 From around the globe, it's theCUBE presenting the Innovation for Good, brought to you by Onshape. Hello everyone and welcome to Innovation for Good, a program hosted by theCUBE and brought to you by Onshape, which is a PTC company. My name is Dave Vellante and I'm coming to you from our studios outside of Boston. I'll be directing the conversations today. It's a very exciting, all live program. We're going to look at how product innovation has evolved and where it's going and how engineers, entrepreneurs and educators are applying cutting edge product development techniques and technology to change our world. You know, the pandemic has of course profoundly impacted society and altered how individuals and organizations are going to be thinking about and approaching the coming decade. Leading technologists, engineers, product developers and educators have responded to the new challenges that we're facing from creating lifesaving products to helping students learn from home to how to apply the latest product development techniques and solve the world's hardest problems. And in this program, you'll hear from some of the world's leading experts and practitioners on how product development and continuous innovation has evolved, how it's being applied to positively affect society and importantly, where it's going in the coming decade. So let's get started with our first session, fueling tech for good. And with me is John Herschdec, who is the president of the Software and Service Division of PTC, which acquired Onshape just over a year ago, where John was the CEO and co-founder. And Dana Grayson is here. She's the co-founder and general partner at Construct Capital, a new venture capital firm. Folks, welcome to the program. Thanks so much for coming on. Great to be here, Dave. Thanks for having me. You're very welcome, Dana. John, let's get into it. First, a belated congratulations on the acquisition of Onshape. That was an awesome seven year journey for your company. Tell our audience a little bit about the story of Onshape, but take us back to day zero. Why did you and your co-founders start Onshape? Well, actually start before Onshape. And like, Dave, I've been in this business for almost 40 years, the business of building software tools for product developers. And I had been part of some previous products in the industry and companies that had been in their era, big changes in this market. And about a little before founding Onshape, we started to see the problems product development teams were having with the traditional tools of that era years ago. And we saw the opportunity presented by cloud web and mobile technology. And we said, hey, we could use cloud web and mobile to solve the problems of product developers, make their businesses run better, but we'd have to build an entirely new system and entirely new company to do it. And that's what Onshape's about. Well, so notwithstanding the challenges of COVID and the difficulties this year, how's the first year been as a division of PTC for you guys? How's business, anything you can share with us? Yeah, our first year at PTC has been awesome. It's been, you know, when you get acquired, Dave, you never, you know, you have great optimism, but you never know what life will really be like. It's sort of like getting married or something, you know, until you're really doing it, you don't know. And so I'm happy to say that one year into our acquisition at PTC, Onshape is thriving. It's worked out better than I could have imagined a year ago along all ways. I mean, sales are up in Q4. Our new sales rate grew 80% versus, excuse me, our fiscal Q4, Q3 in the calendar year. It grew 80% compared to the year before. Our educational use is skyrocketing with around 400% growth, most recently year to year. I have students and teachers in COVID and we've launched a major cloud platform using the core of Onshape technology called Atlas. So just tons of exciting things going on at PTC. That's awesome, but thank you for sharing some of those metrics. And of course you're a very humble individual, you know, people should know a little bit more about you. You mentioned, you know, we founded SolidWorks, co-founded SolidWorks, actually founded SolidWorks. You had a great exit in the late 90s, but what I really appreciate is, you know, you're an entrepreneur, you've got a passion for the babies that you help birth. You stayed with the salt systems for a number of years, the company that acquired SolidWorks well over a decade. And of course you and I have talked about how you participated in the MIT blackjack team, you know, back in the day. As I say, you're very understated for somebody who's so accomplished, so thank you. Well, that's kind of you, but I tend to always keep my eye more on what's ahead, you know, what's next then. And, you know, I look back, sure to enjoy it and learn from it about what I can put to work, making new memories, making new successes. I love it. Okay, let's bring Dana into the conversation. Hello, Dana. You look, you were a fairly early investor in Onshape when you were with NEA. And I think it was a series B, but it was very right close after the A-rays and you were and still are a big believer in industrial transformation. So take us back. What did you see about Onshape back then that excited you? Thanks, thanks for that. Yeah, I was lucky to be an early investor in Onshape. You know, the things that actually attracted me to Onshape were largely around John and the team there really setting out to do something as John says humbly, something totally new, but really building off of their background was a large part of it. But, you know, I was really intrigued by the design collaboration side of the product. I would say that's frankly what originally attracted me to what kept me in the room, you know, in terms of the industrial world was seeing just, if you start with collaboration around design, what that does to the overall industrial product lifecycle, accelerating manufacturing, just, you know, modernizing manufacturing, just starting with design. So I'm really thankful to the Onshape guys because it was one of the first investments I made that turned me onto the whole sector. And wow, just such a great pleasure to work with with John and the whole team there and now see what they're doing inside the PTC. And you just launched Construct Capital this year, right in the middle of a pandemic and which is awesome, I love it. And you're focused on early stage investing. Maybe tell us a little bit about Construct Capital, what your investment thesis is and what are the big waves that you're hoping to ride? Sure, at Construct, it is literally lifting out of NEA what I was doing there. After Onshape, I went on to investing companies such as Desktop Metal and Tulip to name a couple of them, Form Labs is another one in and around the manufacturing space. But our thesis at Construct is broader than just, you know, manufacturing and industrial. It really incorporates all of what we'd call foundational industries that have yet to be fully tech-enabled or digitized. Manufacturing is a big piece of it, supply chain, logistics, transportation and mobility are other big pieces of it. And together, they really drive, you know, half of the GDP in the US and have been very under-invested and frankly haven't attracted really great founders like John in droves. And I think that's going to change. We're seeing entrepreneurs coming out of the tech world orthogonally into these industries and then bringing them back into the tech world, which is something that needs to happen. So John and team were certainly early pioneers and I think, you know, frankly obviously that voting with my feet at the next set of really strong companies are going to come out of this space over the next decade. I think there's a huge opportunity to digitize these sort of traditionally non-digital, you know, organizations, but Dana, you're focused, I think it's accurate to say you're focused on even more early stage investing now. And I want to understand why you feel it's important to be early. I mean, it's obviously riskier and rewardier, but what do you look for in companies and founders like John? Mm-hmm. You know, I think there are different styles of investing all the way up to public market investing. I've always been an early stage investor, so I like to work with founders and teams when they're, you know, just starting out. I happen to also think that we're just really early in the whole digital transformation of this world. You know, John and team have been, you know, back from solid works, et cetera, around this space for a long time. But again, the downstream impact of what they're doing really changes the whole industry. And so we're pretty early in digitally transforming that market. So that's another reason why I want to invest early now because I do really firmly believe that the next set of strong companies and strong returns for my own investors will be in these spaces. You know, what I look for in founders are people that really see the world a different way and, you know, sometimes some people think of founders or entrepreneurs as being very risk seeking. You know, if you ask John probably and other successful entrepreneurs, they would call themselves sort of risk averse because by the time they start the company, they really have isolated all the risk out of it and think that they have given their expertise or what they're seeing, they're just so compelled to go change something. So I look for that type of attitude, experience. As you can also tell from John, he's fairly humble. So humility and just focus is also really important. That those are, that's a lot of it, frankly. Just the founder. And John, you've got such a rich history in this space. And I wonder if you could sort of connect the dots over time. I mean, when you look back, what were the major forces that you saw in the market in the early days, particularly early days of Onshape? And how has that evolved? And what are you seeing today? Well, I think I touched on it earlier. Actually, could I just reflect on what Dana said about risk taking for just a quick one and say throughout my life from blackjack to starting SOLIDWORKS to Onshape, it's about taking calculated risks. Yes, you try to eliminate the risks as much as you can. But I always say, I don't mind taking a risk that I'm aware of and I've calculated through as best I can. I don't like taking risks that I don't know I'm taking. That's really bothersome. You like to bet on sure things as much as you can. Well, sure things are at least where you feel you've done the research and you see them and you know they're there. And you keep that in mind in the room. And I think that's great. And Dana did so much for us. Dana, I wanna thank you again for all that you did at every