 Live from San Francisco, California, the Cube, covering MarkLogic World 2015. Brought to you by MarkLogic. Here are your hosts, John Furrier and Jeff Kelly. Welcome to the Cube, this is our flagship program from SiliconANGLE Wikibon, we go out to the events and extract the single noise, I'm John Furrier, my host. Jeff Kelly, we are here live in Silicon Valley from MarkLogic World 2015. And Jeff, no better guest to kick it off than the CEO Gary Bloom. Welcome back to the Cube, good to see you again. Glad to be here again. So, you're up on the keynote there, we'll get into some of the content, but a lot of stuff happening in the industry right now seems to be massive shift, what Amazon has done in the cloud, the transformation of the software industry, what cloud and mobile and big data has done has certainly changed, we've talked about support on the Cube, but right now in time you're seeing massive funding rounds, valuations from startups that weren't around three years ago in a billion dollars. Customers are concerned, certainly raises the attention of what they're working on, security, big data, what's going on in the industry right now and what are you guys doing, what was your keynote about, did you address that and talk about this mega trend happening right now? Sure, yeah, it's a good question. What I see happening in the market right now is at least in the database where we're going through a generational shift. We haven't had a shift in the database industry in 30 some years, so if you go back the last time it really shifted was the mainframe and it kind of became the Oracle era, right? And the reason it shifted was pretty simple. The answer to IT for every IT problem if a user wanted something was give me $5 million and give me five years and I'll build it for you. And if you look today in the relational model which has dominated the database market for the last 30 years, answer's the same. Give me $5 million, give me five years and I'll build it for you. And the world doesn't work that way anymore, it's a real time world, they need quicker results. We've had good conversations and Jeff and I have been talking about this with his research that he's put out is that the global pressure to be instantly global is a big requirement, so you have upstarts coming out and there's a lot of discussions about the disruption of to the incumbents. But talk about that global impact from a company standpoint, what do they need to do to be global and how does it impact the customer's value proposition because the customer's customer is ultimately the driver on this. Yeah, it is, what's interesting about when you talk about global, I look at everything, I'm a database guy, I've been a database, I'm a database dinosaur, I've been in the industry for 30 years and so I look at everything as a database problem and if you look at it and you say well what happens when you go global, your data becomes heterogeneous. The data and the way you thought about your business in Japan was different than the way you thought about your business in China which was different than the way you think about your business in the US and by the way it's equally heterogeneous even if I go state to state for a lot of businesses. They had different divisions, different people, different teams building different applications for different reasons but now they want a unified customer experience. They want a 360 degree view of the customer around the globe. Well all of a sudden you have to make all that heterogeneous data work together and so for me this is like, I feel like a kid in a candy store. Yeah, it's like all this heterogeneous data and we have the technology to bring it all together. All right, so I'm bringing that story together. I want to drill down on the market logic. What is the current story? What are you guys talking about with customers? What is the main thrust for market logic right now? What have you invested in? What kind of products are you guys rolling out and what are the kind of customer deals that you're working on? Yeah, so the short answer is anything to do with heterogeneous data but we still do what we started doing as well which is all the unstructured content. So if you look at this whole big data movement and you've thrown the big data term out there a couple times, it's a pretty hyped up term. If you look at it going back three and five years ago everybody thought big data was the 80% of the world's data that's unstructured. Now today they look at it and they say no it's actually 100% of the world's data. Well, it turns out that companies are really struggling with the notion of bringing heterogeneous data together to build next generation of transactional systems. So if I'm all of a sudden I'm a traditional business and I want a web presence I have to have a 360 degree view of my customer. If I'm a healthcare provider I need a 360 degree view of the patient. I can't service them online. I can't service them through different assets and different properties I own unless I have a 360 degree view. Well the vast majority of that data is structured data and the patched to structured data for the last 10 to 20 years has been ETL products. Companies like Informatica, talking about an industry change, company going private. Well what essentially ETL products where it was a band-aid over the relational model to allow you to do heterogeneous data and the band-aid's falling off is a band-aid over a gaping wound and it's falling off. And so what's happening is customers need access to all their data and big data has kind of evolved from unstructured data which is what it was 10 years ago to be all your data today. Well walk us through a little bit. Give us a technology 101 here. I mean how does