No Priors Live: Building Durable Software in the AI Age with MongoDB President & CEO CJ Desai

0:00Since 2022, the future of software is in question. This is from the investor community, but also customers. It is a very pivotal moment on the software stack. And then you look at the software stack and you say, okay, what is the one thing that will always be there? How many companies today that are there that are more than$10 billion in just pure play software revenue? It's single digits. Why is that? The software industry has been around for a long time, created by many, many smart people like yourself. Why is it only single digit companies are more than$10 billion in revenue? Because platforms are rare.

0:33platforms are there. Speed matters. When technology transitions happen, are you building as fast as you can? And then are you learning on the technology shift, whether it's the internet age or AI age or mobile? Are you pivoting fast? It's just that you have to stay ahead of that game. If you fall behind that game, investors or customers will always ask you that question, what is the future of your company. Welcome to the very first live recording of the No Priors podcast with host Sarah Guo and MongoDB president and CEO CJ Desai. Hey everyone, I am so happy to be here with you guys and my longtime friend CJ.

1:15I know you guys have had a great day of announcements and learnings here at the conference, but I'm really excited personally to have the opportunity to zoom out with CJ to talk about the future of software, what's happening in SaaS and where the value is going to be. These are important questions to me in my day job as a venture investor. So CJ, you have worked at these platform enterprise software and infrastructure companies, became CEO of MongoDB recently. I feel like the one question that we were just talking about, that every investor asks you and then everybody in the technology ecosystem has the back of their mind is what is the value of software when you can generate a bunch of software?

1:59And so I'd love to just get your thoughts on this. It's a very spicy question to start with. I like it. I'm making sure everybody's awake. Yeah. First, thank you for doing No Priors live for the first time. It's Maiden and we have a really good crowd here. So it's always exciting. You know, when you think about technology transition software, whether you look at Internet age or mainframe all the way to AI, you have to really think through what is the mode here. Whichever applications you create, SaaS applications got created late 90s, late 90s, I think Salesforce had their 25 years anniversary recently.

2:43So SaaS has been around for at least 25 years from a transition perspective. Now with AI, the question is just in general, what is the future of software? What's the stack? Do you really have a moat as a company or not? There are folks who will say, hey, my moat is I have a great customer relationship, or my channel is amazing and that's my moat as I disrupt myself within. but from my standpoint, speed matters, right? Speed matters. So when technology transitions happen, are you building as fast as you can? And then are you learning on the technology shift, whether it's the internet age or AI age or mobile back in early 2010 when Meta made the pivot towards mobile?

3:36Are you pivoting fast? and if you pivot fast to leverage the technology, whatever the platform shifts are happening, I think it is fine. It's just that you have to stay ahead of that game. If you fall behind that game, investors or customers will always ask you that question, what is the future of your company? And that is something you have to be on the leading edge. Not every bet will work. But from my standpoint, the just going on the extreme terminal value being zero for some of the software they are overblown and you know we'll figure this out together. Part of your career you were leading product at ServiceNow it is a front it is one of the most durable enterprise software companies or so everyone assumed until relatively recently and now this question is up for debate I think for a lot of people within an engineering mindset who think about buying developer tools or using developer infrastructure, the word like customer stickiness or distribution as the moat feels very abstract.

4:46Can you just talk a little bit about like how important ServiceNow as an example is to its customers and what you think about that? One of the things is platforms are sticky, products are not. Okay. So no matter which software company you create today in the age of AI, or you created in the past, products can be replaced. My hiring manager at ServiceNow, Frank Slutman, used to say tools are for fools. As in if you say this is a software tool, that's never a good sign. And that's why he used to say that tools are for fools. So one is products can be replaced because that's a fast software is a disruptive market.

5:29So you want to make sure that your platform, that you are positioning to the customer, whether it's a builder here in San Francisco that is creating a brand new company for a use case, all the way to a very large company that is selling to say a large bank. So one is when you position yourself as a platform, maybe that increases your sales cycle versus selling. hey, you are using this, now you can use this, go ahead and replace it, right? So platforms are sticky because it's a thoughtful decision from a customer's perspective. The second thing that - This is actually not the general advice of many people in the startup and VCE community.

