 This is theCUBE from SiliconANGLE Media. I'm Paul Gillan. The cloud is all the rage these days, but as companies move to the cloud and some of them seeking simplicity, what they find is they actually get complexity because they want to balance their resources. They want to hedge their bets. They don't want to get locked in. So they will end up doing business with multiple cloud providers and often with an on-premise cloud as well. That creates cost complexity and that's what cloud health technologies is addressing. My guest is Tom Axby. He's the new CEO of Cloud Health Technologies, a Boston-based company. Recently raised $46 million. They have software that helps companies understand their cloud costs and of course to reduce them as well. So Tom, just a couple of weeks on the job. Welcome to theCUBE. Great, thank you, Paul. Nice to be here. Now I'm sure you can tell better what cloud health does than I can. So why don't you give your description? Actually, I mean, you did a very good setup for me. I mean, Cloud Health is the de facto standard cloud service management software. And as you quite rightly pointed out, one of the complexities now is of a multi-cloud or hybrid cloud environment. So people are making a single vendor bet. And that of course increases, as you mentioned, the complexity and the cost controls, the governance, security, even more. And that's what we do. We manage all that complexity and give our customers a single pane of glass to help manage and optimize their cloud experience. When do customers typically come to you? Are they in a crisis or are they coming to you earlier in the process to avoid that crisis? You know, it's all over the map. It depends on their cloud maturity. So customers, we've got who are early customers who are literally born in the cloud. So you think of services such as AirBnB and Pinterest and Yelp. You know, those services are cloud based right from the get go. And so what they've done is experienced tremendous growth on a global basis by offering these services, managing huge data sets in the public cloud. But they also had the expertise because they were going through that right from the beginning. But as soon as that scale becomes unmanageable, as it does, and that complexity becomes greater in a multi-cloud environment, they bring us in. It's just that their technical acumen was a little bit more advanced than say someone in the enterprise who has been managing data centers and they want to migrate the cloud, but they find that their expertise is in the data center world and their expectations are, I want the same governance and management that I had in my data center as I moved to the cloud. So you're really embarking on the beginning of their cloud journey. And then sort of the third set of our customers are MSPs. So these are actually cloud service providers who are basically offering their customers and they're the trusted source for their customers, all the aggregated services that are available for them and their experience. So mainly small, medium businesses and mid-market businesses will go through the MSPs, but they're customers for us too. Talk about complexity. What are some of the unique characteristics of the cloud environment that create complexity that perhaps customers don't always anticipate? Well, the first thing is, is that the pace of innovation in the cloud is at light speed, okay? You've got these cloud vendors, Amazon, Microsoft, Google, and now you've got IBM, you've got Oracle, and many other ones, Alibaba in Asia-Pac, and they're all increasing their service offerings at a rapid pace of innovation. So just keeping up to speed with the domain expertise is very, very complex. And then when you migrate to the cloud, you're migrating services, critical business services, and just like any other environment, computing environment, whether it's distributed computing or client server, you've got to manage those complexities so your business services and applications can run smoothly. And as you know from, you know, certainly your experience, there's an inordinate amount of moving parts and even more so in the cloud. Now, you multiply that by a multi-cloud or a cloud or a hybrid cloud experience and certainly being able to aggregate that data, it becomes a business critical task. We hear a lot about multi-cloud and customers trying to hedge their bets. Is that a major force in the industry right now? Do you see companies trying, actively trying to diversify the number of providers that they work with? We do, yeah, absolutely. And obviously the larger the company and the larger their cloud spend, the more likely they are to do that. So they're not reliant on one cloud provider. And also they're experiencing different places of innovation from the cloud providers who are jockeying for that innovation right now. What really focused on as well is the hybrid cloud. So it could be a multi-cloud environment, but it also could be their private data center, their managing or both. So yeah, we do see a huge trend in that. When customers come to you for the first time and you do an initial analysis, what are typically some of the areas where you find the greatest inefficiencies and the greatest opportunities to save costs? Sure, I think it depends again on where they are in their cloud journey. They may be moving to the cloud or thinking about it. And what they want is some kind of visibility because they're so used to having tight controls and visibility and budgets within their data center because that environment is so mature to them and the cloud is like the wild west of them. They're going to get these monthly bills or they got to commit to certain workloads or resources without really understanding what their usage patterns are going to be. So we may come in and help with the migration, capacity planning, and certainly their forecasting abilities. The more mature they are, they want to start allocating costs maybe by department or by geographic region. So they're getting more and more