step of the way from where we started to your journey with us ended formally but continues informally. Now, back to you, Dave, I think question about the opportunity and how it's shaped up. Well, I think I touched on it earlier when I said it's about helping product developers. You know, our customers are the people who build the future of manufactured goods. Anything you think of that would be manufactured in a factory, you know, the chair you're sitting in, machine that made your coffee, you know, the computer you're using, the trucks that drive by on the street, all the COVID product research, the equipment being used to make vaccines, all that stuff is designed by someone. Our job is to give them the tools to do it better. And I could see the problems that those product developers had that were slowing them down with using the computing systems of the time. When we built SolidWorks, that was almost 30 years ago. If you don't realize that it was in the early 90s and, you know, we did the best we could for the early 90s, but what we did, we didn't anticipate the world of today. And so people were having problems with just installing the systems. Dave, you wouldn't believe how hard it is to install these systems. You need to spec up a special Windows computer, you know, and make sure you've got all the memory and graphics you need. And getting to get that set up, you need to make sure the device drivers are right, install a big piece of software, a license key. I'm not making this up. They're still around. You may not even know what those are. You and Dana's laughing because, you know, zero cool people do things like this anymore. And it only runs on Windows. You want a second user to use it. They need a copy. They need a code. Are they on the same version? It's a nightmare. The teams change. You know, you just say, well, get everyone on the software. Well, who's everyone? You know, you got a new vendor today, a new customer tomorrow, a new employee. People come on and off the team. The other problem was the data stored in files. Thousands of files. This isn't like a spreadsheet or word processor where there's one file to pass around. These are thousands of files to make one, even a simple product. People were tearing their hair out. John, what do we do? I've got copies everywhere. I don't know where the latest version is. We tried like, you know, locking people out so that only one person can change it at a time that works against speed. It works against innovation. We saw what was happening with Cloud Web and mobile. So what's happened in the years since is every one of the forces that product developers experience, the need for speed, the need for innovation, the need to be more efficient with their people and their capital resources. Every one of those trends have been amplified since we started Onshape by a lot of forces in the world and COVID has amplified all of those. The need for agility and remote work, COVID has amplified all of that. At the same time, the acceptance of cloud, you know, a few years ago, people were like, Cloud, you know, how's that going to work? Now they're saying to me, you know, increasingly, how would you ever even have done this without the cloud? How do you make SOLIDWORKS work without the cloud? How would that even happen? You know, once people understand what Onshape's about and we're the only full SAS solution, software as a service, full SAS solution in our industry. So what's happened in those years? Same problems we saw earlier, but turn up the gain, they're bigger problems. And with cloud, we've seen skepticism of years ago turn into acceptance and now even embracement in the COVID driven new normal. Yeah, so a lot of friction in the previous environment. So cloud, obviously a huge factor. And I guess, Dana, John could see it coming, you know, in the early days of SOLIDWORKS with, you know, it's Salesforce, which is kind of the first major independent SAS player. Well, I guess that was late 90s. So it was post SOLIDWORKS, but pre Onshape. And then Workday was, you know, pre Onshape in the mid 2000s. And, but, you know, the bet was on the SAS model was right for CricCAD and product development, you know, which maybe at the time wasn't a no brainer or maybe it was, I don't know, but Dana, is there, is there anything that you would invest in today that's not cloud based? That's a great question. I mean, I think we still see things all the time in the manufacturing world that are not cloud based. And I think, you know, the closer you get to the shop floor and the production environment, I think John and the PTC folks would agree with this too, but that it's, you know, there's reliability requirements, there's performance requirements, there's still this attitude of, you know, don't touch the printing press. So the cloud is still a little bit scary sometimes. And I think hybrid cloud is a real thing for those or on-premise solutions in some cases is still a real thing. What we're more focused on, and despite whether it's on-premise or hybrid or SaaS and cloud is a frictionless go-to-market model in the companies we invest in. So SaaS and cloud really make that easy to adopt for new users, you know, sign up, start using a product. But whether it's hosted in the cloud and whether it's SaaS, you can still distribute buying power. And I would, I'm just encouraging customers in the customer world and the more industrial environment to entrust some of their lower-level engineers with more budget discretionary spending so that they can try more products and unlock innovation. Right, and the unit economics are so compelling. So let's bring it, you know, to today's, you know, situation, John, you decided to exit about a year ago. You know, what did you see in PTC other than the obvious money? What was the strategic fit? Yeah, well, Dave, I want to be clear. I didn't exit anything really, you know. I love it. I don't like that term exit. I mean, Dana had to exit as a shareholder. And so it's not an exit for me. It's just a step in the journey. What we saw in PTC was a partner, first of all, that shared our vision from the top down at PTC, Jim Heppelman, the CEO. He had a great vision for the impact that SaaS can make based on cloud technology. And really, as Dana highlighted so much, it's not just the technology, it's how you go to market and the whole business being run and how you support and make the customer successful. So Jim shared a vision for the potential and really, really said, hey, come join us and we can do this bigger, better, faster. We expanded the vision really to include this Atlas platform for hosting other SaaS applications at PTC. I mean, Dave, the day I arrived at PTC, I met the head of the academic program. He came over to me and I said, you know, and how many people are on your team? I thought he'd say five, 40 people on the PTC academic team. It was amazing to me because, you know, we were just near about a hundred people when we were acquired in our total company. We didn't even have a dedicated academic team and we had a lot of students signing up, you know, thousands and thousands. Well, now we have hundreds of thousands of students. We're approaching a million users and that shows you the power of this team that PTC had combined with our product and technology boom, you get a big success for us and for the teachers and students of the world. We're giving them great tools. So many good things. We're also putting some PTC technology from other parts of PTC back into on shape one area, a little spoiler, a little sneak peek, working on taking generative design. Dana knows all about generative design. We couldn't acquire that technology we were a startup, you know, just too much to do but PTC owns one of the best in the business. This frustrum technology, we're working on putting that into on shape and our customers will be happy to see it, hopefully in the coming years sometime. Nice, great to see that two way exchange. Now you both know very well when you start a company it's of course a very exciting time. You don't have a lot of baggage, you know, our customers pulling you in a lot of different directions and asking you for specials. You have this kind of clean slate, so to speak. I would think in many ways, John, despite, you know, your install base, you have a bit of that dynamic occurring today, especially, you know, driven by the forced march to digital transformation that COVID caused. So when you sit down with the team at PTC and talk strategy, you now have, you know, more global resources, you got code, cohort selling opportunities. You know, what's the conversation like in terms of where you want to take the division? Well, Dave, you actually, it sounds like we should have you coming in and talking to us about strategy because you've got the strategy down. I mean, we're doing everything said, global expansion. We're able to reach cross-selling. We've got some excellent PTC customers that we can reach now and they're finding uses for Onshape. I think the plan is to, you know, just go, go, go and grow, grow, grow. Where we're looking for this year, priorities are expand the product. I mentioned the breadth of the product with new things. PTC did recently another technology that they acquired for Onshape. We did an acquisition. It was small. It wasn't widely announced in an area related to interfacing with electrical CAD systems. So we're doing, we're expanding the breadth of Onshape. We're going more depth in the areas we're already in. We have enormous opportunity to add more features and functions. That's in the product. Go to market. You mentioned it, global presence. That's something we were a little light on a year ago. Now we have a team, Dana may not even know it. We have an Onshape dedicated team in Barcelona, based in Barcelona, but throughout Europe, we're doing multiple languages. The academic program just introduced a new product into that space that's even fueling more success and growth there. And of course, continuing to invest in customer success and this Atlas platform story I keep mentioning, we're going to soon have, we're going to soon have four other major PTC brands shipping products on our Atlas SaaS platform. And so we're really excited about that. That's good for the other PTC products. It's also good for Onshape because now there's, there's other interesting products that our Onshape customers can use, take advantage of very easily using, say a common login conventions about user experience they're used to invest of all their SaaS based. So that makes it easier to begin with. So that's some of the exciting things going on. I think you'll see PTC expanding our lead in SaaS based applications for this sector, for our target sectors, not just in CAD and data management, but another area of PTC is big in is augmented reality with the