cherezoff - stock.adobe.com

Informatica CEO: ‘We’re the Switzerland of data’

Informatica CEO Amit Walia talks up the company’s role as the ‘Switzerland of data’, helping organisations to manage data across different platforms as it transitions into a cloud-first supplier of data management tools

Famed for its on-premise extract, transform and load (ETL) tools to move data from source to data storage systems, Informatica has been paving the way for its move to cloud since 2016, when it started to build what is now known as the Intelligent Data Management Cloud (IDMC).

The move has expanded the company’s addressable market by about seven-fold as more organisations shift to cloud-based databases, data warehouses, data lakes and other cloud-based data platforms to store and analyse their data.

On a recent trip to Singapore, Amit Walia, CEO of Informatica, elaborated on the company’s role as the “Switzerland of data” in helping organisations to manage data across multiple platforms, the demand factors that are fuelling its growth, and what the company’s cloud-first strategy means for customers. Here are his answers to our questions.

Could you give me an update on where Informatica is now in its transformation journey?

Walia: We were an on-premise software company focused on ETL and around 2016 we faced the question of where the world was going. Our belief was that it’s going to be a multicloud, hybrid world and there will be many more use cases for managing data that have not emerged yet.

In that world, you will need a cloud-native platform and so we set about building our IDMC from scratch. We left the old legacy behind, which we were proud of, but we were going to tweak it. Since then, we’ve gone from a single-product company to a multi-product platform company. We’ve also gone from being a 100% licence-based company to a 100% subscription-based company. That’s a huge change.

To give you some proof points, our TAM [total addressable market] was about $6bn-$7bn back then, but it is now $50bn today. In seven years, we’ve taken the subscription business from zero to close to a $1bn this year, with usage of IDMC doubling year on year to 44 trillion transactions a month. That has allowed us to serve the largest enterprises in this multicloud and hybrid world. No enterprise is going to use a single cloud provider and we see ourselves as the Switzerland of data, pulling everything together.

We are also profitable, with hundreds of millions of dollars in cashflow. We’ve built up a unique business and we are proud of it. Our customers are some of the world’s largest, such as Kroger and Unilever. In Asia-Pacific [APAC], we have customers like GIC, Celcom and Axis Bank. We’re the only data management platform, while everybody else is a point provider. That’s a unique competitive advantage.

Where do you see APAC heading, then, given that it is a very diverse market with countries in various stages of maturity, not just in cloud adoption, but in data maturity as well?

Walia: APAC is a very important part of our business. While it’s a smaller region in terms of its contribution to our business, it’s a very fast-growing region. We all know that APAC economies are going to be the biggest economies in the next 50 years, and we have investments here.

As a company, we’ve been around for the last 25 years. We’ve seen the dotcom bust, 9/11 and the economic crisis in 2008. Each time we came out bigger, so I can almost say we are going to come out bigger this time
Amit Walia, Informatica

As for customers, I see companies that are very savvy and leading the way and there are those that are still trying to still understand how to go about it. I think it is the job of industry leaders like us to help the ones who are innovating and also to educate the market. It’s not just about doing MDM [master data management] or bringing data together – it’s the value you can deliver with that.

I was having a conversation with a customer that is going through a big transformation. If you have two different businesses, how do you create cross-sell and upsell opportunities? That’s where MDM can help, but let’s talk about value rather than MDM.

I do think that cloud is at a tipping point here. Australia and New Zealand are very cloud-centric, while Japan is somewhere in the middle. The public sector is a little behind, while retailers are very far ahead. In the next five years, cloud adoption will definitely accelerate.

From my previous interactions with other Informatica leaders, I understand that IDMC was architected from the ground up, which would not have been possible if Informatica had remained a public company at the time. Now that you’re back in the public market, how will you balance market expectations and the need for the multi-year research and development (R&D) needed to support the long-term growth of the company?

Walia: I will have been CEO for three years this coming January. I started the job when Covid-19 first emerged. I took the company public last fall and walked into this year’s economic uncertainty, so I think I’ve learned things the hard way.

Let’s separate being public for a minute. Right now, every enterprise and its customers are facing uncertainties. As a company, we’ve been around for the last 25 years. We’ve seen the dotcom bust, 9/11 and the economic crisis in 2008. Each time we came out bigger, so I can almost say we are going to come out bigger this time. And that’s because we have a great innovative platform with great customers. We just have to remain focused and keep executing. Sometimes it may look difficult in the short term, but you have to almost step back and keep doing the right thing.

The good thing about a time like this is that investors look for profitability, which is to our advantage. We are definitely going all-in with cloud, and I had mentioned in our recent earnings call that we’re going cloud-only next year. We’re not going to lose sight of growth, but we will also grow while maintaining our cash flows and profitability. We will keep investing, but we will make balanced investments. The next few quarters are going to be challenging across the globe, but that’s OK as we’ve been there.

