >> And once again, I'm Peter Burris, and this has been another CUBE Conversation until next time. (bright classical music)