 Good evening everyone, it's happy hour and the cube is still going so I'm going to call this cube after dark. Lisa Martin here with Rob Stretch A. We're at HPE Discover. This is the rounding out day two of our coverage of Discover 2023. We've had a lot of conversations about green lake as you know, because you've been watching. Rob, we're going to be talking about you're kind of a green lake OG. Well, I was there when it started back under Meg Whitman and when actually the element which is the green thing for people who don't know what that's actually called but was actually brought out. So yeah, this is all fun. It's like going home again when I come to Discover. It is and it's been an evolution from a financial services perspective as well. We're very pleased to welcome Michael Swan, the VP at Hewlett Packard Enterprise Financial Services or HPE FS as you're going to hear us refer to it. Michael, it's great to have you on the program. Thanks for coming. Yeah, thank you so much. There's literally nowhere else I'd rather be at this moment than with you two. Well thanks because we know their party's going on already. Exactly. We appreciate that. So talk to us a little bit about HPE financial services. What are some of the things going on? I know there's been some news and we want to get into green lake but give us that high level story. Yeah, well, HPE financial services is traditionally kind of that captive IT financing company but our business just like the rest of HPE's business has really transformed over the last several years as the whole IT landscape has transformed and now increasingly we're positioning ourselves as more of an IT asset life cycle management company who also happens to be really good at providing IT investment solutions for our customers too. When I hear life cycle management the sustainability word pops into my head. It does, it does it great, perfect. Yes, and you guys just had, I was just looking at my notes here, made some HPE has made some announcements around the sustainable IT portfolio. Talk to us about that. Yeah, so the most recent announcements that we've made, one is with our HPE asset upcycling services offering which we have had available for a number of years now and that offering really is tailored at helping customers manage the ultimate disposition of legacy IT equipment that they no longer really have a need for in their environment and so HPE FS has the ability to take that equipment out, remove any confidential data from any of the storage devices and then ensure that it's managed in the most environmentally sound way that we can. Ultimately what we're aiming to do is drive reuse before recycling. So we're looking to put that equipment back into use with another customer or back into the circular economy as we oftentimes refer to. We've just announced an enhancement to that program now which will enable our customers rather than receiving payment for those products, we can direct the payment to a charity of their choice to a non-profit, a non-governmental organization like WWF for example or really there's multiple different charities that we've identified that they can donate those funds to is another way of kind of layering on more goodness to the offering. Yeah, I think that's super interesting that you got to the upcycling part of it because I think that's become really huge and I think that was part of the announcement was talking about how it's not just taking a whole servering and taking it somewhere else, it could be components and different pieces and in some cases it's not even your own HPE gear, correct? Right, that's correct Rob. So we always have been a multi-vendor provider whether it be the financing of infrastructure for our customers or managing the asset disposition of equipment will service all vendors IT equipment and we do that because that's what's in our customers data centers, right? It's multi-vendor and another point you made Rob around the systems themselves sometimes we will keep those systems whole, right? If that's where the most value is in that product but oftentimes we do find ourselves kind of breaking down those systems into the sub-components. One of the things that enables for us is the testing of those systems so we can ensure that they're operating at their original specifications, they meet the quality that we want to put back out to our customers and it's also a way of testing that there's nothing in there that's counterfeit. And then what we'll do is we'll put those systems back together, we'll reconfigure them to be the solution that our customer, our next customer is looking for as we put that back into the circular economy. Talk a little bit about HPE financial services role in the pivot to Greenlake a couple years ago, we've seen so much progress with Greenlake, a lot of announcements came out yesterday, a lot of unpacking with Fidel Mariso, CTO on stage today but talk about the role that HPEFS had in that pivot a few years ago. Well, interestingly enough like Rob said we've been there since day one, HPEFS has been part of HPE Greenlake and formerly known as flexible capacity services, literally from the very first deal that we did in the Netherlands. And the way I like to talk about our role in HPE Greenlake is that we're both the financial as well as the asset management engine inside of Greenlake. We're really what enables customers to be able to pay for infrastructure as a service, pay for it as they go, as they need to over time. It's because HPEFS is providing the funding source for the infrastructure so the customer doesn't have to pay for that themselves. What we're starting to see that's, I would say increasing in importance for our customers is more of the sustainability angle around HPE Greenlake. So what we're seeing is that oftentimes our HPE Greenlake customers are already operating an application or a workload on legacy infrastructure. And they've made the decision, they want to move away from that paradigm owning and managing and operating the environment themselves to more of a cloud-like experience and as a service type of experience. And when they