 We live in a heterogeneous world and nowhere is that more acute than in the storage part of the IT equation. And FalconStore is a company that from the beginning has really been dedicated to providing storage services to a heterogeneous world. And we're really happy to have Gary Quinn and Tim Sheets here, Gary's the CEO, Tim's the VP of marketing. Gentlemen, welcome to theCUBE. It's great to see you guys. Thanks for having us, David. It's fantastic to be here today. So FalconStore is a company that a lot of people know. Everybody's like always roots for FalconStore. You guys have a deep heritage of technology. You've had some ups and downs clearly. So, Gary, give us the update. Where have you guys been? What's new? Well, you know, as you mentioned, we had our ups and downs. We're 15 years old in a couple of weeks. That's our birthday. So I just want to get a shout out there for a happy birthday to FalconStore. We have a tremendous amount of technology in our portfolio over the last 15 years. And, you know, that technology we've brought together that we talked a little bit about today, whereby we have the ability to actually seamlessly migrate customers on and off the cloud to protect that data, virtualize that data, and also enable customers to choose the right storage at the right time in the right location with the right price. And we think that that is what differentiates us going forward now to this new world of cloud and flesh. So, Tim, as a VP of marketing, obviously on messaging, you know, the persona, the brand of the organization, what do you want FalconStore to be known as? Give us a historical perspective, but what do you want people to think of FalconStore today? You know, really, at FalconStore, you know, we've come up with this saying, you know, it's the power to be free. And we want to give customers the ability to have the flexibility in their environments so that they're free to choose the right storage with the right data services, you know, for what their applications and their business demand, and get rid of that vendor lock-in, right? Stop being tied to the ways that they used to do things and have the freedom to go drive and focus on revenue. You know, choice is an interesting thing. Open. The word open. I've been in this business a long time. The definition of open has changed so much. You guys are really dedicated to that mission. When you say choice, when you say openness, you're completely hardware agnostic, correct? And so, you know, FalconStore grew up, as you probably know, from the past, right? We actually had a totally open campaign. People used to call us a Swiss Army knife. I don't think you win any wars with a Swiss Army knife, but, you know, coming back to that, we are truly hardware agnostic. So in our solution, we provide a reference platform for the server that our storage will run on, our software will run on, and also the storage behind that server can be flash. It could be spindles, different versions of spindles. It could still be tape. It could be cloud backup. So the idea of being tied into any particular platform is something that we pride ourselves on, that we don't need to be tied on any platform. So let's step back a little bit. Gary, what are the big trends that you guys are seeing? Tim, feel free to chime in as well. Take a big picture. What's driving your strategy right now? Well, you know, customers as well as partners, and when I say partners, service providers, you know, are all being challenged today by the fact that there is this new paradigm called flash and there's this new paradigm called cloud. And however you define flash storage or you define cloud, cloud could be public, it could be private, it could be hybrid. You know, what people in the end want is they want more economic value out of their investment. So, you know, I want to get more performance out of my storage. I want to pay a better price point. I want to move my storage to the right location. I want to maybe have someone else management for me. I'd like to spin up compute, server, storage, network, all right, and pay for only what I use. So we see that flexibility that customers are looking for as well as performance at the same time happening. And we think we can help customers do that. How do you guys help? Well, in a number of ways, I mean, I think the biggest thing that we're looking at going forward right is, you know, first, how do you start to break down a lot of those silos silos of, you know, different tools to manage silos of different capability on various platforms, right, silos from where I'm having to manage or monitor from. And so if we can come in and create that horizontal layer, right, that abstracts and breaks down those silos, takes out complexity, gives them a better cost optimization opportunity. We think that's the smart play because that's where the future is going. So that's always kind of been the fundamental premise around Falcon Store, but you got an announcement coming up. What what is that announcement? And what's different and new about it? So the announcement that we'll be making on February 18 will be the availability of a horizontal platform, which we have called Free Store. And the idea behind Free Store is to have a intelligent abstraction core or a virtualization layer of all of your storage assets, whether you're an enterprise customer or you're a service provider. And by doing that horizontal platform that Tim talked about and virtualizing that, you can then apply a common set of data services to the virtual pool, and then monitor, manage, report upon and provision with a very simple, easy to use interface, whether that's on a web browser, a smartphone or a tablet. And that is 15 years of experience brought forward into this new world