 From around the globe, it's theCUBE with digital coverage of AWS re-invent 2020, sponsored by Intel, AWS, and our community partners. Everyone, welcome back to theCUBE's live coverage of AWS re-invent 2020. I'm John Furrier, your host. We are theCUBE virtual. We're not there in person, we're remote this year, and we're excited to cover three weeks of wall-to-wall coverage. It's virtual events, so they're doing it over three weeks. We're in week three, day two, and if you're watching this live on the platform tomorrow Thursday at two o'clock, Andy Jassy will be live here on theCUBE with one-on-one with me to address all the hard questions. But here we're doing day two of week three analysis with Jeremy Burton, industry legend, entrepreneur, now the CEO of Observe, Inc., formerly the CMO of Dell Technologies, before that EMC, he's done a variety of adventures, seen many ways of innovation. Friend of theCUBE, Jeremy, thank you for coming on. Yeah, my pleasure, great. Always great to be on theCUBE. Great to have you on, in particular, because yesterday, Werner Vogels talked a lot about observability, and I noticed you got your Observe shirt on. Observe, Inc., is your company's name, which is one of the many hot startups around observability where you're making a business out of basically what he talked about yesterday. And in today's keynote, you had the extended cloud edge applications that Bill Vass, who leads up both edge and quantum. And then you had Rudy Valdez, who talked a lot about evolution of cloud architecture. And of course, you finally had David Richardson, who is the VP of serverless. So you got edge, quantum, serverless architecture, speaks to the sea change, Jeremy, and you have a good read on these big waves. When you look at serverless and then quantum, you look at edge, which is data, and you look at all this coming together on their architecture. Werner's keynote yesterday kind of makes sense. It's a systems architecture, and this new observability trend isn't like a point product, it's a broader concept. You have a complete rethinking of distributed computing in the cloud. This is kind of what this Amazon feels like. What's your take? Yeah, it's a good observation. The sort of punchline is that people are building applications differently. So the technologies that people are using to build apps are different. The way in which they build applications is different. The way folks release codes into production is different. And it stands to reason, therefore, you're going to need a different approach when you want to troubleshoot these applications, or when you find out what issue, or when you want to find out what issues customers are having. So what we felt a couple of three years ago when we started observe was that a new approach was required, what you're going to need to monitor your application in 2020 is not the same as what you needed in 2015 or 2010. We felt very strongly that this new wave was going to be called observability. It brings a tear to my eye to hear Averna talk about it because as much as we observe, believe that we can do big things in future, it's the big vendors today that can move markets. And so to hear Amazon and Averna in particular talk about observability, I think it lends more credence to the topic. We think that organizations should have observability teams. We think there should be a head of observability. And again, you know, Amazon endorsing this, I think means that there's a much stronger chance that that's going to happen. And they're going to start to shine a light on, I think a topic that almost everybody needs to pay attention to as they build their next generation of applications. When you guys, I know you guys are launched and you have a couple of paying customers now and growing rapidly, well-funded. Got some great investors that found the investors of Snowflake also invested in you guys. So they see this cloud, try to see Snowflake when public and I know you're on the board of Snowflake as well. So you know a little bit about what's going on with Amazon and the opportunity. When you look at observability, okay, you're building a business around it. And again, you think about head of observability. That's not like a small thing when you put someone in charge of something. So why do you say that? I mean, what, I mean, you know, some would say, you know, hey, it's a feature, not a company. I mean, this is two mindsets that are different. How do you address that? Yeah, the thing I'd say is look, the number one job in America is a software engineer is writing code. The number two job is fixing it. And so, you know, the job, think about that for a second, the job of fixing our applications is almost as big as the job of creating our applications. Something has to change, right? I know the job of fixing cars is not as big as the auto industry. Why? Because over time, that industry is matured and there are better tools to, you know, diagnose cars. And so they become easy to fix over time. We've not made that leap with our applications. The tools that the engineering team used to debug and troubleshoot their application are often still very different to what the DevOps team is using, which is very different to what maybe the SRE team is using. And so it's a huge problem in our industry, really not been able to diagnose and troubleshoot issues when they arise. It costs the industry a fortune. It costs, you know, sort of in direct wasted productivity of development