The Exchanges

Q Yeah. And you have a, you have a multi-cloud offering now, right? Uh, what is that?

A So we're the only player where a person, a company that allows you to run, well, one, we ran on all three clouds, but before you would run, say, app A on one cloud, and app B on another, and app C on another. Today, you, with our new announcement, you can run app A across multiple cloud providers. Now, why is that important? Well, if you're a customer in Australia, or you're a customer in Canada, Amazon, or say, Azure may only have one region. And if you want geo, if you want diversity and you only want, you only care about that market because you're a local Australian or Canadian company, the only way you get geo diversity is by going to another cloud provider because, and we've seen a lot of high profile outages, you know, and so they worry about like, am I going to get the diversity? The second thing is, you know, this, this market, the database market has a lot of baggage with Oracle's past behavior. So no one wants to get locked into any one vendor. So especially, Say someone like AWS who's got very broad ambitions as a company. And so one day you might find AWS competing with you and your core business. And so given that, um, companies do like the fact that they can leverage MongoDB to run on any cloud provider and, and leverage the best of breed services because the cloud providers are competing against each other. So Google may have some capabilities that are better tha…

AI assessment note: “you can run app A across multiple cloud providers”

Q controversy around Elastic. It seems to have, like, gotten itself tripped up in this whole conversation. So with this whole complexity of, like, open source and cloud and the relationship, like, what, what do you think of, um, I guess open source in 2021 for a young company. If you're a young startup, uh, is that like the way to go? Is that, uh, or is there an evolution there?

A Well, I think you first have to ask yourself, why are you trying to be open source? What is your, what's the strategy behind it? You just, you shouldn't just be open source for the sake of being open source. You should just say there's a clear strategy. For example, Snowflake is not an open source company. Datadog is not an open source company, right? So you can thrive as an infrastructure company without being open source. You have to ask yourself, what is it? Why is open source an important element of your strategy? And be very, very clear on that. For us, it's all about, you know, a freemium strategy to get people to use, um, MongoDB and to try it because the market's too big for us to try and market to the whole mark, you know, the whole market ourselves. We want to leverage the virality of open source to get broad adoption. So I think that's one. Second thing is you have to recognize that if you, if, if you're open source, the best way to monetize open source is open source as a service. If that's the case, then how are you going to make sure you have a moat around your, your product? And that the cloud providers don't come in and, and, you know, take your free version and compete with you. So you have to think through your licensing around like how you plan to license your product and make it simple for customers so that it's not confusing to them or to the market about, …

AI assessment note: “You shouldn't just be open source for the sake of being open source.”

Q Remarkable. And then you keep adding more stuff to it, like more features, more like product expansion, so data lake, search, online archive. And Realm, which was an acquisition, I believe. Do you want to talk about the, the, the product expansion thinking?

A Yeah. It really comes from a lot of customer feedback and our intuition about the market. So let, you know, you, you mentioned a bunch of products. So search, search is basically what we found. A lot of customers were dual homing data to both MongoDB and say elastic. And they said, this is crazy. We don't want to do that. And they said, we really want to, you know, embed all, you know, our OLTP functionality along with application search in one platform. It's much easier to maintain. We don't have to manage two systems, learn two platforms, blah, blah, blah. And so we've now embedded that. It just makes life so much easier for customers. And Elastic themselves are going more towards a security space than application search. Um, the, the second area around, uh, Realm, Realm.

AI assessment note: “It really comes from a lot of customer feedback and our intuition about the market.”

Q really interesting when I was, uh, when I was researching this and ahead of this talk, like I actually, I hadn't realized to which extent the, the MongoDB open source project has continued to just like explode in, in popularity. Um, what, what are the key drivers, uh, behind that? Like, what, why, why do you think, um, it's, it continues to be so incredibly popular and, in fact, accelerating?

A Well, I think the first thing is like, one, you've got to have strong product market fit. And what essentially MongoDB did was address two fundamental problems with the relational database. One, the relational database where you're trying to basically disaggregate data into rows and columns is a very counterintuitive way to model data. It's frankly, it's not aligned to how developers work. And it just, and as the data model grows, it becomes more and more brittle and it's It's harder to change. I mean, talk to anyone who wants to do a schema change and they'll roll their eyes because they know how painful that is. Well, we essentially solved that problem by coming out with our document architecture, which is much more, uh, um, conducive to the way developers think and the way developers code. So it just makes it so much easier to use MongoDB to build applications, to do it quickly and to do it more powerfully. The second big challenge with relational databases that are not designed for scale. I mean, Oracle was founded in 1977. We're talking about a company, a company that's now 44 years old, and they still haven't solved a scalability problem. You know, they've had like Oracle Rack, SiteCard, you know, and other ways to try and replicate data. They're super expensive because the relational database was designed to be a single node system. So as data volumes grow, their archite…

AI assessment note: “So that's why we've gotten so much popularity”

Q Amazing. Um, so if part of the evolution of the license was to sort of clarify the relationship with the, the cloud vendors, um, how do you work with cloud vendors these days? Like what, what can they do? What, like how do you incorporate or partner with them?

