 Live from the Sands Convention Center in Las Vegas, Nevada, it's The Cube at AWS ReInvent 2014. Brought to you by headline sponsors, Amazon, and Trend Micro. Okay, welcome back everyone. We are here live in Las Vegas for Amazon's web services re-invent conferences at The Cube, our second year covering blanket coverage of what's going on at the show. I'm John Furrier. The founder of SiliconANGLES, The Cube, our flagship program. We go out to the events, extract a suit from the noise. We have a hot company called DataZoo here. Bill Simmons, the CTO founder, and Kesshra Kasura, VP of Technology. Welcome to The Cube. Thank you. So guys, real time in the cloud, data-driven, these are the buzzwords that everyone's marching to right now. It's pretty obvious. The shift's happening. So you guys are a great company doing some really cutting-edge stuff in digital, the digital transformations happening. So I want to get your take on what's happening here. But first, tell the folks, Bill, what you guys are doing as a business. When you started, how many employees, what's your products, and why is the cloud important to you guys? DataZoo builds a marketing cloud for brands and agencies. We provide three major kinds of products. We manage data, so that's add impressions and clicks and activities on websites, but also can manage sales data, ERP data, CRM data. We can overlay that data and produce insights and analytics. We use, I think what's unique about DataZoo is we're not just an analytics company. We're built from the ground up to take action on the big data immediately. So we have a real-time media-buying system that is fed by the insights and analytics to buy media in an optimized way. So we help marketers engage with their customers and increase marketing ROI. And what's the number one concern for your customers that you guys are solving? When you say ROI, does ad spend or money that they're spending and getting the results? What are they looking for? Have you learned anything around, I mean, marketing cloud is pretty obvious, and still early, it's not a lot of stuff out there. Oracle says they have marketing cloud, but I mean, come on, it's not really marketing cloud. I'll look at some other things. That's one set of solutions, but no one really has a real-time digital in social and web. Digital is proven, right? I mean, we all know the web. Websites, AdWords, banner ads, took extreme data, all that stuff. And now it's transferring over to a whole other world. Yeah, DataZoo manages media allocations to online display, mobile, video, YouTube free-roll, social, Twitter. Even traditional TV is going digital. We're able to run advertisements on addressable TV through set-top boxes, more precisely targeted. Do people plug into your platform as a service or is it service-based? Yeah, we're a platform as a service. You can subscribe, you know, the subscription pricing as a marketer. We can help you manage your data, build custom dashboards, but help you manage all your marketing investment. There's an old saying in marketing that half the advertising dollars are wasted, but we don't know which half. Well, DataZoo believes there's no reason for that. A hundred percent should be wasted. No. A hundred percent should be effective. No, of course. No, that's the point. Big data and connected internet, internet of things which people are part of and machines. Everything's measured. Yes. So you should technically have 100% visibility, which means you might suck 50% of the time or you might be good so you can work on that. Is that what you're saying? Yeah, so, you know, marketing... I didn't say suck, but you understand, if it's not effective, at least you know which half is not effective, and you can make adjustments tactically. That's right. So, you know, marketing has traditionally been very much an art form. I think there's still a big element of art in it. You know, there's a lot of very creative work done. However, the allocation of, you know, media to different channels and what amounts, in which regions, to which audiences, that's the kind of work that can be done scientifically and can be done by computers. And so that's what DataZoo supplies. That should technically help the creative process. You kind of know what you're targeting and they say omni-channel. And it's a long tail distribution. An advertiser could have, you know, make big, broad audiences, then go down into the slice of the dice. That's exactly it. The data that you collect while running digital media can be considered research. You can run four or five, ten different kinds of messages, and you can overlay it with data to know what kinds of people are reacting to which kind of messages. And that can inform your strategy going forward. So, if you're selling a car and you thought it would be appealing to young males, but it actually is appealing to older females, that can inform your creative strategy going forward. That's the kind of benefit you get from data-driven advertising. So who's backing you guys? Which VCs are? You guys vet your back? Yeah, our initial investors were Flybridge and Atlas, and then Menlo partners. Which partners from Atlas? Jeff Fagnan. Okay, Jeff's cool. I know Chris Twitch. And Jeff Busking from Flybridge. And John Jarvis from Menlo. And then we have Thompson. Financials also an investor. How many rounds have you done? Four rounds of funding. Wow, that's a lot of cash. Yeah. How much have you raised? Tens of millions. Okay, so not Silicon Valley standards. I was just talking to Illumio. I saw the VCs huddling around them. I'm like, Dockers had three rounds of funding in eight