The NoSQL market is certainly a hotbed of activity at the moment. In the past year, diginomica has had some very interesting conversations with some of the leaders in the industry. For example, DataStax’s co-founder Matt Pfeil told me that he believes Cassandra will be in 100% of the Fortune 100 over the next decade.
Whilst MongoDB CTO Eliot Horowitz explained in a very frank interview where exactly he thinks enterprises should be rolling out their NoSQL environments. It also recently emerged that Mongo is taking direct aim at Oracle with its new consulting arm – no small feat.
This week news has come out that both Basho and MongoDB have secured large sums in funding to continue driving growth in the companies – Mongo received $80 million, Basho $25 million.
The excitement is being driven by the possibility of delivering web-based applications that rely on unstructured data, at scale, on commodity hardware. That’s not to say that relational databases are out – of course they’re not. However, enterprises that are looking to venture into fields that include the elusive ‘big data’, the internet-of-things, or true ‘internet apps’ (such as Netflix) are finding that NoSQL has got to a point where it can now give them the capabilities, resilience and scale that they need.
The market isn’t tied up yet, however. You attend a NoSQL conference and its still full of developers that are trying to get to grips with the ins and outs of how the technology works and understanding its pain-points. It hasn’t quite reached the business level awareness that is required for long-term growth (in most cases) – it will, it’s just still scaling that maturity curve.
But enough by way of background. This week I was given the opportunity to catch up with recently appointed appointed CEO Adam Wray. Almost 10 months into the job, Wray believes he has made some good headway in addressing the concerns he had upon joining. Back in March, he told diginomica:
One of the things we have not done very well is listening to our clients and community in how it drives our specific road map. People look at us and have a hard time figuring out what we want to be when we grow up,” Wray said.
“The developers all know who we are, but if you talk to the business people it’s hit-and-miss. One of the things we have to do is simplify the product so devops can engage with it even faster and understand the power of what it can mean to use our solution set.
He believes that the $25 million in Series G funding announced this week has helped with this. According to Wray, the funding has been used to refine the Riak product (the open source NoSQL database that Basho has built its business around) and ramp up sales and marketing. He said that part of Basho’s primary focus over the past year has been to illustrate to clients through use cases how they can extrapolate Riak and Basho into larger production environments.
We took in the funding to foundationally set the stage. As part of coming into the company – we had passion, community, core Fortune 50 to Fortune 500 customers, great products – but Basho had kind of lost some of its focus and some of its momentum. When I came on board and built the new management team and integrated it with the old management team, we used a chunk of this net new funding and we started off in investing in the product and making sure that the product became more refined and aligned with our enterprise client needs.
Our typical client is one that deals with big data, has a lot of unstructured data use case needs, has a lot of complexity – but are looking for a chance to simplify. We have a land and extend model, where we do one use case with a customer and then over time prove how they can consolidate more use loads into our distributed systems foundation.
We used a big chunk of the funding to make sure that the product is easier to implement, continues to scale, whilst adding more functional. And on the other side we have refined our sales and marketing engine so that they can start to ramp up, which is starting to show in the numbers.
And what of the numbers? According to the Basho press release bookings grew 62 percent sequentially in Q3 and 116 percent sequentially in Q4; bookings grew 88 percent from the second half of 2013 to 2014; 2014 ended with 87 percent licensing, 13 percent professional services revenue; and a number of multi-million dollar enterprise deals were done. The release also highlighted the shipment of Riak 2.0, Riak CS 1.5 and the replacement of Oracle with Riak at the National Health Service in the UK (a big win for Basho in Europe).
Wray also told me that Basho now has more than 200 enterprise clients, with pretty much equal weighting between North America and Europe (40%+ of revenue coming from the latter).
- MongoDB CTO on when Mongo works and when it doesn’t
- Viber migrates from MongoDB to Couchbase halves number of AWS servers
- DataStax co-founder: “We will get Cassandra into 100% of the Fortune 100”
- Hadoop, Cassandra vendors see NoSQL applications emerge
Wray added that a big focus for 2015 is going to be building out Basho’s partner ecosystem. This is where he says enterprise clients will buy in to Basho, through systems integrators adding Riak to hybrid environments. He said:
That’s how we sort of closed out last year with the funding and into this year. And with regard to continued scale we are going to be investing more into our partner ecosystem, we are going to continue to invest in product innovation to give our clients more reason to consolidate and simplify their architecture.
The prime opportunities are going to be product innovation, continuing to play upon distributed systems that scale with simplification with a partner ecosystem. We have some great regional partners that have some great regional strengths, but you are going to see us announcing very large strategic partners with some of the large global integrators.
If you are dealing with production level systems, where people are spending tens of millions of dollars, that means you are going to have large integrators helping pull those pieces together for them, and we are going to be more integrated into those solution offerings so that we can support a model where half of our go to market is direct and the other half is solutions bundled into larger offerings.
Wray also explained that Basho has made some progress in addressing clients concerns about the company’s roadmap – which, as stated, was his primary worry when joining. He said that Basho has gone “180 degrees” in terms of setting customer expectations on what Basho is trying to build with Riak and this has resulted in clients making long(er) term bets with Basho. He said:
Our average deal size has gone from a year to multi-year now. We are even seeing clients going from three to five years or greater. And the reason you are seeing clients making long-term bets on us is because they buy into our story – where if the world is becoming distributed in nature, you will need a distributed database to address a big chunk of your unstructured data needs. And so they are looking for someone that can take on multiple use cases and consolidate with.
Wray likes to use a baseball analogy for the NoSQL database market. He believes that in terms of market growth and adoption, NoSQL (or enterprise adoption of NoSQL) is only in the ‘first innings’ – or even possibly the first bat in the first innings. He believes that the four main contenders for stealing the market in the future are Basho, MongoDB, DataStax and Couchbase. All of which, Wray argues, have their own strengths. He said:
For example, Mongo has done an excellent job of appealing to the developer community. Datastax has tapped into the Cassandra ecosystem. Our differentiation is our key value database; you can build a lot of different use cases on top. And we have proven we can do scale, in distributed environments, with high availability (e.g. the Weather Company and the NHS). Operational scale, with simplicity, in a distributed geographic environment is going to be our core attribute that differentiates us.
He added that over the past three years companies have only been “tinkering” with NoSQL and only now are people really beginning to ask how they can apply the technology to their production environment. Wray said:
And so that means that the scale, and the problems in addressing that scale with regards to complexity, are just coming to the forefront with a lot of real dollars. We might not only be in the first innings, we might only be at the first bat in the first innings. But wherever you want to put us in that maturity curve, it’s definitely early. The market itself has a lot of potential to be a lot larger than the RDBMS market – which is by some estimations $35 billion to $50 billion in revenue.
I would say that that market space isn’t going away. If you think RDBMS is dead, you clearly don’t understand enterprise – enterprise doesn’t change on a dime. Mainframes still exist. But I do think that this market space will be much bigger because of IoT, hybrid and big data. We have an opportunity to define us as the number one player in this space if we do it right.
Every time I speak to one of these NoSQL execs I’m pretty impressed. Given the early stages of the market itself, it seems that they haven’t quite yet been rid of the ability to hold interesting conversations – which is often the case with vendors, thanks to PR/marketing/comms.
As Wray says, it’s all to play for. The next couple of years will be interesting in terms of enterprise adoption. The years following that will be interesting in terms of whether or not we see any consolidation/acquisitions.
The decision customers face is – which platform do we buy into? It’s a tough one.