move to HPE Greenlake, HPEFS can help them in transitioning from that legacy environment to the new HPE Greenlake environment. Is that what you see as one of your major differentiators? There's a couple of things embedded in that. I would say yes, definitely. In the sense that we will actually help customers monetize that existing infrastructure that they have in place and we can do that in two ways. One is through our asset upcycling services that we spoke of earlier. And the other is actually taking existing infrastructure assets that are operating business critical applications for the customer today and we can actually convert those into an HPE Greenlake device. And we've done this with a number of customers. There was actually one that we featured in one of our talks yesterday by Jenny Marineros. We talked about Prisma Health. Prisma Health is the largest non-profit healthcare organization in South Carolina. And they, like a lot of enterprises, were facing increasing costs in managing their environment. You're struggling with never having the right amount of capacity on premise or skyrocketing costs in the public cloud. And just facing that challenge and trying to figure out, okay, what do we do? And they decided to pivot to HPE Greenlake. And as part of that pivot, they actually, what we identified is they had some existing infrastructure assets that were relatively new. We really couldn't see a reason why we would replace those. So we said, let's leverage some of that infrastructure that's in place. We're going to supplement it with some new infrastructure on top of that. But what that does is it's a way, you can literally, it's like flicking on a switch because the system's already in place and operating. We can immediately convert that into an HPE Greenlake asset. And at the same time, we're monetizing that assets. We're freeing up the equity value in that. And we're giving that value back to the customer. So it helps to fund their transformation. You're giving them that visibility. You're coming in and really looking at the infrastructure as a whole in terms of what they have, what they're trying to accomplish. What some of those main points are. How can we optimize what they have in place? The optimization is key. I'm just curious a little bit about the go-to-market model with like HPE sales folks and partner sales folks. Is that, how does that work? So if a sales guy or a gal wants to go in there and upsell all these things, how do you guys get involved in saying, let's really peel the layers of the onion to make sure we're helping this customer maximize their investment. That's a great question. So HPEFS, we do have a dedicated sales force. I don't know that everyone knows that. We do have a dedicated sales force of specialists, both on the financial side of our business, as well as on the asset management side of our business. So what we aim to do first is when there is an HPE GreenLake sales opportunity identified in our CRM systems, SFDC, it's kind of like a lightning bolt, if you will, that comes through and it's a signal to our sales team, engage here, right? There's an opportunity. So we'll engage with the HPE account team or with the partner sales team, if it's a partner-led opportunity, and we'll go in with them and help them have those conversations with the customer to kind of tease out, is there existing infrastructure here that we can monetize and either transition to the HPE GreenLake platform or we'll look to remove it from their site and we'll up-cycle it. So I think one of the interesting things, and I've really loved just the whole sustainability message this entire week. I think it's very genuine, and I think moving up the target to 2040 from 2050, super exciting and very aggressive. I think it's fantastic. There's also, you have the force for good. Tell us a little bit about that, because that seems really exciting as well. Yeah, the force for good financing program is something that the concept for that actually originated through some conversations with the HPE compute team. So with Neil McDonald's team and we were talking to their go-to-market leaders around the new technology that was coming out and through that conversation, we identified a common thread of sustainability. And we said, you know, there's really an opportunity here for us if we think about it as we're putting this new technology out into the marketplace, there's going to be a lot of existing HPE pro-liant customers who are on Gen 9, you know, maybe even Gen 8 still running, and they're going to be looking to transition to Gen 11 because of all the benefits that that technology brings. Why don't we can really attach a strong sustainability play to this at the same time, right? Let's provide a means for that, let's make it easier for that customer to invest in Gen 11, right? So we're providing a very attractive financing rate for customers who choose to do that through this program. We're also embedding asset upcycling services into the offer as well. So customers know right up front, we're committing to taking that equipment back. When they're no longer using it in their environment, we're going to take those systems back and we're going to put them back into the circular economy. And as part of this too, another differentiating feature of this is that whenever, and this really goes to any HPE asset upcycling customer that we work with, when they return those assets to us and we remarket them, we provide them with a sustainability report. And this is truly differentiating. So Rob, you asked about what's differentiating and we're really I think the only IT vendor that's doing this today is providing the sustainability report. And really what that does is it provides that transparency for customers so they can see what's really happening to this equipment, right? It's validation, it's verification and it's providing a, if you will, kind of a record keeping source, data source that they can refer back to is evidence of their commitment and the benefits that are accruing to them by participating in this program. And there's also some credits they can get or