Embark on a transformative odyssey with Calix's Chief Commercial Operations Officer, Matt, as he reveals the seismic shifts within the broadband industry and Calix's own monumental evolution. By leveraging his profound expertise in tech and consulting, Matt unveils how this tech trailblazer is redefining connectivity with cutting-edge cloud and software solutions. The heartbeat of the discussion pulsates with an unwavering commitment to uplift communities through high-caliber broadband services, particularly spotlighting the triumphs within cooperative and municipal landscapes. It's more than a chat; it's a masterclass on the symbiosis of technology, community empowerment, and the metamorphosis of a company from hardware-centric to a software and cloud-centric networking colossus.
Venture further into the episode as we cast light on the astonishing effects that strategic technology investments can have on rural communities, with a nod to our friends at Paul Bunyan Communications in Bemidji, Minnesota. Their story is not just one of success, but also of overcoming obstacles, from navigating complex tech ecosystems to managing government relations, that resonate with smaller providers everywhere. With a keen eye on the horizon, we explore the bright future shaped by AI, automation, and the next big leap in networking—the 50 gig PON. This episode doesn't just talk tech; it's a vision of a world where innovation is intertwined with the growth and vibrancy of communities, all whilst keeping customers at the epicenter of our mission. Join us, and be part of the conversation that's setting the course for a tech-empowered tomorrow.
More at https://linktr.ee/EvanKirstel
Embark on a transformative odyssey with Calix's Chief Commercial Operations Officer, Matt, as he reveals the seismic shifts within the broadband industry and Calix's own monumental evolution. By leveraging his profound expertise in tech and consulting, Matt unveils how this tech trailblazer is redefining connectivity with cutting-edge cloud and software solutions. The heartbeat of the discussion pulsates with an unwavering commitment to uplift communities through high-caliber broadband services, particularly spotlighting the triumphs within cooperative and municipal landscapes. It's more than a chat; it's a masterclass on the symbiosis of technology, community empowerment, and the metamorphosis of a company from hardware-centric to a software and cloud-centric networking colossus.
Venture further into the episode as we cast light on the astonishing effects that strategic technology investments can have on rural communities, with a nod to our friends at Paul Bunyan Communications in Bemidji, Minnesota. Their story is not just one of success, but also of overcoming obstacles, from navigating complex tech ecosystems to managing government relations, that resonate with smaller providers everywhere. With a keen eye on the horizon, we explore the bright future shaped by AI, automation, and the next big leap in networking—the 50 gig PON. This episode doesn't just talk tech; it's a vision of a world where innovation is intertwined with the growth and vibrancy of communities, all whilst keeping customers at the epicenter of our mission. Join us, and be part of the conversation that's setting the course for a tech-empowered tomorrow.
More at https://linktr.ee/EvanKirstel
Hey everybody, super excited for this conversation today because I am a fan of Broadband for All and I think it's doing amazing things across the country and the world closing the digital divide and so much more. Today with Calix Matt. How are you?
Speaker 2:I'm great. Thank you very much, evan, excited to be here and really looking forward to our conversation.
Speaker 1:As am I, both here in New England, which we're desperately waiting for spring and summer. So we're not going to chat about the weather. But you know, calix is a company that I've admired, observed, watched for many years and I have lots of questions. Before that, maybe introduce yourself, if you would, a little bit about your background and how you joined Calix.
Speaker 2:Sure, so I'm the Chief Commercial Operations Officer at Calix. I'm responsible for a lot of the day-to-day of the company. So everything from supply chain to commercial strategy, pricing, it field operations, marketing, channel sales. So, as I say to my customers, if you're unhappy with anything, I'm a good guy to call. And I started with Calix as the chief marketing officer about seven years ago. I've been in tech for about 25 years.
Speaker 2:After I graduated from business school, I joined the tech practice at McKinsey and then I eventually joined my anchor client, which was IBM. And I was involved with IBM for a little bit over a decade. And I joined Calix because I had decided I wanted something where I felt like it was smaller, I could have more impact, it was more entrepreneurial. The good news is, at that time pretty much everything other than the US government could fall into that bucket because we had about half a million employees and over $100 billion in revenue. But eventually I got a call from an executive search professional who I'd known for a long time. She said hey, there's this really interesting small company called Calix and you should really have a look at it. And I was like who Calix what? And I dug into it and what was really interesting was that, you know, I thought that, uh, the company had a great strategy.