A So obviously with Atlas, it has to be deployed and delivered to the cloud, so we have to work with cloud providers. In fact, the cloud provides helps subsidize the R&D effort to deploy Atlas on the cloud platforms, because remember, They're the beneficiaries of these workloads moving to their platform. Not only do they get, you know, revenue from the underlying consumption of storage and compute and network services, but they also, they see customers for every dollar to spend on Atlas, they probably spend another five to 10 dollars on other ancillary services. So, so they're motivated to drive, you know, those workloads to the cloud. Now, Amazon and Azure in particular have competitive offerings, but we feel we're very, Well positioned when it comes to going head to head against those, but there's a, there's some spirit of competition. And that's, that's like we've been dealing with the big guys, Oracle from day one, Microsoft, and obviously now Amazon. Um, and that we recognize, you know, the market's large enough and we feel like we're well positioned. Um, and, and they've actually helped subsidize and drive a lot of marketing, right? They give us marketing dollars to drive customer demand. We partner with them on events. We partner with them on deals. They align the sales compensation to incentivize working to have their salespeople work with us. So there's a lot of, you kno…

AI assessment note: “We partner with them on events. We partner with them on deals.”

Q um, so you mentioned that you use open source as a freemium, um, kind of, um, strategy. Is that, is that for a company of the, you know, global scale of Mongo, is that, is that still the core motion? Is that like sort of bottoms up or is there, Also top down of like, uh, you know, AEs are going directly to CIOs. Like how do those two motions?

A Yeah. So, um, so our business starts to stop with developers. If developers don't use our product, we don't have a business. So we have to make sure we drive a lot of developer enthusiasm by using MongoDB. That being said, developers don't necessarily have the right to say yes. They have the right to say no. They can kill a deal by saying I'll never use MongoDB and you're done. But just because they like MongoDB doesn't mean that you're going to get a check in the mail from the customer, right? So you have to then Translate developer enthusiasm and interest into a real business, you know, value proposition for some decision-maker. It's not always a CIO. It could be the, you know, VP of infrastructure. It could be the line of business, depending. And in our business, it's a land expand. So we're not like a Workday or Salesforce. We're making an enterprise-wide decision day one for the whole enterprise to use your platform. You know, we coexist with Oracle, we coexist with Microsoft, we coexist with other players, right? And we want to get that first workload. And we find the relationship is kind of tends to be in three stages. First, you kind of land, land a workload or a few workloads. Then you find a JCC to expand into as they see successes. Okay, I should use MongoDB for the next application or re-platform an existing application. And then maybe over time, maybe even years, t…

AI assessment note: “Translate developer enthusiasm and interest into a real business, you know, value proposition”

Q and then it progressed to representing 23% of revenues in, uh, fiscal year, 2019. 39% in twenty-twenty and now 46% in twenty-twenty-one. So, uh, it's gone from zero to being almost half of the company's revenue. Um, I just, I just think it's absolutely fascinating and super impressive. So, uh, maybe as a level said, what does Atlas do so folks can, uh, get their, wrap their minds up? Sure.

A What Atlas essentially allows people to do is consume MongoDB as a service. It's a managed offering delivered, um, from the cloud, and we run on all the three major cloud providers. And you pay as you go. So you can start the, you know, the cheapest paid tier is like nine bucks a month. So it's literally like, you know, like having two cups of coffee a month to, we have customers now spending, you know, seven more than seven figures with us on Atlas. So depending on how big your deployment is, how much resources you need. And it really, um, ranges the gamut in terms of, uh, a variety of customers. I would say there's two big reasons why customers love Atlas and why I'm one big reason why It really helps MongoDB. So the two big reasons why it helps, um, uh, customers is one is it just makes it that much easy to consume, um, um, MongoDB because MongoDB has had a very strong product market fit. And one of the other things customers care a lot about is getting rid of undifferentiated heavy lifting, right? And managing a distributed database can be quite challenging. And so when they, when they basically say, you know, why don't you, the experts manage it for us, it just alleviates them. And a customer will always tell us, you know, my competitive advantage is not by hiring more DBAs and more support staff. My competitive advantage is by building great product, adding new features, …

AI assessment note: “What Atlas essentially allows people to do is consume MongoDB as a service.”

Q Okay. Thank you. And data lakes is part of this as well, right?

A Correct. Correct. So as, so we're leaving people to use the power of our query language to query data, not just from MongoDB, but from other sources. And it's not necessarily trying to, we're not trying to be a data warehouse. We're not trying to compete with With, um, Snowflake. It's more to help developers, because we believe that applications of the future, even today, are more and more instrumenting the business. So applications are not embedding analytics, especially real-time analytics into apps. Think about, like, a leaderboard for a gaming application. Think about financial app. Think about supply chain apps where you have to have real-time, you know, information. So being able to embed analytics is going to be even important, and our focus is really helping developers use data to build amazing applications.