teams, but it also costs in terms of customer experience. I mean, you and I both know is, look, if we're having a bad experience with maybe a new service that we're trying out online, we're probably going to go somewhere else. And so there's never been like a more important time for people to invest in observing the entire environment, the entire customer experience. Not only will you have happier customers, you might actually reduce the costs and improve the productivity in your engineering team as well. So I feel like the opportunity there is vast. I also think longer term, it doesn't just apply to troubleshooting distributed applications. I think the security systems are very related to the way we build software. I mean, I think in the news in recent days, we've become attuned to software defects or malware in software, causing breaches in government agencies. Hey, that could be anybody's software right there. And so security has got a role to play in observability and the customer experience, it doesn't stop when they have a bad experience on the website. What if they complain? What if a help desk ticket gets... How do you track that out straight? Yeah, I have a lot of questions for Jassy tomorrow. One of them I'm going to ask him and I want to get your thoughts on it because you brought that up. And I think it's a key point. Building applications and supporting them and fixing them kind of reminds me of the old adage of you got to run IT, running the operation, 70% of the budget is using to running IT. If you look at what's happening and if you talk to customers, and this is what I'm going to ask Jassy tomorrow, Werner actually talked about day two operations in his keynote. I mean, this is Amazon, they're targeting builders. And so I talked to a few other entrepreneurs who have growing companies and some CIOs and CEOs. And the basic enterprises, they don't want to be building things. Like that's not their DNA, they don't build things. Like that's not what they do. I mean, first of all, I love the builder mentality and with Amazon, but they might be at a time where there might not be enough builders, Jeremy, right out there. So you got skills shortages and then ultimately our enterprises really builders. Yeah, they'll build something, but then they just run it. So at what point do they stop building or they build their own thing in the cloud and then they got to run it. So I think Amazon is going to shift quickly to day two operations, yeah, build, build, build, run, run, run. Yeah, that's a great topic of conversation. I think what you sort of poking out is sort of the maturation of this digital age in the state that we're at. I mean, if you go back to 10, 20 years, I mean, look at the mid-90s, there were a lot of people building custom applications, right? I mean, IT was innovation. It was all about building custom apps. And I think that golden era of application development is back there now and customers in order to get competitive advantage, they are building their own applications. When you talk about digital transformation, what does that mean? Well, it means often a traditional company building a new digital experience for services that they've potentially offered in a physical way in the past. So make no mistake, people are builders or they are writing code, they are becoming digital. I think what you'll find at some point as the industry's mature, some of these digital experience has become packaged. And so you can buy those off the shelf. And so there's less building required. But I think as we sit today, there's probably more code been written in anger by more organizations at any point in the last 30 years. And I think this is another reason why observability is so important. As you're building that code and as you're developing that customer experience, you want to be able to understand where the issues are. And like along the way, you don't want to wait till there's a big customer disaster on the day of you roll that something to production before you start investigating, you want to do that as you go. Yeah, and I think that's a kill, I do agree with you by the way, I think there is a builder mentality, but it's favorite. But remember those days back in ITs, if you want to put our time machine hat on and go through the time machine is, that was during the mainframe client server transition and it was called spaghetti code. It's like the monoliths were built and then they had to be supported and that became legacy. So, and I kind of see that happening today where people are moving to the cloud, they are building, but at some point you got to build your thing in the cloud. If I'm a company, again, this is some DOS I'm trying to connect in real time, I got serverless, which is totally cool. We have Quantum as headroom for compute. I'm going to have kind of a SOA server oriented architecture with web services and with observability. I'm going to have all these modern apps, great. Yeah. They got to run them. And now I've got to shift to multiple clouds. So, you know, maybe the private cloud waves coming back, you're seeing telco clouds. You started to see these new tiered, I won't say tier two clouds, but people will build their own cloud environment. There's no doubt it's going to the cloud. And Steve Mulaney at Aviatrix kind of made this point yesterday in his analysis where he's like, he thinks private cloud will be back. It'll just be public cloud. People will build their own clouds and run them. Yeah. I