>> Narrator: theCUBE presents Ignite 22. Brought to you by Palo Alto Networks. >> Hey, welcome back to Las Vegas. Lisa Martin here with Dave Vellante. This is day two of theCUBE's coverage of Palo Alto Ignite 2022. Dave we're just talking about how many times we're in Vegas. And we were here two weeks ago with our guest who's back in Alumni. And it's a blur, right? >> It's true, I lost count. Luckily I'm not flying red eye tonight. So that's good. >> I'm impressed. >> Excited about that. >> Yeah >> I'm actually going to enjoy the, nightlife here for a period of time. And, you know, we were at re-Invent. >> Yeah. >> And what a difference. This is nice and relaxed. You have time. You're not getting bumped in the hallway. >> Right. >> A lot of time for learning. So it's been great show. >> It's been great. And one of the things that we've been talking about is the supply chain. Securing the modern software supply chain is really complicated. We've got an Alumni back with us, to talk about what Palo Alto is doing in that respect. Ankur Shah joins us. The SVP and GM of Cloud Security at Palo Alto Networks. Welcome back. >> Yeah, happy to be back. Good to see you again. Dave and Lisa. >> It's been two long weeks. >> Ankur: I know. It's been two weeks, yeah >> Dave: It's kind of crazy. I mean, ReInvent really was a blur. And it's like you had everything coming at you. And there was obviously a big chunk of security, but you. It was just so much to absorb. >> Yeah. >> Right? >> Yeah, and I couldn't get into any of the sessions versus at Ignite. I mean, you could, you could learn a lot. To your point Dave. And 70,000 people versus 3000 in change. Big difference. >> Dave: Yeah. >> Lisa: Huge difference. >> Yeah. >> Lisa: Huge difference. So we touched on the Cider acquisition. >> Ankur: Yeah. >> Which was announced the intent to acquire last month. Let's dig into a little bit more of that, and then some of the great things that had been announced. >> Ankur: Yeah. >> In the last couple of days. >> Oh, absolutely. So, this is something that we have been marinating for last nine months. Thinking about how best to secure supply chain. And this is software supply chain. The modern application software is fairly complex. You know, back in the days when I was a developer, it was a simple three tier application. Ship the code once a year, et cetera. But now with microservices, new architectures, Kubernetes Public Cloud, we talked about this. It's getting super complicated, and the customers are really worried about securing their entire supply chain. Which is nothing but the software pipeline. And so we started looking at a whole bunch of companies and Cider really stood out. I mean, they had, they were the innovators in this space. Very early days, we've seen supply chain attack. But there hasn't been a really good and strong solution in that space. And Cider just delivered that incredible team. Great technology, super excited about what that integration will look like. in the coming quarters. >> What do we need to know about them? I mean, I'll be honest with you, I wasn't familiar with Cider until I saw you guys made the announcement of the intent to acquire them. What, what should we know about them? Why Cider? What was it that attracted you to them? >> Ankur: Yeah, so, you know, we have a history of technology acquisitions as you know, over the last four years, just in the public cloud. We acquire over half a a dozen companies, small and large. And typically we are always looking for companies who have the next gen technology available. Technology that is more in tune with how application software is going to look like in future. So we're not always going after companies that are making you know, tens of hundreds of millions of dollars in a year and all. We're looking for the right tech. The future. And that's what we found in Cider. Like they have a really strong application security background. And AppSec just broadly speaking, supply chain is part of it. But application security, just broadly speaking, is right for disruption. You've got a lot of vendors, who have been around for like last two decades. Old school stuff, lots and lots of false positives. So we've been bolstering, beefing up our portfolio in the application security space. And Cider really fits right nicely into it. Because it can like I said, secure a lot of technology and tooling, that software developers use as part of their software supply chain. So, great founding team, great technology. It was a perfect fit. >> Talk about integration. We spoke with Nikesh yesterday, with Nir, with a whole bunch of folks. Lee this morning. BJ yesterday as well. And one of the things that seems to stick out at me. With all the shows that we do, is the focus that Palo Alto has on ensuring that it's making the right acquisitions. But that it's the integration, is really seems to be like leading part of the strategy. That seems to be a little bit of a differentiator to me. >> Yeah, it absolutely is. There are two ways to integrate a technology into an existing platform. And Prisma Cloud is a platform as you know. Code-to-cloud, CNAPP platform as we call it. One is just kind of slotted in, put the whole thing in a box. And that's basically making one plus one equal to two. We're looking for high leverage in integrations, whereby once that integration comes along. It makes the rest of the platform even better and superior. It makes that technology look even better. So that's why there's a lot of focus on ensuring that we're delivering the right type of integration, that delivers instant customer value. And that makes the overall platform even superior. So customers don't feel like hey, like there's just one more add-on, on top of the other thing. >> Lisa: Right, not a bolt on. >> So that's why there's a lot of focus on that. Getting the strategy nailed. Because the founding teams generally have a preconceived notion about how the world looks like. Then they understand how Prisma cloud and Palo Alto Networks think about it. And then, we sort of merge the two ideas, and build something that's incredible. So I am, we're spending a lot of time in integration. That honeymoon phase of like, let's high five acquisitions done, that's over. Now it's the grinding work of actually getting this right. And you know, getting hundreds and thousands of customers. >> Well I like how you don't have the private equity mentality. It's not about EBITDA and cashflow. We'll take care of that. >> Ankur: Yeah. >> You know, it's about getting that integration. Getting that flywheel effect, inside the platform. You know, we said one plus one equals, maybe even more than two. Can you explain Prisma Cloud Secrets Security? What is that all about? What do we need to know about that? >> Ankur: Absolutely. So, the developers, you know generally store some stuff in the code repo for their automation work to build application. And that thing, the API keys or as Secrets are stored in code repo. It shouldn't be. Or even if they are, they should be encrypted, or locked down and things of that nature. But, you know, the need for speed trumps everything else. Developers want to go fast. And sometimes they're like, okay well. I guess my application needs this particular, you know API access token or secret. I'm just going to stick it in the code. Now the challenge with that is that, if somebody gets hold of your code repo. Now not only is your code repo, which has all your sensitive data. Your code is the life and blood of a technology company. That's in trouble. But also those secrets and API access keys can be used to log into your cloud accounts. And there you may have sensitive customer data. Everything that you have as a technology company stored in that public cloud accounts. So that's the worry. It's usually the initial access for the kill chain. Because that's where the attacks start. Let me get the secret, let me get the API access key. And let me see what I can do in public cloud. So we are now giving customers the visibility into where the secrets are stored. More importantly, it just right there on developer's face. In the code repo as they're checking in the code. They say why, hey, there's a secret here. Are you sure you want to, you want to keep it like this, no? Okay, well then you can either encrypt it, or just get rid of it. So we're making, we're bringing security where the developers are in their code repo, et cetera. >> So I can see a lot of developers saying, yeah, go ahead, encrypt it. So I don't have to do anything else, you know, extra. It's almost, the analogy is a very small you know, version of this. Its like, use a password manager. You store all your passwords in your contacts on your phone, right? I mean, somebody gets a hold of your contacts, you're screwed. >> Ankur: That's exactly right. >> And so, but I could still see a lot of developers say, check in the box. Say, yeah just encrypt it, leave it there. But you're saying best practice is to not to do that, right? >> Yeah, usually you're not supposed to, you know, store all your secrets, et cetera in code repo to begin with. But if you do, you know, you use a key wall like technology to really encrypt it and store it in a secret manner, yeah. >> Dave: There's an old saying, bad user behavior trump's great security every time. >> Ankur: Every time. >> But this is an example where, we know you're going to have bad behavior. So we're going to protect the bad behavior. >> Yeah, and actually, sorry Lisa, just to that point. The bad user behavior trumps good security. The classic example, this happened three weeks ago. Three, four weeks ago, where Dropbox, one of the file sharing companies there. 120 plus code repos were exposed. And the way their attack started, was a simple social engineering attack. Bad user behavior. There was an email, hey, like your passwords are updated for your, you know, this code plugin. Can you enter the password? And boom, now you have access to the code repo. And now if you have secrets inside of it, now, you know all bets are off. >> Are there hard-coded secrets versus like, I mean, like I think like, like you were saying, Dave. Like usernames and passwords and tokens, versus like soft coded secrets. >> Ankur: It's, I think it, this is more so two forms of it, you know. The most primary one is what we call the API access keys. And this keys are used to access cloud accounts, workloads and things of that nature. But there are actually secret secrets. Could be database login passwords, et cetera. The application is using it to spin up databases. Now, you know, you have access to the data stores. Any other application, there's a login password, all of that stuff. So it's less about the user password, but more the application and databases and things of that nature. >> Dave: So again, and, again, everybody should be using password managers. But when you use a password manager, it's going to give you a long list of passwords, that are either been compromised or are weak. And you just go uh, okay. So can you help? How do you help customers identify what the high risk? You know, API, you know, access are versus those ones that they may not have to worry about. >> Ankur: Yeah, look. You know, secrets aside. Risk prioritization is one of the biggest topics that our customers have across the board, in cloud security. All the security vendors are really, really good at one thing, generating alerts. Everybody does it. They generate an alert. You know, your ring camera, if you've got one. I mean this pop up every day, like every minute rather. Well like can you prioritize it for me? What should I really look at it? So that's a number one thing. What Prisma Cloud does is, you know, contextualize it. What the real risk is? They can tell you like, hey, here's the kill chain. If this thing, you know, goes to public internet. These are the potential exposures that you have. So we provide a prioritized risk of critical alerts that customers have to take care of before they can start taking care of more hygiene type of stuff, right? So that's how we do it. Like we leverage a lot of technology. We apply a lot of context. We tell you like, hey, this code repo is not protected by multifactor authentication. And then there's a secret inside. Are you sure, you know, you don't want to fix it? So that's what we do. But it's a great question. Top of mind for all our customers. And that's how we think about it across the board. Versus generating just alerts all the time. >> Dave: Is the strategy, Because we all know phishing is the sort of most, you know obvious way to. It's the top way in which people get hacked. >> Ankur: Yeah. >> Is your strategy essentially to say. Okay we know that's going to happen, so we're going to try to protect it at the back end. How much of the, maybe it's an industry question. more so than just a Palo Alto specifically, How much emphasis is do you think the industry is taking or should be taking on stopping that, you know that those phishing attacks? Because if that's the number one problem you know, maybe that's where we should be starting. >> Yeah, it's a great question. It's typically the initial vector, for a lot of attacks to your point. But there is one thing that technology and AI cannot solve. Which is the user behavior, to your point. Like we can't get into the heads of the user. I mean, you can train them, you can do everything. You can't prevent somebody from clicking a button. Of course there's technology out there for email security that does that. But your point is, right, it's going to happen. Now what do you do? How do you protect your applications, your crown jewel? You know, whether it's in the cloud or it's in the code repo. So a lot of what we are trying to do in code security, or cloud security, or in general at Palo Alto Networks. is to protect those crown jewel. Because we can't prevent somebody from doing something. User behavior is hard to change. >> Dave: So it's almost like, okay, you left your front door open. Somebody's going to walk in, but oh, they walk into a vault. And they don't know where to go. And there's nowhere they can- >> Ankur: Yeah. >> You know, nothing they can take. They can't get to the silverware or the jewelry. >> I think that's it, yeah. >> What are some of the things, like as we look at, we're wrapping up calendar year '22 heading into '23. That customers can look to Palo Alto Networks to help them achieve? One of the things that we talked about with Nikesh and Niri yesterday, is consolidation. Like, and you guys just did a recent, survey. >> Ankur: Yeah. >> About the state of Cyber, and organizations on average have 366 apps in their environment. 31 security tools, 30 to 50 security tools. >> Ankur: Yeah. >> Consolidation is really key there. What are some of the things that you are excited about to deliver to customers where consolidation is concerned? >> Ankur: Yeah. >> Where software supply chain security is concerned in the next year? >> Yeah, absolutely. Look, there are over 3000 security vendors. And this can be, I mean you talked about average customer having 300. I was talking to a CSO, this was last year for one of the largest financial institution I go, "How many security tools do you have?" He got 120. I said, why? He goes, we have a no vendor left behind policy. >> Wow. >> It's crazy. >> Dave: What? >> Obviously he was joking, but it's crazy, right? Like that's how the CSO's are. >> Dave: I mean, he was kidding. >> Yeah. >> Dave: But recognized that. Wow. >> Yeah, and, this is the state the security industry is in. And our mission has been, and Lee and Nikesh and Niri talked about it. Is just platforms, will platforms take moonshots, things long term. And especially the, macro headwinds that we're seeing. We're hearing more and more from the customers that, look we're not going to buy point product. Then we got to buy another product that stitches it all together. We need platforms, whether it's for zero trust, Prisma SaaS, whether it's cloud. Prisma cloud or for your sock transformation. You know XIM and Cortex line of products. So I think you're going to see more and more of that in 2023. I'm confident in that. >> We heard from Lee today, the world record's 400. >> Yes. >> Yeah. >> That's crazy. >> He's going for it. He's got a ways to go. 120 He's got to... >> Maybe he wasn't, that guy wasn't kidding about his no vendor left behind policy. (laughing) Do you have Ankur, a favorite customer story that really articulates the value of what Palo Alto delivers and continues to. You know, 'cause one of the things that Nikesh said in his keynote was that you know, security's a data problem. Well every company these days, in every industry has to be a data company. But really what they need to be able to be is a secured data company. >> Ankur: Yeah. >> How are you guys enabling that? >> Oh, absolutely. Look, many customer examples come to mind, but speaking of data. You know, one of, some of our largest customers who are protecting their PCI workers where they have sensitive data. They're using for example, Prisma Cloud, to ensure that malicious attacks don't happen. And those workloads are used for credit card processing. They're processing tens of thousands of credit card transactions a second. And make sure that nobody gets hold of that. And that's why they have to make sure that nobody is. No attacker is trying to get hold of the sensitive data, to your point, So we have customers across financial services, media and entertainment technology company. Where we are helping them go as fast as possible in public cloud. Go through digital transformation, by securing their applications. >> Dave: What's the T-shirt say? I see code. >> Oh yeah. >> Dave: Secure from Code to Cloud. >> Lisa: Shift Happens. >> Shift Happens, Secrets from Code to Cloud. >> I love that. I was looking at that, going back to that, what's next in cyber survey? >> Ankur: Yeah. >> It said 74% of respondents, and I believe there was 1300 CIO's, CXO's that were surveyed globally. Where they said security is slowing down DevOps. Can customers look to Palo Alto Networks to help them? >> Ankur: Be enablers? >> Yes. >> Yeah, hundred percent. Look, the conversation over the last few years have changed now. Security used to say like, oh, I don't know about these people who are building applications. The DevOps is like security slowing down. I think there's an opportunity for companies like Palo Alto Networks, to build the bridge between the two. And the way we do it is make the securities easy, simple and not super intrusive. Where developers have to do a natural thing. And one part of it, and I talked about it earlier, is bring security where the developers are. In their code repo, in their IDE. Make it super simple. Don't make them do unnatural things. And it just, this is no different from changing the behavior of our kids. Right? Like you make them do unnatural things, they're not going to do it. But if it is part of their regular, you know, day-to-day operating procedures. I think they're going to be more open to change. Yeah. So I think it's possible. And Palo Alto has a huge responsibility to bridge the divide between the apps team, or the DevOps and the security organization. >> Lisa: Lots of great stuff to come. We thank you so much for coming back, two weeks. Only being on two weeks ago. We appreciate your insights, learning more information. It's great to see you at Palo Alto Ignite. And we'll have to have you back on. 'Cause we know that there's so much more to follow with respect to what you're doing. And shifting left, shift happens. >> Awesome. Lisa, Dave, thank you so much. It's been a pleasure. >> Lisa: Thank you so much. For Ankur Shah and Dave Vellante. I'm Lisa Martin. You're watching theCUBE. The leader in live and emerging tech coverage.

