The next BriefingsDirect enterprise storage partnership innovation discussion explores how the best of startup culture and innovation can be married to the global reach, maturity, and solutions breadth of a major IT provider.
To learn more about the latest in total storage efficiency strategies and HPE’s Pathfinder program we welcome Rob Salmon, President and Chief Operating Officer at Cohesity in San Jose, California, and Paul Glaser, Vice President and Head of the Pathfinder Program at HPE. The discussion is moderated by Dana Gardner, Principal Analyst at Interarbor Solutions.
Here are some excerpts:
Gardner: Paul, how have technology innovation, the nature of startups, and the pace of business today made a deep relationship between HPE and Cohesity the right fit for your mutual customers?
Glaser: That’s an interesting question, Dana. To start, the technology ecosystem and the startup ecosystem in Silicon Valley, California -- as well as other tech centers on a global basis -- fuel the fire of innovation. And so, the ample funding that’s available to startups, the research that’s coming out of top tier universities such as Stanford, Carnegie Mellon, or MIT out on the East Coast, fuels a lot of interesting ideas -- disruptive ideas that lead their way into small startups.
The challenge for HPE as a large, global technology player is to figure out how to tap into the ecosystem of startups and the new disruptive technologies coming out of the universities, as well as serial entrepreneurs, foster and embrace that, and deliver those solutions and technologies to our customers.
Gardner: Paul, please describe the Pathfinder thesis and approach. What does it aim to do?
Insight, investment, and solutions
Glaser: Pathfinder, at the top level is the venture capital (VC) program of HPE and can be subdivided into three core functions. First is insight, second is investments, and third is the solutions function. The insight component acts like a center of excellence, it keeps a finger on the pulse, if you will, of disruptive innovation in the startup community. It helps HPE as a whole interact with the startup community, the VC community, and identifies and curates leading technology innovations that we can ultimately deliver to our customers.
The second component is investments. It’s fairly straight-forward. We act like a VC firm, taking small equity stakes in some of these startup companies.
And third, solutions. For the companies that are in our portfolio, we work with them to make introductions to product and technical organizations inside of HPE, fostering dialogue from a product evolution perspective and a solution perspective. We intertwine HPE’s products and technologies with the startup technology to create one-plus-one-equals-three. And we deliver that solution to customers and solve their challenges from a digital transformation perspective.
Gardner: How many startup companies are we talking about? How many in a year have typically been included in Pathfinder?
Glaser: We are a very focused program, so we align around the strategies for HPE. Because of that close collaboration with our portfolio companies and the business units, we are limited to about eight investments or new portfolio companies on an annual basis.
Today, the four-and-a-half-year-old program has about two dozen companies inside in the portfolio. We expect to add another eight over the next 12 months.
Gardner: Rob, tell us about Cohesity and why it’s such a good candidate, partner, and success story when it comes to the Pathfinder program.
Salmon: Cohesity is a five-year-old company focused on data management for about 70 to 80 percent of all the data in an enterprise today. This is for large enterprises trying to figure out the next great thing to make them more operationally efficient, and to give them better access to data.
Companies like HPE are doing exactly the same thing, looking to figure out how to bring new conversations to their customers and partners. We are a software-defined platform. The company was founded by Dr. Mohit Aron, who has spent his entire 20-plus-year career working on distributed file systems. He is one of the key architects of the Google File System and co-founder of Nutanix. The hyperconverged infrastructure (HCI) movement, really, was his brainchild.
He started Cohesity five years ago because he realized there was a new, better way to manage large sets of data. Not only in the data protection space, but for file services, test dev, and analytics. The company has been selling the product for more than two and a half years now, and we’ve been a partner with Paul and the HPE Pathfinder team for more than three years now. It’s been a quite successful partnership between the two companies.
Gardner: As I mentioned in my set-up, Rob, speed-to-value is the name of the game for businesses today. How have HPE and Cohesity together been able to help each other be faster to market for your customers?
