Matthew Jacobson | September 21, 2020

Snowflake: “The last of the rugged individualists”

Snowflakes fascinate me… Millions of them falling gently to the ground… And they say that no two of them are alike! Each one completely different from all the others… The last of the rugged individualists! — Charles M. Schulz

Snowflake is now a public company. This is yet another milestone on an amazing journey ICONIQ is so fortunate to have joined as investors several years ago in leading the company’s Series D investment and co-leading the company’s Series E investment.

Snowflake Team

At the beginning of our partnership, we shared our perspectives that “Snowflake has perfectly positioned itself at the core of the data revolution.” Our belief in that sentiment is even more enthusiastic today than it was many years ago. Snowflake has ascended as a cloud data platform, a “single source of truth” in providing customers meaningful business insights leveraging a combination of performance, elasticity, scale and ease of use with powerful network effects.

Snowflake’s path to this position, synonymous with its name, has been truly inimitable in our opinion. Its founders Benoit Dageville and Thierry Cruanes prioritized establishing difficult architectural scaffolding ahead of blitzscaling. The company has been piloted to this place by many phases of compounded leadership, each building and improving on the past. Early customers defined the horizon of a powerful and broad market shift. Snowflake inverted the platform paradigm with focus, customer centricity and symbiotic partnerships.

We are excited to share some of the ways we believe Snowflake has distinguished itself from the patterns that defined many enduring technology companies before it, establishing a powerful foundation for the future.

Architecture Before Blitzscaling

There is often a romanticized view in Silicon Valley that the greatest companies ascend from founding to hyper growth and “unicorn” status in an ever shorter duration as a badge of honor. Building Snowflake is really hard. The journey began in 2012 and its founding team chose to take several years to build the product with the right principles before commercialization. This time and patience, supported by an exceptional early technical team and its founding investor Mike Speiser, allowed Benoit, Thierry and team to completely reimagine data management from first principles in the cloud, a foundational element of the company’s competitive advantage today.

Great Companies Can Have Many Phases of Compound Leadership

There is a legendary view of the quintessential technology company, from dorm room to the S&P 500 led by the same founder and CEO. Snowflake has had three CEOs since its inception and many massively load bearing pillars. The company’s journey is one of compound leadership and complementary strengths building upon each other across many phases of a journey.

Phase one of Snowflake’s journey was the founding stage (2012–2014). Benoit, Thierry, and some of the most experienced database experts in the world with long, successful careers had a vision for how the public cloud could revolutionize the way companies can leverage data. They teamed up with Mike Speiser and Sutter Hill (a visionary creator who served as the company’s first investor and CEO), Marcin Zukowski (a thought leader in the area who joined as a third co-founder) and a strong early technical team to architect and build a truly cloud-native product with independently scalable layers across compute and storage. Benoit, Thierry, Mike and Marcin set the stage for Snowflake’s deep technical focus and advantage.

Phase two of Snowflake’s journey was the scale-up stage (2014–2019). Bob Muglia joined as Snowflake’s second CEO following a successful career at Microsoft. Bob complemented Benoit and Thierry’s passion and maniacal focus on product with strong, nuanced insights on pricing and packaging as well as highly innovative ideas on data sharing. Mike recommended Chris Degnan as the company’s first sales hire in 2014, who is Snowflake’s Chief Revenue Officer to this day leading an organization of over 1,000 people. Denise Persson joined as the company’s world-class Chief Marketing Officer, a “unicorn” combining strong branding insights with innovative approaches to the customer journey. Christian Kleinerman also joined to run product, carrying tremendous breadth and depth of experience across data management and cloud scalability to execute on expanding the product surface area. Bob, Chris, Denise and Christian set the stage of important decisions on distribution, product and strategic initiatives to send the company into hypergrowth.

Phase three of Snowflake’s journey takes us today, the orbital stage. Frank Slootman joined as Snowflake’s third CEO, following an exceptional career as CEO of two of the most successful technology companies of recent decades ServiceNow and Data Domain. There is a saying in Silicon Valley “Once you’re lucky, twice you’re good.” Three times could be one for the record books. Frank brings inspiration, strategic agility, discipline and scaled experience to drive Snowflake to its full potential. He starts most meetings focused on all the things that are not going well and has a deep values-rooted approach. He meaningfully expanded the vision of the organization from a cloud data warehouse to the data cloud. His partner in the last several companies, Mike Scarpelli, joined the company as CFO with a strong operational focus, exceptional detail command and best-in-class communication. Greg Czajkowski also joined as SVP of Engineering following a strong career at Google to help the company deliver its product vision. The strength of the team continues to grow with Shelly Begun bringing excellence to the people function so critical in hypergrowth and Derk Lupinek with horsepower and diligence as General Counsel. Frank, Mike, Greg, Shelly, Derk and others are charting the course for Snowflake’s future.

At Snowflake, each phase of leadership has reinforced and compounded on the last, with leaders who bring diverse character strengths and experiences to a shared, important mission.

Early Customers Can Define the Horizon of a Sea Change

There is often an air about the perceived “blue chip” quality of a company’s customers and the importance of the problem it is solving. In the early part of Snowflake’s journey, most large enterprise customers we spoke to were not yet thinking about the immense opportunity of the data cloud. When we made the investment, the prevailing view from some of our most trusted advisors was that, “enterprises will never lift and shift their data to the cloud”. Many of the company’s early customers were emerging players in the technology ecosystem, from particularly high data volume, highly analytical segments like marketing technology, gaming and education. However, these early customers defined the horizon in terms of what was possible and helped shape the product and value proposition as cloud data management moved more mainstream; over time Snowflake’s customer base expanded to incorporate some of the largest companies in the world.

Platform Inversion

With such large and impressive players in the cloud ecosystem, early on many people believed that the major infrastructure providers would subsume the data cloud opportunity. While we considered this question at the onset of our partnership when the entire service sat on a single cloud (and most in a single region), we remained optimistic about the differentiated approach, exceptional team and our views on the symbiotic value for the major “clouds” in a partner like Snowflake bringing more data to their ecosystems. Over time, Snowflake extended its scalability to another important, independent layer — to scale across cloud services and across regions in those cloud services. We believe this customer-centric advancement extended Snowflake’s value proposition, inverting the platform paradigm. In fact, Snowflake now carries this independent layer of scalability to its expanding ecosystem of partners who can now also scale data across cloud services and regions.

Snowflake has forged its own unique and exceptional course — a series of important architectural decisions across its technology, go to market and foundational strategy combined with execution across many phases of leadership. It is our belief that the “data revolution” is still only beginning. We are proud of our partnership with Snowflake and excited to see what is next!