sophisticated in terms of their cost breakdown and their usage patterns and when those usage patterns happen. But also as they control their costs, one of the ways they can do that is to buy future visibility, if you will, into those resources or compute power from the cloud providers. And so being able to figure that out from a historical and prospective billing standpoint can be incredibly valuable to the customers. So what kinds of data do you provide for them? Well, we provide essentially a window of aggregated rollup of any particular service that they could have. So it could be their financial data in terms of their usage information which rich resources or compute loads are working. Also, as they've deployed stovepipe data vendors for performance management or configuration management, security management, all of that comes into play as well. So we can roll up that aggregated data source so they got a single pane of glass into sort of their entire environment. And that could be at the VP level who's running a multi-cloud environment. It could be at the financial level where they're looking for cost controls or it could be at the DevOps level where they're looking for anomalies or performance issues or bottlenecks or capacity planning. So at every level, we're trying to provide visibility into sort of the function and task that our customers have. Of course, cloud vendors aren't interested in having their customers be multi-cloud. They want them to be single-cloud. How cooperative do you find the vendors are in working with you to enable your customers to hedge their bets? Well, I mean, I think that they're very helpful. I mean, number one, we've got deep relationships with all the cloud providers because we've been doing this a long time. And also what we're doing is we're hastening and accelerating our customers' movement to the cloud by offering them the same visibility and governance and tools that they had in their data or private data center world. So they actually embrace it. And they know it's going to be a multi-cloud environment especially for the larger customers. And so absolutely we're helping that. Do you, are customers beginning to look to broker their experiences, their costs, to move workloads sort of flexibly between different cloud providers based, perhaps on even short-term savings? They can do, yeah, absolutely. But again, short-term savings are a trade-off between long-term savings in terms of how much capacity you're buying, how much visibility you've got into your usage patterns as well. But certainly, I mean, that's the world that we're getting into these days. I mean, Amazon does per second billing now. So when you think about all that data, it's absolutely, you know, the complexity of it is absolutely mind-boggling. The cloud world, as Forrester pointed out in a recent report, is consolidating into basically three big players and then sort of everybody else. Do you think that's a good trend as far as customers are concerned? I think, you know, we've seen it over and over again. You see, you know, the dominant providers come forth and start taking over a marketplace, but there's always going to be room for other vendors. You know, IBM and Oracle, certainly, are not just going to lay down people like VM where they're getting into the cloud business as well. So, you know, they're the dominant ones right now, absolutely. I think what's good for the business is the trend itself of people moving all these workloads to the cloud and having more control over it so that it's actually be transparent as to who the cloud provider is. You certain had the opportunity to take executive positions in a number of companies. What was it about this opportunity that appealed to you? Well, I assume it's a very good question. I mean, I've been at RAFE quite some time, especially, you know, in the high-tech world. And we had a very successful run there and we were acquired by a private equity firm. And, you know, I was looking around at perhaps making a move. And I'd been fascinated by the cloud and what it was doing and how transformative it was to business. And it was very akin to experiences I've had in my career, selling infrastructure software. You know, I was at IBM, Tivoli, for example. I was at Micromuse and they were basically undergoing exactly the same transformation in client server and distributed computing days. So, I was also aware of the investors and a couple of board members of Cloud Health and I recalled their very first investment. And it was explained to me by one of their investors, this is Tivoli for the cloud. And, of course, that resonated with me. I thought, that's brilliant, that's so simple, because you've got exactly the same complexities. And then I tracked the company. I had the opportunity to meet the founders and I saw how they had executed against their vision. I saw the caliber of the team there. So, when an opportunity came up because the CEO and the cloud founder, Dan Phillips, was moving into the chairman role as my partner now, you know, I jumped at it. You say Tivoli to the cloud, there's an interesting analogy. Of course, the difference with Tivoli and cloud is that Tivoli is on premise. You have, you control the infrastructure, you have access to all the interfaces you need, not necessarily the case with the cloud. What are some of the difficulties that you encounter with getting customers the information that they need from their cloud providers? Well, certainly the cloud, like I said, the pace of innovation is huge. So, you've really got to be up to speed with the latest offerings. And if you look at all those APIs and how they could be changing new services that they could be coming out with, literally on a week by week basis, you've got to keep track of all of those. Then you've got to have a flexible architecture so you can actually easily integrate with those data sources and also understand the necessary workflows to present all that data in a consumable way. So, it really is a very fast pace of