One plus one equals three
Salmon: The partnership is complimentary. What HPE brings to Cohesity is experience and reach. We get a lot of value by working with Paul, his team, and the entire executive team at HPE to bring our product and solutions to market.
When we think about the combination between the products from HPE and Cohesity, one-plus-one-equals-three-plus. That’s what customers are seeing as well. The largest customers we have in the world running Cohesity solutions run on HPE’s platform.
HPE brings credibility to a company of our size, in all areas of the world, and with large customers. We just could not do that on our own.
Gardner: And how does working with HPE specifically get you into these markets faster?
Salmon: In fact, we just announced an original equipment manufacturer (OEM) relationship with HPE whereby they are selling our solutions. We’re very excited about it.
I can give you a great example. I met with one of the largest healthcare providers in the world a year ago. They loved hearing about the solution. The question they had was, “Rob, how are you going to handle us? How will you support us?” And they said, “You are going to let us know, I’m sure.”
They immediately introduced me to the general manager of their account at HPE. We took that support question right off the table. Everything has been done through HPE. It’s our solution, wrapped around the broad support services and hardware capabilities of HPE. That made for a total solution for our customers, because that’s ultimately what these kinds of customers are looking for.
They are not just looking for great, new innovative solutions. They are looking for how they can roll that out at scale in their environments and be assured it’s going to work all the time.
Gardner: Paul, HPE has had huge market success in storage over the past several years, being on the forefront of flash and of bringing intelligence to how storage is managed on a holistic basis. How does the rest of storage, the so-called secondary level, fit into that? Where do you see this secondary storage market’s potential?
Glaser: HPE’s internal product strategy has been around the primary storage capability. You mentioned flash, so such brands as 3PAR and Nimble Storage. That’s where HPE has a lot of its own intellectual property today.
On the secondary storage side, we’ve looked to partners to round out our portfolio, and we will continue to do so going forward. Cohesity has become an important part of that partner portfolio for us.
But we think about more than just secondary storage from Cohesity. It’s really about data management. What does the data management lifecycle of the future look like? How do you get more insights on where your data is? How do you better utilize that?
Cohesity and that ecosystem will be an important part of how we think about rounding out our portfolio and addressing what is a tens of billions of dollars market opportunity for both companies.
Gardner: Rob, let’s dig into that total data management and lifecycle value. What are the drivers in the market making a holistic total approach to data necessary?
Cohesity makes data searchable, usable
Salmon: When you look at the sheer size of the datasets that enterprises are dealing with today, there is an enormous data management copy problem. You have islands of infrastructures set up for different use cases for secondary data and storage. Oftentimes the end users don’t know where to look, and it may be in the wrong place. After a time, the data has to be moved.
The Cohesity platform indexes the data on ingest. We therefore have Google-like search capabilities across the entire platform, regardless of the use-case and how you want to use the data.
When we think about the legacy storage solutions out there for data protection, for example, all you can do is protect the data. You can’t do anything else. You can’t glean any insights from that data. Because of our indexing on ingest, we are able to provide insights into the data and metadata in ways unlike customers and enterprises have ever seen before. As we think about the opportunity, the larger the datasets that are run on the Cohesity platform and solution, the more insight customers can have into their data.
And it’s not just about our own applications. We recently introduced a marketplace where applications such as Splunk reside and can sit on top and access the data in the Cohesity platform. It’s about bringing compute, storage, networking, and the applications all together to where the data is, versus moving data to the compute and to the applications.
Gardner: It sounds like a solution tailor-made for many of the new requirements we’re seeing at the edge. That means massive amounts of data generated from the Internet of things (IoT) and the industrial Internet of things (IIoT). What are you doing with secondary storage and data management that aligns with the many things HPE is doing at the edge?
Seamless at the edge
Salmon: When you think about both the edge and the public cloud, the beauty of a next-generation solution like Cohesity is we are not redesigning something to take advantage of the edge or the public clouds. We can run a virtual edition of our software at the edge, and in public cloud. We have a multiple-cloud offering today.