>>The cube presents Ignite 22, brought to you by Palo Alto Networks. >>Good morning. Live from the MGM Grand. It's the cube at Palo Alto Networks Ignite 2022. Lisa Martin here with Dave Valante, day two, Dave of our coverage, or last live day of the year, which I can't believe, lots of good news coming out from Palo Alto Networks. We're gonna sit down with its Chief product officer next and dissect all of that. >>Yeah. You know, oftentimes in, in events like this, day two is product day. And look, it's all about products and sales. Yeah, I mean those, that's the, the, the golden rule. Get the product right, get the sales right, and everything else will take care of itself. So let's talk product. >>Yeah, let's talk product. Lee Claridge joins us, the Chief Product Officer at Palo Alto Networks. Welcome Lee. Great to have >>You. Thank you so much. >>So we didn't get to see your keynote yesterday, but we heard one of the things, you know, we've been talking about the threat landscape, the challenges. We had Unit 42, Wendy on yesterday. We had Nash on and near talking about the massive challenges in the threat landscape. But we understand, despite that you are optimistic. I am. Talk about your optimism given the massive challenges that every organization is facing today. >>Look, cybersecurity's hard and often in cybersecurity in the industry, a lot of people get sort of really focused on what the threat actors are doing, why they're successful. We investigate breaches and we think of it, it just starts to feel somewhat overwhelming for a lot of folks. And I just happen to think a little bit differently. I, I look at it and I think it's actually a solvable problem. >>Talk about cyber resilience. How does Palo Alto Networks define that and how does it help customers achieve that? Cuz that's the, that's the holy grail these days. >>Yes. Look, the, the way I think about cyber resilience is basically in two pieces. One, it's all about how do we prevent the threat actors from actually being successful in the first place. Second, we also have to be prepared for what happens if they happen to find a way to get through, and how do we make sure that that happens? The blast radius is, is as narrowly contained as possible. And so the, the way that we approach this is, you know, I, I kind of think in terms of like threes three core principles. Number one, we have to have amazing technology and we have to constantly be, keep keeping up with and ideally ahead of what attackers are doing. It's a big part of my job as the chief product officer, right? Second is we, you know, one of the, the big transformations that's happened is the advent of, of AI and the opportunity, as long as we can do it, a great job of collecting great data, we can drive AI and machine learning models that can start to be used for our advantage as defenders, and then further use that to drive automation. >>So we take the human out of the response as much as possible. What that allows us to do is actually to start using AI and automation to disrupt attackers as it's happening. The third piece then becomes natively integrating these capabilities into a platform. And when we do that, what allows us to do is to make sure that we are consistently delivering cybersecurity everywhere that it needs to happen. That we don't have gaps. Yeah. So great tech AI and automation deliver natively integrated through platforms. This is how we achieve cyber resilience. >>So I like the positivity. In fact, Steven Schmidt, who's now the CSO of, of Amazon, you know, Steven, and it was the CSO at AWS at the time, the first reinforced, he stood up on stage and said, listen, this narrative that's all gloom and doom is not the right approach. We actually are doing a good job and we have the capability. So I was like, yeah, you know, okay. I'm, I'm down with that. Now when I, my question is around the, the portfolio. I, I was looking at, you know, some of your alternatives and options and the website. I mean, you got network security, cloud security, you got sassy, you got capp, you got endpoint, pretty much everything. You got cider security, which you just recently acquired for, you know, this whole shift left stuff, you know, nothing in there on identity yet. That's good. You partner for that, but, so could you describe sort of how you think about the portfolio from a product standpoint? How you continue to evolve it and what's the direction? Yes. >>So the, the, the cybersecurity industry has long had this, I'm gonna call it a major flaw. And the major flaw of the cybersecurity industry has been that every time there is a problem to be solved, there's another 10 or 20 startups that get funded to solve that problem. And so pretty soon what you have is you're, if you're a customer of this is you have 50, a hundred, the, the record is over 400 different cybersecurity products that as a customer you're trying to operationalize. >>It's not a good record to have. >>No, it's not a good record. No. This is, this is the opposite of Yes. Not a good personal best. So the, so the reason I start there in answering your question is the, the way that, so that's one end of the extreme, the other end of the extreme view to say, is there such a thing as a single platform that does everything? No, there's not. That would be nice. That was, that sounds nice. But the reality is that cybersecurity has to be much broader than any one single thing can do. And so the, the way that we approach this is, is three fundamental areas that, that we, Palo Alto Networks are going to be the best at. One is network security within network security. This includes hardware, NextGen, firewalls, software NextGen, firewalls, sassy, all the different security services that tie into that. All of that makes up our network security platforms. >>So everything to do with network security is integrated in that one place. Second is around cloud security. The shift to the cloud is happening is very real. That's where Prisma Cloud takes center stage. C a P is the industry acronym. If if five letters thrown together can be called an acronym. The, so cloud native application protection platform, right? So this is where we bring all of the different cloud security capabilities integrated together, delivered through one platform. And then security, security operations is the third for us. This is Cortex. And this is where we bring together endpoint security, edr, ndr, attack, surface management automation, all of this. And what we had, what we announced earlier this year is x Im, which is a Cortex product for actually integrating all of that together into one SOC transformation platform. So those are the three platforms, and that's how we deliver much, much, much greater levels of native integration of capabilities, but in a logical way where we're not trying to overdo it. >>And cider will fit into two or three >>Into Prisma cloud into the second cloud to two. Yeah. As part of the shift left strategy of how we secure makes sense applications in the cloud >>When you're in customer conversations. You mentioned the record of 400 different product. That's crazy. Nash was saying yesterday between 30 and 50 and we talked with him and near about what's realistic in terms of getting organizations to, to be able to consolidate. I'd love to understand what does cybersecurity transformation look like for the average organization that's running 30 to 50 point >>Solutions? Yeah, look, 30 to 50 is probably, maybe normal. A hundred is not unusual. Obviously 400 is the extreme example. But all of those are, those numbers are too big right now. I think, I think realistic is high. Single digits, low double digits is probably somewhat realistic for most organizations, the most complex organizations that might go a bit above that if we're really doing a good job. That's, that's what I think. Now second, I do really want to point out on, on the product guy. So, so maybe this is just my way of thinking, consolidation is an outcome of having more tightly and natively integrated capabilities. Got you. And the reason I flip that around is if I just went to you and say, Hey, would you like to consolidate? That just means maybe fewer vendors that that helps the procurement person. Yes. You know, have to negotiate with fewer companies. Yeah. Integration is actually a technology statement. It's delivering better outcomes because we've designed multiple capabilities to work together natively ourselves as the developers so that the customer doesn't have to figure out how to do it. It just happens that by, by doing that, the customer gets all this wonderful technical benefit. And then there's this outcome sitting there called, you've just consolidated your complexity. How >>Specialized is the customer? I think a data pipelines, and I think I have a data engineer, have a data scientists, a data analyst, but hyper specialized roles. If, if, let's say I have, you know, 30 or 40, and one of 'em is an SD wan, you know, security product. Yeah. I'm best of breed an SD wan. Okay, great. Palo Alto comes in as you, you pointed out, I'm gonna help you with your procurement side. Are there hyper specialized individuals that are aligned to that? And how that's kind of part A and B, how, assuming that's the case, how does that integration, you know, carry through to the business case? So >>Obviously there are specializations, this is the, and, and cybersecurity is really important. And so there, this is why there had, there's this tendency in the past to head toward, well I have this problem, so who's the best at solving this one problem? And if you only had one problem to solve, you would go find the specialist. The, the, the, the challenge becomes, well, what do you have a hundred problems to solve? I is the right answer, a hundred specialized solutions for your a hundred problems. And what what I think is missing in this approach is, is understanding that almost every problem that needs to be solved is interconnected with other problems to be solved. It's that interconnectedness of the problems where all of a sudden, so, so you mentioned SD wan. Okay, great. I have Estee wan, I need it. Well what are you connecting SD WAN to? >>Well, ideally our view is you would connect SD WAN and branch to the cloud. Well, would you run in the cloud? Well, in our case, we can take our SD wan, connect it to Prisma access, which is our cloud security solution, and we can natively integrate those two things together such that when you use 'em together, way easier. Right? All of a sudden we took what seemed like two separate problems. We said, no, actually these problems are related and we can deliver a solution where those, those things are actually brought together. And that's just one simple example, but you could, you could extend that across a lot of these other areas. And so that's the difference. And that's how the, the, the mindset shift that is happening. And, and I I was gonna say needs to happen, but it's starting to happen. I'm talking to customers where they're telling me this as opposed to me telling them. >>So when you walk around the floor here, there's a visual, it's called a day in the life of a fuel member. And basically what it has, it's got like, I dunno, six or seven different roles or personas, you know, one is management, one is a network engineer, one's a coder, and it gives you an X and an O. And it says, okay, put the X on things that you spend your time doing, put the o on things that you wanna spend your time doing a across all different sort of activities that a SecOps pro would do. There's Xs and O's in every one of 'em. You know, to your point, there's so much overlap going on. This was really difficult to discern, you know, any kind of consistent pattern because it, it, it, unlike the hyper specialization and data pipelines that I just described, it, it's, it's not, it, it, there's way more overlap between those, those specialization roles. >>And there's a, there's a second challenge that, that I've observed and that we are, we've, we've been trying to solve this and now I'd say we've become, started to become a lot more purposeful in, in, in trying to solve this, which is, I believe cybersecurity, in order for cyber security vendors to become partners, we actually have to start to become more opinionated. We actually have to start, guys >>Are pretty opinionated. >>Well, yes, but, but the industry large. So yes, we're opinionated. We build these products, but that have, that have our, I'll call our opinions built into it, and then we, we sell the, the product and then, and then what happens? Customer says, great, thank you for the product. I'm going to deploy it however I want to, which is fine. Obviously it's their choice at the end of the day, but we actually should start to exert an opinion to say, well, here's what we would recommend, here's why we would recommend that. Here's how we envisioned it providing the most value to you. And actually starting to build that into the products themselves so that they start to guide the customer toward these outcomes as opposed to just saying, here's a product, good luck. >>What's, what's the customer lifecycle, not lifecycle, but really kind of that, that collaboration, like it's one thing to, to have products that you're saying that have opinions to be able to inform customers how to deploy, how to use, but where is their feedback in this cycle of product development? >>Oh, look, my, this, this is, this is my life. I'm, this is, this is why I'm here. This is like, you know, all day long I'm meeting with customers and, and I share what we're doing. But, but it's, it's a, it's a 50 50, I'm half the time I'm listening as well to understand what they're trying to do, what they're trying to accomplish, and how, what they need us to do better in order to help them solve the problem. So the, the, and, and so my entire organization is oriented around not just telling customers, here's what we did, but listening and understanding and bringing that feedback in and constantly making the products better. That's, that's the, the main way in which we do this. Now there's a second way, which is we also allow our products to be customized. You know, I can say, here's our best practices, we see it, but then allowing our customer to, to customize that and tailor it to their environment, because there are going to be uniquenesses for different customers in parti, we need more complex environments. Explain >>Why fire firewalls won't go away >>From your perspective. Oh, Nikesh actually did a great job of explaining this yesterday, and although he gave me credit for it, so this is like a, a circular kind of reference here. But if you think about the firewalls slightly more abstract, and you basically say a NextGen firewalls job is to inspect every connection in order to make sure the connection should be allowed. And then if it is allowed to make sure that it's secure, >>Which that is the definition of an NextGen firewall, by the way, exactly what I just said. Now what you noticed is, I didn't describe it as a hardware device, right? It can be delivered in hardware because there are environments where you need super high throughput, low latency, guess what? Hardware is the best way of delivering that functionality. There's other use cases cloud where you can't, you, you can't ship hardware to a cloud provider and say, can you install this hardware in front of my cloud? No, no, no. You deployed in a software. So you take that same functionality, you instantly in a software, then you have other use cases, branch offices, remote workforce, et cetera, where you say, actually, I just want it delivered from the cloud. This is what sassy is. So when I, when I look at and say, the firewall's not going away, what, what, what I see is the functionality needed is not only not going away, it's actually expanding. But how we deliver it is going to be across these three form factors. And then the customer's going to decide how they need to intermix these form factors for their environment. >>We put forth this notion of super cloud a while about a year ago. And the idea being you're gonna leverage the hyperscale infrastructure and you're gonna build a, a, you're gonna solve a common problem across clouds and even on-prem, super cloud above the cloud. Not Superman, but super as in Latin. But it turned into this sort of, you know, superlative, which is fun. But the, my, my question to you is, is, is, is Palo Alto essentially building a common cross-cloud on-prem, presumably out to the edge consistent experience that we would call a super cloud? >>Yeah, I don't know that we've ever used the term surfer cloud to describe it. Oh, you don't have to, but yeah. But yes, based on how you describe it, absolutely. And it has three main benefits that I describe to customers all the time. The first is the end user experience. So imagine your employee, and you might work from the office, you might work from home, you might work while from, from traveling and hotels and conferences. And, and by the way, in one day you might actually work from all of those places. So, so the first part is the end user experience becomes way better when it doesn't matter where they're working from. They always get the same experience, huge benefit from productivity perspective, no second benefit security operations. You think about the, the people who are actually administering these policies and analyzing the security events. >>Imagine how much better it is for them when it's all common and consistent across everywhere that has to happen. Cloud, on-prem branch, remote workforce, et cetera. So there's a operational benefit that is super valuable. Third, security benefit. Imagine if in this, this platform-based approach, if we come out with some new amazing innovation that is able to detect and block, you know, new types of attacks, guess what, we can deliver that across hardware, software, and sassi uniformly and keep it all up to date. So from a security perspective, way better than trying to figure out, okay, there's some new technology, you know, does my hardware provider have that technology or not? Does my soft provider? So it's bringing that in to one place. >>From a developer perspective, is there a, a, a PAs layer, forgive me super PAs, that a allows the developers to have a common experience across irrespective of physical location with the explicit purpose of serving the objective of your platform. >>So normally when I think of the context of developers, I'm thinking of the context of, of the people who are building the applications that are being deployed. And those applications may be deployed in a data center, increasing the data centers, depending private clouds might be deployed into, into public cloud. It might even be hybrid in nature. And so if you think about what the developer wants, the developer actually wants to not have to think about security, quite frankly. Yeah. They want to think about how do I develop the functionality I need as quickly as possible with the highest quality >>Possible, but they are being forced to think about it more and more. Well, but anyway, I didn't mean to >>Interrupt you. No, it's a, it is a good, it's a, it's, it's a great point. The >>Well we're trying to do is we're trying to enable our security capabilities to work in a way that actually enables what the developer wants that actually allows them to develop faster that actually allows them to focus on the things they want to focus. And, and the way we do that is by actually surfacing the security information that they need to know in the tools that they use as opposed to trying to bring them to our tools. So you think about this, so our customer is a security customer. Yet in the application development lifecycle, the developer is often the user. So we, we we're selling, we're so providing a solution to security and then we're enabling them to surface it in the developer tools. And by, by doing this, we actually make life easier for the developers such that they're not actually thinking about security so much as they're just saying, oh, I pulled down the wrong open source package, it's outdated, it has vulnerabilities. I was notified the second I did it, and I was told which one I should pull down. So I pulled down the right one. Now, if you're a developer, do you think that's security getting your way? Not at all. No. If you're a developer, you're thinking, thank god, thank you, thank, thank you. Yeah. You told me at a point where it was easy as opposed to waiting a week or two and then telling me where it's gonna be really hard to fix it. Yeah. Nothing >>More than, so maybe be talking to Terraform or some other hash corp, you know, environment. I got it. Okay. >>Absolutely. >>We're 30 seconds. We're almost out of time. Sure. But I'd love to get your snapshot. Here we are at the end of calendar 2022. What are you, we know you're optimistic in this threat landscape, which we're gonna see obviously more dynamics next year. What kind of nuggets can you drop about what we might hear and see in 23? >>You're gonna see across everything. We do a lot more focus on the use of AI and machine learning to drive automated outcomes for our customers. And you're gonna see us across everything we do. And that's going to be the big transformation. It'll be a multi-year transformation, but you're gonna see significant progress in the next 12 months. All >>Right, well >>What will be the sign of that progress? If I had to make a prediction, which >>I'm better security with less effort. >>Okay, great. I feel like that's, we can measure that. I >>Feel, I feel like that's a mic drop moment. Lee, it's been great having you on the program. Thank you for walking us through such great detail. What's going on in the organization, what you're doing for customers, where you're meeting, how you're meeting the developers, where they are. We'll have to have you back. There's just, just too much to unpack. Thank you both so much. Actually, our pleasure for Lee Cler and Dave Valante. I'm Lisa Martin. You're watching The Cube Live from Palo Alto Networks Ignite 22, the Cube, the leader in live, emerging and enterprise tech coverage.

(bright upbeat music) >> Welcome, everyone, to this Cube conversation. It's part of our season two, episode four of the ongoing AWS Startup Showcase Series. Today's theme, "Cybersecurity: Detect and Protect Against Threats." I'm your host, Lisa Martin. I've got one of our alumni back with us. Rakesh Narasimhan joins me, President and CEO of Anitian. Rakesh, it's great to have you back on the program. >> Thank you very much. Pleasure to be here. >> So some congratulations are in order. I see that Anitian was recently awarded nine global InfoSec awards at RSA conference just this year including couple great titles here hot company and security company of the year. Talk to the audience who knows Anitian what is it doing to enable and empower the digital transformation for enterprises that are, I mean, we've been talking about the acceleration of digital transformation. How is Anitian an enabler of that? >> Thank you again for the opportunity. I think the big change that we brought to the table in Anitian is really what is typically a very manual, complex time consuming and quite expensive process. We've just brought software innovations to it and really that's customers who are trying to do compliance or security in the cloud which just provide a platform that basically accelerates a customer's application migration to cloud. And so that ability is the software innovation that we were able to bring to the space and that just wasn't there before. And so we're just happy that we took the opportunity to innovate there and just bring it to the customers. >> So let's now talk to and address those AWS customers. When you're talking to prospects, existing AWS customers what do you say are the differentiators that makes Anitian so unique when in AWS. >> That's a great question. I think the biggest innovation, the biggest thing that we bring to the table is really an acceleration and timeline and completion of their application. So if you're a customer and you're trying to get into a new market for compliance, for example or you're trying to basically get a new application up and running in a secure environment in either one of those cases, we have a product offering a platform offering that enables you to quickly get up and running and get to production. And that's been the reason why we've enjoyed enormous success in the marketplace in the AWS customer base. >> One of the areas where I see that an Anitian has been very successful is in helping cloud software vendors get FedRAMP compliance and be able to access what is a huge federal market. How are you able to do that? >> Yeah, I think the big thing that we focused on was you have a complete class of SaaS vendors out there who provide enormous innovation that they bring to the marketplace but the government market in general has not been able to participate in it because it again, like I said, it's very complex. It takes time and it's very expensive. And so we focused on that opportunity to really make it easier for all these cloud service providers to be able to bring their innovations to the government market, for example, with FedRAMP and so we help with the automation and the acceleration with our platform offering on top of cloud providers like AWS, and that enables the SaaS provider to offer that opportunity that hitherto is not available to now make it available in the government marketplace. And that's a huge buyer, if you will their budgets are huge. They're still buying even on a downturn in the market even as commercial vendors, who look at that, that market everybody's nervous about it. But if you look at the government market they have budget, they're buying and that needs to be provided to the install base. And so we help make that happen. >> How does that make you unique from a competitive perspective to be able to accelerate veteran for AWS customers in particular? >> I think the biggest issue has always been three things, right? It's complex, it's time consuming but most importantly, how quickly can a company make their software innovations available to a large market has always been sort of the challenge especially in the federal market. So we basically pre-engineering a platform taking care of all the requirements of the standard in compliance and security and then essentially help the customer bring that innovation on top of the AWS environment and making that available to the customers and record time. That's the reason why we're able to enjoy the success. Historically, the space has been very very focused on a lot of consulting folks really providing consulting on an hourly basis. We thought of actually bringing a software oriented approach just like people buy email, they buy service and then all the innovations that come along with it for the subscription that you pay. It's a very similar concept we brought to this space prior to this, either people did it themselves or they hired a lot of consulting folks to tell them what to do. And that could take a long time and then not just time and expense but every single time they made a change they would still, again, have to go redo all that work. We just brought a platform approach which is well understood by now in the industry you pay a subscription, you buy a platform and all the innovations come along for them. So that's huge productivity, time to market but most importantly it enables them to achieve their revenue goals because they're trying to get to market and service the customer, right? So we help them accomplish that in record time. >> So you are really impacting your customer's bottom line. You've been very successful in helping AWS public sector customers to accelerate FedRAMP. As you talked about FedRAMP compliance how are you now switching gears to focus on the AWS commercial customers and even enterprise DevOps teams to be able to accelerate cloud application security? >> Yeah, I think, again we started from a place of humility, if you will. You know, there's a lot of vendors a lot of folks make a lot of claims. We wanted to make sure that we first we're very good at doing something. And that's something was really go after the federal market and the success we achieved in that marketplace had a few insights for ourselves which was people really struggle in all kinds of environments, not just public sector. And what we found is that commercial customers are also trying to go to cloud. They're also dealing with the issues of security in securing their environments. And it's really the DevOps and DevSecOps folks on whom this burden falls. And they have to answer to so many different constituencies in an enterprise company. And so we time and time again while we did the work in FedRAMP we learned that, you know it's not just about compliance. It's also about securing on a base of standards. So how could we provide the same pre-engineered environment for DevOps and DevSecops teams to be able to run that environment for their applications that became an 'aha' for us because we were running into it all the time in the public sector side. So we went and talked to a few customers and said, 'Hey, how about we do the same thing on the commercial side for you?' And I wish I could take credit for this but it's actually not true. It's actually customers who came to us and said, 'Hey you did this really well for us in public sector side. Could you provide the same thing for us in the commercial side?' where it's not about all the documentation and all the audits and things that happen on the compliance side of the house. I just want you to provide an environment so that our DevOps teams could just operate in that environment and Devs can work on it. Can you do that? And we'll pay you. And that was born really our idea of secure cloud enterprise. Our primary offering historically has been secure cloud compliance with a compliance business if you will, where people could go into market and have a completely new market to go after. Whereas in the enterprise side we brought those innovations, those learnings and brought it to a commercial market. And so that's the new product, if you will, that we're launching to service that customer base, if you will. >> So if I'm an AWS customer when do I know it's time to contact Anitian and say, 'Guys we need help and we think you're the right ones to help us