months. That's a lot. I was like, what the hell? No, we're operating and earning money. We're investing in growth. That's East Coast Wing. Yeah, it's East Coast Wing. My value get paid for it. We build businesses. Yeah, I think marketing class is very hot. Everyone who watches theCUBE knows that I go crazy over this whole digital transformation. I truly believe that the shift is happening. The dollars are coming in. And there's really no vehicles for billions to be spent. So I think there's a technical challenge going on in the market. I'd like to get your perspective on this, because this money there, it's just being blocked. There's a big rock in the river that's just stopping it, because we can do little stuff here, Facebook fan pages, Twitter, sponsorships. But in terms of real ad spend at scale, what are you guys doing technically to say, I'm a big brand, Pepsi or someone Coke. I got $10 million for a campaign, which is about a number. You might do a concert, whatever, and I want to roll in, I want mobile, I want activation, I want real time, and I also want activation through display ads. What do you do? How do you guys help them? So we already have tremendous scale just through traditional digital. We evaluate 30 trillion ad buying opportunities a month across the traditional digital channels like banner ads and mobile ads and online video. However, one of the big areas of growth is digital addressable TV. I think that's going to be a huge growth market. A lot of homes in the U.S. and around the world have set-top boxes. Those set-top boxes have hard drives. HD advertisements can be stored there and placed on those devices in a targeted way. So you can buy digital advertising at a massive scale now. Tell us about the technology. Are you guys all in the cloud? Were you on-premise? So we have a hybrid model. We have the real-time bidding engine in the Kolo and then we have the rest of the big data platform hosted in the Amazon cloud. And which portion is in Amazon? You said big data? Yeah, it's the big data piece that's basically the data platform. So for the insights? For the insights and the data collection, the logging systems, they're all in the cloud. Machine learning. Machine learning. And that's because it's variable, you're managing it. What's the reasoning behind that? Yeah, so the big reason is that our business is cyclical. So it actually goes to the roof during these holiday months and then January slows down and then it's pretty cyclical. So the cloud gives us the ability to scale up and down. It gives us the ability to elastically scale up and down. And then also the automation is something that we hook on quite a lot. So we have built-in self-healing systems that can recover themselves when there's issues and things like that. And we also use a whole host of services in Amazon. The Kinesis is the more recent one we started using. And our log collection goes to the Kinesis systems into the S3. So digital transformation is huge. So how are you guys dealing with the real time? That's really a big deal. So I have historical data, so that's passive monitoring. In the active part of the marketplace where there's point of purchase, point of intent. That's a hot area. Are you guys doing anything in that area? Yeah, so our platform is capable of adjusting the real time data. We use tools like Kinesis to help us do that. We can immediately, upon adjusting that data, take action. It may be increase marketing, shut down marketing. For example, if you were marketing to somebody and he wanted to be very effective, if they've already bought something, it's time to stop, right? By taking in some of this real time point of sale data, you could do that. You can spend that money elsewhere, find another new customer. Yeah, retargeting has gone through really kind of a bad rap because that's a real simple technology. I went to a website there for now, I see the ad, but they don't have the intent since there's been a lot of customer dissatisfaction. Now the numbers are off the chart on retargeting. So it looks good on paper, but the user experience satisfaction is really sucky because, you know, I went to a website to check on Hilton in Hawaii and no rooms available, couldn't do it. Okay, whatever, Hilton, I'm not that loyal. Now I keep on seeing a Hilton ad and it's a little button that says turn off, I don't really see that. So now I'm being reminded of my problem. So I already got my solution, but now that Hilton ad is in my face. So I'm actually against Hilton right now in my mind. I'm like, that's a bad user experience. Now the numbers are off the charts once. Yeah. So they don't know to turn that off. Yeah. A little cognitive issue there. That's true. I mean, you know. I don't mean to rail on retargeting, it's a good technical thing. I mean the statistical truth is that people that visit a website are four to ten times more likely to buy that product than the average internet user. And quite often someone will visit the website, didn't find exactly what they wanted, but they'll come back later. So, you know, retargeting can be a little bit annoying. I think it's important to manage the frequency so it's not overwhelming. But to your point, right? To your point that is that the contextual nature of the transaction that did or did not happen is important to capture that moment of data and then recycle that back into the user experience. That's my whole point. Retargeting is good. It doesn't. It's intent there, but they're not closing the loop. They're not saying, well, okay, well, he didn't really get what he wanted. He didn't get what he wanted. So now give