of software defined storage. So I like the name Free Store, freedom, choice, talk about that a little bit. Absolutely. You know, well, it was really, you know, how do we give them the, you know, we talked about the power to be free, right? And so that's kind of where that name started from. You know, the whole idea was, how do we give them one platform with one view for one price, right? It's got to be simple, right? And so we're looking at having a common platform that goes as Gary mentioned, across whatever storage you may have, right? But now having that way to do common data services, you know, we will focus on things like data migration, right? People who want to move from legacy storage to a new platform from one site to another site. How does one of those cloud or service providers get the data from their customer to their own data center, right? We need to enable that. And we do that today, we're going to continue to make that even better going forward. Or they need always on they need that highly available, always on active, active environment, right? Well, maybe they need protection and recovery services from, you know, backup, you know, to snapshots to now I want to be able to do automated recovery as more of an active passive approach, if you will. And then finally, how we can we help them optimize their existing backup? And what we've done here is we've now merged all of those things into one platform to now users enable users to turn them on, turn them off as they see fit. So when I hear one platform, a lot of times, I think of a GUI into a mess is what's really new in the architecture? Have you is there new R&D and new modernization here, Gary? Can you talk about that? So that you're absolutely correct, Dave. What we have taken is FalconStore's 15 years of experience. We've then looked at the new environments that are out there today, whether those are in cloud, whether those are flash or the existing disparate heterogeneous environments customers are trying to manage today at the moment in the spindle environment. And we basically upgraded all of that. So the virtualization core, which most people probably historically as FalconStore customers or FalconStore fans, remember us for something called IP Store. IP Store used to be the core engine for our technology. That IP Store layer has been completely re architected and redone to support flash cloud. We're able to now get upwards of 1 million IOPS in performance or iOS per second to support the flash guys. In addition to that, we've also now been able to increase the the availability of our environment or the resiliency through a better HA functionality with a four way model to support those high end enterprises that need three, four, five nines of availability. So we've now elevated ourselves into the enterprise to be better quality, more resiliency, in addition to that higher performance with flash. And then as you know, we've always been able to move data from one location to another very easily. We have some patented replication technology, which is is amazing that people people have used it. And what do you think about when you're in a cloud environment? What are you doing? You're connecting over a wire to some other location. The biggest cost is the network. So the ability to do a very efficient transfer back and forth or move the data to a consolidated location is done through that micro scan technology. So all of all of that are put together into a common platform, which sometimes people lately, you know, they like a gooey into a big mess. I'd like to say this is not really a big mess because what is it's a nice visual into your virtualized pool. So it's very clear and concise what you can see what you're doing, what you have, what's available, your performance, so you're getting the value you wanted, right? And in addition to that, the ability to apply a common set of services in a consistent manner across the virtual pool. So that's what free store is. Sometimes people also think of a platform is I'm buying something that I'm not using in the free store model, you get all the services, but you get the right to use them at any time, but you only pay for the capacity you manage. I want to come back to that. Microscan is cool. By the way, we interviewed some of your customers. They're using that. If I recall, it was a remote office kind of situation. Yes, yes. Very efficient way to move data and good good controls to seed the base and very cloud like, you know, kind of pre cloud when I go back there. But I want to come back to to flash. You guys, you talk about flash, you guys are adding another layer in here. What about latency? How are you dealing with that? What are customers telling you about that? So, you know, we're we're in the re architecture of the engine. We cut latency down significantly. And when we go and work with flash providers, you know, if they want to go on, take our software and put it on board, you know, we'll be in somewhere in the neighborhood of, you know, the the 50 microseconds range, right? Typically, we're going to see people go into more of a gateway model. And there, obviously, you have an additional server processor, you know, connector cards, you know, the network that you have to deal with. But we're still down around, you know, the 150 or so microseconds. So from an application perspective, it's almost negligible. We've really done a lot of work to make sure that that latency is been reduced to basically a non factor. Well, and compared to spinning disk. Absolutely. And the other thing that we also came out of the flash work with the new engineering is is the whole idea of an active active environment. Because when you're in a flash world, there is no time for fail over. You have to always be