At its .NEXT event, Nutanix has been stressing that the company needs to reinvent itself, moving beyond its hyper-converged base, despite the considerable risks in its larger objective of becoming a platform company that can redefine the datacentre’s private cloud.
LAS VEGAS – The power of creative disruption has been a constant theme here, at Nutanix’s second annual .NEXT customer event. Nutanix vocally and repeatedly has stressed the need, even in its present period of enormous success disrupting the industry, to take the risk of disrupting itself, in order to move forward.
“What we need to do is build and disrupt ourselves every single day said Dheeraj Pandey, Nutanix’s Chairman and CEO, at the start of his keynote Monday kicking off the event.
Mark Leslie, Veritas’ former CEO and founding Chairman of Veritas, who now teaches at the Stanford Graduate School of Business, was a featured speaker in the second day keynote, and he stressed the importance of companies remaking themselves when at peak strength. That’s the time, he said, when they have the ability to do so.
“That is the point of ‘maximum optionality,’ the success point in a company’s life, where you have maximum resources,” Leslie said. “At that point, you have the opportunity to create a brand new trajectory for your company.”
Leslie cited Oracle as a classic example there.
“They initially became dominant in the database business,” he said. “Then they moved into client/server ERP, declaring war on people like SAP who they had worked with in the past. It was an extraordinarily courageous thing to do, and they won.” He indicated that they then rolled up enterprise apps, beginning with their 2004 hostile takeover of PeopleSoft. They then entered the hardware business in 2010 with the Sun acquisition, and now [like almost everyone else] is retooling again, around cloud.
“They have undergone at least five transformations,” Leslie said. In contrast, he pointed to Sun, which had successfully transformed itself several times, but then missed the opportunity to leverage its best-in-class operating system technology and transform into a software company. Leslie said if they had done so, Linux would likely not exist today. Instead, Sun no longer exists.
Nutanix is in the process of taking a fairly large risk, transforming itself from a market leading hyper-converged vendor into a platform company which aims to do for the private cloud what Amazon did for the public cloud. In a world where private clouds are complex, and 80 per cent are considered to be unsuccessful, the goal is to provide a system that works, with consumer grade simplicity. The risk is that several other players – most of them considerably larger than Nutanix, are driving to that same goal, in a race where the player who reaches the line second is likely to be the First Loser.
“We know this is an uphill battle,” said Sudheesh Nair, Nutanix’s president. “Customers are a lot more ready now, and most vendors are still making incremental changes. If you don’t disrupt yourself when the time is right, the market will disrupt you.
“I’m not saying Nutanix is completely there – but I’m saying we have earned the right to compete in that space,” Nair added. “It will come down to our ability to continue innovation at the same speed that we have in the past, to maintain the culture that we have, and to take care of the customers. If we do all three of those things, then we have a realistic chance to become Amazon for the enterprise.”
Nair thinks that Nutanix does have certain advantages here over larger players.
“It’s all about the ‘horses for the courses,’” Nair said. “The bigger companies are like professional marathon runners. A company like EMC saw Data Domain come in with its strong dedupe product, so they scooped up Data Domain and became the king of dedupe. These kind of companies are really good at marathons, and given ten years, they will become the market leader.”
The catch – and it’s a huge one – is that today, no one has anywhere near ten years.
“It’s not about marathons today,” he said. “Hadoop didn’t exist five years ago. OpenStack didn’t exist four years ago. Containers didn’t exist three years ago. It’s no longer a marathon. It’s a series of sprints. The world today is better suited for agile companies. The market is ideal for very fast companies like Nutanix.”
Anton Granic, Nutanix’s Vice President, Americas West and Canada, also made a racing analogy in stating his view that Nutanix’s reinventing of itself is likely to succeed.
“What’s the likelihood of this longshot paying off?,” he asked. “This is my second shot with a small startup, having been with Palo Alto Networks. There are a lot of parallels between them. The parallels with the vision and the rod map are strikingly similar. Both came up with an innovative way to disrupt an existing market, but the opportunity here is exponentially longer. This culture of disrupting from within is going to be our biggest asset over the next 5-7 years.”