Mark Logic make that happen in a way that doesn't take five years and five million dollars like the old world? How do you actually go about doing that? So the reason it became so expensive is in the relational model if you think about what you have to do you have to know what all the data inputs are when you build the application because you have to define what's called a schema. So you have to create this data model that describes every element of the data and then you write SQL statements that go after and look at that data based on its structure in the database. The problem is that the data that's coming inbound companies don't know what are all the data sources they want to include. There's all kinds of new data available to them and so every time the data changes they have to change the database. Every time they want to ask a different question to the database they have to change the SQL, rewrite the SQL, reindex the SQL and then eventually rebuild the database. And so what's happened is for homogeneous data that doesn't change very often, highly structured that fixed schema worked really well. What we do in the Mark Logic world and we use a term we just ingest the data as is. We load it as it exists and we make it searchable. And the way I characterize it to some people we kind of do for corporations what Google did for internet data. Google every time the cube posts a new article, puts a new blog out, changes your website, Google doesn't rewrite Google every time. But if you're a bank and you have 30 different trading systems and one of those trading systems change and you have a trade store that consolidates that data you rewrite your trade store every time one of the trading systems change. In Mark Logic you don't have to do that. So you're basically saying as the infrastructure is changing significantly because the point solutions at the edge of the network, the customer's hands is changing. You mentioned 360 degree view of the customer, mentioned Google. That's almost like not so much ad tech it's really the connected network. So internet of things kind of picks up into that. So we're seeing this transactional whole internet as what customers want. So that's a solution. They're not talking about Hadoop. They're not talking about it. So how do you talk about customers because now we're shifting into solutions. Elaborate on that whole concept of personas. You mentioned Google. That's consumer concepts, right? I mean, that's what customers. It is consumer concepts. If you go back to the heritage of Mark Logic though, our founder was 14 years ago. He's been for his whole life a search engine expert and he's writing internet search engines and he looked out in the market and he said people can find all this data on the internet and then you come to work. You lock up your car, you come in, you swipe your badge, you get in the door and you can't find anything. So what's happening is the experience that people have enjoyed in the public internet is an experience that they want to enjoy in the corporate world. But the data was never stored to be able to do that. So he started out the company, Mark Logic found 14 years ago to build a search engine for corporate data and he realized very rapidly that the reason you couldn't search is because it was stored in a way you couldn't search at. So he built a Mark Logic database, Mark Logic server and we store the data differently. And so to some extent you're right. People want the internet of things but they want it in their corporate life as well as they want it in their private life. So what are some of the examples that you see out there? Because we hear this on theCUBE a lot from all the shows we go to around them. The guys doing big data right like Mark Logic is that we hear liberation. We hear inside out organizations. You mentioned the enterprise. It can be this weird old legacy systems like you said hard to find things when you have a clean sheet of paper unstructured data. So what are some examples you guys are working on right now that are proof points on terms of this liberating concept? We hear that all the time. Man, big data's changed. Just taking an unstructured data and the ability to harness it and be agile has liberated us from a cost shackles and allows us to do things. Yeah, well there's two dimensions to it. One is just finding out interesting facts about your business. One of the things we're quick to separate is you know, when do you use a product like Hadoop? And if all you're trying to do is analyze your data and find interesting facts, then the Hadoop, the data lake and that structure works pretty well. The flip side of it though, there's another whole world that says I want a whole next generation of operational and transactional systems. I want to change the experience of my employees and my customers and how they interact in my business. And as soon as you go there, then you need a database platform. And so, and that's what Markologyx focused on, a database platform. So what are some of the kinds of things we've been doing? We have one of the major global banks. They needed a consolidated view of all their trading data. But the regulators, what did they do for years? They keep all those trading systems separate, but now we want to do a credit risk assessment against you as a single entity. Well, how you could do that if you don't bring all the trade data together in real time? So they use Markologyx to do the data consolidation. We have one of the healthcare providers doing a patient 360. If I want to offer online patient care or patient provisioning of services, how do I do that if the online nurse that's working with me only has a little slice of my data? The online nurse needs to know I was in the