available always on. So that's something we didn't have in the past in our point solutions or our previous products. But we've introduced that now as part of the free store offering. So I want to talk about the stack a little bit, I think, especially when you think about the new flash guys. Many don't have a stack. I mean, I don't have a robust stack. It takes a long time to build up, you know, a storage stack. Why is it so hard, Gary, and talk about your stack a little bit? Well, as you know, a lot of the new guys are we call them the new kids on the block, right? You know, they have an amazing array, right? And all them have a very individual use case, whether they're high performance, whether they're scale out, whatever that may be. And they've realized they have to incorporate some type of data services on top of that. Typically things like replication, deduplication, compression, snapshots, that's all kind of jacks are better to open. All right, you got to come in. Yeah, you're just to be in the game, especially when you move into into an enterprise or somebody who's managing enterprise customers. So what you find is, is that they're really, really good at their hardware, right? And their, their, their design of their hardware. But the software, not that it's an afterthought, but that's not really their forte. So they've been able to pick up something or some guys to put something together for them. Once they start to look at what Falcon Store has done for the last 15 years, they start saying that's something that maybe we should have as we go into the enterprise, because it's a higher level of capability, whether it's availability, resiliency, performance, and, and just it's a different game at the enterprise space. So a lot of these guys have stacks, you know, that some of them are more complete than others, some more immature than others, some have nothing at all. So it's a great opportunity for us to go with them and either work, like Tim mentioned, either in a server gateway model to try it out and say, hey, to get you into the enterprise, attach your storage behind a server, we give them a reference architecture. And if that looks good, then we're willing to do engineering work with them and actually put it right on board in a VM in the array. Okay. All right. And we'll come back and talk more about the channel model. You had something to add to that? Well, you know, the other thing that you find interesting is a lot of these flash guys try to go into today's enterprises and environments, right? You know, not all the tools that are maybe in that environment are going to work with them. So sometimes it's putting in these new flash arrays is another silo, if you will. So you have to think about how do you help manage, you know, and migrate data over onto that array and then once that array is now in, how do you manage your data service across the rest of your enterprise? You know, not all the vendors work together with other vendors tools. So this gives now it shops and service providers a way to begin to merge in some of that newer technology in a less disruptive manner. So you guys are essentially building out a big support matrix, right? You've always had had a knack of doing that. So talk about the segmentation. What markets are you able to go after? So the moment where they're targeting the free store product line towards those flash manufacturers that either have a limited stack, an incomplete stack or immature because they need that to compete in the enterprise space. So we're currently looking to work with them, add more to our certification matrix as well as add more to our go to market model. The second piece is for now, you know, you hear all these guys are getting into the managed services space or more of them or some people converting from managed services to cloud services, you know, a lot of words are entertainment changeable. I like to say at the end that, you know, if somebody's going to come and manage my environment, I think most customers would like to have a private cloud with shareable assets across their enterprise. I don't think they want to share outside their enterprise, they want to share within themselves. And if somebody could do that for them, I think that's a big benefit. So Falcon Store enables people with the free store platform to get a service provider to go in same thing, look, virtualize the pool across customers, allow for shareable assets, get the right box behind the right performance for the right price. So the customer is happy. So we're looking to target those two markets as growth for us. Our existing install base today, if we really break down that install base, probably 10 to 15% of our high end customers who actually work with us to design free store, they're excited about it and they're going to probably migrate to it. But I think what we don't want to forget there at the end of the day is we have today 3000 active customers who pay us today. Those are the guys who keep our lights on, make us happy, help us drive up to see you guys all right. You know, we want to make sure they're still happy. So we are enhancing the individual point solutions to move forward with the new requirements to keep up to date and be relevant in 2015. But what goes into the point solutions will also go into free store, but many things that hardware guys need, as well as service provider guys need will not be retrofitted back into the point solutions. They'll remain in free store. So Tim, talk about the channel model a little bit. I mean OEM kind of get long sale cycles, a lot of co development, belly to belly kind of thing. What about the channel side? Direct sales, you know, indirect sales. Talk about the approach you want to take. Absolutely. You know, as Gary