6:15So I want to talk about this a little bit and then I want to get to your second point. A lot of people talk about having a wedge, right? And for ServiceNow, IT service desk would have been considered the wedge. Is that not the right, is that like a wrong retelling of history here? I mean, you need an initial use case and that initial use case has to be a killer use case because if you go in front of a large bank or a healthcare company or a manufacturing company, say you are building something here with this great audience we have, you can say, okay, this is a disruptive way to think of a legal use case or a finance use case or a help desk use case.

6:53That's great, that's your entry point. But then the entry that was easy for you to get in if it was disruptive, exit would be in a similar way easy because they have not built things around you. Right. So that's the main part that, OK, today it will work for your maybe zero to 100 million, zero to 10, 10 to 100, whatever steps you want to go in. But it gets harder and harder set up from 100 to billion. billion to five billion, and then 10 billion plus. I mean, how many companies today that are there that are more than 10 billion in software, 10 billion in just pure play software revenue? How many companies are there?

7:37It's single digits. Okay. Why is that? The software industry has been around for a long time, created by many, many smart people like yourselves. Why is it only single digit companies are more than 10 billion in revenue? Because... Platforms are rare. Platforms are rare. And platforms are rare. So one is your dream or aspiration as a software company should that you become a platform. And once you're a platform, that means you have N equals at least two. You have two plus products being used by your customers from whatever you're offering. They all work in unison with each other. So it's sticky, truly from a technology perspective.

8:18and then what I would argue further, all the integrations that your customer has to do with their existing systems, because remember, if you go to a large bank, bank has been around for some of them 100 plus years. You go to a large insurance company, they've been around for 100 plus years. If you go to a healthcare company, same thing. You look at Fortune 10, Fortune 100, Fortune 500, that's where the TAM is. And if that's where the TAM is and you go there, and if it is just a product, eventually you're going to max out and then you will have to add multiple things. So if you're a platform, you're sticky, products work with each other, and then those products work with all the systems you have.

9:03And I'll just make it very specific. Speaking to a bank on behalf of MongoDB, they run their commercial banking applications on top of MongoDB. They have built a lot of other integrations. They have done all the security checks, governance, all of that stuff. and I said, wow, gee, how many applications you have built on MongoDB? They say, very critical and that matter. I said, how many? Finally, the CTR tells me in London, 300. I said, wow, okay, that's great. 300 applications built on MongoDB. I said, CJ, don't worry. Thank you for coming to London. We are not going anywhere. I said, can I just ask you what's the denominator?

9:39I understand the numerator is 300. He said, 9 ,000. I said, 9 ,000? That's a great opportunity for MongoDB. And he said, I'm not going anywhere. So that's when the more they use, the more sticky we get, and then we are in the fabric of their infrastructure. So the other premise that some builders and buyers and investors now have is those 9 ,000 applications with Vibe coding being possible or engineering and some code generation, some set of those are just going to be made on demand or in niche ways by every company. What's your take on this? And that's the way that this bank or whoever it is as a customer is going to get exactly what they want and they're not going to be horizontal, more standardized, or even vertical applications anymore.

10:38Yeah. But if you are trying to sell, banks have huge budget for technology, right? So, okay, you used a live coding platform, A, B, and C. You've created an app. Great. So your app velocity has increased. If you use MongoDB, it accelerated. Just kidding. Okay. But your app velocity is high. Got it. But you still need that go-to-market channel. How are you going to approach the bank? and then what is your true disruptive way? And then the bank will ask you, hey, we talk to regulators a lot more than we speak to our customers and vendors. Stuff. Yeah, will this work? Will it pass our regulatory test?

11:24We need resiliency. Oh, what do you mean you just built in AWS? It doesn't work in GCP. I need multi-cloud resiliency. Oh, I really need for this banking application in on-prem, truly sandboxed or better way to say it is an air gap network. I mean these are like enterprise class things that you need where the TAM is. Right? So that's what could hold you up. That is this truly an enterprise class application that you can go to a healthcare company or a public sector federal customer and do that. So yes, wipe coding will allow you to create an app fast. You have a great use case, you have some disruption in mind, that's excellent.