hospital, I got out of the hospital, I was given a prescription, I didn't fill the prescription. Well, those are like five different systems. It's a hospital system, a prescription system, a billing system, a prescription billing system. You have to piece all that together. How can that person do their job if they don't have all the data? So what we're doing is we're bringing this unified view of all the corporate data together so I can launch completely new business initiatives. It's pretty, it's a lot of fun. So that's top line, driving the top line numbers or revenue for customers, not just cost cutting. Talk about the signal from the noise. Let's talk about the reality of some of these trends around some of these startups that are emerging and how hard it is to compete globally and how hard it is to do what you just said, to build a transactional next generation system is oh yeah, you do some legacy stuff, Data Lake is great, but now you're going into a whole new era, mobile, retail's all transactional. I mean, we're living in a transactional world. How hard is it? And what do you say the CIOs out there watching the C level executives who are out there saying, you know, I got to do something, I got to get the ball rolling, got some pilots out there, but I got to transform my business. What's your take on that? How do you talk to that kind of audience? Yeah, so what you're talking about is enterprise requirements. And we see three enterprise requirements that a next generation database has to have. It has to have data availability, it has to have data reliability, and it has to have security. And if you don't have those three dimensions, then I can't recover if something bad goes on. I lose data if I lose storage or anything else where my data's not consistently viewed. So lots of different dimensions. And then security, if I'm going to bring all this data together, the last thing I want is bring it all together and let everybody in the world see all my data all together. So security's become a big trend. In our world, the vast majority of our competition is traditional relational technology. The open source companies have gotten a lot of attention in the marketplace, but none of them have the enterprise capability. And you asked the question, how hard is it to harden it? I spent 14 years of my career at Oracle. It took us, I came in the mid-80s when Oracle was the size Markologic is today, and it took till the mid-90s to harden all those enterprise features, look at a chart on Oracle and see when the stock went straight up to the right. It's when mid-90s they delivered Oracle version seven with enterprise capability. We built that in from the founding of the company. It's not an afterthought. You remember I said our founders started out with the idea that says, hey, I'm going to build a search engine for corporate data. So security, availability, the data reliability were all really important. And I think where the market and the CIO had a tough job, a lot of confusion, because there's a lot of new companies and we have the internet that's pervasive way to read about technologies. And so the confusion was, you know, the difference between, a lot of people I think thought big data was social media analytics. I have all this social media data I need to analyze it. And that's confusing because the reality is it's all about all your corporate data and the fact that you're not leveraging your core corporate data. And that's a different problem. That requires enterprise that nobody else has in our market. So Gary, you mentioned, I think it was in a Barron's interview that you feel like Mark Logic is in a similar position from an evolutionary standpoint as Oracle was in the late 80s when you joined. Can you span on that a little bit? What do you mean by that? And talk a little bit about the momentum the company's enjoying right now. I mean, topping 100 million revenue last year. Talk a little bit about the state of the company and why you think it's kind of similar to where Oracle was in the late 80s. Yeah, so it's just, I feel like we're at the tipping point in the marketplace. And so starting out in the marketplace, there was a lot of companies that were getting a lot of noise. They're the ones that you talked about with massive fundraising. I'm talking fundraising and measured in the hundreds of millions. Yeah, 300, $400 million raised by some of our competitors. And they were creating a lot of distraction in the marketplace doing a lot of aggressive marketing, but they weren't fundamentally solving the customer's problems. So if I look at what's happening in the marketplace right now, the vast majority of customers understand that for this complex heterogeneous data, they can't solve it with relational. Open source helped out a lot that all that money poured into marketing educated the market much faster than the Oracle era. Oracle, you had to buy something to learn about it. Today you just download it and learn about it. It's a big difference. So the market's moving quicker. What we see happening in the Mark logic used customer base is the shift from bespoke applications to mission critical applications that are integrated in part of the workflows of the companies that we operate in. And that fits our merits exactly. And we're typically sitting just like Oracle started sitting next to the mainframe. We're sitting right next to the relational databases solving another whole function, but on the same dimension of core mission critical applications. And so it's just a shift in momentum. The number of people coming to us, Gartner Group has us in their leaders quadrant. We're the only NoSQL player there. Gartner serves enterprise clients. We're an enterprise database. We have the features