mentioned, we have you know, 3000 active customers today around the world. And you know, we're definitely going to continue to work with our channel partners to make sure that they've got access to the point products that they can continue to sell those will certainly help them understand the value of free store. And if you know they're an integrator shop that got the capabilities to go deploy something like free store, certainly we're going to continue to work with them. But we probably envision them majority of our existing partners today are going to continue with our point products. You know, we do do some business direct. And we will continue to do business direct where that makes sense. Right. And we're going to continue to work with partners and give them the opportunities to, you know, go make some more money. And we certainly believe that, you know, free store and enhancing the core products. You know, as Gary mentioned, we've re enhanced and re architect the engine, the core products as well. So not just free stores is getting all the love. We're, we're making sure that can doing that that install base gets the love to. So how do you deal with that inevitable conflict? If you're going direct, you got OEM, you got some channel, what's the conversation like? And how do you rationalize all that? I mean, but when we meet a prospect, and let's talk about individual customers themselves, you know, one of the first things we asked them is, is, you know, do you have a set of partners that you currently work with people that you like to do business with? You know, we would prefer to do it that way. So if the customer comes back and says, you know, hey, I work with, you know, XYZ company. If those guys are on our, on our list of partners, we'll certainly pass that along to them and do business with those guys. If they're not, we'll say to the customer, listen, we'll bring them on board and we'll connect with them to make sure the customer's happy. At the end of the day, it's making the customer happy. And given the customer choice, just like in the technology, giving them choice of how they do business. So if they like to work with integrators, value it at resellers, service providers, we're going to go down that path with them. Because why cause a problem for the customer at the end? At the end, let's make them happy the easiest way to get the technology in their hands. But we also look at Freestore as something that's really more of a service provider model. And so if some, a lot of resellers are now looking to maybe resell cloud services, or maybe change their business model to get into that type of service provider game, if they are, I think that there's a natural because they know Falcon Store from the past. So I don't think it's really a conflict because we're really trying to do the right thing for the customer. However, the customer wants to buy, that's how we want to sell. You're agnostic to it. We're agnostic. We're agnostic. We are, I mean, I know a lot of people like to talk about, you know, channel conflict and what's going on there. You know, my view at the end of the day is, is how does the customer want to buy? And then that's my model. And same thing with a service provider or value at a reseller. However, your go to market model is that's my model. And you might say, well, how can you do that? I mean, how do you make money? Because we're selling on a, on a basically a subscription model with Freestore with capacity based. So it's very easy and predictable and flexible pays you go pay for what you use. If you're a service provider and you have your own way of combining, let's say not only storage management, maybe security, maybe network management, patch management, whatever that may be, you say to a customer, we charge you $100 per month per customer. Now, I have to just fit in there somewhere. And I rather leave it up to the service provider say, you know, we can give you 10 cents a month and go from there. Now, at the moment, you might say you might be leaving money on the table. But right now, I think focus is tremendous technology. We're looking to get back into marketplace. And you said people know us, or it's no of us, you know, we're a little bit of an underdog. And I think right now, you know, we're looking to basically cut all the barriers of entry to Falcon Store away and be easily going into the market. Your technology company, and you can have in that model, you can have a low cost of sales. And if you need, it sounds like if I get this right, where you need direct sales, you'll you'll add that. You'll you'll you'll put up resources there to help customers adopt. But if the customer wants to buy from other channels, great. And just remember, we're, we're, you're right, we're a software company. So our cost is, you know, once we make the product, you know, there's not a lot of cost after that. It's go to market. So we need channel partners to help us get the reach and the breath out to these customers. Remember, also because we're software and we have a reference architecture and we run pretty much almost on anybody's storage. The customer is going to need storage networks, which is they're going to need that reference server underneath it. And we're not going to sell it to them. You know, I mean, that's we're not in the hardware business. I don't get good price performance on the hardware that I sell today. So therefore we would prefer to go to a partner and say that the customer likes these guys are going to need this server or the a couple of servers they're going to need this much more storage. Can you source all that and we'll also sell the software. So it sounds like as well. I mean, I presume your direct sales force also helps your channel in terms of knowledge