12:03but then there is a lot of things that you need from a go-to-market perspective to be able to break in, pass all their checks, governance, security audits, and things like that. You are, and I want to talk about the decision to join Mongo and lead it in a minute, but having worked at these platform companies that are incumbent, ServiceNow and CloudFair and such, What would you do if you were them or any other large enterprise software vendor today? What do you think is the path to success five or ten years from now that the investor community does not understand? Wow. What would I do if I was there recently at Cloudflare?

12:44I would say the TAM for these platforms still exists, and the TAM is still large. So that's a good thing because if you feel like your time is decreasing or all of a sudden not relevant anymore, that's an issue. But whether it's MongoDB or anybody here who are working on their company, I would say you really, really need to understand what is that moat you have. And you need to protect that moat or maybe strengthen that moat even more using AI. Whatever that moat is. If the mode is truly, you are the platform, you already have integrated with 50 different systems in that large healthcare company, great.

13:30Why can't you now integrate with 100 more companies in there? Why can't you create additional products or additional use cases really fast using AI and continue to show, I want to say re-acceleration of growth, that AI is really helping us innovate more and sell more. Because if you say you're innovating more, but you're not selling more, then you have potentially issues, no matter who you are, any company. It's a generic comment. But can you innovate more? Can you disrupt within? And can you sell more? That's what if I'm an investor, and we speak to investors all the time, that's what they are looking for, that, hey, will AI re-accelerate this company's growth?

14:16And unless you show re-acceleration, they are going to say, okay, maybe I'm neutral or in some extreme examples, I'm a bear. When you were at ServiceNow, you got a lot of calls for different jobs. And at Cloudflare, you got a lot of calls from different jobs. I know because I called you about several of them. There's actually been this big shift of dollars in the investor community. I'm really thinking about public markets, but also private markets from business software to essentially AI infrastructure, right? And the model layer. And maybe hyperscalers. And hyperscalers, yes.

14:53The data and developer infrastructure layer has not been the focus of that dollar movement. And you could have done any of these things. How did you think about what sectors would be long-term relevant? And it sounds like you're pretty committed to being platform. So be a platform. Yeah, it's absolutely true that I had choices and choices are always hard. Or I could have, Cloudflare is a great company and I could have stayed at Cloudflare. So from my perspective, the first thing I look for is that, is there a durable term? Right? And I started my career out of college with Oracle Corporation and understood how they scale the database platform, truly created apps on top of it and a bunch of other things during Oracle's organic growth days before they started buying various assets.

15:45Learned a lot on how did they really think about the database platform, then the middleware, then the application layer on top of it and so on. So one with Cloudflare having understanding of the database market, large-term, that's great, and then MongoDB is also a large-term. So that was the sequencing between Cloudflare and MongoDB. Second with MongoDB, when I truly talked to, I want to say many, many customers, when I did my own diligence on MongoDB, one of the surprises I had was mission-critical apps, whether it's an e-commerce app for a retailer, or whether it's a commercial banking app, or a healthcare app, or an insurance claims processing app.

16:27This is a very critical app. and database industry, Oracle will celebrate its 50th in a year and a half. So it has been around for a long time, 50 years. MongoDB has been a truly disruptive force with being created in 2007. So it's been only 18-ish years. So there is a large time that could be disrupted, and whether you believe database market has been around 50 years or 60 years. And MongoDB is truly the only disruptive force. And then the second thing I learned by speaking to some of the companies here in San Francisco area was that some of the digital natives around 2010-15 timeframe and some of now the AI natives that I spoke to were building on top of MongoDB.

17:16And I'm like, wow, okay. So there is something. And when the founders created the company, they didn't know that, hey, it was like almost accidental, that it will be full of unstructured data, and you would want very high velocity, and you will need to be able to search on this, which is what AI applications, just the data is so messy, and MongoDB is perfect for that. So I said, okay, cloud transition is going on. It's still going on. When I speak to Fortune 500, I can tell you without hesitation, they are all still talking about I need to move X percent of apps to GCP, AWS, Azure, some combination, Alibaba in Europe, whatever the case might be.