accelerate.' >> Yeah, I think it's re really straightforward if you are a customer commercial SaaS vendor, if you will, that runs an AWS and you want to go after a new market then you come to us and we can help you quickly get to all the compliance standards so that you can go sell in the government marketplace. That's an offering we already have, or you are a a brand new company and B2B company and you're developing an application and you want a pre-engineered environment that passes all the security standards so that you don't have to worry about it. You have a subscription to AWS and you have a subscription to us. And then that basically provides you a secure environment in which you can start developing your applications and start developing, deploying them much like your DevOps cycle would work. So we provide that basis already for you. So if you're a customer on the B2B side and you're going to cloud to get your applications to the marketplace on AWS, we're a great solution for you to actually have that engineered platform in place already. So those are the two areas where you can contact us and we can help you out. >> And talk to me about when you are in customer conversations especially as we've had such challenging times the last couple of years, how have those customer conversations changed and evolved? Are you seeing an acceleration up the C-suite stack? Is this a key priority for the CEO and his or her team? >> Yeah, I think it's a phenomenal point. I think security's always been top of mind for folks, not just the C-suite, but in boardrooms as well. But you know, the key thing we found is that even in a down market, sometimes in the environment that is playing out in the macro environment. I think the thing that has not changed is people are still trying to figure out how to make their dollar go further. And how do I get a better return on investment? So if you look at our compliance business that growth is all about that market is growing. There's still opportunity, and people are still having budgets and spending. So commercial companies are still trying to figure out how can I extend my market reach into new markets? So that's an area that the C-suite is really interested in. Funny enough, you would think in the cyber world it's a CSOs who are the ones who actually are looking for solutions from us that certainly an audience but CEOs and CROs are the folks who really clamor for our solution because it is their ability to enter a new market and go after a new budget that can grow their business and have an ROI pretty quickly. That's the ability for them to make that decision. So it's very pertinent to their buying behavior that we have aligned ourselves to very simply put by engaging us. They get to go after a new market to establish a new line of revenue they didn't have before. So that's always interesting to any C-suite member as you can imagine. And that's the compliance side. >> Absolutely establishing new revenue streams is huge and that's a big competitive differentiator. We've seen a lot of customers that weren't able in any industry to do that during the challenging pandemic times. And that is a game changer for organizations across industries. >> Exactly, exactly. And wishing that play out, not just on that side, but even on the commercial side where people are also trying to figure out how do I basically make sure it's pre-done so that it's one less thing for me to have to worry about so that I can be more productive. I can get to market pretty quickly which means I can, again, deliver to my customers quickly which means revenue for them as well. So we are the security business, but really if you notice we're solving a business problem for our customers and we're aligned to their ROI so that it's relatively easier for them to make a decision. They certainly get security in compliance but the bigger benefit for them is to grow their business itself. So we are trying to accelerate that momentum for them. >> That's critical, and I'm sure your customers really appreciate the impact that you're having on their growth, their ability to deliver to what I can only presume is their demanding customers. As one of the things I know that's been in short supply the last couple of years, is patience and tolerance. Is there Rakesh a customer story that you think really articulates the value of what Anitian is delivering? Maybe a favorite customer story that you mentioned when you're giving talks? >> Sure, sure. We really have a very customer base across the landscape. If you think about our compliance business, Smartsheet is a great example who partnered early. They were not even in the cloud before. And then that's a great example with AWS where the three of us work together to offer Smartsheet the collaboration software public SaaS company, if you will, who really established themselves and differentiated themselves in the marketplace by offering that on AWS. And we helped them accomplish their FedRAMP itself not just for once, but you know they've been great customers of ours multiple renewals over the years and every single year that the business that they get on the federal sizes increased because of the work that they did first with us. And so, you know, we've look for more opportunities with them, certainly on that part. And increasingly we start thinking about where else can we help them grow? Because typically most customers have a thing to solve on a compliance standard, but it turns out that the compliance journey is, you know some companies are trying to do Socto to be able to even sell. Then you want to do electronic commerce. You might have to do PCI or you want to sell under the federal government. You'll have to do FedRAMP and FedRAMP has moderate, high but depending on the customers you have, including DOD and once you get to DOD, they'll ask for IL4 and IL5. So these are different compliance regimes. If you will think of them as a journey and we want to be the company that provides a seamless progression for customers as they're on that journey so that we can actually deliver something of value. We're not interested in nickel and diamond customers and charging them by the hour, we're a platform player. We want to make sure that they use it to basically get their ROI and growth happening. And we just take care of the hard part of making sure that they're in compliance, right? And similarly, we're bringing the same idea like Smartsheet. I told you about to a commercial marketplace of customers who can do the same thing for commercial apps in the cloud. And so that gives us a very clean way for customers to really become not just productive, but satisfy their customers quickly and hence grow their business. And we celebrate that collaboration and all of that happens because of AWS and our ability to focus on those customers >> Sounds like a great partnership and definite synergy there on I know, and, you know as well, how customer obsessed in their own words AWS. Speaking of customers one more question for you in terms of being on that journey that compliance journey, which isn't a destination, right? It's probably a zigzaggy path. Do you work with customers that both haven't started the process to FedRAMP plans or those that maybe have with a competitor are running into roadblocks? Are those both routes to market for you? >> Yeah, we interestingly enough historically we used to see a lot of folks who have tried to do it themselves and found it hard or for a variety of reasons they just gave up. And so they would come to us. We have also examples of customers who have tried to go down the consulting path and has not worked and come to us so that it's sort of a broken project. We start from there, but a majority of our business is people who've gotten a contract from one of the agencies. Then they're like, 'oh now what!' We need to get this done before September. And so what's the quickest way to get there. And generally that's where we can help you because we are the best, fastest way to get there. And so we get that mix of customers people who have already tried hasn't worked out people who have tried with other folks hasn't worked out, but a majority of the folks are people who don't even know, you know how to go about doing it, but they know they have to do it in order for them to keep the customer that they've won one of the agencies, if you will. So that has given us a very healthy perspective on how to help customers of different kinds in that journey. The other thing is, you know, we've grown tremendously in the last couple of years. And the other thing we learned is every customer is different. And we tried to bring a very common approach to addressing this problem. Even though customers come in all shapes and forms we have startup companies in, you know early forms of maturity. And we have like really iconic, you know unicorn companies who we've helped go through FedRAMP. So the gamut is large, but you know we're learning a lot by doing this. And I think that's the key thing for me. I want our company to be one that is growing with innovation, but at the same time keeping flexibility in our approach so that we are not just learning new things, we're delivering on the harder problems our customers are facing. Cause I think that's where software innovation can really play a big differentiating role. And that's the reason why I always enjoyed being at Anitian and growing the business and keeping the company really, fast moving and innovative. >> Speaking of being fast moving and innovative here we are coming up on the fourth quarter of calendar year 22, what's next for Anitian? What are some of the exciting things that have you pumped up? Have you mojo going for what's next for the rest of the year? >> Yeah, I think a big portion of my enthusiasm for the company and the road ahead is I think it's rare if you look at the industry, oftentimes you see companies that start out with a single solution and then are able to grow from there. One of the best advantages Anitian has is this platform centric approach to do compliance on the journey I talked about. So if you think about that journey every customer that is going to cloud has this challenge that, they either have to comply do a bunch of standards, one or many. And then how do I do that in a platform approach in a common way so that I don't have to worry about it. I play a subscription and I am just protected by that. And I actually get the marketplace. So that's a tremendous journey we are on. We've only done a few of them and we have a whole new set of compliance standards coming on our platform. So that's one way, look forward to that. The other one I'm really looking forward to is the commercial customers. There's a huge opportunity for people to really know that they're sitting on top of a very secure environment in AWS. And how do I quickly propel myself into the marketplace so that I can be differentiated. I can get to market quickly but I can also make sure my innovations are getting to the marketplace as a customer, right? So I think I'm really excited about the things we are bringing to market just not just this year, but next year early next year on the compliance side, as well as the commercial side, that'll actually differentiate us and make it a lasting part of a customer's journey. And that's, I think the best thing you can hope for building a lasting company where your innovations are powering the productivity of your customers in a meaningful manner. And I always feel proud of the team. You mentioned the awards, but honestly more than anything else, we've put together a great team. And the team does a tremendous job with a very good ecosystem of partners. And our humility is it's not just us it's the ecosystem together. And the partnership with Amazon that helps us be the company we are able to be. We live in really story times and we're lucky to be part of this opportunity if you will. >> Yeah better together. That ecosystem is incredibly powerful. Thank you so much Rakesh for talking about what's going on at Anition, how you're helping customers, accelerate FedRAMP compliance, what you're doing in the commercial space and how you're helping your customers really improve their bottom line. We thank you so much for partnering with the Cube for season two, episode four of the AWS startup showcase. >> My pleasure. Thank you very much. >> And we want to thank you for watching but keep it right here for more action on the Cube which as you know, is your leader in tech coverage. I'm Lisa Martin. See you next time. (lively music)

(upbeat music) >> Hey everyone. Welcome to theCUBE's coverage of PagerDuty Summit '22. I'm Lisa Martin. I'm here with one of our alumni. Jonathan Rendy joins me, the SVP of products at PagerDuty. Jonathan, great to have you on the program. >> It's wonderful to be here. Thank you, Lisa. >> Lisa: It's great to be back at PagerDuty Summit. So much news this morning. So much buzz and excitement. Talk to me about some of the things that you're most excited about as we are in such a massively different work environment these days. >> Yeah, so much has been going on and we've been innovating in so many areas. I think you heard in the keynote this morning, automation is such a foundational part of PagerDuty now, and that comes to us via the Rundeck acquisition from a couple of years ago. And we've also extended PagerDuty to new audiences. So we've been a big part of the back office for a long time with SREs and developers and ITOps, and we've really come to realize that the front office is so important, and one of the leading departments there that we can make an impact and extend into with our solution is customer service. >> Lisa: Customer service is absolutely critical these days as we all know. One of the things that was in very short supply the last couple of years is patience. Patience when you're a consumer, patience when you're a business person. And so the voice of the customer, being able to get things escalated quickly and resolved quickly, to those customer service folks is critical for any organization. Without that, people easily go to Twitter or Reddit and escalate problems publicly, and suddenly that becomes a brand reputation problem for the organization. >> Yeah, you're spot on. I mean expectations are at an all time high. People's tolerance is at an all time low. And that gets translated, I always think, to the front door of the organization when there is something that doesn't go right, and that's typically the poor customer service agents who have to deal with that kind of feedback and open up cases and deal with it. And, you know, unfortunately they're not armed a lot of times with the information that could help them not only be better reactive but be better proactive and have information to actually turn what could be a bad experience into a really good one. >> Lisa: You mentioned something really interesting. Jonathan had a great fireside chat this morning that I was able to watch. And you said it takes, for every negative experience that a customer or consumer has, it takes seven additional positive experiences to turn them back around. And I thought, wow, do we even have the patience or the tolerance to your point, to give a business seven more options to turn our experience around? >> Yeah, it's tough. And it's very, very hard for a lot of organizations and nobody's exempt from it. The connection between the front office and the back office, there is no real gold standard for that. And so, is there a path forward? Is there a way forward? We believe there is and we believe there's a way to help, but teams really need to focus on getting information to those folks so that these very negative kind of situations can become a customer satisfaction, can become something where a customer feels like, "Wow, I didn't expect that." There was another statistic that we heard about the other day, which is, you know, greater than 50% of issues are often identified from customers, not from the monitoring products. So, you know, whether it's 50, or 40, or 30, it doesn't really matter. The customer is a signal and it's so important to be attentive to that signal. >> Lisa: What are some, well... you'd rather have that found out before the customer even notices. Talk to me about some of the things that PagerDuty just announced that are going to help not just the front office, back office kind of blurred lines there, but also to ensure that the incident response is smarter, it's faster, and it's being able to detect things before the customer even notices. >> Yeah, so the trick, the $64,000 question, however you want to phrase it or characterize it, is all about getting teams ahead of problems. And while I think it's unrealistic to ever, like every single customer, get ahead of any issue that any customer could see, it's so important that the first customer that comes in with an issue becomes near to the last customer that comes in with an issue, meaning that one, everybody knows about that and they know how it's related to existing issues. That's important so that other customers can be preemptively explained, but then given what PagerDuty's always done, sometimes we know about issues on the back end that may be impacting customers that they don't know about yet. So a shopping cart may not be working correctly, but before somebody hits it, if the customer service team knows about that right away, they can proactively get ready for communication to their customers to let them know, "Hey, there might be an issue here. We know about it, we're working on it. Please stay tuned", or direct them to something else that can help them. >> I can imagine that goes a long way to CSAT scores NPS scores, brand reputation, reducing churn. >> Jonathan: Oh, big time, big time, whether it's CSAT or NPS, you know, everybody is familiar on that big shopping day of the year, of getting that big sale, going to, wanting to order that, and then either not being able to complete the order or having to wait too long for it to be delivered. And then you end up having to go to a brick and mortar outlet to buy it there anyway. So there's so many opportunities and those situations will happen, outages will occur, it's just a matter of when. Those can be avoided in those bad situations via the use of other discounts, coupons, other customer satisfaction areas. You can turn those bad experiences into really good ones. >> Definitely. And I think we all have that expectation that that's going to happen, when outages do happen, 'cause to your point, those are the things that it's not, "Is it going to happen?" It's when, and how quickly can we recover from that so we minimize the impact on everybody else? Couple of the things that you announced this morning, Incident Objects and Service Cloud, talk to me about what that is. It looks like a deeper partnership integration with Salesforce. What are some of the benefits that your customers can expect? >> Jonathan: Yeah, so we have several partners in the front office, and one of the biggest known to the world is Salesforce. And so we've been working with the Service Cloud team there for going on a couple of years now, better integrating our platform into what they're doing. And we've actually built an app that runs inside of Service Cloud. So a customer service agent doesn't need to swivel chair around and look at other products in order to understand what's going on in the back office, it's all built into their experience. That's one, number one. Number two, we've upped that relationship and invested more where Service Cloud, Salesforce has come out with a new incident capability. And so we're integrating directly to that so we can sync up with that system of record from PagerDuty. So wherever the issues are found, whether it's in distributed DevOps teams, or whether it's in a central team, or whether it's a case agent working on the front end, everything will be kept in sync. So we're really excited about that bidirectional integration >> That bidirectional sync is critical. We have, you know, one of the biggest challenges, we've been talking about it since we were back at HP days back in the day, Jonathan, silos, right? That's one of the biggest challenges, is there's still silos between teams and systems, which impacts, you know, time to identify an incident, time to repair that incident, and then of course let alone repair the relationship with the customer on the other end. >> Jonathan: Yeah, yeah, and there's some great examples, working with our own customers, that we run into where when we can make that golden connection between the front office and the back office and sync up customer cases with incidents, magic starts to happen. So we've seen situations where the back office team working on an incident doesn't realize that the issue is customer impacting. They don't realize that there were three, and then four, and then five case tickets opened up, that it's really impacting customers. And when they see that rise in customer impact, they change the priority. They get other people involved. The urgency changes on that issue. Imagine working in a world where that visibility doesn't exist, people continue to work at their own pace and who suffers? The customer, the customer experience. >> Lisa: Without that visibility, so much can suffer. And quickly, we also have this expectation, I mentioned one of the things that was in short supply in the pandemic as patience and tolerance, but another thing is we expect things in real time, realtime access to data, realtime access to the customer, to a product or service, is no longer a nice to have, it is business critical for organizations in every industry. >> Yeah. Yep. And you know, customer service is such a obviously service-centered activity, that it can be, you know, death by a thousand paper cuts to a customer experience. And to the point that you're raising, nobody likes to contact finally someone as an agent, and then get passed to another agent, who gets passed to another agent, and have to repeat the problem that you're having so many times. What if we could capture all that context together. What if we could empower that agent to be able to manage that case from beginning to end more effectively? Like what would the reflection be on the customers who are calling in? They would feel taken care of. They would feel like they were heard. They wouldn't feel ignored, so to speak. So all of that is a part of our solution that we're partnering not only with Salesforce, but also with Zendesk and others to deliver. >> Talk about the automation in CS Ops and some of the main benefits. Obviously, you mentioned this a minute ago, but the ability to empower those agents to have that context is night and day compared to, you know, the solutions from back in the day. >> Jonathan: Yeah. Automation is so fundamental and foundational to everything we do at PagerDuty and if you look at all the audiences that make use of PagerDuty today, whether it's developers, whether it's IT operations and now customer service agents, it's no surprise that, you know, everyone has to do more with less, everyone's working in a more siloed, disconnected manner. So the amount of potential toil, potential manual steps, having to open up a system to get the status of something and then pivot over to my other system, or do research, or ask a customer multiple times when it could automatically be captured what their problem is, what the environment is, and all that information from an agent could be automatically inserted into the case. How valuable is that? Not only for the case, but then the teams on the back end, that helps them diagnose and fix those problems. So the amount of automation that we've built and now just announced and made available as a part of Customer Service Ops just like in DevOps with our automation actions, really important to automating some of those manual toil steps for those agents where, again, 50, 60% of their time is spent doing manual activities. We can get rid of that. We can empower them to do more, to do more with less. >> To do more with less and do more faster and it makes such a huge difference there. Talk a little bit about the DevOps-CS Ops relationship. You know, one of the things that's kind of ironic is here we are in 2022, we have so many tools to collaborate and connect, yet there's still so many silos, and that can either break trust between a customer and a vendor or a solution provider, or it can really facilitate trust. And that was a big theme of the keynote this morning is that trust. But talk about the trust that is you, PagerDuty, really thinks essential between the DevOps folks and the CS Ops folks. >> Yeah. It's critical, as I kind of mentioned before, there really isn't a golden path, a golden connection, a standard that's been set between CS, the customer service organizations and the back office. And how I like to characterize it and what I've seen over the years working with customers is frequently it's almost like when I was a little kid I lived nearby a semi-pro baseball team and I could never get tickets and I would ride my bike to the back of the fence and I would look at the game through a little knot hole in the fence and I'd be like, "Man that would be so great to be in there" Well, that's essentially customer service, sitting there looking at the game happening, constantly trying to interrupt the teams and saying, "Hey, what about us?" And so, by making that a seamless connection, by making customer service a part of the solution, a part of the team in a non impactful, intrusive way, everybody gets what they need, no one's interrupted, and now those customer service agents, they're sitting in the stands. They're not looking through the little knot hole at the back of the center field. >> Lisa: Well you got to tell us, did you ever get tickets? Can you go to pro games now? >> No. No. >> Aww >> Still waiting. >> Oh man. Talk to me, last question here, I asked you before we started filming if you had a crystal ball or a Magic 8-Ball, so next time at least bring me a Magic 8-Ball. What are some of the predictions that you have as you see where we are in... now half of calendar '22 almost gone, the announcements coming from PagerDuty today, this synergy is between PagerDuty, its, what, 21,000 plus customers, your partners, What are some of the things that you're excited about that are coming? >> Jonathan: So a couple things. One is I really think the first example, we talk about the Operations Cloud, what PagerDuty is. And to me, what it really is, is it's not just the DevOps audiences and the ITOps and the SRE teams in the back offices that have to deal with interrupted realtime work, but it's other parts of the organization as well that have to get proactive versus reactive. And the first of those, the first step that kind of personifies the Operations Cloud outside of that back office is customer service. But there will be more, there will be more, whether it's security or other teams. So it's the audiences that can participate and engage in realtime work, that's one. And then I think in the area of customer service and Customer Service Operations, where we are, what we've been doing and what we've been so focused on is making sure that those agents can start to get proactive and start to get to the next step. But wouldn't it be amazing if we could help them, proactively, in a targeted way, talk to their customers and provide that as an automated part of the process. Today that's very manual, so we can empower them with information, but a lot of their communication with their customers is manual. What if we could automate that? And that's our plans, and that's what I'm really excited about doing. >> Can you imagine the trust built between an empowered, proactive CS agent and a customer on the other end. The sky is the limit on that one. >> If I'm a platinum customer or I'm a silver customer, I'm paying for a certain level of customer service. How great would it be if based on the extra that I'm paying, I'm actually getting that service proactively and I'm hearing about issues long before I see them. That to me is building trust. >> Lisa: Absolutely. Jonathan, thank you so much for joining me on theCUBE today. Great to see you back in person. Great to hear some of the things coming down the road for PagerDuty, and we're excited to see your predictions come true. Thanks for your time. >> Likewise, Lisa. Thank you very much. >> My pleasure. For Jonathan Rendy. I'm Lisa Martin covering theCUBE on the ground at PagerDuty summit '22. Stick around, I'll be right back with my next guest. (upbeat music)