feel what happens over time is the sort of line above which you would add value rises. So I kind of feel like, look, cloud is just going to be the infrastructure. We can debate private cloud, public cloud. Is it a public cloud or is it a private cloud served up by a public cloud provider? My view is, look, all of that is just going to be commodity. It's going to be served up for an ever decreasing cost. And so then it's incumbent on organizations to innovate above that line. And 20 years ago, we built our own data centers and now increasingly that seeming like a crazy idea. Now you can get almost all of your infrastructure from the cloud. The great thing is, I mean, look at Observe, we have no people running data center operations, none. We have no people building a database, none. We use Snowflake in the cloud. It runs on AWS. We have one DevOps engineer. And so all the people in the company right now are focused on adding value, helping people understand and analyze data above that line. And we just pay for a service level. And look, as time goes by, there's going to be more and more services and that line is going to rise. And so what I care about, and what I think a lot of CEOs care about is are most of my resources innovating above that sort of value creation line. Because that's what people are going to pay for in our business. And I think that's what's going to represent sort of value add for organizations big and small. You know, that part of a good point. I want to shift to the next topic and then we'll get into some observability questions I have for you and update on your company. Complexity has been a big theme that's come out of all the conversations with analysts that have come on theCUBE as you hear it with Amazon. A lot of undifferentiated heavy lifting extracted away to your point about value layers and competing on value. Amazon continues to do that, all great stuff. But some are saying, and we had said on theCUBE, yes, two days ago, you put the complexity behind the curtain, it's still complexity, right? So complexity with the edge is highlighted. You know, they got green edge core or green grass, which is core thing, IoT core. A lot of cool things happening, but it's still not yet super easy. So complexity tends to slow things down, became description, what's your view on this? Because taming the complexity seems to be a post COVID pandemic mandate for cloud journeys. What's your thoughts? Yeah, I totally agree. I think in certainly, you look organizations that have been in existence for 30, 40 years or maybe even 10 years. Look that there's an amount of technical debt and complexity that you build up over time. But even newer companies, the way that people are building modern distributed applications in some respects is more complex than in days gone by, you know, microservices, some of which maybe you own, some of which maybe you don't. And what you've got to be able to do is see the big picture. You know, when is something in my code, but then when am I making a call out to maybe a third party microservice and that microservice is bailing out at me? Like people have got to see the big picture. And I think what hasn't been available as people have changed the architecture and their applications, there hasn't been an equivalent set of innovation or evolution in the tools that they use to manage that environment. And so you've got this sort of dichotomy of a better way for software developers to write code and deploy it into production, microservices, but at the same time, you don't have good information and good tools to make sense of that complexity. That's great stuff, Jeremy Burton is here. He's the CEO of Observe, Inc. Cube alumni, VIP Cube alumni, by the way, has been on the Cube every year since the Cube has been around 2010 when he took the new job as the CMO of EMC prior to being bought by Dell. Jeremy, you're a legend in the industry, certainly as an executive and a marketer and as an entrepreneur. I got to ask you Observe, Inc., your company now. You're right in the middle of all this. You got a big bet going on. Could you share in your opinion, your words, what is the big bet that you're making with Observe, Inc. What are you betting on? How do you see the preferred future unfolding and where are you guys going to capture that value? Yes, our big bet here really is to take a new approach in terms of enabling people to observe their systems. The term observability actually goes back to a guy in control systems theory in the 60s. And it's got quite a simple definition, which is being able to determine the, I've been able to diagnose a system by the telemetry data that it emits. So let's look at the external outputs and then based on that, can I determine the internal state of the application? And so from the get go, we felt like observability was not about building another tool, right? We're not, you know, it's not about building another monitoring tool or logging tool. It's about analyzing data. And I was struck many years ago, I spent a bit of time with Andy McAfee from the CSAIL lab at MIT. And he made a statement that I thought at the time was quite profound, which he said, look, everything's a matter of data. If you have enough data, you can solve any problem. And that stuck with me for a long time. And, you know, observe really what we do is we ingest vast quantities of telemetry data. We treat everything as events and we try and make sense of it. And the economics of the