Vuforia product line leader and industrial uses of AR. That's a whole nother story. We should do a whole nother show on augmented reality, but these products are amazing. You can help factory workers, people who are left out of the digital transformation sometimes who are standing from a machine all day. They can't be sitting like we are doing Zoom. They can wear an AR headset and our tools let them create great content. This is an area Dana's invested in in other companies. But what I wanted to note is the new releases of our authoring software for this AR content getting released this month used through the Atlas platform the SaaS components of Onshape for things like revision management and collaboration and workflow activity. All that those are tools that we're able to share leverage, we get a lot of synergy. It's just really good. It's really fun to have a good time doing it. That's awesome. And then we're going to be talking to John McElaney later about Atlas and do a little deeper dive on that. Dana, what is your involvement today with Onshape? But you're looking for, which of their customers are actually adopting and they're going to disrupt their industries that you can get good pipeline from that or how do you collaborate today? That sounds like a great idea. As John will tell you, I'm constantly just asking for advice and impressions of other entrepreneurs and picking his brain on ideas. No formal relationship clearly, but continue to count John and John and other people at Onshape in the circle of experts that I rely on for their opinions. All right, so we have some questions from the crowd here. One of the questions is for the dream team. John and Dana, what's your next collective venture? I don't think we're there yet, are we? No, I just say, as Dana said, we love talking to her about, Dana, you just returned the compliment, we would try and give you advice on the deals you're looking at. And I'm sort of casually mentoring at least one of your portfolio entrepreneurs and that's been a lot of fun for me and hopefully a value to them. But also Dana, you're an important pipeline to us in the world of some new things that are happening that we went to see if you've shown us some things that you've said, what do you think of this business? And for us, it's like, wow, it's cool to see that's going on and that's what's supposed to work in an ecosystem like this. So we deeply value the ongoing relationship and no, we're not starting something new. I got a lot of work left to do with what I'm doing and really happy, but we can collaborate in this way on other ventures. I like this question too, somebody's asking, with cloud options like Onshape, will more students have STEM opportunities? So that's a great question. Are you, because of SAS and cloud, are you able to reach more students, much more cost effectively? Yeah, Dave, I'm so glad that I was asked about this because yes, and it's extremely gratifying to us. Yes, we are because of cloud, because Onshape is the only full cloud, full SAS system or industry. We're able to reach STEM education. We're able to be part of bringing STEM education to students who couldn't get it otherwise. And one of the most gratifying things to me is the emails we're getting from teachers that really, and the phone calls, where they really pour their heart out and say we're able to get to students in areas that have very limited compute resources that don't have an IT staff, where they don't know what computer that the students can have at home and they probably don't even have a computer. We're talking about being able to teach STEM on a phone, Dave, an Android phone, a low-end Android phone, you can do 3D modeling on there with Onshape. Now you can't do it in any other system, but with Onshape, you can do it. And so the teacher can say to the students, they have to have internet access. And I know there's a huge community that doesn't even have internet access. And we're not able, unfortunately, to help that. But if you have internet and you have even an Android phone, we can enable the educator to teach STEM. And so we have case after case of saving a STEM program or expanding it into the students that need it most is the ones we're helping here. So really excited about that. And we're also able to let in addition to the run on whatever computing devices they have, we also offer them the tools they need for remote teaching with a much richer experience. Could you teach solid works remotely? Well, maybe if the student ran it and had a Windows workstation, big high-end workstation, maybe you could, but it would be like the difference between collaborating with Onshape and collaborating with SOLIDWORKS, like the difference between a Zoom video call and talking on a landline phone. It's a much richer experience. And that's what you need in STEM. Teaching STEM is hard. So yeah, we're super, super excited about bringing STEM to more students because of Cloud and SAS. And we're talking about innovation for good and then the discussion John, you just had, it really, there could be a whole another vector here we could discuss on diversity. And I want to end with just pointing out, so Dana, you're a new firm. It's a woman-led firm, two women leaders going forward. So that's awesome to see. So really, yeah, thumbs up on that. Congratulations on getting that off the ground. Thank you, thank you. Okay, so thanks you guys. Really appreciate it. It was a great discussion. I learned a lot and I'm sure the audience did as well. In a moment, we're going to talk with Onshape customers to see how they're applying tech for good and some of the products that they're building. So keep it right there. I'm Dave Vellante. You're watching Innovation for Good on theCUBE, the global leader in digital tech event coverage. Stay right there. Around the globe. It's theCUBE presenting Innovation for Good, brought to you by Onshape. Okay, we're back. This is Dave Vellante and you're watching Innovation for Good, a program on CUBE 365 made possible by Onshape, a PTC company. We're live today, real live TV, which is the heritage of theCUBE. And now we're going to go to the sources and talk to Onshape customers to find out how they're applying technology to create real world innovations that are changing the world. So let me introduce our panel members. Our Raphael Gomez-Sverberg is with the Chan Zuckerberg Biohub, a very big idea and collaborative nonprofit initiative that was funded by Mark Zuckerberg and his wife, Priscilla Chan. And really around diagnosing and curing and better managing infectious diseases. So really timely topic. Philip Tabor is also joining us, he's with SilverSide Detectors, which develops neutron detection systems. Yeah, you wanna know if early, if neutrons and radiation are in places where you don't want them. So this should be really interesting. And last but not least, Matthew Shields is with the Charlottesville Schools and it's gonna educate us on how he and his team are educating students in the use of modern engineering tools and techniques. Gentlemen, welcome to theCUBE and to the program. This should be really interesting. Thanks for coming on. Hi, our pleasure. Grab with us. All right, you're very welcome. Okay, let me ask each of you, because you're all doing such interesting and compelling work. Let's start with Raphael. Tell us more about the Biohub and your role there, please. Yeah, so as you said, the Biohub is a non-profit research institution funded by Mark Zuckerberg and his wife, Priscilla Chan. And our main mission is to develop new technologies to help advance medicine and help hopefully cure and manage diseases. We also have very close collaborations with the University of California San Francisco, Stanford University and the University of California Berkeley. And we tried to bring those universities together so they collaborate more on biomedical topics. And I manage a team of engineers, the bioengineering platform, and we're tasked with creating instruments for the laboratory to help the scientists, both inside the organization and also in the partner universities do their experiments in better ways or in ways that they couldn't do before. And this initiative was launched, what, five years ago? It was announced at the end of 2016 and we actually started operations at the beginning of 2017, which is when I joined. So this is our third year. And how's it going? How's it work? I mean, these things take time, but... It's been a fantastic experience. The organization works beautifully. It was amazing to see it grow from the beginning. I was employee number 12, I think. So when I came in, it was just an empty office building and empty labs. And very quickly we had something running though. It's amazing. So I'm very proud of the work that we have done to make that possible. And then of course, as you mentioned now with COVID, we've been able to do a lot of very cool work at the very beginning of the pandemic in March, when there was a deficit of testing capacity in California. We spun up a testing laboratory in record time in about a week. It was crazy. It was a crazy project, but incredibly satisfying. And we ended up running all the way until the beginning of November when the lab was finally shut down. We could process about 3,000 samples a day. I think at the end of it all, we were able to test about 100 on the order of 150,000 samples from all over the state. We were providing free testing to all of the Department of Public Health, Departments of Public Health in California, which at the beginning of the pandemic had no way to do testing affordably and fast. So I think that was a great service to the state. Now the state has created a testing system that will serve those departments. So then we decided that it wasn't necessary to keep going with testing in the other biohubs. So that was shut down. Great. Thank you for that. Now, Phillip, what you do is mind-melting. You basically help keep the world safe. Maybe describe a little bit more about silverside detectors and what your role is there and how it all worked. Sure. So we make nuclear bond detectors and we also make water detectors. So we try and do our part to keep the world from blowing up and make it a better place at the same time. Both of these applications use neutron radiation detectors. That's what we make. We put them out by a port, border crossing, places like that. They can help make sure that people aren't smuggling, shall we say, very bad things. There's also a burgeoning field of research and application where you can use neutrons with some pretty cool physics to find water. So you can do things like put a detector up in the mountains and measure snowpack. Put it out in the middle of the field and measure soil moisture content. And as you might imagine, there are some really cool applications in