(upbeat music) >> Hey everyone. Welcome to theCUBE's coverage of PagerDuty Summit '22. I'm Lisa Martin. I'm here with one of our alumni. Jonathan Rendy joins me, the SVP of products at PagerDuty. Jonathan, great to have you on the program. >> It's wonderful to be here. Thank you, Lisa. >> Lisa: It's great to be back at PagerDuty Summit. So much news this morning. So much buzz and excitement. Talk to me about some of the things that you're most excited about as we are in such a massively different work environment these days. >> Yeah, so much has been going on and we've been innovating in so many areas. I think you heard in the keynote this morning, automation is such a foundational part of PagerDuty now, and that comes to us via the Rundeck acquisition from a couple of years ago. And we've also extended PagerDuty to new audiences. So we've been a big part of the back office for a long time with SREs and developers and ITOps, and we've really come to realize that the front office is so important, and one of the leading departments there that we can make an impact and extend into with our solution is customer service. >> Lisa: Customer service is absolutely critical these days as we all know. One of the things that was in very short supply the last couple of years is patience. Patience when you're a consumer, patience when you're a business person. And so the voice of the customer, being able to get things escalated quickly and resolved quickly, to those customer service folks is critical for any organization. Without that, people easily go to Twitter or Reddit and escalate problems publicly, and suddenly that becomes a brand reputation problem for the organization. >> Yeah, you're spot on. I mean expectations are at an all time high. People's tolerance is at an all time low. And that gets translated, I always think, to the front door of the organization when there is something that doesn't go right, and that's typically the poor customer service agents who have to deal with that kind of feedback and open up cases and deal with it. And, you know, unfortunately they're not armed a lot of times with the information that could help them not only be better reactive but be better proactive and have information to actually turn what could be a bad experience into a really good one. >> Lisa: You mentioned something really interesting. Jonathan had a great fireside chat this morning that I was able to watch. And you said it takes, for every negative experience that a customer or consumer has, it takes seven additional positive experiences to turn them back around. And I thought, wow, do we even have the patience or the tolerance to your point, to give a business seven more options to turn our experience around? >> Yeah, it's tough. And it's very, very hard for a lot of organizations and nobody's exempt from it. The connection between the front office and the back office, there is no real gold standard for that. And so, is there a path forward? Is there a way forward? We believe there is and we believe there's a way to help, but teams really need to focus on getting information to those folks so that these very negative kind of situations can become a customer satisfaction, can become something where a customer feels like, "Wow, I didn't expect that." There was another statistic that we heard about the other day, which is, you know, greater than 50% of issues are often identified from customers, not from the monitoring products. So, you know, whether it's 50, or 40, or 30, it doesn't really matter. The customer is a signal and it's so important to be attentive to that signal. >> Lisa: What are some, well... you'd rather have that found out before the customer even notices. Talk to me about some of the things that PagerDuty just announced that are going to help not just the front office, back office kind of blurred lines there, but also to ensure that the incident response is smarter, it's faster, and it's being able to detect things before the customer even notices. >> Yeah, so the trick, the $64,000 question, however you want to phrase it or characterize it, is all about getting teams ahead of problems. And while I think it's unrealistic to ever, like every single customer, get ahead of any issue that any customer could see, it's so important that the first customer that comes in with an issue becomes near to the last customer that comes in with an issue, meaning that one, everybody knows about that and they know how it's related to existing issues. That's important so that other customers can be preemptively explained, but then given what PagerDuty's always done, sometimes we know about issues on the back end that may be impacting customers that they don't know about yet. So a shopping cart may not be working correctly, but before somebody hits it, if the customer service team knows about that right away, they can proactively get ready for communication to their customers to let them know, "Hey, there might be an issue here. We know about it, we're working on it. Please stay tuned", or direct them to something else that can help them. >> I can imagine that goes a long way to CSAT scores NPS scores, brand reputation, reducing churn. >> Jonathan: Oh, big time, big time, whether it's CSAT or NPS, you know, everybody is familiar on that big shopping day of the year, of getting that big sale, going to, wanting to order that, and then either not being able to complete the order or having to wait too long for it to be delivered. And then you end up having to go to a brick and mortar outlet to buy it there anyway. So there's so many opportunities and those situations will happen, outages will occur, it's just a matter of when. Those can be avoided in those bad situations via the use of other discounts, coupons, other customer satisfaction areas. You can turn those bad experiences into really good ones. >> Definitely. And I think we all have that expectation that that's going to happen, when outages do happen, 'cause to your point, those are the things that it's not, "Is it going to happen?" It's when, and how quickly can we recover from that so we minimize the impact on everybody else? Couple of the things that you announced this morning, Incident Objects and Service Cloud, talk to me about what that is. It looks like a deeper partnership integration with Salesforce. What are some of the benefits that your customers can expect? >> Jonathan: Yeah, so we have several partners in the front office, and one of the biggest known to the world is Salesforce. And so we've been working with the Service Cloud team there for going on a couple of years now, better integrating our platform into what they're doing. And we've actually built an app that runs inside of Service Cloud. So a customer service agent doesn't need to swivel chair around and look at other products in order to understand what's going on in the back office, it's all built into their experience. That's one, number one. Number two, we've upped that relationship and invested more where Service Cloud, Salesforce has come out with a new incident capability. And so we're integrating directly to that so we can sync up with that system of record from PagerDuty. So wherever the issues are found, whether it's in distributed DevOps teams, or whether it's in a central team, or whether it's a case agent working on the front end, everything will be kept in sync. So we're really excited about that bidirectional integration >> That bidirectional sync is critical. We have, you know, one of the biggest challenges, we've been talking about it since we were back at HP days back in the day, Jonathan, silos, right? That's one of the biggest challenges, is there's still silos between teams and systems, which impacts, you know, time to identify an incident, time to repair that incident, and then of course let alone repair the relationship with the customer on the other end. >> Jonathan: Yeah, yeah, and there's some great examples, working with our own customers, that we run into where when we can make that golden connection between the front office and the back office and sync up customer cases with incidents, magic starts to happen. So we've seen situations where the back office team working on an incident doesn't realize that the issue is customer impacting. They don't realize that there were three, and then four, and then five case tickets opened up, that it's really impacting customers. And when they see that rise in customer impact, they change the priority. They get other people involved. The urgency changes on that issue. Imagine working in a world where that visibility doesn't exist, people continue to work at their own pace and who suffers? The customer, the customer experience. >> Lisa: Without that visibility, so much can suffer. And quickly, we also have this expectation, I mentioned one of the things that was in short supply in the pandemic as patience and tolerance, but another thing is we expect things in real time, realtime access to data, realtime access to the customer, to a product or service, is no longer a nice to have, it is business critical for organizations in every industry. >> Yeah. Yep. And you know, customer service is such a obviously service-centered activity, that it can be, you know, death by a thousand paper cuts to a customer experience. And to the point that you're raising, nobody likes to contact finally someone as an agent, and then get passed to another agent, who gets passed to another agent, and have to repeat the problem that you're having so many times. What if we could capture all that context together. What if we could empower that agent to be able to manage that case from beginning to end more effectively? Like what would the reflection be on the customers who are calling in? They would feel taken care of. They would feel like they were heard. They wouldn't feel ignored, so to speak. So all of that is a part of our solution that we're partnering not only with Salesforce, but also with Zendesk and others to deliver. >> Talk about the automation in CS Ops and some of the main benefits. Obviously, you mentioned this a minute ago, but the ability to empower those agents to have that context is night and day compared to, you know, the solutions from back in the day. >> Jonathan: Yeah. Automation is so fundamental and foundational to everything we do at PagerDuty and if you look at all the audiences that make use of PagerDuty today, whether it's developers, whether it's IT operations and now customer service agents, it's no surprise that, you know, everyone has to do more with less, everyone's working in a more siloed, disconnected manner. So the amount of potential toil, potential manual steps, having to open up a system to get the status of something and then pivot over to my other system, or do research, or ask a customer multiple times when it could automatically be captured what their problem is, what the environment is, and all that information from an agent could be automatically inserted into the case. How valuable is that? Not only for the case, but then the teams on the back end, that helps them diagnose and fix those problems. So the amount of automation that we've built and now just announced and made available as a part of Customer Service Ops just like in DevOps with our automation actions, really important to automating some of those manual toil steps for those agents where, again, 50, 60% of their time is spent doing manual activities. We can get rid of that. We can empower them to do more, to do more with less. >> To do more with less and do more faster and it makes such a huge difference there. Talk a little bit about the DevOps-CS Ops relationship. You know, one of the things that's kind of ironic is here we are in 2022, we have so many tools to collaborate and connect, yet there's still so many silos, and that can either break trust between a customer and a vendor or a solution provider, or it can really facilitate trust. And that was a big theme of the keynote this morning is that trust. But talk about the trust that is you, PagerDuty, really thinks essential between the DevOps folks and the CS Ops folks. >> Yeah. It's critical, as I kind of mentioned before, there really isn't a golden path, a golden connection, a standard that's been set between CS, the customer service organizations and the back office. And how I like to characterize it and what I've seen over the years working with customers is frequently it's almost like when I was a little kid I lived nearby a semi-pro baseball team and I could never get tickets and I would ride my bike to the back of the fence and I would look at the game through a little knot hole in the fence and I'd be like, "Man that would be so great to be in there" Well, that's essentially customer service, sitting there looking at the game happening, constantly trying to interrupt the teams and saying, "Hey, what about us?" And so, by making that a seamless connection, by making customer service a part of the solution, a part of the team in a non impactful, intrusive way, everybody gets what they need, no one's interrupted, and now those customer service agents, they're sitting in the stands. They're not looking through the little knot hole at the back of the center field. >> Lisa: Well you got to tell us, did you ever get tickets? Can you go to pro games now? >> No. No. >> Aww >> Still waiting. >> Oh man. Talk to me, last question here, I asked you before we started filming if you had a crystal ball or a Magic 8-Ball, so next time at least bring me a Magic 8-Ball. What are some of the predictions that you have as you see where we are in... now half of calendar '22 almost gone, the announcements coming from PagerDuty today, this synergy is between PagerDuty, its, what, 21,000 plus customers, your partners, What are some of the things that you're excited about that are coming? >> Jonathan: So a couple things. One is I really think the first example, we talk about the Operations Cloud, what PagerDuty is. And to me, what it really is, is it's not just the DevOps audiences and the ITOps and the SRE teams in the back offices that have to deal with interrupted realtime work, but it's other parts of the organization as well that have to get proactive versus reactive. And the first of those, the first step that kind of personifies the Operations Cloud outside of that back office is customer service. But there will be more, there will be more, whether it's security or other teams. So it's the audiences that can participate and engage in realtime work, that's one. And then I think in the area of customer service and Customer Service Operations, where we are, what we've been doing and what we've been so focused on is making sure that those agents can start to get proactive and start to get to the next step. But wouldn't it be amazing if we could help them, proactively, in a targeted way, talk to their customers and provide that as an automated part of the process. Today that's very manual, so we can empower them with information, but a lot of their communication with their customers is manual. What if we could automate that? And that's our plans, and that's what I'm really excited about doing. >> Can you imagine the trust built between an empowered, proactive CS agent and a customer on the other end. The sky is the limit on that one. >> If I'm a platinum customer or I'm a silver customer, I'm paying for a certain level of customer service. How great would it be if based on the extra that I'm paying, I'm actually getting that service proactively and I'm hearing about issues long before I see them. That to me is building trust. >> Lisa: Absolutely. Jonathan, thank you so much for joining me on theCUBE today. Great to see you back in person. Great to hear some of the things coming down the road for PagerDuty, and we're excited to see your predictions come true. Thanks for your time. >> Likewise, Lisa. Thank you very much. >> My pleasure. For Jonathan Rendy. I'm Lisa Martin covering theCUBE on the ground at PagerDuty summit '22. Stick around, I'll be right back with my next guest. (upbeat music)

>>Hey everyone. Welcome to the cubes coverage of PagerDuty summit 22. I'm Lisa Martin. I'm here with one of our alumni. Jonathan Ren joins me the SVP of products at PagerDuty. Jonathan. Great to have you on the program. >>It's wonderful to be here. Thank you, Lisa. >>It's great to be back at PagerDuty summit. So much news this morning. So much buzz and excitement. Talk to me about some of the things that you are most excited about as we are in such a massively different work environment these days. >>Yeah, so much has been going on and we've been innovating in so many areas. Uh, I think you heard in the keynote this morning, automation is such a foundational part of PagerDuty now, and that comes to us via the Rundeck acquisition from a couple of years ago. And we've also extended a PagerDuty to new audiences. So we've been a big part of the back office for a long time with SREs and developers and it ops. And we've really come to realize that, you know, the front office is so important. And one of the, the leading departments there that we can make an impact and extend into with our solution is customer service. >>Customer service is absolutely critical these days, as we all know, one of the things that was in very short supply the last couple of years is patients patients when you're a consumer patients, when you're a business person. And so the, the, the voice of the customer being able to get things escalated quickly and resolve quickly to those customer service folks is critical for any organization without that people easily go to Twitter or Reddit and escalate problems publicly. And suddenly that becomes a brand reputation problem for the organization. >>Yeah, you you're you're spot on, I mean, expectations are at an all time high people's tolerance is at an all time low and that gets translated. I always think to the front door of the organization when there is something that doesn't go right, and that's typically the poor customer service agents who have to deal with that kind of feedback and open up cases and deal with it. And, you know, unfortunately they're not armed a lot of times with the information that could help them not only be better reactive, but be better proactive and have information to actually turn what could be a bad experience into a really good one. >>You mentioned something really interesting. Jonathan had a great fireside chat this morning that I was able to watch. And you said it takes for every negative experience that a customer or consumer has. It takes seven additional positive experiences to turn them back around. And I thought, wow, do we even have the patience or the tolerance to your point to give a business seven more options to turn our experience around? >>Yeah, it's tough. And it's it, it's very, very hard for a lot of organizations and nobody's exempt from it. Um, the connection between the front office and the back office, there is no real gold standard for that. And, and, and so like, is there, is there a path forward? Is there a way forward? We believe there is, and we believe there's a way to help, but teams really need to focus on getting information to those folks so that these very negative kind of situations can become a customer satisfaction, can become something where a customer feels like, wow, I didn't expect that. Um, there was another statistic that, uh, we, we heard about the other day, which is, you know, greater than 50% of issues are often identified from customers, not from the monitoring products. So, you know, whether it's 50 or 40 or 30, it doesn't really matter. The customer is a signal and it's so important to be attentive to that signal. >>What are some of the, well, the, the LA you'd rather have that found out before the customer even notices? Talk to me about some of the things that PagerDuty just announced that are gonna help, not just the front office back office kind of blurred, um, blurred lines there, but also to ensure that the incident response is smarter, it's faster and it's being able to detect things before the customer even notices. >>Yeah. So the, the trick, the, the $64,000 question, however you want to phrase it or characterize it is all about getting teams ahead of problems. And while I think it's unrealistic to ever like every single customer get ahead of any issue that any customer could see, it's so important that the first customer that comes in with an issue becomes near to the last customer that comes in with an issue, meaning that one, everybody knows about that, and they know how it's related to existing issues. That's important so that other customers can be preemptively explained, but then given what PagerDuty's always done, sometimes we know about issues on the back end that may be impacting customers that they don't know about yet. So a shopping cart may not be working correctly, but before somebody hits it, if the customer service team knows about that right away, they can proactively get ready for communication to their customers to let them know, Hey, there might be an issue here we know about it, we're working on it. Please stay tuned or direct them to something else that can help them. >>I can imagine that goes a long way to, um, CSAT scores, NPS scores, brand reputation, reducing churn, >>Oh, big time, big time, whether it's CSAT or NPS. You know, everybody is familiar on that big shopping day of the year of getting that big sale, going to wanting to order that. And then either not being able to complete the order or having to wait too long for it to be delivered. And then you end up having to go to a brick and mortar, uh, outlet to buy it there anyway. So there's so many opportunities and those situations will happen. Outages will occur. It's just a matter of when those can be avoided in those bad situations, via the use of other discounts, coupons, other Jo you know, uh, customer satisfaction areas. You can turn those bad experiences into really good ones. >>Definitely. And I think we all, we all have that expectation that that's gonna happen when things do when outages do happen, cuz to your point that's, those are the things that's not, is it gonna happen? It's when and how quickly can we recover from that? So it's, we minimize the impact on everybody else. Couple the things that you announced this morning, incident objects and service cloud. Talk to me about what that is. It looks like a deeper partnership integration with Salesforce. What are some of the benefits that your customers can expect? >>Yeah, so we have several partners in the front office and one of, one of the biggest, uh, known to the world is Salesforce. And so we've been working with the service cloud team there for going on a couple of years now, uh, better integrating our platform into what they're doing. And we've actually built an app that runs inside of service cloud. So a customer service agent doesn't need to swivel chair around and look at other products in order to understand what's going on in the back office, it's all built into their experience. That's one number one, number two, uh, we've upped that relationship and invested more where service cloud Salesforce has come out with a new incident capability. And so we're integrating directly to that. So we can sync up with that system of record from PagerDuty. So wherever the issues are found, whether it's in distributed DevOps teams or whether it's in a central team or whether it's a case agent working on the front end, everything will be kept in sync. So we're really excited about that. Bidirectional direct, uh, integration >>That bidirectional sync is critical. We have, you know, one of the biggest challenges we've been talking about it since we were back at HP days back in the day, Jonathan silos, right? That's one of the biggest challenges is there's still silos between teams and systems, which impacts, you know, time to identify an incident, time to repair that incident. And then of course, let alone repair the relationship with the customer on the other end. >>Yeah. Yeah. And there's some great examples working with our own customers that we run into where when we can make that golden connection between the front office and the back office and sync up customer cases with incidents magic starts to happen. So, uh, we've seen situations where the back office team working on an incident, uh, doesn't realize that the issue is customer impacting. They don't realize that there were three and then four, and then five case tickets opened up that it's really impacting customers. And when they see that rise in customer impact, they change the priority. They get other people involved. The urgency changes on that issue. Imagine working in a world where that visibility doesn't exist, people continue to work at their own pace and who suffers the customer, the customer experience >>Without that visibility so much can suffer. And, and quickly, we also had this expectation. I, I mentioned one of the things that was in short supply in the pandemic as patients and tolerance. But another thing is we expect things in real time, real time, access to data, real time access to the customer to a product or service is no longer a nice to have it is business critical for organizations in every industry. >>Yeah. Yep. And you know, the customer service is such a obviously service centered activity that it can be, you know, death by a thousand paper cuts to a customer experience. And to the point that you're raising, nobody likes to contact finally, someone in as an agent and then get passed to another agent who gets passed to another agent and have to repeat the problem that you're having so many times what if we could capture all that context together. What if we could empower that agent to be able to manage that case from beginning to end more effectively? Like what would the reflection be on the customers who are calling in, they would feel taken care of. They would feel like they were heard. Yeah. They wouldn't feel ignored, so to speak. So all of that is a part of our solution that we're partnering, not only with Salesforce, but also with Zendesk and others to deliver, >>Talk about the automation in CSOPs and some of the main benefits. Obviously you mentioned this a minute ago, but the ability to empower those agents to have that context is night and day compared to, you know, the solutions from back in the >>Day. Yeah. Automation is so fundamental and foundational to everything we do at PagerDuty. And if you look at all the audiences that make use of PagerDuty today, whether it's developers, whether it's, uh, it operations and now customer service agents, it's no surprise that, you know, everyone has to do more with less everyone's working in a more siloed, disconnected manner. So the amount of potential toil, potential manual steps, uh, having to open up a system to get the status of something and then pivot over to my other system or do research or ask a customer multiple times when it could automatically be captured, what their problem is, what the environment is. And all that information from an agent could be automatically inserted into the case. How valuable is that? Not only for the case, but then the teams on the back end that that helps them diagnose and fix those problems. So the amount of automation that we've built and now just announced and made available as a part of customer service ops, just like in DevOps with our automation actions, really important to automating some of those manual toil steps for those agents where again, um, 50, 60% of their time is spent doing manual activities. We can get rid of that. We can empower them to do more, to do more with less, >>To do more with less and, and do more faster and make such a huge difference there. Talk a little bit about the, the DevOps CS ops relationship. You know, one of the, one of the things that's kind of ironic is here we are in, in 2022, we have so many tools to collaborate and connect yet. There's still so many silos and that can either break trust between a customer and a, and a vendor or a solution provider, or it can really facilitate trust. And that was a big theme of, uh, the keynote this morning is that trust. But talk about the trust that is you PagerDuty really things essential between the DevOps folks and the CS ops folks. >>Yeah. It's, it's, it's critical. As I kind of mentioned before, there really isn't a golden path, a golden connection, uh, a standard that's been set between CS, the customer service organizations and the back office and how I like to characterize it. And what I've seen over the years, working with customers is frequently. It's, it's almost like when I was a little kid, I lived nearby a, um, a semi-pro baseball team and I could never get tickets and I would ride my bike to the back of the fence. And I would look at the game through a little knot hole in the fence and I'd be like, man, that would be so great to be in there. That's essentially customer service sitting there looking at the game happening constantly, like trying to interrupt the teams and saying, Hey, what about us? Like, and so by making that a seamless connection by making customer service a part of the solution, a part of the team in a non impactful intrusive way, everybody gets what they need. No one's interrupted. And now those customer service agents they're sitting in the stands. They're not looking through the little knothole at the back of the center field. >>Well, you gotta tell, did you ever get tickets? Can you go to pro games now? >>Uh, no. No. Oh, still waiting. >>Oh man. Talk to me last question here. I asked you before we, we started filming if you had a crystal ball or, or a magic eight ball. So next time at least bring me a magic eight ball. What are some of the predictions that you have is as you see where we are in now, half of calendar, 22, almost gone. The announcements coming from PagerDuty today, the synergy is between PagerDuty. It's what 21,000 plus customers, your partners. What are some of the things that you're excited about that are coming? >>So a couple things. One is, I, I really think the first example we talk about the operations cloud, what PagerDuty is. And to me, what it really is, is it's not just the DevOps audiences and the it ops and the SRE teams in the back office back offices that have to deal with interrupted, um, real time work, but it's other parts of the organization as well, um, that have to get proactive versus reactive. And the first of those that the, the first step that kind of personifies the operations cloud outside of that back office is customer service. But there will be more, there will be more whether it's security or other teams. So it's the audiences that can participate and engage in like real time work. That's one. And then I think in the area of customer service and customer service operations, where we are, what we've been doing and what we've been so focused on is making sure that those agents can start to get proactive and start to get to the next step. But wouldn't it be amazing if we could help them proactively in a targeted way, talk to their customers, uh, and provide that as an automated part of the process today, that's very manual so we can empower them with information, but a lot of their communication with their customers is manual. What if we could automate that? And that's our plans, and that's what I'm really excited about >>Doing. Can you imagine that the trust built between an empowered, proactive CS agent and a customer on the other end that there's the sky is the limit on that one? >>Uh, if I'm a platinum customer or I'm a silver customer on paying for a certain level of customer service, how great would it be if based on the extra that I'm paying, I'm actually getting that service right. Proactively and I'm hearing about issues long before I see them. That to me is building trust. >>Absolutely. Jonathan, thank you so much for joining me on the cube today. Great to see you back in person. Great to hear some of the things coming down the road for PagerDuty, and we're excited to, to see your predictions come true. <laugh> thanks for your time. >>Likewise, Lisa, thank you very much. >>My pleasure for Jonathan Ren. I'm Lisa Martin covering the cube on the ground at PagerDuty summit 22, stick around of your rack back with my next guest.