innovation right now. And I think that's why, you know, the analogy of Tivoli for the cloud was a good one because you were aggregating all that data, you were giving critical insight into, you know, certainly about their network and infrastructure and business services. So, the analogy holds true, but I think you're right, the pace of innovation is much quicker. Now, talk about how you justify your cost. What kind of deliverables do you promise customers in exchange for what you charge them? Well, fortunately, you know, the deliverables are born out of history. We've got incredible ROIs. As you know, the monthly spend, as it increases, as people's cloud experience grows, okay, those costs can spiral quickly. I think that when people talk about the cost, you know, we always talk about the value. So, what value are you looking for? How are you going to optimize your environment? And so the savings we can save just on their billing or utilization. And then there's the governance and then people want to do departmental chargebacks or geo-chargebacks and we can help them with that cost allocation. So, we tend to talk about value more than cost. Where do customers leave money on the table though? Where do you find some of the greatest disconnects between what they could be spending and what they really are spending? Well, it all comes down to consumption. You know, if you could just like your deciding which mobile phone bill you want to get based on what your projected consumption is going to be, you know, they want to lock you into the biggest one and they're going to show you lots of different values for signing you up for a three-year contract. It's the same for a cloud provider. So, the more you're willing to prepare, the more you can lock in your costs. And of course, as you do that, the risk is that you don't fulfill all those costs and realize those savings. On the other hand, you may be growing so exponentially quickly that you're actually paying more than you would be than if you just, you know, basically consumed a different pricing model. In general though, do you find that customers if they manage their cloud costs wisely, do in the final analysis save money by moving to the cloud versus an on-premises architecture? Without a doubt. The time to deploy services is so quick. You know, the time to integrate different facets of your business services is so quick. You know, when you think about unlimited throughput and speed and storage on a global basis for your services, you know, it's unprecedented. And does your service cover software as a service as well? We do. I mean, we're a SaaS company ourselves. So, and as you know, many SaaS companies are now providing services, excuse me, into the cloud. And we could be, you know, collecting data from those services too. So, what's the future holder then for Cloud Health? Where do you want to take this company? You know, I think that, you know, in the beginning, I said sort of with the de facto standard for cloud service management, it's hard to claim you're really the de facto standard, especially when we're a private company. You know, I think what we want to do is continue to provide value, continue to innovate, you know, continue to have that domain expertise. And when you look across the whole governance spectrum about all these different systems, all these cloud providers, all these different data sources, it's absolutely immense. And I think that always having that single pane of glass so that people can really get the visibility they need to optimize their services, you know, we're going to be a very large company just doing that. I understand you have some ambitious growth plans this year in terms of the number of employees and also moving your headquarters. We do. I mean, I've only been on board for about two and a half weeks. And, you know, there's already been 10 people hired since I've been there. So that's the pace of hiring right now. I think we'll end the year at about 240 employees. So probably out from, you know, probably hired about 80 employees. And then we are moving early next year, we're moving four point downtown crossing. So we've got to accommodate them all. For those of you who are not familiar with Boston, downtown crossing is the center of town. And four point is the hot new area where GE is building its new headquarters. The, in terms of how your business category develops, do you see this as continuing to be a major independent category type of services you provide? Or do you think cloud vendors will ultimately acquire companies like yours and offer these services on their own? I think both is going to happen. I think cloud vendors will acquire companies who do stovepipe, perhaps, you know, functionality for a certain area, but no cloud vendors going to be able to offer the cross multi-cloud or hybrid cloud experience that we do. So I think you're going to see both, but absolutely, you know, the ability to manage multi and hybrid cloud environments is key. It's something I always ask our Boston-based guests. What are the advantages of being based in Boston? Well, the advantage is absolutely huge, especially in this day and age. You know, Boston has got an immense talent pool coming out every single year from universities, and that talent pool now wants to stay in Boston as opposed to move to other places, because, you know, the city's gone through rejuvenation. It's a vibrant city. It's an invested-in city. You mentioned GE. There's other companies moving here. It's a great time to be here. You've got many success points in the high-tech arena, such as HubSpot and Wayfair and LogMeIn, publicly-traded companies offering great opportunities. So I think the pace of innovation here is happening. You know, at a tremendous, a tremendous clip. So, you know, Boston's a great place to be. Glad to hear it. Welcome to town. Congratulations on your growth and much success to you. Greg, well, thank you very much for having me. Cloud complexity simplified. I'm Paul Gillan. This is The Cube.