Ever since Splunk went public I have been inundated with "Big Data" requests. Splunk is now the poster child for Big Data. And Big Data is all the rage. I'm getting Big Data business plans. I'm being asked to speak at Big Data conferences. I'm being called by reporters to opine on Big Data. Despite the fact that when I funded Splunk there was no such thing as Big Data, I now get to opine broadly on Big Data. Given that, I might as well do so here on VentureBlog.
As far as I am concerned, Big Data is not a thing in and of itself. Big Data is an enabler. Big Data is the realization that our world is now full of lots of data that can not be ignored. Machines produce massive amounts of data (thus the utility of Splunk). Browsing the Web produces massive amounts of data (thus the utility of Gravity or StumbleUpon). Tracking ads on the Web produces massive amounts of data (thus the utility of Adchemy or Adara Media). Every car on the road produces massive amounts of data (thus the utility of Inrix). [1] Online shopping behavior produces massive amounts of data (thus the utility of Performance Marketing Brands). Offline shopping behavior in retail stores produces massive amounts of data (thus the utility of RetailNext). The financial services industry produces massive amounts of data (thus the utility of Nomis Solutions). Medical diagnostics produce massive amounts of data (we're looking -- let us know if you're building that company). And on and on.
Understanding and utilizing the underlying data of your business is no longer a strategy, it is a requirement. I wrote years ago that social was not a business in and of itself -- it was an enabler of all online business. In the same way, Big Data is not a business in and of itself -- it is an enabler of all business, online and offline. The current data explosion will only accelerate as technology does an increasingly good job of capturing a larger number of data points with greater and greater granularity. The result will be massive opportunities for technology to solve real problems using this plethora of data. And I look forward to funding many of those solutions for years to come. But they will not likely be "Big Data" solutions -- they'll be advertising or price optimization or travel or loyalty or genomic solutions….
I am thrilled to have invested in Splunk when Erik Swan, Rob Das and Michael Baum first hatched the brilliant idea. It is an unbelievably powerful data platform. And it enables companies to measure and manage their businesses in ways never before possible. But the real opportunity for investment these days is largely not in Big Data in and of itself. [2] The most interesting Big Data opportunities today will take advantage of Big Data as a platform. The next generation of billion dollar applications and services will necessarily be data aware and will be differentiated based upon their ability to extract insight and value from the massive amounts of data upon which they are built. By those standards I've been a Big Data investor for the last decade and I look forward to continuing to be a Big Data investor for decades to come.
[1] Inrix is a great example of a company that uses data as a platform. Inrix collects massive amounts of data to produce from hundreds of thousands of vehicles on the roads at any give time to produce a differentiated service. Using information about vehicle location, speed, temperature, wiper speed, etc., Inrix is able to provide traffic data that is more accurate, more predictive and more valuable. I recently spoke about Inrix's use of data at the Web 2.0 Summit. You can find a video of that talk here.
[2] There will likely be some interesting opportunities in enabling technologies -- tools that help companies collect, store, manage, de-dupe, etc. data across the enterprise.