 Live from Las Vegas, it's theCUBE, covering ServiceNow Knowledge 2018, brought to you by ServiceNow. Welcome back everyone, we are wrapping up three big days of theCUBE's live coverage of ServiceNow Knowledge 18. I'm your host Rebecca Knight, along with my co-host Dave Vellante and Jeff Frick. It has been such fun co-hosting with you both. It's always a gas to be with you, so three days, what have we learned? What have we learned? We're making the world of work work better for people. Beyond that, beyond that, what do you think? Who branding, which I think UnderScore ServiceNow's desire to get into the C-suite, become a strategic partner. Some of the things we heard this week, platform of platforms. The next great enterprise software company is what they aspire to, just from a financial standpoint. This company literally wants to be a hundred billion dollar valuation company. They got a reasonable shot at doing that. They're well on their way to four billion dollars in revenue. It's hard to become a software company and hit a billion. The number of companies who get there are very limited and they are the latest. We're also seeing many products, one platform. And platforms in this day and age beat products. Cloud has been a huge tailwind for ServiceNow. We've seen the sassification of industries. And now we're seeing significant execution on the original vision and penetration into deeply into these accounts. And I got to say, when you come to events like this and talk to customers, there's amazing enthusiasm as much if not more than any show that we do. I mean, I really get it. What's your take? I mean, we go to so many shows and it's not hard to figure out the health of a show. You walk around the floor, what's the energy? How many people are there? What's the ecosystem? I mean, even now as I look around, we're at the very end of the third day and there is action at most of the booths still. So it's a super healthy ecosystem. I think it grew in other 4,000 people from this year, the year over year growth. So it's clearly on the rise. Sass is a big thing. I think it's a really interesting play in the kind of the simple workflow. Not as much conversation really about the no code and the low code that we've heard in the past. Maybe they're past that, but certainly a lot of conversation about the vertical stack applications that they're building. And I think at the end of the day that we talked about this before, it's competition for your screen. You know, what is it that you work in every day, right? If you use, I don't care what an application, Salesforce or any Sass application, which we all have a lot of on our desktop today. If you use it as a reporting tool, it's a pain. It's double entry, it's not good. But what is the tool that you execute your business on every day? And that's really a smart strategy for them to go after that. The other thing that I just think is ripe, and we talked about it a little bit. I don't know if they're downplaying it because they're not where they want to be yet or they're just downplaying it, but the opportunity for machine learning and artificial intelligence to more efficiently impact workflows with the data from the workflow is a huge opportunity. So what was a bunch of workflows and approvals and this and that should all get, you know, most of it should just get knocked out via AI over a short period of time. So I think they're in a good spot. And then the other thing which we hear over and over, you know, Frank Slutman and IT are homies. I still love that line. But as it's been repeated, IT is everywhere. So what a great way to get into HR, to get into legal, to get into facilities management, to get into these other things where like, hey, this is a really cool official little tool. Can I build a nice app for my business? So it seemed to be executing on that strategy. Yeah, CJ Desai said that IT will always be at our core. Rebecca, the keynote was interesting. It got mixed reviews. And I think part of that is they're struggling and we heard that from some of our guests. There's a hybrid audience now. You got the IT homies. You got the DevOps crowd. And then you got the business leaders. And so the keynote on day one was really reaching an audience, largely outside of the core audience. You know, I think day two and day three were much more geared toward that direct hit. Now, I guess that's not a bad thing. No, I mean, and I think that, I mean, as you noted, it's a hybrid audience. So you're trying to reach and touch and inspire and motivate a lot of different partners, customers, analysts, people who are looking at your business in a critical way. At the first day, John Donahoe, it struck me as very, I'm sort of aspirational, really talking about what is our purpose? What do we do as an organization? What are our values? What problems are we trying to solve here? And I think that laying it out there in the way that he did was effective because it really did bring it back to, here's what we're about. Yeah, the other thing I learned is succession has been very successful. Frank Slutman stepped down last year as CEO. He maintained his chairman title. He's now stepped down as chairman. Fred kind of went away for a little while. Fred's back now as chairman. John Donahoe came in. People don't really put much emphasis on this, but Fred Lutty was the chief product officer. Dan McGee was the COO. CJ Desai took over for both of them. He said on theCUBE, you texted me, you got big shoes to fill. He said, I kept that, I kept that just to remind me. And he seems to have just picked up right where those guys left off. You know, Pat Casey, I think, is understated and vital to the culture of this company. You know, Jeff, you see that. He's like a mini Fred, you know? And I think that's critical to maintain that cultural foundation. But as we said, going, the way that Pat talked about kind of this bifurcation and the keynote in the audience is in the building and out of the building, which I've never heard before, kind of an interesting way to cut it. The people that are here are their very passionate community and they're all here and they're adding 4,000 