(bright upbeat music) >> Welcome, everyone, to theCUBE's, continuing coverage of AWS re:Invent 2021. I'm your host, Lisa Martin. And we are running one of the industry's most important and largest hybrid tech events of the year with AWS and its ecosystem partners. We have two live sets, two remote studios, and over 100 guests on the program talking about the next decade in cloud innovation. We're very excited to be welcoming back one of our CUBE alumni, Peter McKay, the CEO of Snyk. He's set to talk about reinventing application security with Snyk. Peter, welcome back to the program. >> It's great to be back, Lisa. Thanks for having me. >> Great to talk to you. So, my goodness, Snyk has had an incredible year, last year, this year, I was just looking at your Series F funding raised over 600 million in the month of September alone. Your valuation is, I think I saw over 9.6 billion, which is nearly doubled. This year-- >> Don't rush at 8.6, but yes, it was double the last time. Yeah, it's been been a crazy 2021, that's for sure. >> So, talk to me about some of that before we get into what you guys are doing with AWS. Let's talk about that, we talked about that funding. What are some of the strategic areas of investment? I know you've done a recent acquisition cloud skiff, but where are you really going to be focusing the Series F funding? >> Yeah, we've been very aggressive in building out our platform. We have a great vision for where we see developer security evolving and we want to get there fast. A lot of our customers and developers are kind of pushing us in that direction of really consolidating a platform. And so, to get there quickly, we do it organically building it ourselves, and we do it in inorganically where we can see other companies accelerate that roadmap. And so, it's this combination of very aggressive, organic expansion of both the breadth of our products, but also the depth, like adding more to our platform, but also the inorganic, because a lot of companies who have team and technologies that are very complimentary to what we're doing and allows us to continue to consolidate what is a very fragmented market in and around developers security. And so, we're going to continue to use the resources to accelerate that roadmap. The second part of it is, we are a little bit different than some companies where they kind of follow where the decision headquarters are of companies for us, we follow developers. And so, around the globe, Multinational Corporations have developers in the Philippines, in Argentina and all around the world and we needed to be there. And so, expanding our community, expanding our customer success organization around the world is critical for us. And so, that's something part of our kind of use of proceeds is the expansion of our go-to-market as well. >> Peter, modern development has changed. Next thing modern development has changed. So, traditional AppSec doesn't apply anymore. A new approach is needed. Talk to me about why Snyk believes that and what that new approach is. >> Yeah, you just go back to for 30 years, security was owned by application security teams and that's when it was kind of this waterfall application development model where they develop an app and every three, six, nine months, and then the security teams would audit that application and kind of send all the feedback, hear all the issues, go fix it, developers, and it was incredibly inefficient. And then you throw on top of this digital transformation and companies moving incredibly fast in building new applications. This agile development motion and all the incredible tools that allow developers to develop really fast. But then you get this very slow antiquated way of kind of testing it at the very end, right before you move the applications in production. So, it just didn't scale. And so, the concept is just way too late in the process. You really need to move security testing into that developer environment from the IDE, the CI/CD all the way through. So, when you're developing along the way, you're fixing the issues well ahead of time. And that's where modern development organizations are all this concept of shift left and building it in, into that's really the driver is moving security earlier and earlier in the software development life cycle. >> And that's key, especially you talked about the acceleration of digital transformation, but we've also seen the acceleration of the threat landscape in the last 20 months. There's been significant changes. The perimeter is so fragmented, it's expanding, the threat landscape goes all the way into outer space to low earth orbit these days. Talk to me about that as kind of a facilitator or an accelerator of what Snyk is doing to really focus on shifting security left with those developers. >> Yeah, I think people are kind of waking up to the fact that up to this point, they've spent billions and billions of dollars on endpoint securities and runtime security and all the things that are kind of in production. And they're realizing that, okay, well, why are we still vulnerable? Why are we still have these issues? And I think it's the realization that they're waiting too long to fix it. And a lot of the issues are happening. They're either new issues with moving to the cloud or they're issues that happen well before it got into production. And so, this realization that we've got to go earlier and earlier and fix these issues well before we go into production and don't wait till the very end. So, I think that's really driving the market to this shift lab. >> And you guys have actually kind of really pivoted your go-to-market model around that developers don't try and buy software the way that IT and security teams do. Talk to me about Snyk's GTM. >> Yeah, it's very unique in that it's really marrying this model developer security approach with the way developers want to buy. So, we start with our community and we do free content and tools all around building awareness for the developer community. We have, all of our products are free, so developers can try before they buy. And if you're truly a developer solution, you offer it free and let them use it. And then when they want to collaborate and they want to integrate and automate that moves from free to paid. So, it's very much of this bottoms up motion that really allowed developers to try MI. That's a big, big driver for our business, inbound motion drives 70% of our pipeline from them coming to us from this community. And then we come in kind of top down once they kind of get into different places. And we go in through those security organizations, which are trying to shift labs, trying to move security earlier, earlier and we work together with the security organizations to help move that to the developer world. So, you've got this bottoms up, developer adoption, viral adoption of Snyk within those organizations. Now, with the top-down kind of, and we become this bridge between the developer teams in engineering, and the security teams that are all trying to move in the same direction. And so, that's kind of how this market is evolved. And we're kind of that bridge for both those organizations. >> I was going to ask you about that, that bridge is critical, but also that bridge is a cultural change. I'm curious, how do you see organizations? It sounds like obviously you're, what over, I think, six, 700 customers now, a couple of million developers using the technology, so-- >> 1300 customers today >> 1300, okay. Wow! You have had a big year. 1300 customers, millions of developers using the technology. Talk to me a little bit about how you guys have figured out how to facilitate that cultural shift and shift security left, but also bridge between the IT and the security folks which have tended to be on sort of opposite sides of the spectrum. >> Yeah, I think the realization, I think a lot of people are very early on and I was... We'd been in the software industry for 25 years. Even nobody ever thought developers would care about security. Like there's no way developers really care about security. And really, if you think about, if you asked the developer, would you rather develop a secure app or an insecure app? If all things were equal, of course, they'd want it to be secure, but it needs to be easy. It needs to be like, don't slow me down, whatever you do, don't slow me down. And so, we have this, "Hey, it's all about speed of development, speeds, speed, speed." So, for us, we need to make it embedded, like integrated completely into that software development life cycle. So, developers don't have to be security experts, developers don't have to get out of their flow to do it, learn a different piece of software to figure out it's all embedded into that process. So, you can be fast and you can be agile, but you can also be secure at the same time. And so, part of that is embedding education and other things in there to learn that expansion of getting in the door and kind of building that momentum within these development communities all around the world. And so, I think we help all our customers with that kind of developer adoption and working together with the security teams and engineering teams on how we roll that out around best practices. And in some of the things we've learned over the six and a half years of doing this. >> It sounds very strategic and methodical and a great approach that is obviously quite successful. We talked about the growth trajectory now, 1300 customers. Let's talk about what you guys are doing with AWS. Here we are at reinvent this year. Talk to me about this Snyk, AWS partnership. >> Yeah, it's been really gaining momentum over the past year and a half, almost two years now. AWS, a lot of the workloads, one of the reasons, a lot of the applications don't go to the cloud is because of security issues and moving workloads to the cloud. Also developing applications in the cloud, security is a critical part of it. So, AWS is obviously infrastructure, but they also need solutions that allow them to make sure that those companies that are developing on AWS are secure. And so, we've integrated our Intel database into AWS inspector. We have a lot of offerings, very specific AWS offerings that our mutual customers can leverage. And we work very collaboratively with AWS in not only our technical roadmap with them, but also our go-to-market side, which is very much aligned. And it's continuing, we kind of, I say, we're in the second inning of that game. We got a lot more coming. >> Okay, but well aligned. Give me a customer example, if you will, have joined AWS Snyk customer that you've really helped with this transition, shifting security left they're building apps in the AWS cloud very successfully and securely. >> Yeah, I'd well, almost every company has some relationship with size with AWS. And so, for us, it's one of the first questions we ask anybody coming in is what's your relationship with one of the cloud vendors? And that inevitably it'll be, yeah, we have a relationship with AWS. And so, we talk about our roadmap that we have with AWS. They can buy our software through the AWS marketplace. You could leverage kind of your EDPs that you have with AWS to kind of build that scale. So, we're very technically aligned with the AWS platform. And so, you look at financial services, we've done a fair amount of financial services, insurance companies that are all kind of moving more workloads to AWS. Some of them have been our customers before, some of them separate from AWS, and now they're kind of, "Hey, can I move all my apps over and leveraged, Snyk in that process?" So, it's now, a good part of our go-to-market motion is coming through AWS marketplace as well. So, it's been a very successful partnership on both parties. >> A lot of momentum there, speaking of momentum, we talked about the funding raise this year alone, tremendous momentum going on for the company. What are some of the things that we can expect to see from Snyk in calendar year 22? >> Yeah, well, aggressive roadmap. I mean, that's still, we see, we have four modules today. We started with one and we added to, that was open to a security. We added a container security, infrastructure as code security. Then we added code security or a stats solution. We see modules five, six, seven coming out. we made an acquisition of drift technology, adding into kind of adding some more depth. So, you're going to see just a lot more continued aggressiveness on our side, as we scale both our engineering, organically and inorganically, but also, the go-to-market, now we're almost in all the major countries around the world and we're going to continue to invest in building that out and going where the developers are, the 28 million developers around the world. Our goal is to reach every one of them as fast as we possibly can with our free or paid, or whatever way is to get to 28 million developers as fast as we can. >> So, for those developers watching, where do you want to point them to go to, to start their free trial. >> Just go right to our website, snyk.io and you can get all of our products free, you can chat, schedule demos, you can do everything very easily if not. And it's very self-service so, if you don't want to talk to anybody, you don't have to talk to anybody, but if you do, we have plenty of people you can talk to. That's our world, frictionless motion. >> Frictionless and contactless at the same time, Peter, congratulations on the growth and momentum of the company. What you're doing, the evolution of the partnership with AWS and that lofty goal to reach 28 million developers. Am looking forward to our next conversation to see where you are on that progress. >> Same thing, same here, Lisa, thank you for your time. >> Oh, likewise. For Peter McKay, I'm Lisa Martin and you're watching theCUBE's continuous coverage of AWS re:Invent 2021. Stick around, more great content coming up next. (soft upbeat music)

>>Welcome to the cubes, continuing coverage of AWS reinvent 2021 find Lisa Martin and we are running one of the industry's most important and largest hybrid tech events with AWS in this ecosystem partners. This year, we have two live sets, two remote sites over 100 guests talking about the next decade in cloud innovation. And we're excited to be joined by Patrick Jeanne, the CTO of OutSystems Patrick. Welcome to the program. >>Thank you. I appreciate being one of those 100 guests, >>One of the 100, one of the elite, 100, we'll say it like that. Right? So, so OutSystems has some revolutionary news. You guys are saying, you know, what developer experience needs to change? Tell us more. >>It does. I mean, it needs to change. And I've been in the industry developing applications for too many years dimensions basically since I was 12 years old writing software and, you know, going over that time and thinking about it, doing the traditional software development route. So many applications that take too long was, you know, costly to build so much risk involved in it. Eventually it didn't meet all the requirements. And if you look at the investment we make in software, which is important, I mean, software is a, is a unique differentiator for, for businesses. That investment has such a high risk and a high cost, and that needs to change and it needs to change just because of the complexity that is in that process inherent in it that's. And that is what we are doing and OutSystems is tackling that problem. And, um, from a business standpoint, it must change. >>It must change that that is strong words there. So talk to me about what you're announcing, what, what were the gaps in the market customer feedback? Was it, or were there any catalysts from the pandemic going we've got to change this developer experience and this is the time >>For sure. I mean, if you think about from the pandemic and I mean, we were on a journey for digital transformation. We've been on this journey for a number of years and it really accelerated that the experiences that we have with each other, with you and me, we're not the same studio today. I mean, there's there reasons that we have used this experience remote, we have a technology that can do it, the pandemic accelerated that. And so, so much of the experiences we have are digital experiences. And if you think about it, there's a device in between us. There's going to be a device in between all the people viewing what we're looking at, that experience that, uh, that they will have with us will be basically surfaced through an application on that device. And the pandemic has really accelerated that. And that's an area that we play in, obviously for what's considered low code application development. >>And if you just think about application development in general, that's what powers all of these experiences. And going back to that, you know, statement about that, it needs to change if we need these experiences to be diverse, if we need these experiences to be meaningful, if we need them to make sure that when people engage, as far as what that device is, something that brings, you know, delight and pleasure to them, we need developers across the board. Investing in that today, there is a very constrained market for professional developers, but because of the inherent complexity in software development. And so if you think about how that's almost almost you're limiting access to the people who can create those experiences, that's not a good situation. There's about 25 million developers in the world that would consider themselves developers today, 7, 8, 9, 10 billion devices out there. Think of that disparity between those two numbers. >>And so we need a larger number of people to actually develop applications. So that experience can be much more diverse. We need to expose development to many more people. That is the problem today with software development is that it is complex. It is too specialized. It's too inherit as far as with failure when you get it together. And so either you shy away from that as an organization or as an individual to do development, or you go on these very long development as far as cycles to actually create these applications. What we do is we take the approach of let's make it very simple to get into, you know, some terms and call it citizen developer, low code, basically all they're saying is let's, let's reduce the risk of development. Let's go into a process where we make it accessible to more and more people. You can go through and develop applications with the lower risk. You can build change into that process and you can get value into end users as rapidly as possible. So that's, that is the value proposition. That is what needs to change >>Strong value proposition well said, Patrick, talking about reducing the complexity, uh, the risk as well. So, so go ahead and crack crack open what you guys are actually announcing today. >>Yeah, for sure. So with, we we've been doing this for many years, we have, um, software development, we have 14 million plus as far as end-users using applications that have been developed with the Al systems platform, what we're announcing is taking some of the great benefits that we have to what you'd consider as the first part of that low code process, where you have a, you have a developer that has an idea, and there's a canvas in front of you. You know, you're, you're an artist, right? But again, this is what you are as a developer. And so you go in and you create that application. We've been doing this for many years and it works really well. But thing that we're improving upon now is the ability to do that and scale that out to millions of end-users 10 millions of end-users. So if you think about that inherent speed of developing an application, using a platform like OutSystems, we're taking that same concept and rolling that into an internet scale application, hosting architecture. >>So any developer that uses our systems, basically like it would be comparable to a traditional development team that has application architects, cloud architects, security, engineers, database engineers, a whole team of very smart individuals that generally the, the biggest technology companies in the world can put together. Most companies can't do that. You don't have access to that type of that type of skillset. And so we're providing that with project Neo, which is what we're announcing today in our, um, at our user conference and customer conference, is this brand new as far as platform that allows you to build these applications at scale. And this is initially built on AWS using all the great AWS technologies. If you look at what AWS has done and provided to developers today, it's amazing. It is absolutely amazing. The amount of technologies that you can leverage. It's also daunting because as a traditional developer, you have to go in and choose, you know, what do you do? It's like, there's just massive cognitive load as far as upfront when you're going to design and application and what type of messaging what's at the data store. Well, how do I host my application? What type of network, you know, as far as security do I use, we're taking all that heavy lifting, all that undifferentiated, heavy lifting off of the developers, putting it into the project, Neo platform, allowing a single developer or a small group of developers to actually leverage that best in class architecture on AWS today. >>So when you're talking to developers, what are some of the things that you described as the unique differentiators of project Neo? It sounds like this was really apt and apt time for change, but when you're talking to those folks, what do you say? You know, 1, 2, 3, these are the things that make project Neo unique. >>Yeah. So you're the first is don't worry about the application architecture. Like I mentioned, don't when you go in that, the idea, the concept of that application and what it means to, to deliver some value, whether it's into a business or a hobby or whatever. I mean, however, you're developing application, you're doing it for a reason. You want that value to come out as quickly as possible. You want that experience. And so that first thing is you don't have to worry about the architecture anymore. So in the past, you know, you'd have to think about if it's a very large application, it's millions and millions of end-users. How do you structure that? How do you put it together? That concern is removed from you in that process? The other thing is we solve the problem of software disintegration. So with traditional development, when you develop an application and you get it into the hands of end, users get immediately starts to disintegrate. >>So there will be bugs that will appear. There will be, as far as, um, security flaws that will come up services that you use will become deprecated. We'll swap out cloud services, you know, AWS or Azure or Google, we'll swap out cloud services with different services behind the scenes version that we new versions of those that is software disintegration. As soon as you develop software today and all of these beautiful cloud services that you use and components, they often something will become outdated almost by the time you release it. A lot of times with software development projects, it literally is you start with some version or some component before you can get that out in a traditional mode. Something becomes outdated. We solve that issue. What I like to call software disintegration, we, as far as our systems, ensure we invest in that platform. And so when we need to change out those components, so services, those versions fix is for a security flaws, fixed bugs. >>We do that and it seamless. And so your application, you do not have to rewrite your application. You do not have to go through that process as a tradition, as a developer on our systems like you would, as your traditional developer, we solve that software disintegration issue. So it is it's, it's very empowering to developers to not have to worry about that. There are many, you look at the numbers today about how much is invested in innovation versus maintenance. You know, a lot of companies start out at 70% innovation, 30% as far as maintenance. And then over time that flips and you'll get to 30% of your time spent on innovations development, 70% maintenance, that burden we removed that burden. >>Those are some really powerful statements protect that you mean, I really liked the way that you described software disintegration. I've actually never heard that term before. And it kind of reminded me of, you know, when you buy a brand new car, you drive it off. The lot the value goes down right away, then before you even get things out. And on the consumer side, we know that as soon as we buy the newest iPhone, the next one's going to be out, or there's some part of it, that's going to be outdated in terms of technical debt. I was reading a stat that technical debt is expected to reach and costs businesses 5 trillion us dollars over the next 10 years. How does OutSystems helps customers address the challenges with technical debt and even reduce it? >>Yeah. If you think about the guy, the truest sense of technical debt, it's a, it's a decision that you make in the development process to basically, you know, load up the future with some work that you don't want to do right now. And so we're solving that issue where number one, we, you don't even have to make that decision. So you can go back to that concept of removing that cognitive load of, do I get the software out right now or do I get it out in the right way? And that's really what technical debt technical debt is saying. I need to get it out now. And there are some things I want to do that it'd be better if I did them now, but I'm going to go ahead and push that out into the future. You don't have to do that today with us. >>And so what happens with our systems? We invest in that platform, and this is hard. I mean, this is not an easy thing to do. This is why we have some of the best and brightest engineers focusing on this process at the heart of this, not to get too technical, but the heart of this is what we call the true change engine. But then, um, within our platform, we go through and we look at all of the changes that you need to make. So if you think of that concept of technical debt of like, oh, I want to get this into the hands of man users, but I don't want to invest in the time to do something right. It's always done right. As far as with the OutSystems platform. So we take that, we look at the intent of your change. So it's like a, it's like a process where you