research and agronomy and public policy for this. All right, so it's okay. So it's much more than whatever, fighting terrorism. There's a real edge or I kind of IoT application for what you guys do. Yeah, we do both. It's swords to plowshares, you might say. Matt, I look at your role as kind of scaling the brain power for the future. Maybe tell us more about Charlottesville schools and the mission that you're pursuing and what you do. Sure, thank you. I've been in Charlottesville City Schools for about 11 or 12 years. I started there teaching a handful of classes, math and science and things like that. But the school board and my administration had the crazy idea of starting an engineering program about seven years ago. My background is in engineering. My master's is in mechanical and aerospace engineering. And I basically spent a summer kind of coming up with what might be a fun engineering curriculum for our students. And it started with just me and 30 students about seven years ago. Kind of a homespun from scratch curriculum. And one of my goals from the outset was to be a completely project-based curriculum. And it's now grown. We probably have about six or 700 students, five or six full-time teachers. We now have pre-engineering going on at the fifth and sixth grade level. And I now have students graduating after senior year with like seven years of engineering under their belt and heading off to doing some pretty cool stuff. So it's been a lot of fun building up a program and learning a lot in the process. That's awesome. I mean, theCUBE has been passionate about things like women in tech, diversity, STEM. Not only do we need more students in STEM, we need more underrepresented women, minorities, et cetera. And we were just talking to John Hirsteck and Dana Grayson about this, is do you feel as though you're, I mean, first of all, the work that you do is awesome, but I'll go one step further. Do you feel as though it's reaching a more diverse base? And how is that going? That's a great question. I think research shows that a lot of people get funneled into one kind of track or career path or set of interests really early on in their educational career. And sometimes that funnel is kind of artificial. And so that's one of the reasons we keep pushing back. So our school system is introducing kindergarteners to programming. And so we're trying to push back how we expose students to engineering and to STEM fields as early as possible. And we've definitely seen the fruits of that in my program. In fact, my engineering program sprung out of an after school and extracurricular science club that actually three girls started at our school. So I think that actually has helped that three girls started the club and that eventually is what led to our engineering program. So that sort of baked into the DNA. And also our school is a big public school and we have about 50% of the students are under the poverty line. And I'm in Charlottesville, which is a big refugee town. And so I've been adamant from day one that there are no barriers to entry into the program. There's no tests you have to take. You don't have to be taking a certain level of math or anything like that. And that's been a lot of fun to have a really diverse set of kids enter the program and be successful. That's phenomenal. That's great to hear. So Phillip, I want to come back to you. I think about maybe someday we'll be able to go back to sporting events. And I know when I'm in there, there's somebody up on the roof looking out for me. Watching the crowd and they have my back. And I think in many ways, the products that you build are similar. I may not know they're there, but they're keeping us safe or they're measuring things that I don't necessarily see. But I wonder if you could talk about a little bit more detail about the products you build and how they're impacting society. Sure. So there are certainly a lot of people who are watching, trying to make sure things are going well and keeping you safe that you may or may not be aware of. And we try and support a lot of them. So we have detectors that are deployed in a variety of uses with a number of agencies and governments that do, like I was saying, ports and border crossing, some other interesting applications that are looking for signals that should not be there and working closely to fit into the operations these folks do. And we also have a lot of outreach to researchers and scientists trying to help them support the work they're doing using neutron detection for soil moisture monitoring is some really cool opportunities for doing it at large scale and with much less expense or complication than would have been done with previous technologies. You know, they were talking about collaboration in the previous segment. We've been able to join a number of conferences for that virtually, including one that was supposed to be held in Boston, but another one that was held out of the University of Heidelberg in Germany. And this is sort of things that in some ways the pandemic is pushing people towards greater collaboration than they wouldn't have been able to do had it all been in person. Yeah, we did, the Cube did live works a couple of years ago in Boston. It was an awesome show. And I think, you know, with this whole trend toward digital, I call it the force march to digital thanks to COVID. I think that's just going to continue to grow. Raphael, I wonder if you could describe the process that you use to better understand diseases and what's your organization's involvement been in more detail with addressing the COVID pandemic? So we have, the biohub is structured in a way that fosters so the combination of technology and science. So we have two scientific tracks, one about infectious diseases and the other one about understanding just basic human biology, how the human body functions and especially how the cells in the human body function and how they're organized to create tissues in the body. And then it has this set of platforms, mine was one of them by engineering that are all technology rated. So we have data science platform, all about data analysis, machine learning, things like that. We have a mass spectrometry platform is all about mass spectrometry technologies to exploit those ones in service for the scientist. And we have a genomics platform that is all about sequencing DNA and RNA. And then an advanced microscopy, it's all about developing technologies to look at things with advanced microscopes and other technologies to marry computation and microscopy. So the scientists set the agenda and the platforms we just serve their needs, support their needs and hopefully develop technologies that help them do their experiments better, faster or allow them to the experiments that they couldn't do in any other way before. And so with COVID, because we have that very strong group of scientists that have been working on infectious diseases before and especially in viruses, we've been able to very quickly pivot to working on that. So for example, my team was able to build pretty quickly a machine to automatically purify proteins and it's been used to purify all these different important proteins in the COVID virus, the SARS-CoV-2 virus. And we're sending some of those purified proteins all over the world to scientists that are researching the virus and trying to figure out how to develop the vaccines, understand how the virus affects the body and all that. So some of the machines we built are having a very direct impact on this. Also for the COVID testing lab, we were able to very quickly develop some very simple machines that allowed the lab to function faster and more efficiently. So to add a little bit of automation in places where we couldn't find commercial machines that would do it. Got it. So Matt, I mean, you got to be listening to this and thinking about, okay, some day your students are going to be working at organizations like like Biohub and SilverSide. And a lot of young people that just, I don't know about you guys, but like my kids, they're really passionate about changing the world. You know, how it's way more important than, you know, the financial angles. And it's, I got to believe you're seeing that. You're right in the front lines there. Absolutely. In fact, when I started the curriculum six or seven years ago, one of the first bits of feedback I got from my students as they said, okay, this is a lot of fun. So I had my students designing projects and programming microcontrollers, Raspberry Pi's and Arduino's and things like that. The first bit of feedback I got from students was they said, okay, when do we get to impact the world? I've heard engineering is about making the world a better place and robots are fun and all, but where's the real impact? And so, thanks to the guidance of my students, I'm baking that more in now on like day one of engineering one, we talk about how the tools they're learning and the skills they're gaining eventually very soon can be used to make the world a better place. You know, we all probably heard that famous line by Jeff Hammerbocker, the greatest minds of my generation are trying to figure out how to get people to click on ads. I think we're really, generally, generationally, finally at the point where young students in engineering are really passionate about affecting society. I want to get into the product side and understand how each of you are using on shape and the value that it brings. Maybe Raphael, you can start. How long you've been using it? What's your experience with it? Let's start there. I've been using for about two years and I switched to it with some trepidation. You know, I was used to always using the traditional product that you have to install on your computer that everybody uses. And so I was kind of locked into that, but I started being very frustrated with the way it worked and decided to give on shape a chance with trepidation because any change always, you know, causes anxiety. But very quickly, my engineers started loving it just because it's... First of all, the learning curve wasn't very difficult at all. You can transfer from the traditional product to on shape very quickly and easily. You can learn all the concepts very fast. It has all the functionality that we needed. And what's best is that it allows to do things that we couldn't do before or we couldn't do easily. Now we can access our CAD documents from anywhere in the world. So when we're in the lab fabricating something or testing a machine, any computer we have next to us or a tablet or an iPhone, we can pull it up and look at the CAD and check things or make changes. That's something that we couldn't do before because before you had to pay for every installation of the software for every computer. And I couldn't afford to have 20 installations to have some