transfer, almost like an overlay inside of a large I mean, actually, it's not really it's a partner sales force. You know, and like I said, if the customer wants to go direct, we're not going to fight them. All right. But for the most part, like Tim said, 95 to 97% depending on what geography you're in, our business goes to a channel partner. Talk more about the pricing. Everybody wants to sort of shift CapEx to OpEx. What's new in the in the pricing. So so think about what what's happening in the world today. You know, people have very heterogeneous environments, right? They're hoping they're getting a lot of utilization out of what they're buying. You know, some guys showing up say we need flash. The management is saying, why are you guys not doing the cloud? Right? You know, there's a lot of conflict going on today inside, you know, between it and a management organization. And then you got a lot of people writing about how wonderful the cloud is, how wonderful flash is, all these new paradigms. It just adds more complexity to an organization that has is getting less and less human capital. So, you know, what we see needing to happen is you need some way to help these guys to get their arms around. How do I either try this new paradigm, whether it's a location in the case of the cloud, or it's a new device in the case of flash? Okay, so what's the reaction been Tim from customers for a free store? Can you talk about that a little bit? I mean, the new pricing model. So, you know, when we talk to people, the first reaction is they kind of scratch their head. And it's like, did I hear you right? You know, the way we're going to approach this is everything's included. There's no smoke, no smears, no surprises. When we deploy a free store, it's going to be for a simple price per terabyte on an annual basis. And that price per terabyte covers all the software, you know, it's going to cover the 24 by seven support, you know, as long as you're under contract with us, you know, all updates, software upgrades, enhancements, you get, right? Period. End of story. And the beauty of that is now customers know exactly what they're going to pay. And the only thing they have to figure out is how much capacity and the way that's going to work is once they go ahead and get free store installed, you know, let's say they start with a hundred terabytes, right? And we'll just make up an artificial number of it's a dollar terabyte. So year one, that's going to cost them a hundred dollars. They can turn as many services on or off as many times as they want. It doesn't matter. It's there. It's all they could bring a new storage in, maybe at least it's coming up off an old storage box and want to bring in a new migrate off the old, move it over. They don't have to stop, call us, get another license for the new array. They just do it, right? It gives them the flexibility to deal with what's going on in their environment. Now at the end of the year, we'll do something we call an x-ray, which allows us to see how much stores they now have under management. We'll give them the opportunity to true up. So let's say they start at a hundred. Now they're 125. We'll make sure. Yep. Is this the right 125? Did you have a project that you didn't take offline or make sure that everything's good? We'll then charge them for what the difference is going into year two. So it's 125 times the preset price per terabyte of a dollar is now $125. But let's say for a moment they've done some consolidation and now they only have 70 terabytes. Great. The new price for year two will be 70 terabytes times a dollar, 70 bucks. You're on your merry way. How do you predict what year one's going to look like? You guys have some services that help you do that or some tooling. So even with our prior point solutions, we would look at a customer's environment and they currently have some amount of storage today that they are storing information on. So there's some capacity there. They're looking to deduplicate that. We can look at the types of retention periods that they have or what they're trying to achieve on deduplication. So say it's 10 to 1. Could be up to 71. Then once you run through our tools, then now you're going to have say 10% storage versus 100% before or you may be going to have one seventh versus 100% before. So we help them do that with sizing capability. Same thing on snapshots. How many snapshots you're looking for? How many times you look to do it? What are your incrementals? How many changes are you looking to do? And we have a bunch of algorithms and formulas that will help them get started. So then when they put our tools in and they start getting better performance out of their existing portfolio, they ultimately will wind up with extra storage to use. And so we're only going to charge them for what they're using, okay? Not what is plugged in behind. So only what they use what our service is. So you might put an array in but never apply any of our services to it. You won't be charged. And you're not worried about leaving money on the table. Well, you know, a lot of people, a lot of people have asked me that question, you know, and I'll be honest with you, I do think we're probably leaving something behind. But at the moment, you know, I think we need to be we have some of the coolest technology out there. And a lot of you guys all know about it over the years. And they wonder where what happened to Falcons during the last five years. In the last five years, we haven't actually done anything new or major in the marketplace due to a lot of things that were happening at the company. This is the first time in five years that we're basically announcing a brand new solution that's relevant and leapfrogging the industry right now. So I