me the, hey, thanks for coming to Hilton. Here's a better place for you. Here's a coupon. I mean, they can be a smarter there, I'm just saying. Definitely. I mean, it's something that DataZoo can do through its dynamic creative system. You can intelligently wire it up to rules. So if you search for hotels in Hawaii that didn't come up, maybe they'll give you hotels in somewhere else or back off. All right, so how many customers do you guys have? What's your profile? Big brands? My agencies? Who uses your product? So DataZoo is live in 50 countries around the world. We have over 500 customers ranging from direct brands that want to run things in-house to agency partners that represent multiple brands. Our biggest areas are in automotive, in financial, and in consumer packaged goods. And however, we work in travel and retail and every other vertical. Talk about engagement. What's the technology aspect? And what's the engagement market? Because that's the holy grail right now in this engagement. What's going on in the, quote, engagement area? What are the hot things to watch? Yeah, so I think in digital, the most exciting thing happening in terms of engagement, in terms of engaging customers is really video. I think marketers are starting to learn that visual video is a very engaging format. People are waiting to watch their YouTube video. And the cube? They're focused on it. Or the cube. And they're very focused on what they're looking at. So it's an opportunity to really talk to the person. Well, Brightroll just got bought by Yahoo for almost a billion dollars. I think 670 or something. It's 70 million. Yeah. Digital video is a major area of growth. I think, you know, so our system is able to optimize. Even no one likes pre-rolls. Well, that is true. I know. You've got to pay the bill somehow. Yeah, it's true. I think, I like the idea of skippable pre-rolls. You know, and sometimes you'll see something you're interested in and sometimes you won't. But it gives you the option. What's going on in that technology? What's your relationship with Amazon? Talk more about that. So we use a whole host of services, like I said. And we get a personal touch. Whenever we have any questions, Amazon is ready to help us. Even though we are a customer with appetite, we have ambitious plans. And Amazon is helping us every step of the way. What about the business side? Are you guys in the marketplace? We're not in the marketplace today. Our product comes with a heavy services component to it. And digital marketing is fairly complicated. I think it's not as simple as something that would appear in Amazon Marketplace for, you know, 22 cents an hour. Yeah, exactly. You guys probably charge good arm and a leg for that. It's good value. Certainly having that data. I've got to ask you about, again, let's go back to the transformation. Both technically and from a business market landscape standpoint. Social media, obviously, is huge. IBM is big on social business, which is, to me, an indicator of the trends. I mean, IBM kind of pioneered the word e-business back in the web days, which you don't even know when it talks about e-business anymore. It's all e-business, right? So it's not even a word anymore. Social business is interesting because it teases out social media being kind of a gimmicky, kind of buzz-oriented in the crowd kind of flavor to business process, where people are starting to operationalize this new normal of digital, which is different. You've got OAuth logins, not so much clickstream data. The first-party data equation is different. What's your view on, what's your take on this transformation? More social networks are popping up than ever. I mean, you've got the big three or four now, LinkedIn, Facebook, Twitter, and then you're going to have, you know, a series of smaller networks, if you will, I guess. Call them networks, call them user groups. What's the social business operational plan looked like for a company? Or are those a two-word? Yeah, I think it's definitely critical. You know, there's, it's a very clear statistics that, you know, it's very important to influence the influencers. So, and through social networks that are digital, not traditional like going to church kind, you can very easily measure who's an influencer and you can target them. So you're able to use digital signals and social networks to help reach your customers and get good recommendations and references. I think it's, you know, it's a part of business you just can't ignore today. You have to have social studies. How would you peg the inning? First inning, games not even started. It seems early. I mean, operationalizing a new transformation is really difficult. But the motivation's there. I've seen for customers that like, okay, I get it. But where's the data? I need ROI. So ROI becomes the real gate for scale. Yeah. Because in social, where is the ROI? Right, yeah. Yeah. More leads. Is it a Twitter handle? Is that their email address? Wait, no one uses email anymore? Or are they young? So they, oh, they use email. Of course you're saying it. But like the whole younger generations, you know, they have a zillion emails. That's like text messages. So the environment's changing. What's your take on that? How early? Where is it? What are the customers telling you? Yeah, I think social is very early. There's some tools that are useful. I think there's a lot of reluctance to use, say, a Facebook login to connect to your business. I think that there's not a really strong, I mean, LinkedIn is a good business social network. But it's not connected to the applications well. It's sort of a reference