 Live from Anaheim, California. It's theCUBE, covering Nutanix.next 2019. Brought to you by Nutanix. Welcome back to theCUBE's live coverage of Nutanix.next here in Anaheim, California. I'm your host, Rebecca Knight, along with my co-host, John Furrier. Here we are, we're at day two, John. This conference, I got to say it's pretty cool. 6,500 people were steps away from Disneyland, and you go to a lot of these things every year. I also do about a dozen or so for theCUBE. So in other words, we're veterans of this kind of thing. This does seem to have a different vibe, and I think it really gets to the kind of company Nutanix is and where it is in its journey. Nutanix is still a small company, even though they're 10 years old, as Dheeraj talks about, the numbers aren't massive. I mean, we go to a lot of other shows where it's 15,000 Amazon Web Services just had an event in London. Dave Vellante was out there covering. Stu was covering Red Hat Summit in Boston this week. Tons of events going on. Amazon Web Services Summit in comparison was 12,500 people, 22,000 registered. That's a summit in London. It's not the re-invent main conferences, like 30,000 people, and that's always sold out. So they got a lot, in terms of attendees numbers, they're still in the kind of the entry level, mid-range kind of growth. But I think that's okay. They like that culture. And I think this story here at this show is intimacy. They would rather err on the side of better content and more intimate opportunities for their customers to really get the straight scoop. And I think less of a conference slash trade show, more of an intimate relationships where they can provide feedback for customers to get feedback. And for Nutanix to kind of figure out with the customers how to connect to them. So I think the story here is Nutanix is growing up as a company. They're 10 years old and they got to go to the next level and the management team has technical chops and they have a long-term view and they have that 20-mile stare. They look, they can see out and they're trying to figure it out. I still think that the numbers are light on their forecast. I still think that there's some sandbagging going on there. I'm not saying they're sandbagging, but I mean, I think you look at essentials, which is the enterprise and then multi-cloud. The numbers that we're seeing at Wikibon are much bigger and Amazon reflects that. So I think they're being cautious, but smart about how they execute off their success they've had in the first 10 years to go the next 10 to 20 years. And I think that's clear in the management team that they want to build a durable company. Well, exactly. And I think that that's what's really coming through is that this is, as you said, they're growing up. This is a real coming-of-age moment for them. They've celebrated the 10 years. Okay, so what kind of company are we? Who do we want to be? And what's coming through is that from the technology side, they get it. They say, I'm sort of reminded of the Henry David Thoreau quote, our life is frittered away by detail. Simplify, simplify, simplify. That's what customers want. They want this one-click data recovery. They want their credentials to be assumed. You know who I am. I'm safe to be in here fixing things, making, dealing with that. So I think that they get that, that simplicity is key. They also get customer service. I mean, their net promoter scores, as we've noted, are in the 90s. That's just unheard of. It's monster, monster numbers. It really is. And so they get it. We need to be responsive to customers. We need to have a personal relationship with these, because it's not just organizations. It's people at the other end of these transactions. I mean, I think Nutanix, one of the stories that's popping out in the hallways as they kind of walk around and talk to customers and people and the company and partners, is that Nutanix has a lot of headroom in their growth. I think Wall Street is interesting and you heard D. Raj talk about that yesterday about having a new customer. You asked him about his management style and he said, quote, I have a new customer called Wall Street and I have to balance that against Main Street Enterprise, which is his core business. And so he is a CEO and the company are dealing with this new stakeholder called Public Company Customer Retail Stock Buyers. That's a short-term cycle. And I think if you look at their stock, they had a big knife edge drop in past quarter and I think the shorts are circling. It's a whole nother dynamic. It's a whole nother theater for Nutanix to deal with and I think that's something they got to get used to. And he was clandy, so I'm addressing it. We're going to balance it, but they got to be thinking long term because this company has a lot more to do and their customer base are risk takers because everyone we talk to has this different kind of style or persona. They're smart. They're usually engineering oriented. They love engineered solutions and they're taking chances. And everyone who's taken the chance with Nutanix has paid off. That seems to be the theme. And as we were talking before we came on camera, Mark Hamill, Jedi Knight, you know, Star Wars was on stage giving the keynote. Their customer base is a lot like, you know, the Jedi in order, right? I mean, they see themselves as, you know, elite technically. They're not afraid to take organizational risks and push that DevOps culture. And we heard that from Sonia, the chief product officer that they're really looking at this kind of new way to do things like they did with hyperconvergence. They pioneered that, set the table on that and foundationally built that. They want to take that same playbook of HCI hyperconverge infrastructure and apply it to the cloud and provide an abstraction layer advantage. And I think that is clearly their strategy. And that's the top to me, the top story here. I couldn't agree more. And I also think that what is also coming through is this idea of we don't want to be safe. What's clear is that consumer technologies have leapfrogged IT enterprise vendors. The things that we hold in our pockets are so much more sophisticated than what businesses and organizations, multi-billion dollar businesses and organizations are using what their employees are using on a day-to-day basis. So we expect a certain kind of design and ease of use in our personal lives and why they're bringing it to enterprises. And I think that that is really what's exciting and interesting about this. What's interesting about their story is that the consistent theme about the customers is that it's kind of a consolidation story, but that's not the real story because back in the old days of IT, consolidation was the strategy. Consolidate