every single year. The people that are outside of the building maybe don't know as much about it and really maybe that aspirational kind of messaging touch them a little bit more because they're not into the nitty gritty. It's really interesting too, just because this week is such a busy week in technology, the competition for attention, eyeballs in time. And I was struck this morning going through some of our older stuff where Fred would always say, you know, I'm so thankful that people will take the time to spend it with us this week. And when people had choices to go to Google IEL, Microsoft Build, of course, we're at Nutanix Next, Red Hat Summit. I'm sure I'm missing a bunch of other ones. The fact that people are here for three days of conference and again they're still here is a pretty good statement in terms of the commitment of their community. Now the other thing I want to mention is four years ago, Jeff, was I think, it might even been five years ago, we sit on theCUBE, this company's on a collision course with Salesforce and you can really start to see it take shape. The customer service management piece, we know that Salesforce really isn't designed for a CSM, customer service management, is how Abhijit talked about it. So they are on a collision course there, they've hired a bunch of people from Salesforce, Salesforce is not going to roll over. You know, they're going to fight hard for that, Oracle's going to fight hard for that. So software companies believe that they should get their fair share of the spend, as long as that spend is 100%. That's the mentality of a software company, especially those run by Mark Benioff and Larry Ellison. So it's going to be really interesting to see how these guys evolve, they're going to start bumping into people. These guys got pretty sharp elbows though. Yeah, and I think the customer relationship is very different. You know, we were at PagerDuty Summit last year, I talked to Nick Metta, who just got nominated for entrepreneur of the year, I think for Inc, from GainCite. And he really talked about, what is a customer management versus opportunity management? Once you have the customer and you've managed that sale and you've made that sale, that's really where Salesforce has strived and that's what we use it for, right? In our own company. But once you're in the customer, like say you're in IBM or you're in Boeing, how do you actually manage your relationship in Boeing? Cause it's not Boeing and your sales person. There's many, many, many, many relationships. There's many, many, many activities. There's some where you're winning, some where you're losing, some where you're new, some where you're old. And so the opportunity there is way beyond simply managing, you know, a lead to an opportunity to a closed sale. That's just the very beginning of the process and actually having a relationship with the customer. The other thing is, so you can, one of the measurements of progress in 2013, this company, 95% of its business was in IT. Their core ITSM change management, help desk, et cetera. Today, that number's down to about two thirds. So a third of the business is outside of IT. We're talking about multi hundreds of millions of dollars. So ITOM, HR, the security practice, they're taking these applications and they're becoming multi hundred million dollar businesses. You know, some of them aren't there yet, but they're north of 50, 75. You're talking about hundreds of customers, higher average price, average contract values. You know, they don't broadcast that here, but you know, you look at, you peel back the numbers and you can see just tremendous financial story. The renewal rates are really, really high. You know, well, in the mid 90s, high 90s, which is unheard of. And so I think this company is going to be the next great enterprise software company and their focus on the user experience, I think, is important because if you think about the great enterprise software companies, Salesforce, Oracle, SAP, I don't know, maybe put IBM in there because they sort of acquired their way to it, but those three, they're not the greatest user experiences in the world. Right, they're working on the UI, but Oracle, we use Oracle, it's clunky, you know, it's powerful, it's reliable. They were solving some different problems, right? When those companies came up, they were solving a very different problem. Oracle on the relational database side, very different problem. You know, ERP was so revolutionary when SAP came out and I still just think it's so funny that we get these massive gains of efficiency. We had it in the ERP days and now we're getting it again. So they're coming at it from a very different angle. They're fortunate that they're a more modern architecture, they're a more modern UI and unfortunately, if you're legacy, you're kind of stuck in your historical paradigm. So the go to market gets more complicated as they start selling to all these other divisions. You're going to start, you're seeing overlay, sales forces, you know, it's going to be interesting. IBM just consolidated its big six shows into one. You wonder what's going to happen with this, so they're going to have to create many knowledges for all these different lines of business. We'll see how that evolves. You think with the one platform, maybe they keep it all together. I hope they don't lose that core. You think of VMworld, you know, it's still a core technical audience and I think that brings a lot of energy and credibility, you know, to a show like this. They still do have some little regional shows and there's a couple of different kind of theories that they're getting out because as we know, you know, once you get, well, just different, right? AWS reinvent was over 40,000 last year. Oracle runs, I don't even know what Oracle runs, it's 65,000, 70,000, Salesforce, 100,000, but they kind of cheat, they give away a lot of tickets. But it is hard to keep that community together. You know, we've had a number of people come up to us while we're off air to say hi that we've had on before. The company's growing, things are changing, new leadership, so to maintain that culture, I