discounts they can get for being sustainable as well on the mid-sized companies, right? Yeah, there's a credit in the force for good financing program. So there is a discounted financing rate that they will get. So they're going to pay on average about 5% less in total over the contract term than if it was just a standard financing program. We've now also opened this up. So I did mention it was kind of originated together with the HP compute team, but we've broadened it to all of the HP technology now. So it's available to all of our customers. And it is really targeting those SMB and commercial, maybe smaller enterprise customers. That's great, as an incentive for those customers but also as kind of a catalyst for their businesses overall. When you talked about the sustainability report, we talked to so many companies all over the globe and in every industry now customers are saying we have sustainable IT programs or sustainability ESG programs that we have to report on and deliver. So our customers will work with us and they're coming to an HPE saying we need to make sure that we're working with a vendor or a partner that actually has similar programs and can demonstrate how they're going to help us reduce our carbon footprint or become carbon neutral. So that's a real big, I'm seeing as part of RFPs as almost kind of a requirement these days. So that's no longer a nice to have, it's really incredible. Well, I think you said it right, actually. You said sustainability is a catalyst. It is a catalyst, it truly is. We're winning deals because of this capability. I'm not lying to you, we are literally winning deals. That has been the differentiator in some of the business, both the direct business that we're doing with customers as well as HPE GreenLake business. It's a differentiator when they see that. Yeah, and I think what's really interesting is people don't usually think finance and sustainability in the same sentence. And I think that's really a great way to go and make that difference to those customers. And so with the Force for Good Financing program, for example, one of the ways we're trying to drive awareness around that is we're saying, okay, this program isn't available to any customer. You have to have demonstrated a commitment to sustainability. And the way that you've done that is you've earned a certain sustainability ranking through one of, we've now identified three specific sustainability certification organizations which include D&B, they include CDP, and then Sustainal Linux. So if one of those organizations has already accredited you and given you a sustainability ranking over a certain level, then you automatically qualify for that program. So it's a way for us to try to engender some affinity to sustainability and use it as a catalyst. If a customer isn't already thinking that way, we want them to be thinking in that way. Yeah, it goes back to being science-based as well. I think that's key. We heard that from Antonio earlier today, as a matter of fact. Yes, right, right. One of the things too that you and I talked about, I think it was this morning during our keynote analysis, Antonio was talking yesterday about it, the very high customer retention rate of 98%. What I think Michael is talking about is, I'll say a word, catalyst for that. And Antonio was on CNBC, I think in the last week or so, talking about the massive growth in HBC and AI and the pipeline there. I'm just thinking all of this is part of that flywheel that really helps to drive that. It is, and some of the announcements like yesterday, I'll give you one example. One of the announcements that Antonio made yesterday that I think is super cool is, we're now going to be pre-provisioning private cloud enterprise instances into Equinix data centers. So we're partnering with the largest provider of Colo environments in the world, a industry leader who's also demonstrated a commitment to sustainability, right? They're committing to 100% renewable energy for all of their data centers. We're pre-provisioning these instances into those environments. We believe it's really going to help accelerate customer adoption of HPE GreenLake because we're making it really easy and really simple for them to get on board and start consuming IT as a service. I think that incentives are, and your position is really strong there. How, Michael, last question for you. How would those small businesses and commercial organizations get started partnering with HPE FS to, in order to really start understanding and optimizing their infrastructure? Yeah, well, if it's a smaller organization, typically what we find is anytime they're looking to learn about new IT solutions, learn more about technology, they probably have a partner of choice that they're already working with. And so we do spend a lot of time and focus educating HPE's partners on our capabilities, on our offerings, helping them to be smarter about things like sustainability and asset management and what are the things that we can do to help transition customers and help fuel their own digital transformation initiative. So I would say first go to your partner, your HPE partner. And, but we also work directly with small businesses as well. And so that's, they can pick up the phone, they can chat with us online through hpe.com. You know, there's a number of different ways that they can engage with us. Awesome, it's great to hear what HPE FS is doing to help drive the business, force for good, tech for good, but also how you're helping customers really kind of catalyze their own sustainable IT programs. We appreciate your time, your insights, we'll let you get to the party. Yeah, thank you very much. Thank you for some time. We appreciate it. I really appreciate it. Our pleasure. For our guests and for Rob Stretch, I'm Lisa Martin. Up next, Sue Preston is going to be joining us. What are we talking about HPE professional services, how they're working with customers to drive transformations, those digital transformations that Michael was talking about and big business outcomes like achieving sustainable IT. Stick around and we'll be right back.