1. Upstart (UPST) — Two Updates
a. First National Bank of Omaha (FNBO)
Upstart announced that FNBO — an existing partner of the company since 2019 — is expanding this relationship (following a successful pilot program) to cover the bank’s entire loan business nationwide. This test allowed Upstart to shine once more with approval and loss rates both handsomely exceeding FNBO’s initial expectations. Impressively, 78% of the pilot program loans were approved instantly which helps explain the elite +83 net promotor score (NPS) that these loans sported.
FNBO is a top 100 bank in the United States with more than $25 billion in assets under management (AUM) and primary banking offices in 7 states. This bank was already counted in the 31 partners Upstart currently works with (vs. 10 when it went public in 2020).
b. National Bankers Association (NBA)
Upstart also inked a new partnership with the NBA (not basketball) to bring its inclusive, artificial intelligence (AI) powered loan practices to minority-owned banks. NBA members will also gain access to Upstart’s referral network and the coinciding incremental volume. Optus Bank became the NBA’s first member to offer Upstart-powered loans through its website using the company’s application programming interfaces (APIs).
- Application programming interfaces (APIs) defined: Blocks of code enabling software to perform tasks. APIs act as the language that empower access to data services, operating systems and other applications to create an end product. A user interface (UI) is what the customer sees and APIs are what the enterprise uses to build the platform’s UI and user experience (UX)
Optus is growing quickly but is quite small with just a couple hundred million in total assets vs. roughly $50 million in 2017. Still, NBA members in aggregation are far from small and Upstart now has an inside track on working with them all. Thanks to Upstart’s loan algorithms raising approval rates by 30% and lowering APRs by 11% for African-American borrowers — this is a perfect fit.
Click here for my broad overview of Upstart.
2. CrowdStrike (CRWD) — Leadership Interviews & The 2021 CrowdStrike Global Security Attitude Survey
a. Founder/CEO George Kurtz and CFO Burt Podbere Interview with UBS
Kurtz on competition:
“The bulk of endpoint replacements will come from legacy players over a multi-year journey. With next generation players, we’ve called them out because you have to have technology that actually works. You can’t just make a PowerPoint.”
Kurtz & Podbere on why module cross-selling continues to be so strong:
“There’s a massive need for agent consolidation and we’ve been able to do that. On average, IDC says large enterprises are using 13 different security agents. If we can consolidate 4, 5 or 6 of those agents or more, that’s a great opportunity for total addressable market (TAM) expansion for us and a chance to remove cost and complexity for our customers.” — Kurtz
“We have 21 real modules. Our competitors have 2 and a half real modules if they’re lucky.” — Kurtz
“We give out metrics on users with 4, 5 & 6 modules — very soon that will be 5, 6 & 7 and then 6, 7 & 8 as we are at a point when most of our customers have 4 modules. We have a tremendous opportunity to continue cross-selling just within our existing customer base.” — Podbere
Podbere on the value proposition:
“We bring greater efficacy to solve a breach at a lower cost. The differentiation that we provide is simply more value to customers.”
Wonderfully simple.
Kurtz on Humio’s Community (free) edition:
“We got as many sign-ups in 6 weeks as we thought we’d get in 6 months.”
On identity and the Relationship with Okta—a Next Generation Identity Security Company
“I want to reiterate that our identity solution is complementary to Okta and not competitive. Our identity solution is specifically tailored to the endpoint. We actually freely share information with Okta.”
“We have no plans to be in the identity access market. We know endpoints and workloads better than everyone else out there — our goal is to tie in the machine identity to the user identity and data. We will continue to work with partners like Okta.”
On Humio and Extended Detection and Response (XDR):
- Extended Detection and Response Defined: This is an evolution and expansion of Endpoint Detection and Response (EDR) beyond the endpoint by utilizing partner data sources to paint a more complete picture of risk across the entire security stack. Great EDR (CrowdStrike believes it’s best in breed here) is a vital prerequisite for great XDR.
Humio’s ability to conduct index-less log management greatly bolsters the data compression and scalability of CrowdStrike’s Falcon platform. This upgrade is a vital piece of building out an effective XDR solution that is able to efficiently pull from, digest and analyze absurd amounts of data from partners within every piece of the security stack.
“We’ve taken some of Humio’s technology and added it to the XDR module to help us plug into partner data architectures. Humio allows us to efficiently map and use all of this information and to advance and broaden our threat detection.”
CrowdStrike continues to heavily invest in Humio as a standalone log platform and also integrate its know-how into CrowdStrike’s suite of modules.
“Humio customers are using the technology not just for security but to connect the technology to literally everything they have. Humio allows you to collect as much data as you want to answer any questions you have in real-time.”
Podbere on customer adds:
“Fluctuations on net customer adds in any given quarter could simply mean that we had bigger deals and more expansions like we saw this quarter vs. last quarter.”
Kurtz on cloud security competition:
“We feel very good about competing with any of the agentless technologies with Falcon Horizon (the cloud security module). Most of our competition has no workload protection. The reality is, you can have as much agentless technology as you want but you still need to combine that with workload protection to get full coverage. Customers don’t just want one, they want both — we are in rare air.”
Kurtz on SecureCircle (its most recent acquisition) and data protection:
“Data loss prevention (DLP) we feel is broken. There isn’t a customer that I’ve talked to that likes their DLP solution. It reminds me of the customers I talked to about anti-virus when starting CrowdStrike. The DLP market (CrowdStrike calls it data protection) is a $3 billion market. Since we did the acquisition, we have been overwhelmed by Symantec DLP customer interest.”
b. CFO Burt Podbere Interviews with Barclays
Podbere on CrowdStrike’s Success:
“We continue to expand our lead on legacy and next-generation vendors due to our scalability, efficacy and differentiated offerings like Falcon Complete.”
“Win rates have increased over legacy and next-generation vendors as our net new ARR lead grows without more discounting. We had a record number of displacements and boomerang deals where a client starts somewhere else and boomerangs back to us for efficacy and ease-of-use.
“We’re seeing a very similar path to what we saw with Salesforce and ServiceNow. The larger they became, the more successful they became. We think we are on that path in a winner take most market.”
On cash flow and margins:
“We will continue to prioritize growth. We see an opportunity to invest more aggressively in the future to capture more share and will do so.”