computers with the CAD ready to use them like once every six months would have been very inefficient. So we love that part. And the collaboration features are fantastic. Especially now with COVID that we have to have all the remote meetings. It's fantastic that you can have another person drive the CAD while the whole team is watching that person change the model and do things and point to things. That is absolutely revolutionary. We love it. The fact that you have very, very sophisticated version control. Before it was always a challenge asking people, please, if you create an version and a part, how do we name it so that people find it? And then you end up with all these collection of files with names that nobody remembers what they are, the person left, and now nobody knows which version is the right one, a mess. With UnShape and the versioning system it has and the fact that you can go back in history of the document and go back to previous version so easily and then go back to the present version and explore the history of the part. That is truly just world changing for us that we can do that so easily. And for me as a manager to manage this collection of information that is critical for our operations, it makes it so much easier because everything is in one place. I don't have to worry about file servers that go down, that I have to administer, that I have to have IT, taking care of, that I have to figure out to give access to people to those servers when they're at home and they need a virtual private network and all of that mess disappears. I just simply give a person an account on UnShape and then magically they have access to everything in the way I want. And we can manage all our documents and everything in a way that is absolutely fantastic. Rafael, what was your, what were some of the concerns you had, you mentioned you had some trepidation, was it the performance, was it security, some of the traditional cloud stuff and I'm curious as to how, whether any of those were manifested or were they really that you had to manage? What were your concerns? Look, the main concern is how long is it gonna take for everybody in the team to learn to use the system like it and buy into it? Because I don't want to have my engineers using tools against their will, right? I want everybody to be happy because that's how they're productive, they're happy and they enjoy the tools they have. That was my main concern. I was a little bit worried about the whole concept of not having the files in a place where I could quote unquote see it in some server on site, but that's kind of an outdated concept, right? So that took a little bit of a mind shift, but very quickly then I started thinking, look I have a lot of documents on Google Drive, like I don't worry about that, why would I worry about my cat on Onshape, right? It's the same thing. So I just needed to sort of put things in perspective that way. The other concern was the learning curve, right? It's like how easy it will be for everybody to, and for me to learn it. And whether it had all of the features that we needed and there are a few features that I actually discussed with Cody at Onshape and they were actually awesome about using their scripting language in Onshape to sort of mimic some of the features of the old cat in Onshape in a way that actually works even better than the old system. So it was amazing, yeah. Great, thank you for that. Philip, what's your experience been? Maybe you could take us through your journey with Onshape. Sure. So we've been using Onshape at SilverSide for coming up on about four years now, and we love it. We're very happy with it. We have a very modular product line. So we make anything from detectors that would go into backpacks to vehicles to very large things that a shipping container would go through. And so, excuse me, Onshape helps us to track and collaborate faster on the design. We can have multiple people working at the same time on a project. And it also helps us to figure out if somebody else comes to us and say, hey, I want something new, how we can grab modules from things that we already have put them together and then keep track of the design development and the different branches and ideas that we have, how they all fit together as the design comes together. And it's just been fantastic. From a mechanical engineering background, I will also say that having used a number of different systems and thought SolidWorks was the greatest thing since sliced bread before, I got using Onshape and I went, wow, this is amazing and I really don't want to design in any other platform after getting only a little bit familiar with it. You know, it's funny, right? The speed of technology progression, I was explaining to some young guns the other day how I used to have a day timer and that was my life. And if I lost that day timer, I was dead. And I don't know how we existed without Google Maps. So how did we get anywhere? I don't know. But so Matt, it's interesting to think about some of the concerns that Raphael brought up. You hear, for instance, all the time, wow, I get my Amazon bill at the end of the month, it's through the roof, but the reality is that, yeah, well, maybe you are doing more, but you're doing things that you couldn't have done before. And I think about your experience in teaching and educating. I mean, so much more limited in terms of the resources that you would have had to be able to educate people. So what's your experience been with Onshape and what has it enabled? Yeah, I was actually talking, before we went with Onshape, we had a previous CAD program and I was talking to my vendor about it and he let me know that we were actually one of the biggest CAD shops in the state. Because if you think about it, a really big program, you know, a really big company might employ five, 10, 15, 20 CAD guys, right? I mean, when I worked for a large defense contractor, I think there were probably 20 of us as the CAD guys. I now have about 300 students doing CAD. So there's probably more students with more hours of CAD under their belt in my building than there were when I worked for the big defense contractor. But like you mentioned, probably our biggest hurdle is just resources. And so we want, one of the things I've always provided myself in trying to do in this program is provide students with access to tools and skills that they're gonna see either in college or in the real world. So that's one of the reasons we went with a big professional CAD program. There are, you know, sort of K-12 oriented software and programs and things, but you know, I want my kids coding in Python and using Slack and using professional type of tools. And so when it comes to CAD, that was a real hurdle. I mean, you know, you could spend $30,000 on one seat of, you know, professional CAD program. And then you need a $30,000 computer to run it on if you're doing, you know, big, heavy assemblies. And so one of my dreams that it was always just a crazy dream and the way I would always pitch it to my school system, I'd say someday I'm gonna have a kid on a school-issued Chromebook in subsidized housing on public Wi-Fi doing professional level CAD. And that was a crazy statement until a couple of years ago. So we're really excited that I literally, and you know, March, you said the forced March, the forced March into, you know, modernity. March 13th, I had kids sitting in my engineering lab that we spent a lot of money on doing CAD. March 14th, those kids were at home on their school-issued Chromebooks on public Wi-Fi, keeping their designs going and collaborating. And then, yeah, I can go on and on about some of the things, you know, the features that we've learned since then that are even better. So it's not like this is some inferior diminished version of the CAD. I mean, there's so much about it that's better. Well, I wanna ask you that. I may be over my skis on this, but are we starting to see the early days of the democratization of CAD and product design? And is the citizen engineer, I mean, maybe insulting to the engineers in the room, but is that, are we beginning to see that? I have to believe that as everything moves into the cloud, part of that is democratization that I don't need. I can, whether, you know, I think artists, you know, that I can have a music studio in my basement with a nice enough software package. And I can be a professional for now, my wife's a photographer, I'm not allowed to say that. I can be a professional photographer with, you know, some cloud-based software. And so, yeah, I do think that's part of what we're seeing is more and more technology is moving to the cloud. Phillip or Raphael, anything you'd add? I think, I mean, yeah, that combination of cloud-based CAD and then 3D printing that is becoming more and more affordable and ubiquitous. It's truly transformative. And I think for education, it's fantastic. I wish when I was a kid, I had the opportunity to play with those kinds of things because I was always building things, but, you know, in a very primitive way. So I think this is a dream for kids to be able to do this. And yeah, there's so many other technologies coming on, like Arduino and all of these electronic things that kids play at home very quickly with things that back in my day would have been unthinkable. So we know there's a, go ahead, Phillip. We had a pandemic and SilverSide moved to a new manufacturing facility this year. I was just on the shop floor talking with contractors standing six feet apart, pointing at things. But through it all, our CAD system was completely unruffled, nothing stopped in our development work, nothing stopped in our support for existing systems in the field. We didn't have to think about it. We had other server issues, but none with our, you know, engineering CAD platform and product development and support rolled right ahead, which was cool. I don't know. No, please. No, Kylie. At Matt's point, I think it's just really cool what you're doing with the kids. The most interesting secondary and college level engineering work that I did was project-based. Take an important problem to the world, go solve it. And that is what we do here. That is what my entire career has been. And I'm super excited to see what your students are gonna be doing in their home classrooms, on their Chromebooks now, and what they do building on that. Yeah, I agree. I'm super excited to see your kids coming out of college with engineering degrees. Because yeah, I think that project-based experience is so much better than just sitting in a classroom, taking notes and doing math problems. Absolutely. I think it will give the kids a much better flavor of what engineering is really about. I think a lot of kids get turned off by engineering because they think it's kind of dry, because it's just about the math