necessary and the growth rates there. So you're right. We went well past the $100 million this year. We're growing over 50%. We have by far the most modern technology in the marketplace. I have a little advantage over almost everybody else in the market. I have a traditional business model. So some of the years and the years of experience doing hardening some of those technologies. Well, and we have a technology that's hardened, but the business model is a big issue. And I think a lot of these open source companies are ultimately they're interesting models. They're searching for ways to monetize it. You know, free isn't the business model last I checked. And oh, by the way, customers today, this is helping us a lot. They don't think of open source is free because they look over and they see how much money they give to Red Hat every year. And they go, well, maybe open source isn't really free. So now it's about solving the business problem. And the economic advantage of MarkLogic is not around the cost of software. It's that we build an application in the fraction of the amount of time. It has about a 10% workload of what I call the DBA tail, the database administrator. Typical MarkLogic customer about 10% of the resources for an equivalent MarkLogic versus Oracle application. And oh, by the way, we run completely on scale at Intel Commodity Hardware. Yeah, we don't run on a proprietary mainframe called a sun machine. We don't run on a very expensive engineered system called an Exadata. Just commodity piece parts, white box, very inexpensive. The other guys have expensive invention, Oracle, you're experienced there, different in different world then now we got cloud, we got open source, we got commodity hardware. Talk about the use cases where you guys are winning out there. And is it more on-prem? Is there migrations of the cloud? Cloud has opened up this notion of agile because what you're talking about is agility and flexibility, but the security nightmare is still upon everyone's mind, right? They are like sitting there, all the customers that we talk to, literally, literally 100%, it's security, security, security, and agile, agile drive top line, which you mentioned. So help, elaborate on the security piece what you guys are doing there, your advantage, and how you think about the agility of what cloud offers and what customers are going to do in the use cases that you're winning and selling into. Yeah, so it goes back on the security front, goes back to our heritage, an early adopter of more logic technology with intelligence agencies. And if you're running intelligent systems, people's lives are at stakes based on those intelligent systems, data security is critically important. If you think about all the disclosures of data and everything else that have gone on, you have to have security. So again, it's one of those features. We built it into our product, it's very granular. In a mark logic world, you only see what you're entitled or authorized to see. In most of our competitors, and this is all the open source providers, you see all the data and none of the data. They do not have granular security. We have very granular security. So it starts with a technology foundation, and then it starts with the question of, well, where do I put the data who has access to it? And we've tried to take a strategy of saying, I'm not going to try to solve that problem. I don't want to get in the religious debate with whether a bank should put their data in the cloud or shouldn't put their data in the cloud. Because then I'm in a religious discussion. Yeah, exactly. And so what we've done with our technology is the agility comes from the speed of which you build the application, the fact you run it on commodity hardware, the fact that you don't have a big administrative change every time you want to do something different with your data, you just ask new questions, just like you do with Google. And you don't change the database every time you want to ask a new question. So that's where all the cost benefit comes from. So then when it comes to cloud, I don't care. Yeah, yeah. We license our technology from a pricing perspective, from a contractual perspective. For you, Mr. Customer, you run it where you want to run it. If you want to run it on premise, that's fine. If you want to run it on physical hardware, that's fine. You want to run it on virtual hardware, we're okay with that. You want to run it in the cloud, public cloud or private cloud, you can do that. You can get MarkLogic for 99 cents an hour on AWS. It's a good business model to have that option where you just run whatever you want, whatever cloud. We just neutralized it. We just neutralized it and said, you have to decide where you want to put your data based on your business requirements. And that's good for customers. So I want to ask you about this idea of not having to redo the database every time you want to make changes. Talk about what that means from a headroom standpoint for customers. Obviously it gives you more range of opportunities, but a lot of these guys are increasing their developer footprint, hiring more to full stack developers. We just saw a survey we published this morning about the kinds of more full stack developers we've ever seen before, AKA cloud. Talk about that aspect of it. So I'm a customer, okay, I got MarkLogic at this benefits. What's the headroom? Air conditioning coming in the future, power windows. What's the kind of functionality you envision coming? Yeah, so we've already added a lot of that functionality. So first of all, we're a database platform. So we give you the integrated stack. We don't leave it to you to build your own stack. So the search engine, the app services database, all