You talked about cloud-only – how are you taking customers on that journey as they transition from on-premise to cloud?

Walia: When we talk about cloud-only, we’re not leaving our customers behind. First of all, we have not terminated support for products that customers are still using to run their workloads, including mission-critical workloads. So, whatever they are running with our products, we will support those products.

Now, our customers also want to go to the cloud and our innovation is also in the cloud. So, we are asking customers to begin new workloads with our cloud products and, separately, we are helping them to migrate their on-premise workloads to the cloud.

We began the migration journey for our old ETL product, PowerCenter. In fact, we’ve had hundreds of customers move their on-premise ETL workloads to our IDMC platform. We’re going to automate this migration as much as possible with utilities that can automate 90-95% of the workload. We’re going to do that for all our products. We won’t “end-of-life” our products and we’re never going to leave our customers behind.

Could you elaborate on how automation can ease the transition for customers?

Walia: Take the example of someone who is running an old Teradata workload at PowerCenter and wants to go to Snowflake with Informatica IDMC. PowerCenter has so much business logic that we can convert to IDMC logic using our Claire artificial intelligence (AI) engine. That means customers don’t have to go through all their business logic, saving them time and money. We’ve automated the process and that’s a significant reduction of risk.

The other way to think about it is that from a customer’s point of view, that sort of automation is huge, and Teradata has no incentive to help its customers migrate to Snowflake. In this case, Informatica, which supports both new and old workloads, can completely de-risk the customer’s journey to cloud. That’s what we are doing under the covers.

What are some of the demand factors that are driving growth for the company?

Walia: We serve use cases from the front office to the back office. And depending on the customer, it could be both. Data governance and privacy never goes away because if you want to democratise data, then it has to come with some governance. I can’t have you and me getting access to the same data if you are in R&D and I’m in sales. We see that continuing to help us.

Customer churn analysis is another demand driver. We play a big role in that with our MDM capabilities, so the same platform that helps you to manage your customer churn can also help to acquire new customers. And then, of course, next-generation analytics, with the help of AI, can help customers predict some things. There’s also the modernisation of workloads by customers that want to reduce cost by getting rid of some of the old infrastructure.

Informatica has a rich ecosystem of partners that includes major hyperscalers and data platforms like Snowflake. Increasingly, they are also trying to do a little bit of what Informatica does as well. How do you manage the relationship with your partners?

Walia: I’ll answer this question by saying that Snowflake has more competition from Microsoft, Amazon, Google and Databricks than they are worried about competing with Informatica. Everybody has a couple of connectors here and there, but that doesn’t make data management, which is about things like data integration, data quality, MDM, data catalogue, data governance and data privacy. That’s data management, not connectors that you push down onto Snowflake.

And so, we’ve never looked at them as competition and they don’t look at us as competition. Everybody has to have a little bit of that, to be very honest, and that’s OK. Ultimately, customers want an industrial-grade enterprise data management platform that they can bet on to manage all of their data, regardless of where their data is.

Informatica has a rich heritage and is well established in the large and older enterprises. What about the next-generation digital-native companies that are emerging?

Walia: We’ve mentioned Uber as a customer in our last earnings call and there are many others whose names I can’t reveal. In the past, we also talked about Twitch, the video game live-streaming platform that Amazon acquired. We have plenty of such next-generation companies that have gone on Informatica.

And let’s not forget the old companies that have transformed, like Unilever, which runs its supply chain across 96 countries on us. That’s a pretty extensive and large use case. We serve the Fortune 5000, and our goal is to serve these larger enterprises that have complex data platforms and mission-critical workloads. And they include existing companies that have done very well and newer companies that are becoming bigger.

Do you see any differences in the way digital-native companies and established companies use your platform?

Walia: Interestingly, no. When you think of a Kroger, they are basically taking live data to make decisions on just-in-time inventory replenishment to keep their customers satisfied. That’s not any different from Uber’s use case, which is focused on getting the right driver to pick you up. So, I would say that some of these companies operate on the cutting edge in terms of use cases and it doesn’t matter if they’ve been around for five years, 10 years or 20 years.

Read more about data management in APAC

  • In this buyer’s guide, we look at the challenges surrounding why enterprises are struggling to deal with data, the use of cloud data management platforms, artificial intelligence, and recommend some best practices.
  • Globe Telecom has moved its on-premise data warehouse to Snowflake to address scalability challenges and improve customer experience.
  • Databricks has been expanding its footprint across the APAC region amid growing interest among traditional enterprises and digital native companies in the data lakehouse architecture.
  • Informatica has consolidated its operations in four key APAC markets in a move that will enable it to better meet the demand for cloud-based data management software.

Next Steps

Informatica World 2023: Cloud, data and AI together

Read more on Data quality management and governance

CIO
Security
Networking
Data Center
Data Management
Close