17:56So that's one. But second, AI transition has just started. So if Cloud started with AWS, we are in the almost approaching 20th year and it's still going on. AI will still go on and this is a layer you must have. That's it. So TAM must have layer, no risk of disruption. I think it's actually a really interesting observation that in this clearly core and durable and very, very large market, the number of pervasive disruptive technologies is very few over many decades. right? And so there's more to do with that starting point. The previous CEO, Dave, wonderful human being, told me that, CJ, you know that many attempts have been made by many folks to create next version of database and this and that or next disruptive database.

18:47Nobody has passed billion and definitely nobody has passed two billion and MongoDB did that. So there's something special there. When you think about the investor focus on the model layer versus the application layer or the anxiety, they're anxious about the SaaS applications. They're anxious about data infrastructure because it feels like the way you build applications is still evolving very quickly. Okay. Yep. Tell me if you disagree with any of these assumptions. And then they're anxious about the AI native companies because they're worried that all of the value ends up in the models. So I just feel like it's a very anxious investor environment overall.

19:28That's the bear thesis, right? That is the bear thesis, but I think it is like the dominant thesis right now. It is the dominant thesis. Yes. Okay. Well, you know, change my mind on the assumptions. What do you feel like more confident on, you know, in terms of ways in which applications will be valuable in the future? Just even speaking to since 2022, I think that's probably a very pivotal moment with the chat GPT in the fall. Since 2022, now we are three years plus in the journey. I have never seen this because it's been pretty static for a while. The future of software is in question. It's definitely in question.

20:14And this is from the investor community, but also customers that are asking, hey, should I use X or should I use Y and whatever, right? So definitely, it is a very pivotal moment on the software stack. And then you look at the software stack and you say, okay, what is the one thing that will always be there? I mean, LLMs will be there for the software stack for foreseeable future. when you are truly building AI application that rely on that stack. And even you have seen a lot of innovations in, you look at XAI came from nowhere, kind of, and how well they are doing overall. But that stack will be there in the agentic software framework.

21:03So that's a constant. And the data layer has to be there because you need to store data somewhere. So the data layer has to be there. So that's the second one. everything that is around that, that's going to evolve and you better show true value on whether you use the platform analogy or whatever, whether it's the top layer of the stack, whether you really understand use case for the insurance industry and you are building an AI native company for the insurance industry. Insurance industry has multitude of use cases. You say, okay, please move from old SAS X to new Y. This new Y, the speed to value is going to be this fast, and we will always be ahead.

21:53Things that you thought were not possible with the old SAS are now possible because of AI. That use case focus on the top layer, besides the LLM and the data layer, will still always be critical. Mongo has startup and individual developer customers all the way to Fortune 10. Yeah. Almost all of them. What do you hear from the buyers and builders at the very largest companies in terms of their real perspective on AI value and what they're excited about or skeptical about now? Yeah, so I would say I feel it's a total failure of a week if I don't speak to at least 10 customers a week. That requires a lot of prep, a lot of follow-up, but it's usually at least 10.

22:37And so I'm constantly getting these data points and trying to do pattern matching on what's going on. The first thing I would say is that when you think about Fortune 500, Global 2000, and the community there, some of them are here, it is still not moving very fast. A lot of them tried with the office productivity type co-pilots. Unclear how much value they got out of it. They're like, okay, this really works with my Excel or can I really do this thing or create a PowerPoint slide using natural language. The feedback is not great on the value they got. The feedback on coding assistance, that took off in 2024 in a meaningful way, very positive.

23:252024 and 20 started with GitHub Copilot, then few others all the way to Anthropic and so on. So 2025 was a breakthrough year from my perspective on the coding assistants, and that's still going on. I get very positive feedback from customers. Hey, I'm using this particular coding assistant or this one, and it has improved the innovation, velocity, security, whatever I'm looking at, and so on. And then people are still tinkering around customer support. You know that. But on customer support, they're like, okay, truly, if I'm a large, say, telco, or I'm a large healthcare company, can that fully be done on this AI-native company that does customer support?