tell us the intent. >>When you, as a application developer, you're designing an application, you tell us the intent of the application is to look and feel. It could be some business processes can be some integrations. We determine what's the best way to do that. And then once again, from a software disintegration standpoint, we continue to invest in all the right ways to do that the best way possible. And so, I mean, we have customers that have written applications. That's 10, 15 years ago, they're still using our platform with those same applications they've added to them, but they actually have not rewritten those applications. And so if you think about the normal traditional development process, the technical debt incurred over that type of lifetime would be enormous with us. There's no technical debt. They're still using the same application. They have simply added capabilities to it. We invest in that platform. So they don't have to >>So big business outcomes there, obviously from a developer productivity perspective, but from the company wide perspective, the ability to eliminate technical debt, some significant opportunities there. Talk to me about the existing OutSystems customers. When are they going to be able to take advantage of this? What is the migration or upgrade path that they can take? >>Yeah. And so it's, it was very important to me and, and, uh, and the team, as far as our systems, to be able to integrate, to innovate as far as for customers, without disrupting customers. And we've probably all been through this path of great new technology is awesome. But then to actually utilize that technology when you're a current customer, it creates pain. And so we've invested heavily in making sure that the process is pain-free so you can use project Niamh. So we are announcing it as it was in public preview, as far as now, and then we will release it from GA as far as in the first quarter of next year. So over this timeframe, you'll be able to get in and try it out and all that continue to use your current version, which is OutSystems 11. So what we, what we affectionately call it 11, as far as Alice systems, Al systems, 11 version, and continued to use, and you can continue to use that today. >>Side-by-side and coexistence with the project, Neo and project Neo is a code name. So we will, we will have an official product name is for as at launch, but it's our it's. Our affectionate is kind of a unofficial mascot as Neo. So we call it project Neo bit of a fun thing, and you can use it side by side. And then in the future, you'll be able to migrate applications over, or you can just continue to coexist. I mean, we see a very long lifetime for OutSystems 11, it's a different platform, different technology behind the scenes project, Neos, Kubernetes base, Lennox containers. Based once again on the bill, we went in with the, just looked at it and said, rearchitect re-imagined, how would you do this? If you had the best and brightest, as far as engineers, architects, um, you know, we have, which we do, you know, very smart in those people. >>And we did that. And so we did that for our customers. And so Neo is that how systems 11 still a great choice. If you have applications on it, you can use it. And we have, we anticipate that customers will actually side by side, develop on both in which we have some customers in preview today. And that's the process that they have. They will develop on 11, they will develop on the Neo and they will continue to do that. And there's no, we, we are dedicated to making sure that there's no disruption and no pain in that process. And then when customers are ready to migrate over, if that's what they choose, we'll help them migrate over. >>You make it sound easy. And I was wondering if project Neo had anything to do with the new matrix movie, I just saw the trailer for it the other day. >>It was a happy coincidence. It is not easy. Let me, let me be clear. It is something we have been working on for three years and really this last year really kicked into high gear. And, um, you know, a lot of behind the scenes work, obviously for us, but once again, that's our value proposition. It's we do the hard work. So developers and customers don't have to do that hard work, uh, but no relations in the L I love, I do love the matrix movies. So it's a, it's a nice coincidence. >>It is a nice coincidence. Last question, Patrick, for you, you know, as we wrap up the calendar year 2021, we head into 20, 22. I think we're all very hopeful that 2022 will be a better year than the last two. What are some of the things that you see as absolutely critical for enterprises? What are they most concerned about right now? >>Yeah, I think it's look, I mean, it's, obviously it has been a crazy couple of years. And, um, and if you think about what enterprises want, I mean, they want to provide, uh, a great experiences for their customers, a great experience for their employees. Once again, digital transformation, we're where you don't even kind of talk about digital transformation more because we're in it. And I think that customers need to make sure that the experiences they provide these digital experiences are the best possible experiences. And these are differentiators. These are differentiators for employees is, are differentiators for customers. I believe that software is one of the big differentiators for businesses today and going forward, and that will continue to be so we're where businesses may be invested in supply chains and invested in certain types of technologies. Business will continue to invest in software because software is that differentiator. >>And if you look at where we fit, you can go, you can go buy, you know, some great satisfied where my software as a service off the shelf in the end, you're just like every other business you bought the same thing that everybody else has bought. You can go the traditional development route, where you invest a bunch of money. It's a high risk, takes a long time. And once again, you may not get what you want. We believe what is most important to businesses. Get that unique software that fits like a glove that is great for employees is great for their customers. And it is a unique differentiator for them. And I really see that in 2022, that's going to be big and, and going forward. They're the legs for that type of investment that companies make and their return on that is huge. >>I agree with you on that in terms of software as a differentiator. No, we're seeing every company become a software company in every industry these days to be first to survive in the last 20 months and now to be competitive, it's really kind of a must have. So Patrick, thank you for joining me on the program, talking about project Neo GA in quarter of calendar year 22 exciting stuff. We appreciate your feedback and your insights and congratulations on project Neil. Thanks, Lisa. Appreciate it for Patrick Jean I'm Lisa Martin, and you're watching the cubes continuous coverage of re-invent 2021.

(bright upbeat music) >> Welcome, everyone, to theCUBE's, continuing coverage of AWS re:Invent 2021. I'm your host, Lisa Martin. And we are running one of the industry's most important and largest hybrid tech events of the year with AWS and its ecosystem partners. We have two live sets, two remote studios, and over 100 guests on the program talking about the next decade in cloud innovation. We're very excited to be welcoming back one of our CUBE alumni, Peter McKay, the CEO of Snyk. He's set to talk about reinventing application security with Snyk. Peter, welcome back to the program. >> It's great to be back, Lisa. Thanks for having me. >> Great to talk to you. So, my goodness, Snyk has had an incredible year, last year, this year, I was just looking at your Series F funding raised over 600 million in the month of September alone. Your valuation is, I think I saw over 9.6 billion, which is nearly doubled. This year-- >> Don't rush at 8.6, but yes, it was double the last time. Yeah, it's been been a crazy 2021, that's for sure. >> So, talk to me about some of that before we get into what you guys are doing with AWS. Let's talk about that, we talked about that funding. What are some of the strategic areas of investment? I know you've done a recent acquisition cloud skiff, but where are you really going to be focusing the Series F funding? >> Yeah, we've been very aggressive in building out our platform. We have a great vision for where we see developer security evolving and we want to get there fast. A lot of our customers and developers are kind of pushing us in that direction of really consolidating a platform. And so, to get there quickly, we do it organically building it ourselves, and we do it in inorganically where we can see other companies accelerate that roadmap. And so, it's this combination of very aggressive, organic expansion of both the breadth of our products, but also the depth, like adding more to our platform, but also the inorganic, because a lot of companies who have team and technologies that are very complimentary to what we're doing and allows us to continue to consolidate what is a very fragmented market in and around developers security. And so, we're going to continue to use the resources to accelerate that roadmap. The second part of it is, we are a little bit different than some companies where they kind of follow where the decision headquarters are of companies for us, we follow developers. And so, around the globe, Multinational Corporations have developers in the Philippines, in Argentina and all around the world and we needed to be there. And so, expanding our community, expanding our customer success organization around the world is critical for us. And so, that's something part of our kind of use of proceeds is the expansion of our go-to-market as well. >> Peter, modern development has changed. Next thing modern development has changed. So, traditional AppSec doesn't apply anymore. A new approach is needed. Talk to me about why Snyk believes that and what that new approach is. >> Yeah, you just go back to for 30 years, security was owned by application security teams and that's when it was kind of this waterfall application development model where they develop an app and every three, six, nine months, and then the security teams would audit that application and kind of send all the feedback, hear all the issues, go fix it, developers, and it was incredibly inefficient. And then you throw on top of this digital transformation and companies moving incredibly fast in building new applications. This agile development motion and all the incredible tools that allow developers to develop really fast. But then you get this very slow antiquated way of kind of testing it at the very end, right before you move the applications in production. So, it just didn't scale. And so, the concept is just way too late in the process. You really need to move security testing into that developer environment from the IDE, the CI/CD all the way through. So, when you're developing along the way, you're fixing the issues well ahead of time. And that's where modern development organizations are all this concept of shift left and building it in, into that's really the driver is moving security earlier and earlier in the software development life cycle. >> And that's key, especially you talked about the acceleration of digital transformation, but we've also seen the acceleration of the threat landscape in the last 20 months. There's been significant changes. The perimeter is so fragmented, it's expanding, the threat landscape goes all the way into outer space to low earth orbit these days. Talk to me about that as kind of a facilitator or an accelerator of what Snyk is doing to really focus on shifting security left with those developers. >> Yeah, I think people are kind of waking up to the fact that up to this point, they've spent billions and billions of dollars on endpoint securities and runtime security and all the things that are kind of in production. And they're realizing that, okay, well, why are we still vulnerable? Why are we still have these issues? And I think it's the realization that they're waiting too long to fix it. And a lot of the issues are happening. They're either new issues with moving to the cloud or they're issues that happen well before it got into production. And so, this realization that we've got to go earlier and earlier and fix these issues well before we go into production and don't wait till the very end. So, I think that's really driving the market to this shift lab. >> And you guys have actually kind of really pivoted your go-to-market model around that developers don't try and buy software the way that IT and security teams do. Talk to me about Snyk's GTM. >> Yeah, it's very unique in that it's really marrying this model developer security approach with the way developers want to buy. So, we start with our community and we do free content and tools all around building awareness for the developer community. We have, all of our products are free, so developers can try before they buy. And if you're truly a developer solution, you offer it free and let them use it. And then when they want to collaborate and they want to integrate and automate that moves from free to paid. So, it's very much of this bottoms up motion that really allowed developers to try MI. That's a big, big driver for our business, inbound motion drives 70% of our pipeline from them coming to us from this community. And then we come in kind of top down once they kind of get into different places. And we go in through those security organizations, which are trying to shift labs, trying to move security earlier, earlier and we work together with the security organizations to help move that to the developer world. So, you've got this bottoms up, developer adoption, viral adoption of Snyk within those organizations. Now, with the top-down kind of, and we become this bridge between the developer teams in engineering, and the security teams that are all trying to move in the same direction. And so, that's kind of how this market is evolved. And we're kind of that bridge for both those organizations. >> I was going to ask you about that, that bridge is critical, but also that bridge is a cultural change. I'm curious, how do you see organizations? It sounds like obviously you're, what over, I think, six, 700 customers now, a couple of million developers using the technology, so-- >> 1300 customers today >> 1300, okay. Wow! You have had a big year. 1300 customers, millions of developers using the technology. Talk to me a little bit about how you guys have figured out how to facilitate that cultural shift and shift security left, but also bridge between the IT and the security folks which have tended to be on sort of opposite sides of the spectrum. >> Yeah, I think the realization, I think a lot of people are very early on and I was... We'd been in the software industry for 25 years. Even nobody ever thought developers would care about security. Like there's no way developers really care about security. And really, if you think about, if you asked the developer, would you rather develop a secure app or an insecure app? If all things were equal, of course, they'd want it to be secure, but it needs to be easy. It needs to be like, don't slow me down, whatever you do, don't slow me down. And so, we have this, "Hey, it's all about speed of development, speeds, speed, speed." So, for us, we need to make it embedded, like integrated completely into that software development life cycle. So, developers don't have to be security experts, developers don't have to get out of their flow to do it, learn a different piece of software to figure out it's all embedded into that process. So, you can be fast and you can be agile, but you can also be secure at the same time. And so, part of that is embedding education and other things in there to learn that expansion of getting in the door and kind of building that momentum within these development communities all around the world. And so, I think we help all our customers with that kind of developer adoption and working together with the security teams and engineering teams on how we roll that out around best practices. And in some of the things we've learned over the six and a half years of doing this. >> It sounds very strategic and methodical and a great approach that is obviously quite successful. We talked about the growth trajectory now, 1300 customers. Let's talk about what you guys are doing with AWS. Here we are at reinvent this year. Talk to me about this Snyk, AWS partnership. >> Yeah, it's been really gaining momentum over the past year and a half, almost two years now. AWS, a lot of the workloads, one of the reasons, a lot of the applications don't go to the cloud is because of security issues and moving workloads to the cloud. Also developing applications in the cloud, security is a critical part of it. So, AWS is obviously infrastructure, but they also need solutions that allow them to make sure that those companies that are developing on AWS are secure. And so, we've integrated our Intel database into AWS inspector. We have a lot of offerings, very specific AWS offerings that our mutual customers can leverage. And we work very collaboratively with AWS in not only our technical roadmap with them, but also our go-to-market side, which is very much aligned. And it's continuing, we kind of, I say, we're in the second inning of that game. We got a lot more coming. >> Okay, but well aligned. Give me a customer example, if you will, have joined AWS Snyk customer that you've really helped with this transition, shifting security left they're building apps in the AWS cloud very successfully and securely. >> Yeah, I'd well, almost every company has some relationship with size with AWS. And so, for us, it's one of the first questions we ask anybody coming in is what's your relationship with one of the cloud vendors? And that inevitably it'll be, yeah, we have a relationship with AWS. And so, we talk about our roadmap that we have with AWS. They can buy our software through the AWS marketplace. You could leverage kind of your EDPs that you have with AWS to kind of build that scale. So, we're very technically aligned with the AWS platform. And so, you look at financial services, we've done a fair amount of financial services, insurance companies that are all kind of moving more workloads to AWS. Some of them have been our customers before, some of them separate from AWS, and now they're kind of, "Hey, can I move all my apps over and leveraged, Snyk in that process?" So, it's now, a good part of our go-to-market motion is coming through AWS marketplace as well. So, it's been a very successful partnership on both parties. >> A lot of momentum there, speaking of momentum, we talked about the funding raise this year alone, tremendous momentum going on for the company. What are some of the things that we can expect to see from Snyk in calendar year 22? >> Yeah, well, aggressive roadmap. I mean, that's still, we see, we have four modules today. We started with one and we added to, that was open to a security. We added a container security, infrastructure as code security. Then we added code security or a stats solution. We see modules five, six, seven coming out. we made an acquisition of drift technology, adding into kind of adding some more depth. So, you're going to see just a lot more continued aggressiveness on our side, as we scale both our engineering, organically and inorganically, but also, the go-to-market, now we're almost in all the major countries around the world and we're going to continue to invest in building that out and going where the developers are, the 28 million developers around the world. Our goal is to reach every one of them as fast as we possibly can with our free or paid, or whatever way is to get to 28 million developers as fast as we can. >> So, for those developers watching, where do you want to point them to go to, to start their free trial. >> Just go right to our website, snyk.io and you can get all of our products free, you can chat, schedule demos, you can do everything very easily if not. And it's very self-service so, if you don't want to talk to anybody, you don't have to talk to anybody, but if you do, we have plenty of people you can talk to. That's our world, frictionless motion. >> Frictionless and contactless at the same time, Peter, congratulations on the growth and momentum of the company. What you're doing, the evolution of the partnership with AWS and that lofty goal to reach 28 million developers. Am looking forward to our next conversation to see where you are on that progress. >> Same thing, same here, Lisa, thank you for your time. >> Oh, likewise. For Peter McKay, I'm Lisa Martin and you're watching theCUBE's continuous coverage of AWS re:Invent 2021. Stick around, more great content coming up next. (soft upbeat music)

(Upbeat intro music) >> Welcome to theCUBE's continuing coverage of AWS re:Invent 2021. I'm Lisa Martin and we are running one of the industry's most important and largest hybrid tech events with AWS in this ecosystem partners this year. We have two live sets, two remote sets over 100 guests talking about the next decade in cloud innovation. And we're excited to be joined by Patrick Jean the CTO of OutSystems, Patrick welcome to the program. >> Thank you, I appreciate being one of those 100 guests. >> One of the 100, one of the elite 100, we'll say it like that, right? >> Yes. >> So OutSystems has some revolutionary news. You guys are saying, you know what, developer experience needs to change, tell us more. >> It does I mean, it needs to change. And I've been in the industry developing applications for too many years to mention, basically since I was 12 years old writing software and going over that time and thinking about it, doing the traditional software development route. So many applications that take too long was costly to build, so much risk involved in it. Eventually it didn't meet all the requirements. And if you look at the investment we make in software, which is important, I mean, software is a unique differentiator for businesses. That investment has such a high-risk and a high cost and that needs to change. And it needs to change just because of the complexity that is in that process inherent in it. That's and that is what we are doing in OutSystems is tackling that problem. And from a business standpoint, it must change. >> It must change that is strong words there. So talk to me about what you're announcing what were the gaps in the market, customer feedback, were there any catalysts from the pandemic going we've got to change this developer experience and this is the time. >> For sure. I mean, if you think about from the pandemic and I mean, we were on a journey for digital transformation. We've been on this journey for a number of years the pandemic really accelerated that the experiences that we have with each other, you and me are not in the same studio today. I mean, there reasons that we use this experience remotely. We have a technology that can do it. The pandemic accelerated that. And so, so much of the experiences we have are digital experiences. And if you think about it, there's a device in between us. There's going to be a device in between all the people viewing what we're looking at. That experience that they will have with us will be basically surfaced through an application on that device. And the pandemic has really accelerated that. And that's an area that we play in, obviously for what's considered low-code application development. And if you just think about application development in general, that's what powers all of these experiences. And going back to that statement about that it needs to change. If we need these experiences to be diverse, if we need these experiences to be meaningful, if we need them to make sure that when people engage as far as what that device is something that brings, delight and pleasure to them. We need developers across the board investing in that. Today there is a very constrained market for professional developers because of the inherent complexity in software development. And so if you think about how that's almost, almost here limiting access to the people who can create those experiences, that's not a good situation. There's about 25 million developers in the world that would consider themselves developers today, seven, eight, nine, 10 billion devices out there. Think of that disparity between those two numbers. And so we need a larger number of people to actually develop applications so that experience can be much more diverse. We need to expose development to many more people. That is the problem today with software development is that it is complex, it is too specialized. It's too inherent as far with failure when you get it together. And so either you shy away from that as an organization or as an individual. To do development are you going on these very long development as far as cycles to actually create these applications? What we do is we take the approach of let's make it very simple to get into. Sometimes we call it citizen developer, low-code, basically all they're saying is let's reduce the risk of development. Let's go into a process where we make it accessible to more and more people. You can go through and develop applications with the lower risk. You can build change into that process. You can get value into end users as rapidly as possible. So that is the value proposition, that is what needs to change. >> Strong value proposition well said, Patrick. Talking about reducing the complexity, the risk as well. So go ahead and crack open what you guys are actually announcing today. >> Yeah, for sure. So we've been doing this for many years. We have software development, we have 14 million plus as far as end-users using applications that have been developed with the Allo systems platform. What we're announcing is taking some of the great benefits that we have to what you'd consider as the first part of that low-code process. Where you have a developer that has an idea, and there's a canvas in front of you. You're an artist, right, with a canvas that's what you are as a developer. And so you go in and you create that application. We've been doing this for many years and it worked really well. The thing that we're improving upon now is the ability to do that and scale that out to millions of end-users, 10 millions of end-users. So if you think about that inherent speed of developing an