Developers and SI relationships are helping to drive customer adoption, according to MongoDB CEO Dev Ittycheria as the firm reported an 82% year-on-year increase in subscription revenues.
For Q1 2020, the database firm turned in overall revenues of $89.4 million, up 78% year-on-year subscription revenues making up $84.0 million of the whole. Net loss in the first quarter was $33.2 million as the firm continues to invest - or as CFO Michael Gordon put it “burn cash” - in future developments.
But investing to innovate is critical, argues Ittycheria, in order to tap into the potential of the market opportunity:
IDC recently updated its forecast and expects the worldwide database software market to grow from $64 billion in 2019 to approximately $98 billion in 2023. We believe that much of this incremental $34 billion will come from modern applications and new workloads, which we are well positioned to capitalize on.
Achieving that requires a number of pieces to be in place, he adds:
For a new platform to succeed, it has to be embraced by the developer community, given the disproportionate influence developers have regarding technology decisions. Our developer mindshare…demonstrates that MongoDB has clearly established itself as the most popular modern database platform in the world.
Second is the growing recognition that, because working with data is so critical in building applications, using a modern general purpose database platform enables businesses across every industry to innovate faster and respond more quickly to new market opportunities. Customers are increasingly choosing MongoDB for their mission-critical workloads to drive innovation.
Third is the increasing importance of being able to easily move applications across any compute environment. Customers want the flexibility to run applications on-premise, in a private cloud and in the public clouds without being locked in with any cloud vendor.
Ittycheria sees a trend among customers of leaning towards hybrid cloud environments rather than placing ‘all or nothing’ bets. This plays well to MongoDB’s strengths, he argues:
We are at the early stages of the largest platform shift in history with the move to the cloud. Customers are still figuring out this transition and there are a number of approaches being taken. MongoDB provides complete optionality for customers to make this transition without locking themselves into a course of action and gives them the ability to make continuous adjustments. In short, customers can confidently future-proof themselves by choosing MongoDB.
He cites a number of use cases to make his point, beginning with tech vendor Splunk:
When Splunk needed robust handling for non-relational data to complement our extensive IP they naturally chose MongoDB. Splunk embeds MongoDB into the search head component of every deployment of MongoDB's Splunk Enterprise to store application state and configuration data.
TIM, formally Telecom Italia, a leading telecommunications provider in Italy, is adopting MongoDB for their customer usage data, which was traditionally stored on a relational database. MongoDB is also used within their new service delivery platform as one of the fast data layers to guarantee quick access to information.
Renewable energy provider Enphase Energy is a global energy technology company and the world's leading provider of solar micro-inverters. They decided to migrate from DynamoDB to MongoDB Atlas. Atlas will provide Enphase with the ability to reduce risk, automate processes, scale elasticities and meet their future global availability needs.
Auto Trader UK, the UK and Ireland's largest digital automotive marketplace, has been using MongoDB since 2011. They recently made an internal decision to move to the cloud and saw immense value in using MongoDB Atlas for removing the operational overhead of their existing deployment.
FanFight, a fantasy cricket league based in India, built their business on MongoDB to accommodate the dramatic fluctuation in concurrent users anywhere from 10,000 to 100,000 depending on their team or the match. They chose MongoDB Atlas to get a better insight into real-time monitoring, improve their scalability, low response times and take their platform to the next level.
It’s a varied bunch of logos, but there are some unifying themes, suggests Ittycheria - a trend towards using SIs as an application development arm. To that end, MongoDB has been fostering what he calls the “natural synergy” with firms such as Accenture, Capgemini, Infosys, TCS, Cognizant as well as local boutique vendors around the world:
The use cases are quite varied. Some SIs are focused on the financial services sector or the healthcare sector. Others are more horizontal. Others have a more of a geographic focus. So, it really depends on the partner. We typically try and work with a partner that's best positioned in a particular customer account. And then, we have, obviously, some strategic relationships that span all theaters and it just depends on the situation of who we partner with…Many of the deals SIs bring to us would most likely have involved longer sales cycles and smaller initial deals without their involvement. Their trusted relationships give those customers the confidence to sign larger initial deals with us and to include MongoDB at the core of their digital transformation initiatives.
A good example of MongoDB’s investment strategy is the recent acquisition of mobile database and synchronization platform provider, Realm. Ittycheria explains the rationale for this move:
Data synchronization is the single biggest challenge in building compelling mobile applications and Realm has developed a comprehensive synchronization platform that is a natural complement to MongoDB Atlas and Stitch. Realm reinforces our run anywhere strategy and, like MongoDB, is focused on giving developers a far more flexible, intuitive and comprehensive way to work with data.
There will be more detail on how this works in practice at MongoDB’s user and developer conference in New York next month, but Ittycheria clearly sees much in common between his firm and Realm:
Much like the founders of MongoDB, the Realm founders came from Nokia. So, they had a lot of experience building databases for mobile devices, especially for featured phones, and they saw all the challenges with those legacy solutions. So, they've built a database optimized for the mobile device, including very sophisticated data synchronization protocol to basically synchronize data back and forth from the mobile device to the back-end server and vice versa, especially dealing with slow or intermittent connections.
Moreover, they built a very sophisticated API, so as data changes, the UI would be updated in real time. And the trend now is to build these very rich mobile applications that represent data in real time. And data is the biggest challenge with mobile. And so, we were very attractive to Realm because of the developer mindshare they have. Much like MongoDB, their data model is very similar to ours, and so they had a lot of developer traction.
Speculate to accumulate. MongoDB has been candid about its intention to continue to invest in product expansion and that’s the right thing to do. Ittycheria is correct to point to the tipping point potential offered by the emergence of a new generation of databases. As someone who cut his milk teeth in this game by covering the Database Wars of the 1990s as Oracle finished off Cullinet and out sold and out marketed pretenders like Ingres, Informix and Sybase, the promise of a re-imagining of the battles royal on a fresh battlefield is compelling. It's Chinese curse time - to live in interesting times. More to come when Derek reports from MongoDB World next month.