think to eliminate any kind of friction on the way into acquiring that technology, we're willing to leave a little money on the table. I'll make it up and hopefully we'll make it up in volume. So how did you how did you fund this latest development? Talk about the business. Maybe give us update there. And so I took over the company in July of 2013. And, you know, we took an inventory of what was going on in engineering. What did our product line look like? What would it take to get between where we were in 2013 to become to become more relevant? Address some of the new things, the shifts that were going on like the introduction of Flash and this whole world of the cloud. And we basically sat down and came up with what we think we could possibly get done there. We also had an opportunity to do a joint development agreement with with with a major manufacturer in the Flash space. And there were some deliverables that we needed to provide to them. But what came out of that and we finished that project, the project was done in 2014. Everything's been delivered. It's not everything that Falcon Store has, but it was pieces that they needed to support their go to market strategy. We learned a lot about the Flash environment, which was really, really valuable to us. OK, so that is now we believe has brought us forward to 2015. In addition to that, we also were able to find a minority shareholder to help us out. All right, because we were a situation in 2013. But now we've kind of gone through all of 14. We delivered what we needed to deliver. We got our install base very nice and solidified and stable at this point. Customers are upgrading, moving forward. We feel positive about that. And now we're introducing some new technology for growth. So we think that at 15, you know, as long as we can execute well in the Flash and the cloud space and continue to preserve our install base, you know, we think we have a really good opportunity here in 2015. So Tim up front talked about messaging, freedom, sort of choice. You know, year, year and a half, maybe even 24 months from now, where do you want Falcon Store to be? Well, you know, I'd love people to see the Falcon Store, right, is that technology that really gives them the flexibility and the freedom, you know, coming in and being able to say, hey, you know what? All those silos, you've broken those down. You've let you were labeled us to cost optimize our infrastructure and right size it for the business and the drivers and the revenue that they're trying to target. And if people still associate with with Falcon Store, you know, giving them that those freedoms, I think we've done our job. Hey, Gary, I'll end it with you. You talked about some of your priorities. Maybe you could be more specific in terms of milestones you want to hit. What should we as an outside observers be looking at in terms of progress? Indicators of success for Falcon Store? So a couple of things that's a great question. You know, some people ask you what are the mile markers? You know, maybe not what the revenue is, but what are the mile markers? You know, how do we know that things are happening for you guys? And I think what you want to see from us is, you know, any types of relationships that we get off the ground where we're going to market either onboard an array or jointly together in a gateway model with a flash manufacturer. If you see any major telcos or even smaller privatized cloud providers that you see adopting Falcon Store technology, I think you'll see that that's a validation that the technology works and the and the market places there and we're moving ahead. The next piece after this, you know, people say, well, what about what next? It sounds like you're just kind of catching up and then what's going on next? There are a few interesting things going on. I mean, the whole concept of scale out or distributed storage, all right, the ability to store information anywhere and have a kind of a Lego block model of snap on, snap off servers, storage switches for a completely resilient redundant environment that's highly scalable but very cost effective. That's really kind of the next kind of Nirvana there, you know, for us anyway. I mean, we're not really in the big data space. We're not a Hadoop guy. All right, you know, the object thing is something that we have to address and take care of. But this whole idea of being able to store information anywhere in a distributed model and snap on, snap off hardware and it could be anybody's hardware, even if it's not a name brand that I think is the ultimate Nirvana. And I think we have some of the underpinnings at the moment to look at that and expand further. But at the moment, we got to stay focused in 15. We got to basically drive free store into the marketplace. And if you see some adoption by other people distributing our products and then also hopefully people call you up and say, you know, how do you like those guys? Are they good guys? And I think we've accomplished our goal. Well, it's like I said at the top, a lot of people are rooting for for Falcon Store and companies like Falcon Store. There are some great companies in this industry, in the storage industry particular. I sometimes call it the cartel and we we love to see independent innovators, right? It's the lifeblood of the industry. So, you know, as I say, congratulations on getting here. Wish you the best of luck and thanks very much for coming on theCUBE. Thank you very much for having us. We really appreciate you giving us an opportunity to get the word out. Thank you. OK, thanks for watching, everybody. This has been Cube Conversations. We're talking about a heterogeneous world and Falcon Store solving those problems. Thanks for watching. We'll see you next time.