application, using a platform like OutSystems, we're taking that same concept and rolling that into an internet scale application, hosting architecture. So any developer that uses OutSystems, basically like it would be comparable to a traditional development team that has application architects, cloud architects, security engineers, database engineers, a whole team of very smart individuals that generally the biggest technology companies in the world can put together. Most companies can't do that, you don't have access to that type of skillset. And so we're providing that with Project Neo, which is what we're announcing today in our, at our user conference and customer conference. Is this brand new as far as platform that allows you to build these applications at scale. And this is initially built on AWS using all the great AWS technologies. If you look at what AWS has done and provided to developers today, it's amazing. It is absolutely amazing. The amount of technologies that you can leverage. It's also daunting because as a traditional developer, you have to go in and choose what do you do? It's like, there's just massive cognitive load. As far as upfront when you go in to design an application. What's up in messaging, what's up at data store, well, how do I host my application? What type of network as far as security do I use? We're taking all that heavy lifting, all that undifferentiated heavy lifting off of the developers, putting it into the Project Neo platform. Allowing a single developer or a small group of developers to actually leverage that best in class architecture on AWS today. >> So when you're talking to developers, what are some of the things that you describe as the unique differentiators of Project Neo? It sounds like this was really apt and apt time for change. But when you're talking to those folks, what do you say you know, one, two three, these are the things that make Project Neo unique. >> Yeah, so the first is don't worry about the application architecture. Like I mentioned when you go in, the idea, the concept of that application and what it means to deliver some value, whether it's into a business or a hobby or whatever. I mean, however you're developing application, you're doing it for a reason. You want that value to come out as quick as possible. You want that experience. And so that first thing is, you don't have to worry about the architecture anymore. So in the past you'd have to think about if it's a very large application, it's millions and millions of end-users. How do you structure that? How do you put it together? That concern is removed from you in that process. The other thing is we solve the problem of software disintegration. So with traditional development, when you develop an application and you get it into the hands of end users it immediately starts to disintegrate. So there will be bugs that will appear. There will be as far as security flaws that will come up services that you use will become deprecated. We'll swap out cloud services by AWS or Azure or Google. swap out cloud services with different services behind the scenes. Version, there'll be new versions of those that is software disintegration. As soon as you develop software today and all of these beautiful cloud services that you use and components. Something will become outdated almost by the time you release it. A lot of times with software development projects, it literally is you start with some version or some component before you can get that out in a traditional mode, something becomes outdated. We solved that issue. What I like to call software disintegration. We, as far as OutSystems, ensure we invest in that platform. And so when we may need to change out those components, those services, those versions fix is for security flaws, fixed bugs, we do that and it's seamless. And so your application, you do not have to rewrite your application. You do not have to go through that process as a tradition, as a developer on OutSystems like you would, as your traditional developer. We solve that software disintegration issue. So it's very empowering to developers to not have to worry about that. There are many, you look at the numbers today about how much is invested in innovation versus maintenance. A lot of companies start out at 70% innovation, 30% as far as maintenance, and then overtime that flips. And you'll get to 30% of your time spent on innovations development, 70% maintenance, that burden, we remove that burden. >> Those were some really powerful statements Patrick that you made and I really liked the way that you described software disintegration. I've actually never heard that term before. And it kind of reminded me of when you buy a brand new car, you drive it off the lot, the value goes down right away then before you even get things out. And on the consumer side, we know that as soon as we buy the newest iPhone, the next one's going to be out, or there's some part of it, that's going to be outdated. In terms of technical debt, I was reading a stat that technical debt is expected to reach in costs of businesses, 5 trillion, US dollars over the next 10 years. How does OutSystems help customers address the challenges with technical debt and even reduce it? >> Yeah, I mean if you think about in the kind of the truest sense of technical debt, it's a decision that you make in the development process to basically load up the future with some work that you don't want to do right now. And so we're solving that issue where not only, you don't even have to make that decision. So you can go back to that concept of removing that cognitive load of, do I get the software out right now or do I get it out in the right way? And that's really what technical debt, technical debt is saying I need to get it out now. And there are some things I want to do that it'd be better if I did them now, but I'm going to go ahead and push that out into the future. You don't have to do that today with us. And so what happens with OutSystems is we invest in that platform. And this is hard. I mean, this is not an easy thing to do. This is why we have some of the best and brightest engineers focusing on this process at the heart of this, not to get too technical, but the heart of this is what we call the true change engine within our platform. We go through and we look at all of the changes that you need to make. So you think of that concept of technical debt of like, ah, I want to get this in the hands of end users, but I don't want to invest in the time to do something right. It's always done right, as far as with the OutSystems platform. So we take that, we look at the intent of your change. So it's like a process where you tell us the intent. When you as a application developer, you're designing an application, you tell us the intent of the application is to look and feel. It could be some business processes this could be some integrations. We determine what's the best way to do that and then once again, from a software disintegration standpoint, we continue to invest in all the right ways to do that the best way possible. And so, I mean, we have customers that have written applications that's 10, 15 years ago. They're still using our platform with those same applications they've added to them, but they have not rewritten those applications. And so if you think about the normal traditional development process, the technical debt incurred over that type of lifetime would be enormous. With us there's no technical debt. They're still using the same application they've simply added capabilities to it. We invest in that platform so they don't have to. >> So big business outcomes down, obviously from a developer productivity perspective, but from the company wide perspective, the ability to eliminate technical debt, some significant opportunities there. Talk to me about the existing OutSystems customers. When are they going to be able to take advantage of this? What is the migration or upgrade path that they can take and when? >> Yeah and so it is very important to me and the team as far as OutSystems to be able to integrate, to innovate as far as for customers, without disrupting customers. And we've probably all been through this path of great new technology is awesome. But then to actually utilize that technology when you're a current customer, it creates pain. And so we've invested heavily in making sure that the process is pain-free. So you can use Project Neo. So we are announcing it as in, it was in public preview as far as now, and then we will release it from GA as far as in the first quarter of next year. So over this timeframe, you'll be able to get in and try it out and all that. Continue to use your current version, which is OutSystems 11. So what we affectionately call O-11, as far as Allo systems. The Allo systems 11 version continue to use, and you can continue to use that today side-by-side and coexistence with the Project Neo. And Project Neo is a code name. So we will have an official product name as for as at launch but it's our affectionate it's kind of a unofficial mascot as Neo. So we call the Project Neo is a little bit of a fun name and you can use it side by side and then in the future, you'll be able to migrate applications over. Or you can just continue to co-exist. I mean, we see a very long lifetime for OutSystems 11, it's a different platform, different technology behind the scenes. Project Neo's Kubernetes-base Linux containers. Based once again, on the ability, we went in with the gist and looked at it and said, re-architect, re-imagine, how would you do this if you had the best and brightest as far as engineers, architects, we have, which we do. Various market and those people and we did that. And so we did that for our customers. And so Neo is that OutSystems 11 still a great choice. If you have applications on it, you can use it. And we have, we anticipate the customers will actually side by side develop on both in which we have some customers in preview today. And that's the process that they have. They will develop on 11, they will develop on Neo and they will continue to do that. And there's no, we are dedicated to making sure that there's no disruption and no pain in that process. And then when customers are ready to migrate over, if that's what they choose, we'll help them migrate over. >> You make it sound easy. And I was wondering if Project Neo had anything to do with the new matrix movie I just saw the trailer for it the other day, I wonder if this is related. >> It was a happy coincidence. It is not easy let me, let me be clear. It is something we have been working on for three years and really this last year really kicked into high gear. And a lot of behind the scenes work, obviously for us, but once again, that's our value proposition. It's we do the hard work. So developers and the customers don't have to do that hard work. But no relations to Neo, I love, I do love the matrix movies. So it's a nice coincidence. (Lisa laughs) >> It is a nice coincidence. Last question, Patrick, for you, as we wrap up the calendar year 2021, we heading into 2022. I think we're all very hopeful that 2022 will be a better year than the last two. What are some of the things that you see as absolutely critical for enterprises? What are they most concerned about right now? >> Yeah, I think it's, look I mean, it's obviously it has been a crazy a couple of years. And if you think about what enterprises want, I mean, they want to provide a great experiences for their customers, a great experience for their employees. Once again, digital transformation, where you don't even kind of talk about digital transformation more because we're in it. And I think that customers need to make sure that the experiences they provide these digital experiences are the best possible experiences. And these are differentiators. These are differentiators for employees. These are differentiators for customers. I believe that software is one of the big differentiators for businesses today and going forward. And that will continue to be so where businesses may be invested in supply chains, invested in certain types of technologies. Business will continue to invest in software because software is that differentiator. And if you look at where we fit, you can go, you can go buy, some great set of software, my software as a service off the shelf. In the end, you're just like every other business you bought the same thing that everybody else had bought. You can go the traditional development route, where you invest a bunch of money, it's a high risk, takes a long time. And once again, you may not get what you want. We believe what is most important to businesses. Get that unique software that fits like a glove that is great for employees, it's great for their customers. And it is a unique differentiator for them. And I really see that in 2022, that's going to be big and going forward. They're the legs for that type of investment that companies make and they return on that is huge. >> I agree with you on that in terms of software as a differentiator. Now we're seeing every company become a software company in every industry these days to be, first to survive in the last 20 months and now to be competitive, it's really kind of a must have. So, Patrick thank you for joining me on the program, talking about Project Neo, GA in the first quarter of calendar year 22. Exciting stuff we appreciate your feedback and your insights and congratulations on Project Neo. >> Thanks, Lisa, appreciate it. >> For Patrick Jean, I'm Lisa Martin, and you're watching theCUBEs continuous coverage of re:Invent 2021. (Outro music)

>>from around the globe. It's the Cube with digital coverage of Dell Technologies. World Digital experience brought to you by Dell Technologies. Hello, everyone. And welcome back to the cubes coverage of Del Tech World 2020 the virtual del tech world. Of course, the virtual queue with me is Alison Do. She's the CMO and a member of the executive leadership team at Dell Technologies. Hey there, Alison. Good to see you. >>Hi, David. Good to see you too. I'm gonna see you alive, but it's so good to see on the feed. >>Yeah, I miss you, too. You know, it's been it's been tough, but we're getting through it and, you know, it's a least with technology. We're able to meet this way and, you know, for us continue the cube for you to continue del Tech world, reaching out to your to your customers. But, you know, maybe we could start there. It's like I said the other day else into somebody. I feel like everybody I know in the technology industry has also become a covert expert in the last six months. But but, you know, it changed so much. But I'm interested in well, first of all, you're a great communicator. I have met many, many members of your team. They're really motivated group. How did you handle the pandemic? Your communications. Uh, did you increase that? Did you? Did you have to change anything? Or maybe not. Because like I say, you've always been a great communicator with a strong team. What was your first move? >>Eso There's obviously there's many audiences that we serve through communications, but in this instance, the two most important our customers and our team members. So I'll take the customers first. You have likely seen the spoof Real's Going Around the Internet of Here's How Not to Talk to Customers, Right? So you saw early in February and March in April, all of these communications that started with in these troubled times We are here to help you and, you know, we're already in a crisis every single day, all day long. I don't think people needed to be reminded that there was a crisis happening. So you've got this one end where it's over crisis mongering and the other side where it was just ignoring the crisis. And so what we did was we really looked at all of our communications a new So, for example, in our small business space, we were just about I mean days away from launching a campaign that was about celebrating the success of small businesses. It's a beautiful piece of creative. I love it, and we made the very tough decision to put that work on the shelf and not launch it. Why? Because it would have been incredibly tone deaf in a moment where small businesses were going out of business and under incredible struggle to have a campaign that was celebrating their success. It just wouldn't have worked. And what we did very quickly was a new piece of creative that had our own small business advisers, lower production values, them working from home and talking about how they were helping customers. But frankly, even that then has a shelf life, because ultimately you have to get back to your original story. So as we thought about our own communications, my own leadership team and I went through every single piece of creative toe. Look for what's appropriate now what's tone deaf, and that was a very heavy lift and something that we had to continue to do and I'm really proud of the work. We did pivot quickly, then on the employee side. If you'd asked me in January, was Team member Communications the most important thing I was doing? I would have said It's an important thing I'm doing and I care deeply about it, But it's not the most important thing I'm doing. Where there was a period from probably February to June where I would have said it became the most important thing that I was doing because we had 120,000 people pivot over a weekend toe. Working from home, you had all of the demands of home schooling, the chaos that stress whilst also were obviously trying to keep a business running. So this engagement with our employees and connecting the connecting with them through more informal means, like zoom meetings with Michael and his leadership team, where once upon a time we would have had a more high value production became a key piece of what we did. So it sounds so easy, but this increase of the frequency with our own employees, while also being really honest with ourselves about the tone of those communications, so that's what we did and continue to dio >>Well, you've done a good job and you struck a nice balance. I mean, you weren't did see some folks ambulance chasing and it was a real turn off. Or like you said, sometimes tone deaf. And we can all look back over history and see, you know, so many communications disasters like you say, people being tone deaf or ignoring something. It was sloughing it off, and then it really comes back to bite them. Sometimes security breaches air like that. So it seems like Dell has I don't know, there's a methodology. I don't know if you use data or it's just a lot of good good experience. How have you been able to sort of nail it? I guess I would say is it is. >>But there's some secret method that I'm cautiously optimistic. And the superstitious part of me is like, Don't say that, Okay, I'm not gonna would alright eso so that it's it's both it z experience, obviously. And then what? I What I talk a lot about is this intersection of data versus did data and creativity, and you spend a lot of time in marketing circles. Those two things can be sometimes pitched is competing with each other. Oh, it's all about the creativity, or it's all about the data. And I think that's a silly non argument. And it should be both things And this this time like this. This point that I make about ambulance chasing and not re traumatizing people every single day by talking about in these troubled times is actually from a piece of research that we did, if you believe it or not. In 2008 during the middle of the global financial crisis, when we started to research some of our creative, we found that some of the people who have seen our creative were actually less inclined to buy Dell and less positive about Dell. Why? Because we started with those really hackneyed lines of in these troubled times. And then we went on to talk about how we could take out I t costs and were targeted at I T makers, who basically we first played to their fear function and they said, and now we're going to put you out of a job, right? So there's this years of learning around where you get this sweet spot from a messaging perspective to talk about customer outcomes while also talking about what you do is a company, and keeping the institutional knowledge is knowledge of those lessons and building and refining over time. And so that's why I think we've been able to pivot as quickly as we have is because we've been data driven and had a creative voice for a very long time. The other piece that has helped us be fast is that we've spent the last 2.5 3 years working on bringing our own data, our own customer data internally after many, many years of having that with the third party agency. So all the work we had to do to retarget to re pivot based on which verticals were being successful in this time and which were not we were able to now due in a matter of hours, something that would have taken us weeks before. So there's places where it's about the voice of who we are as a brand, and that's a lot of that is creative judgment. And then there's places about institutional knowledge of the data, and then riel getting too real time data analysis where we're on the cusp of doing that. >>Yeah, so I like the way you phrase that it's not just looking at the data and going with some robotic fashion. It reminds me of, you know the book. Michael Lewis, Moneyball, the famous movie, You know, it's like for a while it was it was in baseball, like whoever had the best nerds they thought we were gonna win. But it really is a balance of art and science, and it seems like you're on this journey with your customers together. I mean, how much how much? I mean, I know there's a lot of interaction, but but it seems like you guys are all learning together and evolving together in that regard. >>Absolutely. David, One of the things that has been really interesting to watch is we have had a connected workplace program for 10 years, so we've had flexible work arrangements for a very long time, and one of the things that we have learned from that is a combination of three key factors. The technology, obviously, can you do it? The three culture, and then the process is right. So when you have a the ability to work from home doesn't mean you should work from home 22 out of 24 hours. And that's where culture comes in. And I frankly, that's where this moment of cumulative global stress is so important to realize as a leader and to bring out to the Open and to talk about it. I mean, Michael's talked a lot about this is a marathon. This is not a sprint. We've done a lot of things to support our employees. And so if you think about those three factors and what we've learned, one of the things that we found as we got into the pipe pandemic was on the technology side. Even customers who thought they had business continuity plans in place or thought that they had worked from home infrastructure in place found that they didn't really so there was actually a very quick move to help our customers get the technology that would enable them to keep their businesses running and then on the other two fronts around processes and culture and leadership. We've been ableto have smaller, more intimate conversations with our customers than we would have historically, because frankly, we can bring Michael, Jeff. Other parts of the leadership team me together to have a conversation and one of the benefits of the fact that those of us who've been road warriors for many, many, many years as I know you have a swell suddenly found yourself actually staying in one place. You have time to have that conversation so that we continue to obviously help our customers on the technology front, but also have been able to lean in in a different way on what we've learned over 10 years and what we've learned over this incredibly dramatic eight months, >>you know, and you guys actually have some work from Home Street cred? I think, Del, you're the percentage of folks that were working from home Pre Koven was higher than the norm, significantly higher than normal. Wasn't that long ago that there were a couple of really high profile companies that were mandating come into the office and clear that they were on the wrong side of history? I mean, that surprised me actually on. Do you know what also surprised me? I don't know. I'm just gonna say it is There were two companies run by women, and I would have thought there was more empathy there. Uh, but Dal has always had this culture of Yeah, we were, You know, we could work. We could be productive no matter where. Maybe that's because of the the heritage or your founders. Still still chairman and CEO. I don't know. >>You know those companies and obviously we know who they are. Even at the time, what I thought about them was You don't have a location problem. You have a culture problem and you have a productivity problem and you a trust problem with your employees. And so, yes, I think they are going to be proven to be on the wrong side of history. And I think in those instances they've been on the wrong side of history on many things, sadly, and I hope that will never be us. I don't wanna be mean about that, but but the truth of the matter is one of the other benefits of being more flexible about where and how you work is. It opens up access to different talent pools who may or may not want to live in Austin, Texas, as an example, and that gives you a different way to get a more diverse workforce to get a younger workforce. And I think lots of companies are starting to have that really ization. And, you know, as I said, we've been doing this for 10 years. Even with that context, this is a quantum leap in. Now we're all basically not 100% but mainly all working from home, and we're still learning. So there's an interesting, ongoing lifelong learning that I think is very, very court of the Dell culture. >>I want to ask you about the virtual events you had you had a choice to make. You could have done what many did and said, Okay, we're going to run the event as scheduled, and you would have got a covert Mulligan. I mean, we saw Cem some pretty bad productions, frankly, but that was okay because they had to move fast and they got it done. So in a way, you kind of put more pressure on your yourselves. Andi, I guess you know, we saw this with VM Ware. I guess Was, you know, just recently last >>few >>weeks. Yeah, and so but they kind of raise the bar had great, you know, action with John Legend. So that was really kind of interesting, but, you know, kind of what went into that decision? A Zeiss A. You put more pressure on yourself because now