Big Switch Networks CEO Murray On Hiring Blitz, Strong Relationships With Dell EMC And HPE, And The Cloud Mission For Partners
Big Switch CEO Doug Murray says his company has reached the point where it needs additional leadership personnel as well as manpower in other areas to sustain its fast pace of growth.
Switching It Up
Software-defined networking firm Big Switch Networks is signaling that it is ready for life in the mainstream with the hiring of three new sales and engineering leaders, as well as a key promotion, all designed to accelerate the eight-year-old company's sales and channel strategies.
CEO Doug Murray said the Santa Clara, Calif., company has reached the point where it needs additional leadership personnel, as well as manpower in other areas to sustain the fast pace of growth it's seen in recent months. The company, Murray said, is trying to maintain an 80 percent year-over-year growth rate as its cloud-focused data center networking portfolio takes hold among a widening set of large enterprise customers.
"I've been at the company nearly five years at this point, and when I joined, we didn't have a shipping product yet," Murray said. The new execs come "at a time when we're doing well and accelerating, so I'm very proud to hand the ball off to them to have them help us get to that next base camp."
Big Switch's new hires are Alan Hase as chief development officer and vice president of engineering; Brant Kennedy as vice president of worldwide sales; and Derek Donahue as vice president of sales Americas. The company also promoted Dana Aiken to a new role as vice president of sales strategy and enablement operations.
What follows is an edited excerpt of Murray's conversation with CRN.
What's the impetus behind bringing on these new execs all at once?
Early in the journey, it was about getting the first 50 to 100 customers, proving out the various use cases, prioritizing investment based on customer reception and starting to build the foundation for a partner ecosystem that includes strategic partners like Dell and HPE and starting to build out our channel partner ecosystem and alliance partners, as well as companies like Nutanix and Red Hat. That has led us to a point of inflection where we're much more mainstream with respect to the logos we're landing and where we're getting deployed. We feel it's a perfect time to double down on investment in the product side, with an emphasis on cloud, and the go-to-market side, which is why we brought on Brant to run worldwide sales, Derek who joined us recently to handle the Americas, and Dana, who has worked with us for about a year, to do sales enablement.
What are some of the initiatives you have planned that made it necessary to expand the leadership team?
How does our inside sales team work effectively with the channel? How do we effectively turn on the channel to get them excited about the newer architectures and the way people look at Big Switch? As we move from where we are up to the next base camp, you have to bring in great leaders, people who have the experience and can help reshape how we're looking at some of the next steps relative to our sales channel and the product side, as well. It's an exciting time because not only are we growing -- in the trailing 12 months we grew 80 percent year over year -- but we're also investing a lot in our people and our partnerships. We've increased headcount 4X since I joined the company. A lot of emphasis is on culture and how we take the culture internally and bring it to the partners in our ecosystem and out to our end customers, as well. That's why we're adding more firepower to the leadership team.
Is the growth you mentioned pushing you to add even more people in the near future?
We're continuing to grow significantly. We have more than 30 positions that are open in our field organization. I'd expect the expansion to really continue in the next 12 to 24 months. When you're doubling the sales force and you're trying to double from a revenue perspective, it's very important that you're focused and disciplined around on-boarding, sales productivity, getting folks trained and up to speed, reducing cycle times, getting a heat map so when a new rep comes into a territory they know their channel partners, their technology partners, here's the pipeline, here's the recipe. That's a very strategic thing.
What do you want your channel partners to know about the expansion of your sales leadership ranks?
It's very important to look at it as investing in the go-to-market machine to make our relationships with channel partners even more successful. In the early days of the company, a lot of that was done in a fairly boutique sense with specialized partners in each market. As we move to this next wave, having that experience from a channel point of view becomes important. Both Brant and Derek, one of the really important things they bring to the table is the extensive work they've done in the past with the channel. That was a key part of our hiring criteria. It's very much about how you leverage the channel as an important part of our model. Today, 100 percent of what we sell is through partners. It's a big focus for us. We're a pure-play software company, so the value-add for our partners is significant. They can take our software, bolt it together with our partners' hardware – servers and switches – and create value-add by packaging all of that together for the end user.
What are your marching orders for your new sales leaders? What do you want them to be doing as soon as they hit the ground?
The first thing they're doing, especially Brant and Derek, is getting out in front of customers and partners. They're spending their first 60 days really getting out spending time with customers and partners and seeing in markets where we're mature what's working and what's not. In markets where we're just entering, they're trying to get the repeatability we're seeing in other markets. They'll get to a point where we know when we move into a new territory this is how long it takes for a channel partner and our account managers to become successful. Since we're a subscription business, the ability to continue to grow at 80 percent-plus per year is something we continue to see in our projections, and a lot of that is renewals, but a lot of it is going to be getting them out to spend time with, and get deeper and closer to end users themselves, so we can focus on what we can do to accelerate the business.
How ready is the market – customers and the channel – for that type of sale?