in a single integrated platform, all targeting the enterprise. We've gone on to the next generation of things because the vast majority of the competitive landscape, they're trying to add enterprise to a product as an afterthought. And it's really hard. Like I said, it took Oracle, arguably 15 years to harden their enterprise capability. We have it already. It took us years to harden it too. It's just that we started 14 years ago and we've been in the marketplace and we have customer use cases that are very hardened. So we've moved on. We've moved on to bi-temporal capability, a feature in the database that says, I can look back in time and say, what did I know at a previous period of time about that information? Whereas most databases today, you look and you say, well, I know it's in the database today, but I can't look back in time and say, what did I know and when did I know it in a future, in a past period of time? We added semantics capability. You know, the idea that says, I'm going to compliment what's in my database with facts from other databases. So capital markets, a great example. If I go to a typical capital market system, I search for IBM. I find all the articles on IBM, pretty well known company, arguably one of the probably best brand name companies in the world. If I go into that same database and I type in big blue, I don't find anything. But you and I, and most people that are talking about IBM know IBM and big blue are synonymous with each other. In Mark logic with semantics, I search for big blue, I'll give you all the IBM results, even though nowhere in your database does it say big blue. So you got some intelligence in it. I've added intelligence into the database and what we're doing is we're changing the kinds of applications people can build to be much smarter about their data. So I had a chance to moderate a panel with some of your customers earlier and I wonder if you could talk a little bit about, we're here at MarkLogic World, talk about the community, your customers, the event itself and kind of how the community is actually part of the process of evangelizing MarkLogic and kind of helping your business. Yeah, so the community's huge and we're now past 500 enterprise class customers. So kind of up there with, I think where Cloudera is in the Hadoop world, Hortonworks, I think everybody's a little bit surprised, only 233 customers at the time of their IPO. People thought perception, they had thousands, they didn't. Well their revenue was only 23 or 30 million a quarter to 23 million at the time they went public. Right, so we're north of 500 enterprise class customers. I mentioned, and you mentioned the revenue, we're growing over 50%. The reason we're doing that is because we have a loyal following of customers. They're using our products, we're solving real business problems and they keep investing more and more into us. This event, we have 240 customers represented at this event today for the next three days. The conference sold out two weeks ago, we've never sold out the conference before. So the conference is sold out, it's the beginning of the MarkLogic World tour, we'll do this in London and Amsterdam and Washington DC and New York, a few other places. And so it's a great way to start a world tour is with a sell out crowd. And it's all about, if you did a panel, what you find in our community is this loyal following of people solving really meaningful corporate problems with their data, with MarkLogic. And that's our target market. We're not chasing the two guys and a dog in a garage building a website. We're targeting corporations and we have over 500 of them using MarkLogic today. What's the top conversations? We love to talk about, because we love social media, we love to get in the crowd chat, we love to get out there with our tools, track conversations. So I got to ask you directly, what is the top three or five conversations, substantive conversations you have with customers, your people, your employees, partners that are important that you'd like to share with the folks out there in terms of what they should be joining, which conversations to join. So what's your top set of conversations? Yeah, well the conversation I enjoy the most with senior executives in particular is the discussion about the art of what's possible with their data. And what's happened is, companies have collected this massive amount of data, but they're actually not getting very much business value out of it. And so, if I take the insurance, the healthcare payers and the providers both, the way they look at what healthcare.gov did, and we were, as you know, the heart of healthcare.gov, very successful system. It supported 80,000 concurrent users that's at peak this year, 160,000 requests a minute coming from the database. And then I started dealing with the payers and the providers that use that system and supply policies to it. And they kind of said, hey, you've largely commoditized my business through healthcare.gov, right? Insurance kind of commoditized. It's an amazon.com marketplace for healthcare policies. Yeah, that's good. It changes the market. It's good for 11 million people have health insurance that may not have had it otherwise. So that's all good. But now they're looking at it and saying, hey, my business has changed. I said, yeah, but you're sitting on a war chest of data. If you're a provider, the amount of data you have about your patient, and the amount of new proactive services you can offer to those customers is enormous if you could get a single view of your data. But as long as that data is locked up, which is what's happening in most corporations, the data is locked up in data silos and you can't bring it together and you can't consolidate