infrastructure now is such that is you truly can ingest all the telemetry data and it's affordable, right? I mean, one of the wonderful things that Amazon has done is they've brought you, you know, very cheap affordable storage. You can ingest all your data and keep it forever. But now can you make sense of it? Well, you know, compute is pretty cheap these days and you've got amazing processing engines like Snowflake. And so our sense was that if we could allow folks to ingest all of this telemetry data, process that data and help people easily analyze that data, then they could find almost any problem that existed in their applications or in their infrastructure. So we really set out to create a data company which I think is fundamentally different to really what everybody else is doing. And today we're troubleshooting distributed applications but I think in future my hope is that we can help people analyze almost anything around their applications or infrastructure. And what's the use case problem statement that you're entering the market on? Is it just making sure micro services can be deployed? Is it Kubernetes? Is it managing containers? Is there a specific customer adoption use case that you're focused on right now? Yeah, we've tried to target our ideal customer, if you like, has been the three or 4,000 SaaS companies. We're really focused on the US right now but three to 4,000 SaaS companies predominantly, obviously running on AWS, often the Kubernetes infrastructure, but people who are having a hard time understanding the complexity of the application that they've created and they're having a hard time understanding the experience that their customers are having and tracking that back to root cause. So really helping those SaaS companies troubleshoot their applications and having a better customer experience. That's where the early customers are. And if we can do a good job in that area, I think we can over time start to take on some of the bigger companies and maybe some of the more established companies that are moving in this digital direction. Jeremy, thanks for sharing that. And I got one last set of questions for you around the industry. But before I get there, give a quick plug for Observe. What are you guys looking to do higher? I mean, give a quick PSA on what's going on with Observe. Yeah, so the company is now rough and tough about three years old. We've got about 40 people. We're well funded by Sutter Hill Ventures. They were the original investors in Snowflake. And yeah, I mean, we've more than doubled in size since the COVID lockdown began. We had about 15 people when that began. We've got almost 40 now. And I would anticipate in the next year we're probably going to double in size again. But yeah, really the core focus in the company is understanding and analyzing vast quantities of data. And so anybody who is interested in that space, look us up. Looking for mainly any areas, obviously engineering, any other areas they'll come for openings. Engineering all over. I mean, as you'll see, if you go to Observing.com, we've got a pretty slick front end. We invested very early on in UX design. So we believe that UI can be a differentiator. So we've got some amazing engineers on the front end. So can always do with the help there. But obviously, there's a data processing platform here as well, we do run on top of Snowflake. We do have a number of folks here who are very familiar with the Snowflake database and how to write efficient SQL. So front end, back end. We very soon, I think we'll be starting to expand the sales team. We're really starting to get our initial set of customers and the feedback loop rolling into engineering. And my hope would be probably early part of next year we really start to nail the product market fit. And we've got a huge release coming in the early part of next year where the metrics and alerting functionality will be in the product. So yeah, it's all systems go right now. Congratulations, love to see the entrepreneurial journey. We'll keep an eye out for you and you're in a hot space. So we'll be riding, you'll be riding that wave. Question for you on the, just kind of the industry. You're in the heart of Silicon Valley, like I am. Obviously I'm Palo Alto, you're up in the Hillsborough area. I think you're in Hillsborough, right? That's where you live. San Francisco, the Valley, the pandemic, pretty hard hit right now. People are sheltering in place, there's still a lot of activity. What are you hearing in the VC circles, startup circles as everyone looks at coming out of the pandemic? And you look at Amazon and you look at what Snowflake has done. I mean, Snowflake was built on top of Amazon competing against Redshift. Okay, they were hugely successful at doing that. So there's kind of this new playbook emerging. What are people talking about? What's the scuttle button? Yeah, I mean, clearly tech has done very well throughout what has been just a terrible environment. I think both kind of socially and economically. And I think what's going on in the stock market right now is probably not reflective of the economic situation. And I think a lot of the indices are dominated by tech companies. So if you're not careful, you can get a little bit of a false read. But look, what is undisputed is that the world is going to become more digital, more tech centric than less. So I think there is a very, very bright future for tech. There is certainly plenty of VC money available. That