So, from the edge all the way to on-premises and into public clouds it’s a seamless look at all of your data. You have access and visibility to all of the data without moving the data around.
Gardner: Paul, it sounds like there’s another level of alignment here, and it’s around HPE’s product strategies. With HPE InfoSight, OneView -- managing core-to-edge issues across multiple clouds as well as a hybrid cloud -- this all sounds quite well-positioned. Tell us more about the product strategy synergy between HPE and Cohesity.
Glaser: Dana, I think you hit it spot-on. HPE CEO Antonio Neri talks about a strategy for HPE that’s edge-centric, cloud-enabled, and data-driven. As we think about building our infrastructure capabilities -- both for on-premise data centers and extending out to the edge -- we are looking for partners that can help provide that software layer, in this case the data management capability, that extends our product portfolio across that hybrid cloud experience for our customers.
As you think about a product strategy for HPE, you really step up to the macro strategy, which is, how do we provide a solution for our customers that allows us to span from the edge all the way to the core data center? We look at partners that have similar capabilities and similar visions. We work through the OEMs and other types of partnership arrangements to embed that down into the product portfolio.
Gardner: Rob, anything to offer additionally on the alignment between Cohesity and HPE, particularly when it comes to the data lifecycle management?
Salmon: The partnership started with Pathfinder, and we are absolutely thrilled with the partnership we have with HPE’s Pathfinder group. But when we did the recent OEM partnership with HPE, it was actually with HPE’s storage business unit. That’s really interesting because as you think about competing or not, we are working directly with HPE’s storage group. This is very complementary to what they are doing.
When we did the recent OEM partnership with HPE, it was actually with HPE's storage business unit. That's really interesting because as you think about competing or not, we are working directly with HPE storage. This is very complementary to what they are doing.
We understand our swim lane. They understand our swim lane. And yet this gives HPE a far broader portfolio into environments where they are looking at what the competitors are doing. They are saying, “We now have a better solution for what we are up to in this particular area by working with Cohesity.”
We are excited not just to work with the Pathfinder group but by the opportunity we have with Antonio Neri’s entire team. We have been welcomed into the HPE family quite well over the last three years, and we are just getting started with the opportunity as we see it.
Gardner: Another area that is top-of-mind for businesses is not just the technology strategy, but the economics of IT and how it’s shifted given the cloud, Software as a Service (SAAS), and pay-on-demand models. Is there something about what HPE is doing with its GreenLake Flex Capacity approach that is attractive to Cohesity? Do you see the reception in your global market improved because of the opportunity to finance, acquire, and consume IT in a variety of different ways?
Flexibility increases startups’ strength
Salmon: Without question! Large enterprises want to buy it the way they want to buy it, whether it be for personalized licenses or a subscription model. They want to dictate how it will be used in their environments. By working with HPE and GreenLake, we are able to offer the flexible options required to win in this market today.
Gardner: Paul, any thoughts about the economics of consuming IT and how Pathfinder might be attractive to more startups because of that?
Glaser: There are two points Rob touched on that are important. One, working with HPE as a large company, it’s a journey. As a startup you are looking for that introduction or that leg up that gives you visibility across the global HPE organization. That’s what Pathfinder provides. So, you start working directly with the Pathfinder organization, but then you have the ability to spread out across HPE.
For Cohesity, it’s led to the OEM agreement with the storage business unit. It is the ability to leverage different consumption models utilizing GreenLake, and some of our flexible pricing and flexible consumption offers.
The second point is Amazon Web Services has conditioned customers to think about pay-per-use. Customers are asking for that, and they are looking for flexibility. As a startup, that sometimes is hard to figure out -- how to economically provide that capability. Being able to partner with HPE and Pathfinder, to utilizing GreenLake or some of our other tools, it really provides them a leg up in terms of the conversation with customers. It helps them trust that the solution will be there and that somebody will be there to stand behind it over the coming years.