or some very abstract concepts. And they are there, but I think the most important thing is just that hands-on of building and the creativity of making things that you can touch, that you can see, that you can see functioning. Great. So, we all know the relentless pace of technology progression. So, when you think about, when you're sitting down with the folks that on-shape and they're at the customer advisory board, what are the things that you want on-shape to do that it doesn't do today? I could start by saying, I just love some of the things it does do because it's such a modern platform. And I think some of these, some platforms that have a lot of legacy and a lot of history behind them, I think we're dragging some of that behind them. So, it's cool to see a platform that seemed to be developed in a modern era. And so that's, you know, it is the Google Docs. And so the fact that collaboration and versioning and link sharing is, and like platform agnostic abilities, the fact that that seems to be just built into the nature of the thing. So far, that's super exciting. As far as things that to go from there, I don't know. Other than price, you can't say lower price. That's it. So far on-shape, a PTC has worked with us really well. So I'm not complaining there either. Great, yeah. Yeah, no gaps guys, white space, come on. We've been really enjoying the three week update cadence. You know, there's a new version every three weeks and we don't have to install it. We just get all the latest and greatest goodies. One of the trends that we've been following and enjoying is the help with revision management and release workflows. And I know that there's more than on-shape is working on that we're very excited for because that's a big important part about making real hardware and supporting it in the field. Something that was cool, they just integrated some markup capability in the last release that took, we were doing that anyway, but we were doing it outside of on-shape. So now we get to streamline our workflow and put it in the CAD system where we're making those changes anyway when we're reviewing drawings and doing this kind of collaboration. And so I think from our perspective, we continue to look forward to further progress on that. There's a lot of capability in the cloud that I think they're just kind of scratching the surface on you. Right. I would, I mean, you're asking to nitpick. I would say one of the things that I would like to see is faster regeneration speed. There are a few times with complex disabilities that regenerating the document takes a little longer than I would like to. Okay. It's not a serious issue, but anyway, I'm being spoiled by that. Yeah, no, that's good. I've been doing this a long time and I like to ask that question of practitioners. And to me, it's a signal, like when you're nitpicking and you're struggling to nitpick, that to me is a sign of a successful product. And I wonder, I don't know, I have to deep dive into the architecture, but are things like alternative processors, you're seeing them hit the market in a big way, you know, maybe helping address that challenge. But I'm going to ask you the big chewy question now. Then we maybe go to some audience questions. When you think about the world's biggest problems, I mean, we're just global pandemics, obviously top of mind, you think about nutrition, you know, feeding the global community, we've actually done a pretty good job of that, but it's not necessarily with the greatest nutrition, climate change, alternative energy, the economic divides, you've got geopolitical threats, social unrest, healthcare is a continuing problem. What's your vision for changing the world and how product innovation for good can be applied to some of the problems that you all are passionate about? Big question, who wants to start? Not biased, but for years I've been saying that if you want to solve the economy, the environment, global unrest, pandemics, education is the key. So if you want to make progress in those realms, I think funding education is probably going to pay off pretty well. Absolutely, and I think STEM is key to that. I mean, a lot of the well-being that we have today in the industrialized countries is thanks to science and technology, right? Improvements in healthcare, improvements in communication, transportation, air conditioning, every aspect of life is touched by science and technology. So I think having more kids studying and understanding that is absolutely key. Yeah, I agree. Philip, you got anything to add? I think there's some big technical problems in the world today, Rafael and ourselves are certainly working on a couple of them. I think they're also collaboration problems and getting everybody to be able to pull together instead of pulling separately and to be able to spur the ideas onward. So that's where I think the education side is really exciting, what Matt is doing. And this kind of collaboration in general, when we can provide tools to help people do good work, that is, I think, valuable. Yeah, and I think that's a very good point. And along those lines, we have some projects that are about creating very low-cost instruments for low-research settings, places in Africa, Southeast Asia, South America, so that they can do biomedical research that it's difficult to do in those places because they don't have the money to buy the fancy lab machines that cost $30,000 an app. So we're trying to democratize some of those instruments. And I think thanks to tools like Unshave, then it's easier, for example, to have a conversation with somebody in Africa and show them the design that we have and discuss the details of it with them. And that's amazing, right? To have somebody in 10 time zones away looking real-life, in real-time, with you about your design and discussing the details or teaching them how to build a machine, right? Because if they have a 3D printer, you can just give them the design and say, like, you build it yourself, even cheaper than us building it and shipping it there. So all that aspect of it is also super important, I think, for any of these efforts to improve some of the hardest parts in the world. From climate change, as you say, poverty, nutrition issues, you have availability of water. You have that project about finding water. If we can also help deploy technologies that teach people remotely how to create their own technologies or how to build their own systems that will help them solve those problems locally. I think that's very powerful. Yeah, the point about education is right on. I think some people in the audience may be familiar with the work of Eric Bryn Jolson and Andy McAfee, the second machine age, where they put forth the premise that, hey, is that a laid it out? Look, for the first time in history, machines are replacing humans from a cognitive perspective. Machines have always replaced humans, but that's going to have an impact on jobs, but the answer is not to protect the past from the future. The answer is education and public policy that really supports that. So I couldn't agree more. I think that's a really great point. We do have some questions from the audience. If I can ask you guys, this one kind of stands out. How do you see artificial intelligence? I was just talking about machine intelligence. How do you see that impacting the design space? You guys trying to infuse AI into your product development? What can you tell me? Absolutely. We are using AI for some things, including some of these very low cost instruments that will hopefully help us diagnose certain diseases, especially diseases that are very prevalent in the third world. And some of those diagnostics are these days done by these armies of technicians that are trained to look under the microscope, but that's a very slow process. It's very error prone and having machine learning systems that can do the same diagnosis faster and cheaper and also little machines that can be taken to very remote places to these villages that have no access to a fancy microscope to look at a sample from a patient. That's very powerful. And we don't do this, but I have read quite a bit about how certain places are using artificial intelligence to actually help them optimize designs for parts. So you get these very interesting looking parts that you would have never thought of, a person would have never thought of, but that are incredibly light and curly or strong and I have all sorts of properties that are very interesting thanks to artificial intelligence and machine learning in particular. Yet another advantage you get when your work is in the cloud, I've seen, I mean, there's just so many applications to that. So if the radiology scan is in the cloud and the radiologist goes to bed at night, radiologists could come in in the morning and say, oh, the machine while you were sleeping was using artificial intelligence to scan these 40,000 images. And here's the five that we picked out that we think you should take a closer look at. Or like Rafael said, I can design my part, my mount or bracket or whatever and go to sleep and then I wake up in the morning and the machine has improved it for me, has made it strider, strider, stronger and lighter. And so just when your work is in the cloud, that's just a really cool advantage that you get that you can have machines doing some of your design work for you. Yeah, we've been watching this week, this month I guess is AWS reinvent and it's just amazing to see how much effort is coming around machine learning, machine intelligence, Amazon has SageMaker, Google's got embedded ML and BigQuery, certainly Microsoft with Azure is doing tons of stuff and machine learning. I think the point there is that these things will be infused into R&D and into software product by the vendor community and you all will apply that to your business and build value through the unique data that you're collecting in your ecosystems. And that's how you add value. You don't have to be necessarily developers of artificial intelligence but you have to be practitioners to apply that. Does that make sense to you Philip? Yeah, absolutely. And I think your point about value is really well chosen. We see AI involved from the physics simulations all the way up to interpreting radiation data. And that's where the value question I think is really important because it's, is the output of the AI giving helpful information to the people that need to be looking at it? So if it's curating a series of radiation alerts saying, hey, like these are the anomalies you need to look at, is it doing that in a way that's gonna help a good response? And in some cases the AI is only as good as the people that sort of gave it a direction and turn it loose and you wanna make sure that you don't have biases or things like that underlying your AI that are gonna