April 6, 2016

Excerpt from a recent IDG article, which was also picked up by Silicon Valley Business Journal.

Meg Whitman

About two years ago we started a program called Pathfinder, where we are taking advantage of our position in the middle of the greatest renaissance in B2B infrastructure and security and big data that’s happening anywhere in the world. It’s right here in Silicon Valley. We basically said, “For those four transformation areas, we’ve got to partner with some of these young companies and integrate them into our solution so we can offer the newest technology best-of-breed.” We just led the financing round for Mesosphere, and so our job now is to help companies understand what DCOS {Mesosphere’s Datacenter Operating System} represents and then integrate it into their environment as they transition to a hybrid world.

We are increasingly forming partnerships and making investments in these small companies that we then curate for enterprise scale. A lot of CIOs tell me, “This is all great. There’s a new security company being born in Silicon Valley once a week. What am I supposed to do with all these companies? Am I supposed to integrate them all into my environment? How do I know they scale? How do I know if someone will be able to service them?”

So we’re going to try to be a curator, if you will, because if we integrate a young company into our solutions, we have to be able to support them globally. We have to be able to break/fix globally. By the way, I think that will make us very relevant to customers. Someone asked me the other day, “But Meg, when you integrate these young companies into the go-to-market powerhouse that is Hewlett-Packard Enterprise, these companies could go from $4 million to $40 million to $150 million to a billion dollars relatively fast and you will only own a small percentage of the company.” That is correct. And, by the way, if that’s true, we will have increased our relevancy to the CIO and I’m sure they will buy a lot more of the more traditional Hewlett-Packard Enterprise offerings.

But we can’t buy all these companies. First of all, there’s too many of them. And in security, by adopting companies to integrate into our solution, if another one comes along that is better for our customers, we move to that one and we’re not stuck having paid $200 or $300 million for a company. It’s a different operating model for Hewlett-Packard Enterprise, it’s a big cultural change for the company, because we are used to selling only what we own, for the most part.