It varies, and it actually varies greatly. Because we support more than 60 different switching platforms, there are some companies we partner with that are fairly niche-y, and want to use us for a specific market. They want to use us as a way to provide value and differentiation for people who do nontraditional networking. There are other cases where it's much more wed to a specific brand, so with Dell or HPE in the Fortune 500. The Fortune 500 all inevitably have contracts with big companies like Dell and HPE and their whole partner ecosystem. In that case, there's a level of comfort with the brand, the support structure and the channel structure. One market that matured very quickly for us was Japan. We have companies that sell our products in Japan, and their success is really about how they bring all of this together into a comprehensive solution, or even service. They've really latched onto this. In some cases they use Dell switches. In some cases they use HPE, or Quanta switches, then they wrap services on top of that. In other markets, it's more nascent, and they're just getting their feet wet.
How much of your growth is the result of customers really pushing to drive digital transformation by getting into next-generation networking?
That's a considerable part of the move. A lot of the early adopters we have by vertical have become champions for the technology, for the category in terms of next-generation networking. Because of that, they help elevate us within the category. Once we cracked through to get some good traction in the carrier space, it in essence goes viral. If we're in with a company like Verizon, the other companies in the market are very intrigued and want to see what they did and what benefits they got by going down this path, and 'what's in it for me?' Once we landed our first mobile carrier in Japan, we were able to get all three of them fairly quickly. The vertical element becomes fairly important. You'd never think oil and gas would be one of the first industries to come across the chasm, but once we got our first oil and gas customer, we landed our next oil and gas company in the next quarter.
What other industries have you successfully expanded into?
Our core areas tend to be carriers, financial services and government. We're seeing that as we cross the chasm, and become mainstream, it's universities, it's big companies like National Instruments. It's a ton of universities. As we look at financials like USAA, they all then speak to each other. That actually helps with the sales cycle because people who have peers in that space call them, get input and references, and it accelerates how we do proofs-of-concept. Some of our early users, early adopters, end up getting promoted, or they go into different roles, and that's made them even stronger advocates for the change. That effect is significant for us in terms of getting the flywheel going.
What advantage do you think you have in the market over more traditional, or larger, competitors like Cisco, HPE Aruba or Extreme?
A lot of things. No. 1 is we have a great emphasis on the cloud. The way we operate our technology is very similar to the way you'd operate something in Amazon. Playing to our strength as it pertains to cloud-on-prem, if you will, is something that is very important. In one respect, we're really looking at things as a cloud company from a networking point of view, and flexibility across clouds. You're in AWS, but you'd also like to leverage [Microsoft] Azure, it's helping to make sure you can enable a multi-cloud strategy.
It sounds like customer choice is also an important differentiator for Big Switch.
Choice and freedom in two areas specifically: One is hardware platforms, because we a multitude of different hardware platforms. If a customer is with one of the hardware platforms we have and they decide they want to go with another one for the next workload or application, they have the flexibility to do that. The second thing is freedom with respect to how you use the product. That's a very important part of our differentiation. We have a lot of companies that use VMware vCenter. We have integration with Kubernetes and MesoSphere. We do work with Nutanix and their management console. That level of flexibility is very important to us. Then, it's about how they buy the product. Some customers say it's great that they don't have to pay for something that's perpetual up front. They can just buy a year of it and come back and renew it. It allows customers to buy based on what their budget looks like and with flexibility around how they consume the technology, as well.
Do you see customers becoming more savvy about multi-cloud, and how they manage their environments?
It's clear that the multi-cloud/hybrid cloud wave is coming. People should be betting on how they assist customers with that transition and how they balance on-prem private cloud with what we see in the hybrid and public sense. Fortune 1,000 companies have reasons why they need to keep some data on-prem. If they have five data centers, they're not going to flip a switch and shut them down and put everything in AWS, or Azure or Google Cloud. What they might do is, instead of building a sixth data center, they'll refactor what they have and data center seven might be AWS and data center eight might be Azure. So many discussions we're having with customers are around what does it look like on-prem now and what does the environment look like from a networking point of view and a security point of view as we migrate specific workloads into the cloud.
How much better have customers become about taking charge of those decisions and deciding what workloads are going where and what it's going to cost them?
From the customer conversations I have, it's still early. In many respects, they're looking at their peer group to see who's moving what where, and some CIOs who are incredibly innovative are forcing the issue. The CIO will chime in and say, 'This isn't about the next three to five years, we're doing this next year.' There are others that are being fairly creative, too. We have a Fortune 500 customer that has a series of data centers. We sold the first product to them, the monitoring fabric, then instead of building new data centers, they would refactor and prioritize workloads on-prem and take other specific workloads and move them to SaaS apps or out to the cloud. We're now live in five of their data centers and it's a very successful deployment. Companies like that are being innovative with the balance, but they're still working through it. People still underestimate the cost associated with cloud. There's a misconception out there that it must be cheaper.