result in less than helpful outcomes coming from it. So we spend quite a lot of time thinking about how do we provide the right outcomes to people who are relying on our systems? I mean, that's a great point, right? Humans are biased and humans build models so models are inherently biased, but then the software is hitting the market that's gonna help us identify those biases and help us, you know, of course, correct. So we're entering some very exciting times. Guys, great conversation. I can't thank you enough for spending the time with us and sharing with our audience the innovations that you're bringing to help the world. So thanks again. Thank you so much. Okay, welcome. Okay, when we come back, John McElaney is going to join me. He's an Onshape co-founder and he's currently the VP of strategy at PTC. He's going to join the program. We're going to take a look at what's next in product innovation. I'm Dave Vellante and you're watching Innovation for Good on theCUBE, the global leader of digital technology event coverage. We'll be right back. Around the globe, it's theCUBE presenting Innovation for Good, brought to you by Onshape. Okay, welcome back to Innovation for Good. With me is John McElaney, who is one of the co-founders of Onshape and is now the VP of strategy at PTC. John, it's good to see you. Thanks for making the time to come in the program. Thanks, Dave. So we heard earlier some of the accomplishments that you've made since the acquisition. How has the acquisition affected your strategy? Maybe you could talk about what resources PTC brought to the table that allowed you to sort of rethink or evolve your strategy. What can you share with us? Sure, a year ago when John and myself met with Jim Heppelman early on as we were pondering sort of joining PTC, one of the things that became very clear is that we had a very clear shared vision about how we could take the Onshape platform and really extend it for all of the PTC products, particularly sort of their augmented reality, as well as their thing works sort of the IoT business and their product. And so from the very beginning, there was a clear strategy about taking Onshape, extending the platform and really investing pretty significantly on the product development as well as go-to-market side of things to bring Onshape out to not only the PTC-based but sort of the broader community at large. So PTC has been a terrific, terrific sort of partner as we've gone after this market together. So we've added a lot of resource in the product development side of things, a lot of resource in the go-to-market and customer success and support. So really on many fronts, it's both resources as well as sort of support at the corporate level from a strategic standpoint. And then in the field, we've had wonderful interactions with many large enterprise customers as well as the PTC channel. So it's been really a great year. Well, and you think about the challenges of in your business going to SAS, which you guys took on that journey seven, eight years ago. It's not trivial for a lot of companies to make that transition, especially a company that's been around as long as PTC. So I'm wondering how much, I was just asking you how much PTC brought to the table. I got to believe you're bringing a lot to the table too in terms of the mindset. Even things as mundane is not the right word, but things like how you compensate salespeople, how you interact with customers, the notion of a service versus a product. I wonder if you could address that. Yeah, it's a really great point. In fact, after we had met Jim last year, John and I, one of the things we walked out in the Seaport area in Boston, and one of the things we sort of said is, Jim really gets what we're trying to do here. And part of, let me bring you into the thinking early on, part of what Jim talked about is there's lots of install base sort of software that's inside of the PTC base that's helped literally thousands of customers around the world. But the idea of moving to SAS and all that it entails, both from a technology standpoint, but also a cultural standpoint, like how do you, not just compensate the salespeople as an example, but how do you think about customer success? In the past, it might have been that you had professional services that you bring out to a customer and help them deploy your solutions. Well, when you're thinking about a SAS based offering, it's really critical that you get customer successful with it, otherwise you may have churn and it'll be very expensive in terms of your business longterm. So you've got to get customer success with the software in the very beginning. So Jim really looked at Onshape and he said that John and I, from a cultural standpoint, a lot of times companies get acquired and they've acquired technology in the past that they integrate directly into PTC and then sort of roll it out through their products or their distribution channel. He said, in some respect, John and John, think about it as we're going to take PTC and we want to integrate it into Onshape because we want you to share with us both on the sales side and customer success on marketing, on operations, all the things because longterm we believe the world is a SAS world that the whole industry is going to move to. So really it was sort of an inverse in terms of the thought process related to normal transactions. And that makes a lot of sense to me. You mentioned Sharon, Sharon's the silent killer of a SAS company. And there's a lot of discussion in the entrepreneurial community because you live this, what's the best path? Today you see, you watch Silicon Valley double, double, triple, triple, but there's a lot of people who believe and I wonder if you comment this, the best path to, in the XY axis, if it's growth on one and retention on the other axis, what's the best way to get to the upper right? And really the best path is probably to make sure you've nailed obviously the product market fit but make sure that you can retain customers and then throw gas in the fire. You see a lot of companies, they burn out trying to grow too fast but they haven't figured out, but there's too much churn, they haven't figured out those metrics. I mean, obviously on shape, you were sort of a pioneer in here. I got to believe you've figured out that customer retention before you really, battle to the metal. And growth can mask a lot of things but getting customers, especially in the engineering space, nobody goes and sits there and says, tomorrow we're gonna go and put a hundred users on this and immediately swap out all of our existing tools. These tools are very rich and deep in terms of capability and they become part of the operational process of how a company designs and builds products. So anytime anybody's actually going through a purchasing process, typically they will run a trial they'll run a project where they look at kind of what, what is this new solution going to help them do? How are we going to orient ourselves for success, longer term? So for us, getting new customers and customer acquisition is really critical but getting those customers to actually deploy the solution and be successful with it. We like to sort of say the marketing of the lead generation and even some of the initial sales that's sort of like the kindling but the fire really starts when customers deploy it and get successful with the solution because they bring other customers into the fold and then of course if they're successful with it, then in fact you'll have negative churn which ironically means growth in terms of your inside of your install bits. Right, and you've seen that with some of the emerging SaaS companies where you're actually, when you calculate whether it's net retention or renewals it's actually from a dollar standpoint it's up in the high nineties or even over a hundred percent. So that's a trend we're going to continue to see. I wonder if we could sort of go back and when you guys were starting on shape some of the things that you saw that you were trying to strategically leverage and what's changed today? And we were talking, I was talking to John earlier about in a way you kind of got a blank slate against like doing another startup not obviously you got install base and customers to service but it's a new beginning for you guys. So what are the things that you saw then cloud and SaaS and okay but that's we've been there done that what are you seeing today? Well, so this is a journey of course that on shape on its own has gone through it had I'll sort of say several iterations both in terms of how do you get customers? How do you get them successful? How do you grow those customers? And now that we've been part of PTC the question becomes okay one there's certainly a higher level of credibility that helps us in terms of our megaphone is much bigger than it was when we were standalone company but on top of that now figuring out how to work with their channel with their direct sales force they have for example, very large enterprise well, many of those customers are not going to go and forklift out their existing solution and replace it with on shape. However, many of them do have challenges in their supply chain and communications with contractors and vendors across the globe and so finding our fit inside of those large enterprises as they extend out with their customers is a very interesting area that we've really been sort of incremental to PTC and then they have access to lots of other technology like the IoT business and now of course the augmented reality business that we can bring things to bear. For example, in the augmented reality world they've got something called expert capture and this is essentially imagine an AR headset that allows you to be able to speak to it but also capture images, still images in video and you can take somebody who's doing their task and capture literally the steps that they're taking it's geolocation and from there build steps for new employees to be able to learn and understand how to use that technology to help them do their job better. Well, when they do that if there's replacement products or variation of some of the tools that they built the original design instruction set for they now have another version well they have to manage multiple versions well that's what Onshape is really great at doing and so taking our technology and helping their solutions as well so it's not only expanding our customer footprint it's expanding the application footprint in terms of how we can help them and help customers. So that leads me to the TAM discussion and again as part of your strategist role how do you think about that I was just talking to some of your customers earlier about the democratization of CAD and engineering I kind of joked sort of like citizen engineering but so that the demographics