What Diane Greene's Legacy At VMware Tells Us About Her Plans For Google Cloud

Google made a dramatic move in mid-November when CEO Sundar Pichai announced that the company was putting former VMware cofounder Diane Greene in charge of its cloud businesses while acquiring her stealth cloud startup, Bebop. Experts hailed the move as a sign Google is now ready to go on “the offensive” in cloud computing, “chasing“ Amazon Web Services and Microsoft Azure for “supremacy” in the space.

While her startup may prove valuable to Google in time for its own technology alone, Greene (already a Google board member) is an intriguing choice to insiders in large part due to her legacy at VMware, the company she cofounded with her husband Mendel Rosenblum in 1998. Greene built VMware into one of the fastest growing companies in tech, selling it for $635 million in 2003 to EMC. While she’d leave in 2009, VMware’s continued to grow, with a market capitalization in late November of about $25 billion.

While her startup may prove valuable to Google in time for its own technology alone, Greene (already a Google board member) is an intriguing choice to insiders in large part due to her legacy at VMware, the company she cofounded with her husband Mendel Rosenblum in 1998. Greene built VMware into one of the fastest growing companies in tech, selling it for $635 million in 2003 to EMC. While she’d leave in 2009, VMware’s continued to grow, with a market capitalization in late November of about $25 billion.

Greene’s mission is clear: long-time executive Urs Hölzle predicted recently that Google will be a cloud company by 2020, with related revenue outstripping its advertising billions. To get there, Greene will have to recapture some of her success in growing VMware. A recent interview with a former colleague turned investor and follow-up discussion with Forbes over email suggest how she’ll get started.

Just days before her appointment, Greene went to Stanford University to speak with a former colleague for a computer science class about ”blitzscaling,” or how to achieve rapid corporate growth. As seen in the video below, Greene was reunited with a former VMware executive who’d reported to her for two years as the company went public in 2007, Greylock partner Jerry Chen. A guest speaker at the request of his colleague, billionaire Reid Hoffman, Chen asked Greene about her strategy for scaling VMware with no idea she was about to join the Googleplex. Forbes spoke to Chen and later Greene to discuss Greene’s approach at VMware as discussed at Stanford and how those themes might play out at Google.

Cloud credibility:

When enterprise buyers look for a public cloud platform today, they look at Amazon and Microsoft first, Chen argues. “Google has great technology and great engineers, but customers have been cautious about whether Google appreciates and understands the cloud as a real business,” he says.

Greene can change that, her former coworker argues, by adopting a “full stack” approach to cloud that more closely integrates Google’s cloud infrastructure offerings with its Google for Work and Google Apps product suites. Those businesses individually are more popular than some might realize, Chen believes, but suffer from a lack of clear sales synergy like Microsoft deploys with sales of its Azure cloud platform alongside Office 365.
​In response, Greene told Forbes by email that she believes that “Google Cloud Platform already offers best of class storage, compute, networking and big data support, all based on more than a decade of work building Google’s internal cloud.” Google Apps is “already the best collaboration and productivity suite” on the market, Greene claims. The battle will be to increasingly capture customers as they move to the cloud for the first time from on-premise alternatives. Google will need to support hybrid environments and offer highly secure applications, she says.

Product focus:

An early investor in billion-dollar container startup Docker, Chen notes that Google used types of containers for years before Docker exploded into popularity in recent months. Google’s long developed its own versions of open-source technologies such as containers and database software only to have smaller startups take the lead in monetizing them, Chen says. One priority for Greene could be to look at Google’s own innovations in storage, security and virtualized computing and find paths to business contracts and new streams of revenue.

At VMware, Greene maintained a neutral approach to individual vendors and partners. Salespeople who sold one at the expense of the rest were let go for jeopardizing the big picture. Google’s task is to capture more of the energy around some of the fast-growing open source projects today, says Chen. Now at Google, Greene says that trend is already happening,”We believe that cloud will be based on significant open-source components that are offered as services,” Greene says. “People don’t want to be locked into a single provider.”

Hiring focus:

At VMware, Greene would look for the smartest or “best” person in any given domain she could find, and focus on hiring that person. If they didn’t work out, she’d keep hiring until a person worked out. “Office culture is like an auto-immune system,” says Chen. “She’s not afraid to replace people for the health of the group.”

Chen says it’s no accident that his former VMware executive colleagues now hold critical leadership roles at a range of new cloud companies, from cloud software startup Pivotal and $14 billion (market cap) platform-as-a-service company ServiceNow to Amazon’s own cloud sales executives Mike Clayville. Greene’s push to get Google more large-scale contracts will draw upon a core group of talent from VMware and her startup that have a longer history of building relationships with big customers, Chen says. One name to watch is Bogomil Balkansky. a former VMware senior vice president who joined Greene at Bebop. Plus there’s Google’s commitment to competitive compensation relative to some of the hot younger startups in Silicon Valley. ”Google plus Diane will make a pretty compelling story for folks interested in that business,” he says.

Greene declined to comment on her plans for hiring and restructuring the teams reporting to her now at Google. She did say that Bebop, though “a ways away” from shipping a finished product, is still intended “to make it easy to create beautiful enterprise applications.” Finishing that work at Google should get it to market faster and make it “unusually powerful,” she claims.

One area that Greene says she expects to focus on is the privacy and security of cloud computing. “I anticipate a lot of focus on how to safeguard the interests of individuals, companies and regulators,” Greene says.

Chen sees Greene’s appointment as one that will eventually mean more choice for the tech ecosystem. ”The more public clouds that are out there with Amazon, Microsoft and Google all involved, that makes it better for startups,” the investor says. “Hiring Diane is definitely a strong signal. But it will take a few years to play out to see if Google is successful and if they invest enough behind Diane and her new team.”