AI assessment note: “Correct. Correct. So as, so we're leaving people to use the power”

Q Actually, on that, on that, uh, on that note, like any, um, you know, building, BladeLogic was based in Massachusetts, uh, Mongolton being built in, um, in the, in New York, at least originally, even though I think you had also a core headquarter on the West Coast. Like any, any, any thoughts on the ecosystem and not building enterprise software out of the East Coast?

A So, um, one, I personally love New York City. It's my favorite city in the world, and I've been to almost every major city in the world, um, so I'm thrilled to see. When I started BladeLogic, I actually wanted to build it in New York City, but at the time, um, it was very hard to recruit people who were willing to, you know, you're trying to recruit from, you know, the big banks and so forth, and there are people who really, you know, wanted to kind of maintain their cash comp, but then also have big equity, and obviously, in the startup, you have to be willing to trade. Cash for equity. So culturally, there wasn't as many people who had that entrepreneurial mindset. There was obviously some interesting companies. Obviously, uh, DoubleClick was doing well, and, uh, you know, ad tech was, was a big space, and new media was another hot area, but hardcore tech was not a place for, for, uh, New York. I think what's changed is one is the access to capital. Obviously, you know, you know, firms like Firstmark and others have done a lot of investing in New York, so it's actually encouraged entrepreneurs to, Key companies in New York. I think the nice thing about New York is you can walk out your door whenever you get back to your office and be able to, uh, you know, basically walk to a customer and you can walk to some very large customers, you know, in a 10, 20, 3040, you know, block …

AI assessment note: “I think what's changed is one is the access to capital.”

Q IPO, uh, maybe talk to Teams and, and hiring, and like, what do you want to do, you know, before IPO versus IPO? Do you, do you, um, have to recruit a completely different set of folks as you, as you scale? And then, uh, you know, what are the right type of folks that you want, uh, you know, as a growth stage startup versus as a public company?

A Yeah, so I view my job that I need to do three things well. I need to be very clear on what our strategy is, at least, you know, the next, you know, couple years. I need to make sure I have the right people in the organization, especially the executive team, to go execute on that strategy. And I need to remove any barriers, whether they're cultural barriers, you know, financial barriers, organizational barriers, to make sure people are set up for success. So obviously with our strategy, we're not changing that every day. So once you're clear on the strategy, then a lot of the focus is on On people. In fact, sometimes I joke with my chief people officer that I'm like the glorified head of HR because 80% of the issues I'm dealing with are on people. Who's moving up, who's moving sideways, and sometimes who's moving backwards. And in a high growth business, not everyone scales at the same rate, right? And so, um, you know, it's a, it's not a secret, but since we've gone public three and a half years ago, we've had six C-level changes, right? So, so essentially almost two a year, right? Because certain people hit a wall, And you, and you as a leader need to, one, see when someone is starting to struggle, right? It's almost like watching someone swim and it's starting to struggle when the, you know, they may be starting to, like, you know, keep their head above water. You can start …

AI assessment note: “since we've gone public three and a half years ago, we've had six C-level changes”

Q there's this tension between, like, bottoms up and, and, and, and top down, um, but, like, at your scale, there is still no, Sort of like temptation to just say, Hey, you know, everybody knows Mongo now. So yes, I mean, it's great to like the developers love us, but like, why don't we go directly to the CIO? Because the CIO by now knows Mongo, right? So you guys.

A Yeah. So I think you have to really understand customer buying behavior because even the CIO says, I want to standardize MongoDB. They don't have the time or the resources to replatform every app onto MongoDB. Think, but look at Oracle. Oracle is the most hated vendor in our tech industry. In the tech industry today, but still tons of Oracle because it's very hard to unravel every Oracle app that was built. So you're still going to see a lot of Oracle out there. So what customers want to focus on is where am I having the most pain? You know, we tell our salespeople look for where the pain is in the organization. Either they need to address a pain point for building a new app, or they need to replatform an existing app because, um, you know, the users are complaining or they're just not being able to service the business properly. You know, find where they have the most pain that typically more the pain, the more the dollars are available and the more attention of senior management. And then we use that as a wedge to get in the door and then use that as a way to, you know, so once we get in the door, our net expansion rates are very high because obviously we can then start winning more and more workloads. And as you get more and more traction, the velocity of the new winds start accelerating. So you have to, we, we encourage ourselves to be able to go slow, to go fast. You don't…

AI assessment note: “even the CIO says, I want to standardize MongoDB. They don't have the time”

Q Is there stuff on the product roadmap that you can talk about?

A Yeah, I mean, I would just think of us as we really want to be an application data platform. So a lot of people sometimes confuse us. Are you competing with Snowflake? Are you going after Databricks, you know, or Dremio or other companies like that? And our focus is only around, is predominantly, I should say, around the developer. If you read Snowflake's S-One, they never mentioned the word developer. That's all about the business analysts, The data scientists, et cetera, to help them kind of get, you know, insight into the data. We're really focused on helping developers build amazing applications and leveraging software and data to do so. So you'll see us expand into, you know, other capabilities that developers need to kind of build applications.

AI assessment note: “you'll see us expand into, you know, other capabilities that developers need”