24:11Not there yet, right? They are going after initial use cases, and that's great in certain industries. You mean the end-to-end customer experience? End-to-end customer experience. And the question that I get from these customers, they ask me my perspective on SaaS, is that should I think about this AI-native company and customer support as an end or an or? So I have a system of record on one of the companies for customer support. We can say Salesforce. Yes, Salesforce. And if I'm using... HubSpot, yeah. and I'm using, I have this disruptive company that came and said they can solve these problems, do these support cases, should I think about that as an end or an or?

24:59And I ask them the same questions, you know, we use these systems of record, SaaS systems of record, and when somebody comes and says, I'm like, are you a layer on the top of system of record or you can replace the whole system? Because you will have my attention as a leader if you say I'm going to replace it, it's going to be cheaper, it's going to be faster, it's going to be better. And oh, by the way, I have disrupted pricing. And for the value you get, that's when you pay me the money. That's a conversation I'll have every single day. That's a very surprising attitude, actually. I mean, I think it is risk-taking and the value that you're asking for is much higher.

25:39But you're showing openness to a lot of pain or being willing to ignore a bunch of the sunk cost of the implementation of the systems you already have. Yes. And having built systems of record yourself, you think that's feasible, that other people will do that too? I mean, absolutely. If you are, you know, our CIO here is in the audience deeper, and when we have this conversation, she gets approached by AI native companies daily, multiple times a day. And when she comes and asks me, how do you think about that, whether it's for go-to-market, sales, marketing, whatever the case might be, I said, this is how I think about it, that if this allows us to hire fewer people, makes our people more efficient, then we will use that budget.

26:25And I want to be AI first organization on behalf of MongoDB to say we are transforming our business, not making just productive. Productive is okay, but we are transforming our business using AI. I think that's really interesting because a lot of the conventional wisdom would be the system of record is so embedded that you're going to come in with a wedge or a layer on top. Yeah. And that is different from what you're describing, which is I'm going to sell a platform and I'm willing to buy a platform if the use case is good enough. That's correct. But I actually think coming full circle, that's a very interesting opportunity for MongoDB in particular because one of the reasons you might actually replace these systems of record in this age is you want to keep much richer information about interactions, or whatever else it is in your system of record, and it's messy, it's got to sit something, it might not be Oracle anymore.

27:18I was talking to a European retailer, the day before yesterday at NRF in New York, and they said they tried a bunch of systems of record for ERP, expensive failed implementations, lots of issues on supply chain all the way to financials and decided they're going to invest in just building it themselves and they're building that on MongoDB. And I mean, that's a great use case. And I'm like, okay, you had me at hello. And to do that, but if these kind of organizations are going to transform within or disrupt within, I asked Deepa or CIO the same question, that are there things that we can build ourselves to disrupt within on MongoDB?

28:04So that's the story and the compelling value we can articulate also to our customers. I want to take the last couple minutes that we have together to talk a little bit about leadership, especially as a product person. I think if you, you know, first, of course, as a CEO, but first and foremost, as an extraordinary product person. I do think you talk a lot more about business strategy and have for the decade I've known you than many product people. Like, when did you start thinking about that as a product and engineering person? Because you're talking about defensibility modes, like how people buy you.

28:40And I know that's a lot of business orientation for somebody who's also, you know, thinking about the product itself. I think it was our CEO at the time was John Thompson at Symantec. And this was early 2005-ish time frame. And I learned a lot from him. And specifically, his bar on how you interact with customers, how you sell to them, how you serve them, how you show up in front of them was very, very high. And through my early career as a product person, I was director of product management, I still remember, I made a huge impression on me. And how was it higher than other people's, right? Because I think everybody would be like, oh, I'm going to be a high-quality product director.

29:27Yeah. What he basically taught me, Sarah, was, hey, when you speak to customers, not only you ask them how we can serve you better, but ask them, hey, what other problems they are having, what pain points they are having, and you fly there, you meet them, you have coffee with them, whatever it is, truly understand because it allows you to see around the corner. And you cannot be a great, one of the best advice he gave me, you cannot be a great products and engineering person unless you speak to customers all the time. Okay? All the time. Because that will allow you to not only do a pattern match, but see around the corner.