vendors, consolidate footprint to reduce costs, clearly a cost reduction. With Nutanix, what they get is they get consolidation and they enable advantages. So the real value of Nutanix is to be positioned for those new kinds of app developers. So you get consolidation as a side benefit for enabling the value, and that's the theme that's coming out of all the customer testimonials and interviews is, we got to do more. We got to create more enablement for the app developers and we got to provide more performant storage, servers and software for the customers. And that's their main focus and they get the consolidation as a benefit. That's going to scare a lot of people and customers that I've talked to said, hey, I got all this stuff but I can't just throw it away tomorrow. I got to move it out of our time. So this is the Nutanix sales challenge. How do you move faster with all that incumbent legacy stuff in these data centers while enabling the multi-cloud capability? And we're going to be talking about that more today with Chris Cadaris on the show. We have a lot of great guests. We have the CIO, Wendy Pfeiffer. I was reading an article about her today. She answered an ad as a teenager to work for NASA. She had an idea for NASA and so we're going to hear much more about her story. We've got a lot of great guests. Well, what's your take? I mean, you've been here, you're getting immersed in. What's your take of the show? What's your analysis? Well, what's really interesting to me is that we're having these conversations against this backdrop where the technology industry is really under fire. I mean, we heard Diana Howard here on the show yesterday and then she was up on the main stage today talking about the good, the bad and then the really scary elements of AI and how it really has these powers that can do a lot of wonderful things and help children with special needs and help workers be more productive and engaged and collaborate. But yet, there is also this much darker side that AI is really only as good as its creators and then the other difficulty is that because we have become so trusting of these machines, we disregard our own intuition and that is a really scary element. So what I think is exciting, and it goes back to this risk-taking mentality that Nutanix has is we're going to talk about these things. We're not just going to forget about them or they're going to be a sideshow. This is really on the main stage. Let's talk about our values. Let's talk about the humanity of technology and this is really an important part of the conversation. It's interesting the culture. We talked about the culture a lot yesterday. You can see from the mix of the guests we've had here and how they're putting their content together across the show portfolio. It's not just speeds and feeds. There's a lot of tech for good kind of angles but they're not tech for good stories. Like, hey, look at this. Here's a tech for good story. Look how good we are because we promoted it. They're authentic people that have a great story that has a tech involvement but it's not a pure Nutanix messaging kind of thing. Right and it goes back to their values, the humble, hungry, honest and have a lot of heart. I mean, I think that that is, you really see how important culture is when it is top down. When dirage embodies certain characteristics and traits, you see that employees then look up and they say, okay, this is what we're about. This is who we are. You know, we also talked yesterday about our analysis in the keynote. What's interesting about culture is there's also a culture shift going on inside their customer base and against back to this kind of the Star Wars team, Jedi Knights and the revolution kind of continuing for Nutanix, their opportunity is to continue to stay on the course and this is going to be a big bet for them. They got to make some big bets on the technology side which they're making but also they have an opportunity because a lot of their installed base are rebels, right? So you have this rebellion kind of IT guy, generational shift where you have DevOps coming in and Gene Kim who's wrote the book on DevOps runs the biggest DevOps event in the world. Series of events, DevOps Enterprise Summit. He's even saying it's about 3% changeover. So I think there's a big tailwind coming for Nutanix around DevOps, operating models in the enterprise and cloud where the convergence of those two worlds coming together and it's going to be a younger generation. It's going to be a different world. If that happens, I think that's going to be something that Wall Street might not see. I think that's kind of an area and that's going to be a good tailwind for Nutanix. The other notable thing that I would point out from this show is the presence of VMware visibly in the conversation. And I think D. Raj was talking about, hey, we don't mind talking about VMware because they validate the marketplace. They're the big 800 pound gorilla and we're going to continue to innovate around them. We don't need their hypervisor. Customers don't need to pay the V-tax. That's his messaging. So that was a key notable. The other one was the challenge that Nutanix has and this is again, it might be a Wall Street insight for some of the Wall Street folks out there is that their challenge has been getting new logos. Their cost of sales is a little bit high because they require POCs and once they get in there, they usually win. And then their cost per sales, cost per order dollar on the sales side once they have a customer is very low. They get more renewals and they have more net contract values. They have great customer economics on that side. The Eulah Packard Enterprise deal for them could bring them a tsunami of new logos. That could give them a lot of leverage and bring their customer base well above their 12,000 number now and bring them up into a whole nother level. So I think the HPE deal will be a tell sign on the numbers and if they can get more new logos in there, the big accounts that HPE has through their channel that's a big story. So VMware, HPE, Culture, all the main story here. And of course we had HPE on the show yesterday talking about that very development. So we have lots more great content, great guests to come today. This has been just a ball hosting with you. So I'm really excited for another day. New Tenants are very intimate show. They don't really care about the big numbers. They want the right numbers and that speaks to their culture. And they know their people because as we've talked about many times, Mark Hamill up on the stage yesterday. So they know their community. Please stay tuned for more of the coverage from theCUBE of Dot Next here in Anaheim. I'm Rebecca Knight for John Furrier. Stay tuned.