Gardner: Before we close out, I would like to peek in the crystal ball for the future. When you think about the alignment between Cohesity and HPE, and when we look at what we can anticipate -- an explosion of activity at the edge and rapidly growing public cloud market -- there is a gorilla in the room. It’s the new role for inference and artificial intelligence (AI), to bring more data-driven analytics to more places more rapidly.
Any thoughts about where the relationship between HPE and Cohesity will go on an AI tangent product strategy?
AI enhances data partnership
Salmon: You touched earlier, Dana, on HPE InfoSight, and we are really excited about the opportunity to partner even closer with HPE on it. That’s an incredibly successful product in its own right. The opportunity for us to work closer and do some things together around InfoSight is exciting.
On the Cohesity side, we talk a lot about not just AI but machine learning (ML) and where we can go proactively to give customers insights into not only the data, but also the environment itself. It can be very predictive. We are working incredibly hard on that right now. And again, I think this is an area that is really just getting started in terms of what we are going to be able to do over a long period of time.
Gardner: Paul, anything to offer on the AI future?
Glaser: Rob touched on the immediate opportunity for the two companies to work together, which is around HPE InfoSight and marrying our capabilities in terms of predictability and ML around IT infrastructure and creative solutions around that.
As you extend the vision to being edge-centric, as you look into the future where applications become more edge-centric and compute is going to move toward the data at the edge, the lifecycle of what that data looks like from a data management perspective at the edge -- and where it ultimately resides -- is going to become an interesting opportunity. Some of the AI capabilities can provide insight on where the best place is for that computation, and for that data, to live. I think that will be interesting down the road.
As you extend the vision to being edge-centric, compute is going to move toward the data at the edge. The lifecycle of what that data looks like from a data management perspective at the edge is an interesting opportunity.
Gardner: Rob, for other startups that might be interested in working with a big vendor like HPE through a program like Pathfinder, any advice that you can offer?
Salmon: As a startup, you know you are good at something, and it’s typically around the technology itself. You may have a founder like Mohit Aron, who is absolutely brilliant in his own right in terms of what he has already done in the industry and what we are going to continue to do. But you have got to do all the building around that brilliance and that technology and turn it into a true solution.
And again, back to this notion of solution, the solution needs global scale, it’s giving the support to costumers, not just one experience with you, but what they are expecting to experience from the enterprises that support them. You can learn a lot from working with large enterprises. They may not be the ones to tell you exactly how you are going to code your product; we have got that figured out with the brilliance of a Mohit and the engineering team around him. But as we think about getting to scale, and scaling the operation in terms of what we are doing, leaning on someone like the Pathfinder group at HPE has helped us an awful lot.
Salmon: The other great thing about working with the Pathfinder group is, as Paul touched on earlier, they work with other portfolio companies. They are working with companies that may be in a little different space than we are, but they are seeing a similar challenge as we are.
How do you grow? How do you open up a market? How do you look at bringing the product to market in different ways? We talked about consumption pricing and the new consumption models. Since they are experiencing that with others, and what they have already done at HPE, we can benefit from that experience. So leveraging a large enterprise like an HPE and the Pathfinder group, for what they know and what they are good at, has been invaluable to Cohesity.
Gardner: Paul, for those organizations that might want to get involved with Pathfinder, where should they go and what would you guide them to in terms of becoming a potential fit?
Glaser: I’d just point them to hewlettpackardpathfinder.com. You can find information on the program there, contact information, portfolio companies, and that type of thing.
We also put out a set of perspectives that talk about some of our investment theses and you can see our areas of interest. So at a high level, we look for companies that are aligned to HPE’s core strategies, which is going to be around building up the hybrid IT business as well as the intelligent edge.
So we have those specific swim lanes from a strategic perspective. And then second is we are looking for folks who have demonstrated success from a product perspective, and so whether that’s a couple of initial customer wins and then needing help to scale that business, those are the types of opportunities that we are looking for.
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Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Additional disclosure: HPE helped defray the costs of production to conduct this interview.