dictionary. I go there and search for my connections. But I don't use a LinkedIn login to connect different applications I'm using. I think there's still a lot of competition there. I know Google. You mean for the identity? Yeah, the identity management and automatically knowing who you are, who you're connected to, to make work more efficient and B2B operations more efficient. I think maybe if you ask which inning, I'd say third inning. Yeah. Or very early. Yeah, I mean it's a zero-zero game at this point. Obviously no one's really knocking it out of the park. But there's movement. You're seeing early adopters. You're seeing some technology. It's interesting. I see digital as taking a very cloud-like trajectory. And I want to get your take on this technically and what you guys think. Because the buzzwords I'm hearing in digital in terms of the next generation all sound like cloud, automation, orchestration, service levels. So in a way, ad tech or just digital or SaaS, technically will be SaaS. So a lot of those challenges are the same, aren't they? Definitely. When we started this business, I was amazed at how much manual work was going into digital advertising. It's very much like running a data center. Hands-on manipulation of each and every line item or server. People had to run spreadsheets to make sure things are running correctly. It's a big mess. It's very manual. And people may know of things they could do to optimize, but they don't have time. They can't react fast enough. It's sort of like a self-healing. You need self-healing systems in the cloud. You need self-healing systems in digital. Machine learning is an amazing tool for targeting, right? If you know what you're looking for. Teaching the machine how to learn is a great tool. You find what you want. Definitely. I think, you know, data is not out to optimize out everybody working in marketing. We're getting rid of all the tedious stuff. So that people can work on more creative stuff. You can tell I'm pretty geeking out on this stuff. I study it pretty heavily. So in the old days, contextual and behavioral were the two real things that people pivoted on, not other things, but generally those were two big variables. What's going on in the behavior, in the onsite, whatever, and then context, contextual, advertising or not. So, okay, I got that. So last night I was talking to a VC here and I was explaining to my vision, I'm like, well, that worked. But now let's go into the new transformation where data is the asset. So there's two data types. This is my thesis. Passive and active. You can all get data passively and then do stop with it. Active data is pure gold. That's interaction on the spot in real time. Do you guys agree, do you see that that could be the new pivot points? Yeah, I have, you know, I think, you know, early 2000s was sort of the era of big data, big data management, I think Hadoop came in and S3 came in and people can manage big quantities of data pretty well. They can ETL it pretty well. I think, you know, the next wave was really insights and analytics. Hey, we have a lot of data, can we run insights? I call the third wave really activated data, like big action, like taking automated action against the big data and the insights you're generating because nobody has time for all the analytics we're producing now. People produce so much analytics, it's overwhelming. You can't react to it fast enough. It's like I've seen it in office space where the guys get the big reports, the TPS reports. No one has time. You need data for the data. You need a system that takes action on the TPS reports. I mean, I think the other big thing is the continuous data, which is data that has no end, it keeps on flowing. And that's the real time data and being able to zoom into that continuous data into the minutes of Windows and being able to identify the patterns I think is a big action. Well guys, I really think that you guys are a secret weapon and I think you guys are going to get the word out. I think I love your business model. I think you're way ahead of the curve, certainly at many levels and the market will just, you're where the puck is coming, as they say. And also a big fan of Atlas and Crystal Enchin and those guys, Jeff, great investors. So congratulations. You should get a meeting with Jeff Kelly. He's a big data analyst. You should chat with him. He's going to show you our new crowd chat application, which is an engagement application that sits out in the crowd layer for chats. It would be perfect for you guys, feed into your system. Yeah, sounds great. So really think you've got the great vision for that. The marketing cloud is still this term that's, Oracle certainly pumped the hell out of it at Oracle Open World. I don't know if you saw what was going on there. Yeah, thank you, Oracle. Yeah, thanks for benching the market. They don't have anything right now. So thanks for coming on. I really appreciate it. URL, places to go to find information, share with the folks. Yeah, sure. And visit datazoo.com. We have a number of videos online. Datazoo XU. Datazoo. Not zoo. San Diego Zoo. Yes. Datazoo. Datazoo. We have a number of white papers and videos that you can watch to learn more. Great. We should follow up on another conversation. This is really good chat. Very relevant. Thanks for coming on. I appreciate it. This is theCUBE. We'll be right back after this short break. We're talking digital transformation. We're talking cloud transformation. It's a cloud world and it's very disruptive and it's awesome. So we'd love to share that with you. We'll be right back after this short break.