has not really changed materially in the last year. So if you have a good idea, if you're on one of these major trends, I think there is a very good chance that you can get the company funded. And our expectation is that next year, obviously industries are going to return to work that have been dormant maybe for the last six or nine months. And so some parts of the economy should pick up again. But I would also tell you, I think certain sort of habits are not going to die. I mean, I think more things are going to be done online. And we've gotten used to that way of working. And you know what, not some of it is miserable. I don't know about cocktails over Zoom, but working with customers in some respects is easier because they're not traveling. We're not traveling, so we both have more time. It's sometimes easier to get meetings with people that you would never get. Now, can you do an efficient sales process, education, proof of concept? Those processes maybe have to grow up a little bit to be taken online. But I think the certain parts of the last maybe six or nine months that we don't want to throw away and go back to the way we were doing it because I think maybe this way of doing it is more efficient. What do you think about the entrepreneurial journeys out there? Obviously, Amazon, we're here covering re-invent is really kind of building a massive compute engine. They got higher level services. And I've been speculating for years, I think Snowflake is the first kind of big sign that points to kind of what I said five years ago, which is there's going to be an opportunity for these other clouds, specialty clouds, I called them. Not to be the wrong word, but Snowflake basically built on top of Amazon and most valuable company ever on the Wall Street IPO on someone else's cloud. So is that a playbook? I mean, is that a move? I mean, this is kind of like a new thing. Do you take the chance? I mean, I feel like on databases, I've got a lot of history. I mean, it's an Oracle almost 10 years. And what Snowflake did was they re-architected a database explicitly for the cloud. I mean, you can run Oracle on the cloud, but it doesn't do things the way that Snowflake does it, right? I mean, Snowflake uses commodity storage. It uses S3, it's elastic. And so when you're not using it, you're not paying it. And these things sound very simple and very obvious now, which is I think what the genius of the founders, you know, Benoit and Thierry were. And I think there will be other categories of infrastructure that will get re-architected and reinvented for the cloud. And, you know, have got equally big opportunities. And so, yeah, I mean, I think the model, I believe firmly that the model is if you're a startup, you don't need to waste a lot of time like reinventing the wheel on data center infrastructure and databases and a lot of the services that you would use to construct an application. You know, you can start, you know, if the building that you're trying to build is like 12 floors, you can start at the eighth and ninth floor, you know, I've got like, there's what, three or 400 quality engineers at Snowflake that are building our database. I don't need to do that. I can just piggyback on top of what they've done and add value and, you know, the beautiful thing, you know, now if you're a business out there thinking of becoming digital and reinventing yourself or you're a startup just getting going, there's a lot of stuff you just don't have to build anymore. You just don't even have to think about it. Yeah, this is the new programmable internet. It's internet truly 2.0 or 3.0, whatever, 4.0. A complete reset of online. And I think the pandemic, as you pointed out on many CUBE interviews and Andy Jassy sent his keynote, is on full display right now. And I think the smart money and smart entrepreneurs are going to see the opportunities and... Yeah, it comes back to ideas and a great, I mean, I've always been a product person, but look, a great idea, a great product idea and a great product idea that capitalizes on the big trends in the industry. I think there's always going to be funding for those kind of things. I don't know a lot about the consumer world, I've always worked in B2B, but the kind of things that you're going to be able to do in future, I mean, think about it, if storage is essentially free and compute is essentially free, just imagine what you could do, right? And that's what we're going on. Jeremy, enterprise is the new consumer. Get out, let's understand that. Let's, finally, B2B is the new consumer. Enterprise is hot. I was, again, I was riffing on this all week. All the things going on in enterprise is complex, is now the new consumer. It's now all connected. It's all one thing. The consumerization of IT, the consumerization of computing has happened. It's going on. So you're a leader. Thank you for coming on. Great to see you, as always. Say hi to your family and stay safe. Yeah, you too. Thanks for the invite. Always, always a pleasure. Jeremy Burton, breaking down the analysis of day two of week three of reinvent coverage, John Furrier, we're the cube virtual, we're not in person anymore. Virtualization has allowed us to do more interviews, over 110 interviews so far for reinvent. And tomorrow, Thursday at two o'clock, Andy Jassy will spend 30 minutes with me here on the cube, looking back at reinvent, the highs, the lows, and what's next for Amazon Web Services. I'm John Furrier. Thanks for watching.