think that's why Pat is so important. I think he is that connection to the past and that connection to Fred that kind of carries forward. The other thing we have to mention is the ecosystem when we first started covering service now knowledge, it was, you know, fruition partners, cloud sherpas, I mean, who are these guys? And now you see the acquisitions, it's EY is here, Deloitte is here, Accenture is here, PWC, you know, Unisys is here, big name companies, Capgemini, KPMG, with big install bases, strong relationships. It's why you see the sales guys at service now bellying up to these companies because they know it's going to drive more business for them. You know, so pretty impressive story. I mean, it's hard to be critical of these guys. I mean, your price is too high, okay? You know, all right, but the value's there so people are lining up. I mean, it's a smoking hot company, as you said, what do they need to do next? What do you need to see from them next? Well, I mean, you know, the thing is they laid out the roadmap. You know, they announced twice a year in different cities with each letter of the alphabet. They got to execute on that. I mean, this is one of those companies that's theirs to lose. It really is, they got the energy. I mean, they got to retain the talent, attract new talent. The street's certainly buying their story. Their free cash flow is growing faster than their revenue which is really impressive. They're extremely well run company. Their CFO is a rockstar stud behind the scenes. I mean, they got studs in development, they got a great CEO, they got a great CFO, really strong chief product officer, really strong general managers who got incredible depth and expertise. I mean, it's theirs to lose. I mean, they really just have to keep executing on that roadmap, keeping their customer focus and you know, hoping that there's not some external factor that blows everything up. Yeah, good point, good point. What about the messaging we've heard? As you said, it's new branding so it's making the world of work work better. This focus on the user experience, the idea that the CIO is no longer just so myopic in his or her portfolio, really has to think much more broadly about the business, a real business leader. I mean, is this, are you hearing this at other conferences too? Is it jiving with the other? Yeah, everyone talks about the new way to work, the new way to work, the new way to work and the consumerization of IT and you know, all the millennials that want to operate everything on their phone. That's all fine and dandy. Again, at the end of the day, where do people work? Because again, you're competing. Everyone has, excuse me, many, many applications unfortunately that we have to run to get our day job done. And so if you can be the one that people use as the primary way that they get work done, that's the goal, that's the end game, right? I would add, so the messaging to me is interesting because IT practitioners, as a community, are some of the most underappreciated, you know, overworked and they only hear from the business when things go bad. For decades we've seen this. The thing that struck me at Service Now Knowledge 13 when we first came here is, wow, these IT people are pumped. You know, you walk around and you show the IT people like this, they're kind of dragging their feet, heads down, and the Service Now customers are excited. They're leading innovation in their companies. They're developing new applications on these platforms. And it's a persona that I think is being reborn. And it's as exciting to see. It's funny you bring up the old shows because before it was a lot about just letting IT, excuse me, do their work with a little bit more creativity, better tools, build their own store, build an IT services Amazon looking store. We're not hearing any of that anymore. Two more with less. Squeeze, squeeze. We're not hearing that at all anymore. Now, you know, we're part of delivering value as we've talked about with the banking application and link from Lone Star. You know, now these people are intimately involved with the forward-facing edge of the company. So it's not talking about we'll have a cool services store. I remember like 2014, that was like a big theme. We're not hearing that anymore. We've moved way beyond that in terms of being a strategic partner in the business, which we are over and over. But these are people that are now the strategic partner for the business. Look at, customers have to make bets. And they're making bets on service now. They've obviously made a bunch of bets on Oracle. Increasingly, they're making bets on Amazon. You know, we're seeing that a lot. They've made big bets on VMware, obviously big bets on SAP. So CIOs, they go to shows like this to make sure that they made the right bet. You know, they're not missing some blind spots to talk to their peers. But you can see that they're laying the chips on the table, I guess pun intended. I mean, they're paying off. That's great. That's a great note to end on, I think. So, again, a pleasure co-hosting with both of you. It's been a lot of fun. It's been a lot of hard work, but a lot of fun, too. Thank you, Rebecca. So, the Cube season, Jeff, I got a shout out to you and the team. I mean, you guys, it's like so busy right now. I thought you were going to ask me where we're going next. I was going to say, oh, my God. I know I'm in Chicago at V-Mon. Right, we have V-Mon going. We've got a couple of on the grounds. SAP Sapphire's coming up. Accelerate. Accelerate, open stack. We're going back to Vancouver. Haven't been there for a while. Informatica World, back down here in Las Vegas. Pure storage, San Francisco. We got the MIT CDO conference coming up. We got Google Next. Yep, yep. Big Cloud Show. Human Transforming Technology. Just keep an eye on the website upcoming. We can't keep it all straight. Cube.net, siliconangle.com, wikibon.com, bunch of free content. You heard it here first. There you go. Excellent. For Rebecca Knight and Jeff Frick and Dave Vellante, this has been the Cube's coverage of ServiceNow Knowledge 18. We will see you next time. Thanks, everybody. Bye-bye.