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Ex-Vertica CEO: Hadoop is pulling the rug from under the database industry

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Chris Lynch has been watching the database industry closely for decades as both the CEO of Vertica Systems and now as a partner with Boston-based venture capital firm Atlas Venture. And, as he told us on this week’s Structure Show podcast, the database industry is under some serious fire from open source technologies like Hadoop.

Here are some highlights from an insightful 15-minute conversation that you’ll probably want to hear in its entirety.

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“We’re starting to see the finical impact that Hadoop can have on the ecosystem of database vendors,” he said, referring to the latest earnings numbers from analytic-database pioneer Teradata.

But Teradata(s tdc) isn’t alone in feeling the pinch. “In my tenure, we were charging $100,000-$150,000 a terabyte,” Lynch said of his days at Vertica, which is now part of HP. “… Those now-generation companies like Vertica, like Greenplum(s emc), have, in fact, their own set of pressures now with Hadoop, as Hadoop becomes commercially viable, more robust,” he added.

Chris Lynch
Chris Lynch

The pressure is coming from everywhere. Cloudera is now positioning itself as a data-management platform more than a Hadoop distribution, and even SQL-on-Hadoop startup Hadapt (one of Lynch’s investments) is “going gangbusters,” Lynch said.

The problem for legacy vendors, he noted, isn’t always about vision — they see big data happening — but about economic pressures. “How do you embrace a new business and a new market that sub-optimizes what you’ve worked so hard to build?” Lynch asked. “That’s hard to embrace. It’s certainly hard to embrace because of the pressures of public companies to make quarterly numbers.”

It’s especially challenging considering the reasons Hadoop is becoming so popular. “The reason [Hadoop] allows you to aggregate [all your data] is less about the technology and more about the economics,” Lynch said. “Because they’ve made it affordable to put all that data in one place.”

Asked which legacy vendor is best poised to ride the Hadoop and greater big data wave, Lynch was quick to point to IBM. “I think that the best-positioned company is, in my opinion, by far IBM, because of the breadth of their offers and the ways that they can make money as this big data marketplace develops,” he said, noting its product range from databases up to BI applications and the billions it has spent acquiring and building new technologies.

“If you look at the investments someone like IBM(s ibm) has made compared to Oracle(s orcl), that tells the story,” he said.

Lynch also talked about the hard work it can involve to take great technology — like that from his latest investment, machine learning startup Nutonian — and turn it from literally a science project into enterprise software. “That’s what we do at Atlas — we invest very early-stage in companies ’cause we like to build them,” he said. “We’re not financial engineers, we don’t have a billion-dollar fund and we’re not buying lottery tickets. We’re actually building companies.”

9 Responses to “Ex-Vertica CEO: Hadoop is pulling the rug from under the database industry”

  1. @Ralph,

    Is this your real name? Second, I have followed Chris since his days as CEO of Acopia Networks. If it were not for Chris, his ability to lead, if it weren’t for his relentless determination to help others around him succeed, then why would a billion dollar publicly traded company like F5 acquire Acopia? I’m sure it’s highly unlikely you’ve led startups to IPO or acquisition, but in the off-chance you have…..tell me “Ralph” what were the names of companies you’ve helped build and how many jobs did you invest in and create? I am drooling to find out.

    We’ve all hired several people in our time and we can’t make each and every one of them happy. It’s the way it is. I can assure you however that, the happy/successful people he’s hired most definitely out-weigh the unhappy ones. And, if they’re unhappy like yourself, then maybe they didn’t have the chops to succeed.

    Are you also saying Vertica was a naïve entrepreneur’s idea? Sorry, I didn’t see any examples of what you were referring to, as I haven’t with just about everything else you mentioned. HP didn’t think they were naïve. Yes, there can be a stigma that big companies turn their backs on the startups they acquire, but not F5. Not HP. Why mention IBM? We’re talking about startups, right? You mean IBM who rewards their A++ players by quintupling their quotas, slaughtering their territories and giving them 3-4 different managers, all the while having to negotiate more with internal IBM derelicts than with customers. Solid analogy.

    CEA – commitment, effort and attitude. Your post clearly proves you lack in all 3.

    But, please know “Ralph,” I’m rooting for you!

  2. Big data is like teenage sex. Everyone thinks the others are doing it. No one knows how to do it right. No one wants to admit they have zero use for it. So the swindlers keep coming up to separate fools from fool’s money.

  3. Too bad you’ll post anything an investor says about their investments.

    Hadapt has almost no customers. “gangbusters” is a ridiculous overstatement. They were handing out equity to get people to try the software last time I checked.

    Sqrrl is a hopeless project with little differentiation from alternatives.

    IBM is the only company left that Lynch hasn’t swindled to buy a company he has invested in.

    Lynch doesn’t build companies, he crushes naive entrepreneurs and flips their ideas for a few bucks. What a thug.

    • Having been the customer of a Chris Lynch company and a colleague of Chris’ for several years, your comments couldn’t be further from the truth. Chris is a serial entrepreneur who has created thousands of jobs, developed market disruptive technologies, and helped countless entrepreneurs found / develop / build companies. You sound like someone hiding behind your own failures by attempting to disparage someone who has been and continues to help others achieve success.

      As for Hadapt, we have numerous customers, many in the Fortune 100 who lead their respective market segments. I’d suggest you find alternative channels to “check” with as those you are currently leveraging clearly have no ability to determine fact from fiction.

      – Scott

    • Ralph, the Chris I know is exuberant and passionate about the technology and the companies that build it. I’ve never met anyone that was so engaged and hardworking in my life — from startups to cancer fundraising. You completely missed the mark.