you But you also had compares what? Your thoughts on >>that. So there was a moment in about March where I felt like I was making a multimillion dollar decision every single day. And that was on a personal note, somewhat stressful to kind of wake up and think, What? What? Not just on the events front. But as I said on the creative front, What work that my team has been working on for the last two years? I am I going to destroy today was sort of. I mean, I'm kind of joking, but not entirely how that felt for me personally at the moment. And we had about we made the decision early on to cancel events. We also made the decision quite early on that when we call that, we said we're not going to do any in person events until the end of this calendar year. So I felt good about the definitiveness there. We had about a week where we were still planning to do the virtual world in May and what I did together with my head of communications and head of event is we really sat and looked at the trajectory in the United States, and we thought, this is not gonna be a great moment for the U. S. The week we were supposed to run in May, if you looked at the trajectory of diseases, you would have news be dominated by the fact that we had an increasing spike in number of cases and subsequent deaths. And we just thought that don't just gonna care about our launches. So we had to really, very quickly re pivot that and what I was trying to do was not turn my own organization. So make the decisions start to plan and move on. And at the same time, though, what that then meant is we still have to get product launches out the door. So we did nine virtual launches in nine weeks. That was a big learning learning her for my team. I feel really good about that, and hopefully it helps us. And what I think will be a hybrid future going forward. >>Yeah, so not to generalize, but I've been generalizing about the following. So I've been saying for a while now that a lot >>of the >>marketing people have always wanted to have a greater component of virtual. But, you know, sales guys love the belly. The belly closed the deals, you know? But so where do you land on that? How do you see? You know, the future of events we do, you expect to continue to have ah, strong virtual component. >>I think it's gonna be a hybrid. I think we will never go back to what we did before. I think the same time people do need that human connection. Honestly, I miss seeing the people that I work with face to face. I said at the beginning of this conversation, I would like to be having this discussion with you live and I hate Las Vegas. So I never thought I'd be that interested in, like, let's go to Las Vegas, you know, who knew? But but so I think you'll see a hybrid future going forward. And then we will figure out what those smaller, more direct personal relationship moments are that over the next couple of years you could do more safely and then also frankly give you the opportunity to have those conversations that are more meaningful. So I'm not entirely sure what that looks like. Obviously, we're gonna learn a lot this year with this event, and we're going to continue to build on it. But there's places in the world if you look at what we've done in China for many, many, many years, we have held on over abundance of digital events because of frankly, just the size of the population and the the geographic complexity. And so there are places that even early into this, we could say, Well, we've already done this in China. How do we take that and apply it to the rest of the world? So that's what we're working through now. That's actually really exciting, >>You know, when you look at startups, it's like two things matter the engineering and sales and that's all anything else is a waste of money in their minds when you and and all they talk about is Legion Legion Legion. You don't hear that from a company like Dell because you have so many other channels on ways Thio communicate with your customers and engage with your customers. But of course, legions important demand. Gen. Is important. Do you feel like virtual events can be a Z effective? Maybe it's a longer tail, but can they be as productive as the physical events? >>So one thing that I've always been a little bit cantankerous on within marketing circles is I refuse to talk about it in terms of Brand versus Li Jen, because I think that's a false argument. And the way I've talked about it with my own team is there are things that we do that yield short term business results, maybe even in corridor in half for a year. And there are things that we do that lead to long term business results. First one is demand, and the second one is more traditional brand. But we have to do both. We have to think about our legacy as a known primarily for many, many years as a PC maker. In order for us to be successful in the business businesses that we are in now, we love our PC heritage. I grew up in that business, but we also want to embrace the other parts of their business and educate people about the things that we do that they may not even know, right? So that's a little bit of context in terms of you got to do both. You got to tell your story. You've got to change perceptions and you got to drive demand in quarter. So the interesting things about digital events is we can actually reach more people than we ever could in an in person world. So I think that expands the pie for both the perceptions and long term and short term. And I hope what we are more able to do effectively because of that point that I made about our own internal marketing digital transformation is connect those opportunities to lead and pass them off to sales more effectively. We've done a lot of work on the plumbing on the back end of that for the last couple of years, and I feel really fortunate that we did that because I don't think we'd be able to do what we're doing now. If we hadn't invested there, >>Well, it's interesting. You're right. I mean, Del of course, renowned during the PC era and rode that wave. And then, of course, the AMC acquisition one of the most amazing transformations, if not the most amazing transformation in the history of the computer industry. But when you when you look to the future and of course, we're hearing this week about as a service and you new pricing models, just new mindsets I look at and I wonder if you could comment, I look at Dell's futures, you know, not really a product company. You're becoming a platform. Essentially, for for digital transformation is how I look atyou. Well, how do you see the brand message going forward? >>Absolutely. I think that one of the things that's really interesting about Dell is that we have proven our ability to constantly and consistently reinvent ourselves, and I won't go through the whole thing. But if you look at started as a direct to consumer company, then went into servers then and started to go into small business meeting business a little bit about when private acquired e. M. C. I mean, we are a company who is always moving forward and always thinking about what's next. Oftentimes, people don't even realize the breadth and depth of what we do and who we are now so as even with all of that context in place, the horizon that we're facing into now is, I believe, the most important transformation that we've done, which is, as you see, historical, I t models change and it becomes, yes, about customer choice. We know that many of our customers will continue to want to buy hardware the way they always have. But we also know that we're going to see a very significant change in consumption models. And the way we stay on top of our game going forward is we lean into that huge transformation. And that's what we're announcing this week with Project Apex, which is that commitment to the entire company's transformation around as a service. And that's super exciting for us. >>Well, I was saying Before, you're sort of in lockstep with your customers. Or maybe you could we could. We could close by talking a little bit about Dell's digital transformation and what you guys have going on internally, and maybe some of the cultural impacts that you've seen. >>So you, you you touched on it. It's so easy to make it about just the I t. Work, and in fact, you actually have to make it about the i t. The business process. Change in the culture change. So if you look at what we did with the AMC acquisition and the fact that you know that there's a lot of skepticism about that at the time, they're not gonna be able to absorb that. Keep the business running. And in fact, we have really shown huge strides forward in the business. One of the reasons we've been able to do that is because we've been so thoughtful about all of those things. The technology, the culture and the business process change, and you'll see us continue to do that. As I said in my own organization, just to use the data driven transformation of marketing. Historically, we would have hired a certain type of person who was more of a creative Brett bent. Well, now, increasingly, we're hiring quants who are going to come into a career in marketing, and they never would have seen themselves doing that a couple of years ago. And so my team has to think about okay, these don't look like our historical marketing profile. How do we hire them? How do we do performance evaluations for them. And how do we make sure that we're not putting the parameters of old on a very new type of talent? And so when we talk about diversity, it's not just age, gender, etcetera. It's also of skills. And that's where I think the future of digital transformation is so interesting. There has been so much hype on this topic, and I think now is when we're really starting to see those big leaps forward and peoples in companies. Riel transformation. That's the benefit of this cookie year we got here, Dave. >>Well, I think I do think the culture comes through, especially in conversations like this. I mean, you're obviously a very clear thinker and good communicator, but I think your executive team is in lockstep. It gets down, toe the middle management into the into the field and and, you know, congratulations on how far you've come. And, uh, and and also I'm really impressed that you guys have such a huge ambitions in so many ways. Changing society obviously focused on customers and building great companies. So, Alison, thanks so much for >>thank you, Dave. You virtually I'm very >>great to see it. Hopefully hopefully see Assumes. Hopefully next year we could be together. Until then, virtually you'll >>see virtual, >>huh? Thank you for watching everybody. This is Dave Volonte for the Cube. Keep it right there. Our coverage of Del Tech World 2020. We'll be right back right after this short break.

>> From theCUBE studios in Palo Alto and Boston, bringing you data-driven insights from theCUBE and ETR, this is Breaking Analysis with Dave Vellante. >> The steepest drop in the stock market since June 11th flipped the narrative and sent investors scrambling. Tech got hammered after a two-month run, and people are asking questions. Is this a bubble popping, or is it a healthy correction? Are we now going to see a rotation into traditional stocks, like banks and maybe certain cyclicals that have lagged behind the technology winners? Hello, everyone, and welcome to this week's episode of Wikibon's CUBE Insights powered by ETR. In this Breaking Analysis, we want to give you our perspective on what's happening in the technology space and unpack what this sentiment flip means for the balance of 2020 and beyond. Let's look at what happened on September 3rd, 2020. The tech markets recoiled this week as the NASDAQ Composite dropped almost 5% in a single day. Apple's market cap alone lost $178 billion. The Big Four: Apple, Microsoft, Amazon, and Google lost a combined value that approached half a trillion dollars. For context, this number is larger than the gross domestic product for countries as large as Thailand, Iran, Austria, Norway, and even the UAE, and many more. The tech stocks that have been running due to COVID, well, they got crushed. These are the ones that we've highlighted as best positioned to thrive during the pandemic, you know, the work-from-home, SaaS, cloud, security stocks. We really have been talking about names like Zoom, ServiceNow, Salesforce, DocuSign, Splunk, and the security names like CrowdStrike, Okta, Zscaler. By the way, DocuSign and CrowdStrike and Okta all had nice earnings beats, but they still got killed underscoring the sentiment shift. Now the broader tech market was off as well on sympathy, and this trend appears to be continuing into the Labor Day holiday. Now why is this happening, and why now? Well, there are a lot of opinions on this. And first, many, like myself, are relatively happy because this market needed to take a little breather. As we've said before, the stock market, it's really not reflecting the realities of the broader economy. Now as we head into September in an election year, uncertainty kicks in, but it really looks like this pullback was fueled by a combination of an overheated market and technical factors. Specifically, take a look at volatility indices. They were high and rising, yet markets kept rising along with them. Robinhood millennial investors who couldn't bet on sports realized that investing in stocks was as much of a rush and potentially more lucrative. The other big wave, which was first reported by the Financial Times, is that SoftBank made a huge bet on tech and bought options tied to around $50 billion worth of high-flying tech stocks. So the option call volumes skyrocketed. The call versus put ratio was getting way too hot, and we saw an imbalance in the market. Now market makers will often buy an underlying stock to hedge call options to ensure liquidity in these cases. So to be more specific, delta in options is a measure of the change in the price of an option relative to the underlying stock, and gamma is a measure of the volatility of the delta. Now usually, volatility is relatively consistent on both sides of the trade, the calls and the puts, because investors often hedge their bets. But in the case of many of these hot stocks, like Tesla, for example, you've seen the call skew be much greater than the skew in the downside. So let's take an example. If people are buying cheap out of the money calls, a market maker might buy the underlying stock to hedge for liquidity. And then if Elon puts out some good news, which he always does, the stock goes up. Market makers have to then buy more of the underlying stock. And then algos kick in to buy even more. And then the price of the call goes up. And as it approaches it at the money price, this forces market makers to keep buying more of that underlying stock. And then the melt up until it stops. And then the market flips like it did this week. When stock prices begin to drop, then market makers were going to rebalance their portfolios and their risk and sell their underlying stocks, and then the rug gets pulled out from the markets. And that's really why some of the stocks that have run dropped so precipitously. Okay, why did I spend so much time on this, and why am I not freaking out? Because I think these market moves are largely technical versus fundamental. It's not like 1999. We had a double whammy of technical rug pulls combined with poor underlying fundamentals for high-flying companies like CMGI and Internet Capital Group, whose businesses, they were all about placing bets on dot-coms that had no business models other than non-monetizable eyeballs. All right, let's take a look at the NASDAQ and dig into the data a little bit. And I think you'll see what I mean and why I'm not too concerned. This is a year-to-date chart of the NASDAQ, and you can see it bottomed on March 23rd at 6,860. And then ran up until June 11th and had that big drop, but was still elevated at 9,492. And then it ran up to over 12,000 and hit an all-time high. And then you see the big drop. And that trend continued on Friday morning. The NASDAQ Composite traded below 11,000. It actually corrected to 10% of its high, 9.8% to be precise, and then it snapped back. But even at its low, that's still up over 20% for the year. In the year of COVID, would that have surprised you in March? It certainly would have surprised me. So to me, this pullback is sort of a relief. It's good and actually very normal and quite predictable. Now the exact timing of these pullbacks, of course, on the other hand is not entirely predictable. Not at all, frankly, at least for this observer. So the big question is where do we go from here? So let's talk about that a little bit. Now the economy continues to get better. Take a look at the August job report; it was good. 1.4 million new jobs, 340,000 came from the government. That was positive numbers. And the other good news is it translates into a drop in unemployment under 10%. It's now at 8.4%. And this is really good relative to expectations. Now the sell-off continued, which suggested that the market wanted to keep correcting, so that's good. Maybe some buying opportunities would emerge in over the next several months, the market snapped back, but for those who have been waiting, I think that's going to happen. And so that snapback, maybe that's an indicator that the market wants to keep going up, we'll see. But I think there are more opportunities ahead because there's really so much uncertainty. What's going to happen with the next round of the stimulus? The jobs report, maybe that's a catalyst for compromise between the Democrats and the Republicans, maybe. The US debt is projected to exceed 100% of GDP this calendar year. That's the highest it's been since World War II. Does that give you a good feeling? That doesn't give me a good feeling. And when we talk about the election, that brings additional uncertainty. So there's a lot to think about for the markets. Now let's talk about what this means for tech. Well, as we've been projecting for months with our colleagues at ETR, despite what's going on in the stock market and its rise, there's those real tech winners, we still see a contraction in 2020 for IT spend of minus 5 to 8%. And we talk a lot about the bifurcation in the market due to COVID accelerating some of these trends that were already in place, like digital transformation and SaaS and cloud. And then the work-from-home kicks in with other trends like video conferencing and the shift to security spend. And we think this is going to continue for years. However, because these stocks have run up so much, they're going to have very tough compares in 2021. So maybe time for a pause. Now let's take a look at the IT spending macroeconomics. This data is from a series of surveys that ETR conducted to try to better understand spending patterns due to COVID. Those yellow slices of the pies show the percent of customers that indicate that their budgets will be impacted by coronavirus. And you can see there's a steady increase from mid-March, which blend into April, and then you can see the June data. It goes from 63% saying yes, which is very high, to 78%, which is very, very high. And the bottom part of the chart shows the degree of that change. So 22% say no change in the latest survey, but you can see much more of a skew to the red declines on the left versus the green upticks on the right-hand side of the chart. Now take a look at how IT buyers are seeing the response to the pandemic. This chart shows what companies are doing as a result of COVID in another recent ETR survey. Now of course, it's no surprise, everybody's working from home. Nobody's traveling for business, not nobody, but most people aren't, we know that. But look at the increase in hiring freezes and freezing new IT deployments, and the sharp rise in layoffs. So IT is yet again being asked to do more with less. They're used to it. Well, we see this driving an acceleration to automation, and that's going to benefit, for instance, the RPA players, cloud providers, and modern software vendors. And it will also precipitate a tailwind for more aggressive AI implementations. And many other selected names are going to continue to do well, which we'll talk about in a second, but they're in the work-from-home, the cloud, the SaaS, and the modern data sectors. But the problem is those sectors are not large enough to offset the declines in the core businesses of the legacy players who have a much higher market share, so the overall IT spend declines. Now where it gets kind of interesting is the legacy companies, look, they all have growth businesses. They're making acquisitions, they're making other bets. IBM, for example, has its hybrid cloud business in Red Hat, Dell has VMware and it's got work-from-home solutions, Oracle has SaaS and cloud, Cisco has its security business, HPE, it's as a service initiative, and so forth. And again, these businesses are growing faster, but they are not large enough to offset the decline in core on-prem legacy and drive anything more than flat growth, overall, for these companies at best. And by the time they're large enough, we'll be into the next big thing, so the cycle continues. But these legacy companies are going to compete with the upstarts, and that's where it gets interesting. So let's get into some of the specific names that we've been talking about for over a year now and make some comments around their prospects. So what we want to do is let's start with one of our favorites: Snowflake. Now Snowflake, along with Asana, JFrog, Sumo Logic, and Unity, has a highly anticipated upcoming IPO. And this chart shows new adoptions in the database sector. And you can see that Snowflake, while down from the October 19th survey, is far outpacing its competitors, with the exception of Google, where BigQuery is doing very well. But you see Mongo and AWS remain strong, and I'm actually quite encouraged that it looks like Cloudera has righted the ship and you kind of saw that in their earnings recently. But my point is that Snowflake is a share gainer, and we think will likely continue to be one for a number of quarters and years if they can execute and compete with the big cloud players, and that's a topic that we've covered extensively in previous Breaking Analysis segments, and, as you know, we think Snowflake can compete. Now let's look at automation. This is another space that we've been talking about quite a bit, and we've largely focused on two leaders: UiPath and Automation Anywhere. But I have to say, I still like Blue Prism. I think they're well-positioned. And I especially like Pegasystems, which has, for years, been embarking on a broader automation agenda. What this chart shows is net score or spending velocity data for those customers who said they were decreasing spend in 2020. Those red bars that we showed earlier are the ones who are decreasing. And you can see both Automation Anywhere and UiPath show elevated levels within that base where spending is declining, so that's a real positive. Now Microsoft, as we've reported, is elbowing its way into the market with what is currently an inferior point product, but, you know, it's Microsoft, so we can't ignore that. And finally, let's have a look at the all-important security sector, which we've covered extensively and put out a report recently. So what this next chart does is cherry-picks of a few of our favorite names, and it shows the net score or spending momentum and the granularity for some of the leaders and emerging players. All of these players are in the green, as you can see in the upper right, and they all have decent presence in the dataset as indicated by the shared NS. Okta is at the top of the list with 58% net score. Palo Alto, they're a more mature player, but still, they have an elevated net score. CrowdStrike's net score dropped this quarter, which was a bit of a concern, but it's still high. And it followed by SailPoint and Zscaler, who are right there. The big three trends in this space right now are cloud security, identity access management, and endpoint security. Those are the tailwinds, and we think these trends have legs. Remember, net score in this survey is a forward-looking metric, so we'll come back and look at the next survey, which is running this month in the field from ETR. Now everyone on this chart has reported earnings, except Zscaler, which reports on September 9th, and all of these companies are doing well and exceeding expectations, but as I said earlier, next year's compares won't be so easy. Oh, and by the way, their stock prices, they all got killed this week as a result of the rug pull that we explained earlier. So we really feel this isn't a fundamental problem for these firms that we're talking about. It's more of a technical in the market. Now Automation Anywhere and UiPath, you really don't know because they're not public and I think they need to get their house in order so they can IPO, so we'll see when they make it to public markets. I don't think that's an if, that I think they will IPO, but the fact that they haven't filed yet says they're not ready. Now why wouldn't you IPO if you are ready in this market despite the recent pullbacks? Okay, let's summarize. So listen, all you new investors out there that think stock picking is easy, look, any fool can make money in a market that goes up every day, but trees don't grow to the moon and there are bulls and bears and pigs, and pigs get slaughtered. And I can throw a dozen other cliches at you, but I am excited that you're learning. You maybe have made a few bucks playing the options game. It's not as easy as you might think. And I'm hoping that you're not trading on margin. But look, I think there are going to be some buying opportunities ahead, there always are, be patient. It's very hard, actually impossible, to time markets, and I'm a big fan of dollar-cost averaging. And young people, if you make less than $137,000 a year, load up on your Roth, it's a government gift that I wish I could have tapped when I was a newbie. And as always, please do your homework. Okay, that's it for today. Remember, these episodes, they're all available as podcasts, wherever you listen, so please subscribe. I publish weekly on wikibon.com and siliconangle.com, so check that out, and please do comment on my LinkedIn posts. Don't forget, check out etr.plus for all the survey action. Get in touch on Twitter, I'm @dvellante, or email me at david.vellante@siliconangle.com. This is Dave Vellante for theCUBE Insights powered by ETR. Thanks for watching, everyone. Be well, and we'll see you next time. (gentle upbeat music)