it to get a single view of it. How do you do customer 360 if I have a hundred different systems that touch the customer? How do I do patient 360? How do I even do a better job of running my HR group if 30 systems define my HR database? Well, bring it together. So the art of what's possible is the conversation I love to say, imagine if you had a single consolidated view of all your data and you had a simple, low-cost, easy way to look at that data, no different, free tech search. You can search your data. You can build complex applications on it on the unified view. Imagine what you could do differently with your company if you actually used your data and the eyes just pop. Okay, so that's awesome. Great answer. Second one, technology. What do you get excited about conversation? That's most relevant for you, your company and the customers, technology. What's exciting for you? What's exciting for me might be boring for other people. A schemeless architecture. We've been in the relational model for 30 years which required you to have a stringent schema. And now we've come to the marketplace and we said, forget the schema. Which is like a straight jacket for your data. It's like, I'm not going to let it get out. I'm not going to let it move and I'm not going to allow it to do anything. Totally. And so we're taking the straight jacket off the data. Well, the heart of it and the technology that's most interesting for me is the Achilles heel of the last generation was a schema and we don't have one. So in a funny way, the thing that I'm most excited about is the thing we don't have, which is the schema. So if the straight jacket's the data, then the people who administer the data are an insane asylum. But they're liberated now with the big data. I mean, that's really what's happening. You're seeing transformation. I mean, how would you summarize the whole transformation? I mean, not to be gimmicky and cliche, but there is a transformation going on. How do you talk about that and to a business person saying, hey, hey, I'm sitting here, I'm trying to solve the problem of transforming in real time without disrupting the operations at the same time getting the efficiencies. What's that about? Yeah, so for me, it's about nothing more than says, why did we use all this technology? What was the reason? Go back in history. Why did we build technology? It's to change the experience of change how people do things. But technology, in many respects, it can help you do that or it can be the hindrance to do that. And what this big data initiative and big data movements all about in this next generation database that we're anchoring, which is a huge marketplace, what it's all about is transforming the way you think about your data and what you can do with it. And it's allowing your data and your information in your company to be enabler of your business instead of liability. And otherwise, we were just collecting data. For a long time, we were collecting data because the regulators said regulated industry had to collect data. And they were just checking a box that says, okay, I saved the data for 10 years. Now we're going into those same banks saying, well, why don't you get business value out of that data? Why don't you learn more about the trading behaviors of your customers? Why don't you learn more about the trading behaviors of your traders so you can do trader surveillance and detect fraud? Yeah, so the good news is we've opened up the world for all this data. The bad news is there's a lot of the criminally inspired have been innovative as well. And the reality is you want the business value, you don't want the downside risk and you get both of those with Markology. We got to get to break here but I want to ask you one quick final question. I will always get this in there because the transformation means change. You mentioned healthcare.gov. You've commoditized the business and this is what's happening but the value will always shift. We always talk about that but the personnel conversation always comes up. What's my career path? How do I use my team? How do I configure my resources? What's your anecdotal observation in the industry right now from your experience of what you've seen historically and looking forward? How someone should manage their personnel in the enterprise? Well, there's two ways to look at it and one way is how much labor do you need and if you're adopting new technologies hopefully your labor pool can get a little smaller. It's a huge cost and oh by the way there's a shortage of people to do it. So it's one of these where we're not taking jobs away we're reducing the workload down to a manageable workload but if I'm managing my employees I want to know everything about my employee and the employee managing employees and career paths is no different than managing healthcare policies in a marketplace or managing a 360 view of the trader or the customer. If my data is locked up in 30 different HR databases how do I know who you are? And so if I'm the executive and I'm managing you and I can't see all the dimensions of you what do I do with that? From a technology perspective it's embraced the future the market's shifting and I think a lot of people there's still people doing mainframe programming 30 years from now there'll be people doing Oracle programming but it's gonna be much more exciting if you get on the innovative wave and you ride the wave of the new technologies and that's where the skills are gonna be most in demand. Gary Bloom the CEO of MarkLogic here inside the cube we're live in Silicon Valley in the Bay Area for the MarkLogic World 2015 it's the cube instructing the central noise we'll be right back with more coverage wall to wall all day after the short break.