are changing the number of users potentially that can access the products because it's so much more of a facile experience how are you thinking about the total available market? It really is a great question it used to be when you sold boxes of software it was how many engineers are out there and that's the size of the market. The fact of the matter is now when you think about access to that information and that data is simply a pane of glass whether it's a computer, whether it's a laptop a cell phone or whether it's a tablet the ability to use different vehicles access information and data expands the capabilities and power of a system to allow feedback and iteration I mean one of the very interesting things in technology is when you can take something and really unleash it to a larger audience and build purpose built applications you can start to iterate and get better feedback there's the classic case in the clothing industry where Zara is a fast sort of turnaround agile manufacturer and there was a great New York Times article written a couple of years ago my wife's a fan of Zara and I think she justifies any purchases by saying Zara you got to purchase it now otherwise it may not be there the next time you go back to the store they had some people in a store in New York that had this women's throw kind of covering shawl and they said well it would be great if we could have this little clip here so we can hook it through or something and they sent the note back to the factory in Spain and literally two weeks later they had 4,000 of these things in store and they sold out because they had a closed loop and iterative process and so if we can take information and allow people to access it multiple ways through different devices and different screens that can be very specific information that we remove a lot of the engineering data but bring end user products conceptually to somebody that would have had to wait months to get the actual physical prototype and we can get feedback while we can have a better chance at making sure whatever product we're building is the right product when it ultimately gets delivered to a customer so it's really it's a much larger market that has to be thought of rather than just the kind of selling a box of software to an engineer. Now that's a great story and again, it's got to be exciting for you guys to see that and with the added resources that you have a PTC. So let's start, I promise people we're going to talk about Atlas. Let's talk about the platform a little bit of Atlas was announced last year. Atlas for those who don't know it's a SaaS based platform it purports to go beyond product lifecycle management and you're talking cloud like agility and scale to CAD and product design but John you could do a better job than I what do we need to know about Atlas? Well, I think Atlas is a great description because it really is metaphorically sort of holding up all of the PTC applications themselves but from the very beginning when John and I met with Jim part of what we were intrigued about was that he shared a vision that Onshape was more than just going to be a CAD authoring tool that in fact, in the past these engineering tools were very powerful but they were very narrow in their purpose and focus and we had specialty applications to manage diversions, et cetera. What we did in Onshape is we kind of inverted that thinking we built this collaboration and sharing engine at the core and then kind of wrap the CAD system around it but that collaboration sharing and versioning engine is really powerful and it was that vision that Jim had that he shared that we had from the beginning which was how do we take this thing and make a platform that can be used for many other applications inside of any company and so not only do we have a partner application area that is much like the App Store or the Google Play Store that was sort of our first instantiation of this platform but now we're extending out to broader applications and much media applications and internally that's the thing works in the augmented reality but there'll be other applications that ultimately find its way on top of this platform and so they'll get all the benefits of the collaboration the sharing, the versioning, the multi-platform, multi-device and that's an extremely, extremely strategic leverage point for the company. Yeah, it's interesting, John, you mentioned the Seaport before so PTC for those who don't know built a beautiful facility down at the Seaport in Boston and of course when PTC started, back in the mid-1980s, there was nothing at the Seaport so it's kind of ironic, we've seen the transformation of the Seaport, we're seeing the transformation of industry and of course PTC and I'm sure someday you'll get back into that beautiful office. Can't wait. But yeah, I'll bet and but I want to, I bring this up because I want you to talk about the future, how you see that our industry and you've observed this has moved from very product centric to platform centric with SAS and cloud and now we're seeing ecosystems form around those products and platforms and data flowing through the ecosystem, powering new innovation. I wonder if you could paint a picture for us of what the future looks like to you from your vantage point. Yeah, I think one of the keywords you said there is data because up until now data for companies really was sort of trapped in different applications and it wasn't because people were nefarious and they wanted to keep it limited, it was just the way in which things were built and when people use an application like Onshape, what ends up happening is their day to day interaction and everything that they do is actually captured by the platform and we don't have access to that data, of course it's the customer's data but as an artifact of them using the system and doing their day to day job, what's happening is they're creating huge amounts of information that can then be accessed and analyzed to help them both improve their design process, improve their efficiencies, improve their actual schedules in terms of making sure they can hit delivery times and be able to understand where there might be roadblocks in the future. So the way I see it is companies now are deploying SAS based tools like Onshape and an artifact of them using that platform is that they have now analytics and tools to better understand and instrument and manage their business and then from there, I think you're gonna see because these systems are all extremely well architected and allow through very structured API calls to connect other SAS based applications, you're gonna start seeing closed loop sort of systems. So for example, people design using Onshape, they end up going and deploying their system or installing it or people use the end using products. People then may call back into the customer's support line and report issues, problems, challenges. They'll be able to do traceability back to the underlying design. They'll be able to do trend analysis and defect analysis from the support lines and tie it back and close loop the product design manufacturer deployment in the field sort of cycles. In addition, you can imagine there's many things that are sort of as designed, but then when people go on site and they have to install it, there's some alterations, modifications. Think about like large air conditioning units for buildings. You go and you go to train and you get a large air conditioning unit that's put up on top of the building with a crane. They have to build all kinds of adapters to make sure that that will fit inside of the particulars of that building. With Onshape and tools like this, you'll be able to not only take the design of what the air conditioning system might be, but also all the adapter plates, but also how they installed it. So it's sort of as designed as manufactured and as stalled. And all these things can be traced, just like if you think about the transformation of customer service or customer contacts. In the early days, you used to have tools that were PC-based tools called contact management solutions, kind of act or gold mine. And these were basically glorified electronic Rolodexes. They had customer names and they had phone numbers and whatever else. And Salesforce and Siebel, these types of systems really broadened out the perspective of what a customer relationship was. So it wasn't just the contact information, it was, how did they come to find out about you as a company? So all the pre sort of marketing and then kind of what happens after they become a customer. And it really was a 360 view. I think that 360 view gets extended to not just to the customers, but also tools and the products they use. And then of course the performance information that can come back to the manufacturer. So, as an engineer, one of the things you learn about with systems is the following. And if you remember when the CD first came out, CDs, they used to talk about four times over sampling or eight times over sampling. And it was really kind of the fidelity to system. And we know from systems theory that the best way to improve a performance of a system is to actually have more feedback. The more feedback you have, the better a system can be. And so that's why you get 16, 64 X sampling, et cetera. Same thing here. The more feedback we have of different parts of a company that better perform at the company will be better customer relationships, better overall financial performance as well. So that's the view I have of how these systems all tie together. It's a great vision. And your point about the data is, I think right on it used to be so fragmented in silos. And in order to take a system view, you've got to have a system view of the data. And for years we've optimized maybe on one little component of the system. And that sometimes we lose sight of the overall outcome. And so what you just described, I think is, I think sets up very well as we exit, hopefully soon we exit this COVID era. And John, I hope that you and I can sit down face to face at a PTC on shape event in the near term. In the seaport. In the seaport would be, I'll tell you that'd be a great facility to have an event for sure. It's wonderful. So John McElady, thanks so much for participating in the program. It was really great to have you on. Great, thanks Dave. Okay, and I want to thank everyone for participating today. We had some great guest speakers. And remember, this is a live program. So give us a little bit of time. We're going to flip this site over to on-demand mode so you can share it with your colleagues and you, or you can come back and watch the sessions that you heard today. This is Dave Vellante for theCUBE and on shape PTC. Thank you so much for watching innovation for good. Be well, have a great holiday and we'll see you next time.