Speaker 2:The founder and ceo at that time, carl russo um, this is his third multi-million dollar company that he's built um, and he had a great strategy for how he wanted to transform our industry. Um, this is the broadband service provider industry that we serve and it was really compelling and I was like, okay, he's done it before and he had assembled an amazing team Michael Weaning, who was at Salesforce before coming to Calix, right before I did. He had a great background Shane Elaniak, corey Sindlar. So the team that they were starting to assemble at the time that I joined was really a team that I felt could take a networking company and build an amazing cloud and software company. So I liked the strategy, I liked the team, but the biggest thing was really the customers and the purpose.
Speaker 2:At Calix, nearly 50% of our customers are primarily not focused on profit. That means they're telephone cooperatives or electric cooperatives or municipalities. You know those cooperatives were formed 100 years ago because communities were saying, look, we'd love electricity, but no one who makes money selling electricity wants to build it here. Or we'd love great telephone service, and you know we're not a priority for those companies.
Speaker 2:Well, fast forward 80 years and you could say the same thing about broadband. Right, it's becoming this essential utility and service for communities. And so these organizations stood up and said, hey, the big players don't want to come here, we can figure this out, and it's really fascinating because their primary focus is transforming their communities. I was on a similar session like this with one of our customers and he was asked you know, how did you get into broadband? And it was like well, we got a call from one of our communities where we provide power. They had a hospital that really didn't have a connection. And then we got a call from another one where there was a school that didn't really have a connection. And then we started talking to our customers and we realized like all of them were really suffering from this.
Speaker 2:So we decided to bring world-class service right. It wasn't about, you know, we wanted a better EBITDA. We wanted a better, you know, arpu. We wanted to right. Those things are important, like if you're not financially viable, right, you can't help anyone. But the primary driver is I just want to do great things for my community. And so, as I explored some of the customers and I realized this, I was like, wow, this is a really incredible purpose for a company is to enable its customers to drive that kind of transformation. So that's what really convinced me to go to a company I'd never even heard before, I'd never kind of transformation. So that's what really convinced me to go to a company I'd never even heard before I'd never heard of before.
Speaker 1:It's a wonderful mission and goals there, especially in communities like yours, vermont, where notorious challenges around broadband even you know New Hampshire and the rest of New England much, much work to be done and you know we're going to talk about your transformation at your customers, but also internally at Calix. You've been involved in triple transformation as well, taking the company to the next level. What did that involve?
Speaker 2:Well, you know, it forced us to look at every part of the company, right. So you mentioned triple transformation, right. So if you were here a decade ago, every part of the company? Right, so you mentioned triple transformation, right. So if you were here a decade ago, we were a networking company. Right, we were focused on hardware with some monolithic software, and it was all about, you know, enabling folks to make connections. And what was interesting is you think about a broadband network and what flows through data, right, and when you look at sort of the technology evolution and the acceleration of the demand, how do we create more flexibility in that model? Well, that's software and cloud. Well, everything about a software and cloud company is different than a hardware company.
Speaker 2:I had some exposure to this, obviously, when I was at IBM in the 90s and the 2000s. Right, and it requires a different skill set, a completely different back office, a different sales team, different product development skills. I mean, you think about it top to bottom. And so we have successfully, over the last 10 years, navigated that transition. Carl Russo would actually say it started more like 15 years ago, but we accelerated that transformation in the last seven years, whereby the value prop that we're offering our customers is really different than it was even half a decade ago, and it's required us to retool every part of the company, you know, like I said, from the back office to the front office, to the product development, to how we serve our customers. As an example, we have a success team, right? If you were at Salesforce a decade ago, well, they talked about having a success team, which is how do we go train our customers?
Speaker 1:How do we get?
Speaker 2:value out of the solution. It was unheard of in our industry and frankly it still is other than Calix, and we built a really large team to be in the field, working with our customers to say how do you use cloud technology to liberate the data in your networks and use it to simplify your operations and understand your customers and their needs Completely transformational in our industry, literally doesn't exist anywhere else. Still it was certainly brand new, you know, seven years ago at Calix when I joined. So that's kind of the Talos transformation. The other two elements are sort of community transformation. I alluded to this right.
Speaker 2:So the first one is our customers are fundamentally creating a healthy economic environment in their communities.
Speaker 2:They're bringing innovation, and it's not just that they have a great broadband, their communities. They're bringing innovation and it's not just that they have a great broadband connection, but they're bringing world-class network security to protect from viruses and malware, content control to protect children from pernicious content like pornography and things like that, empowering parents, bringing connected camera solutions, hooking up hospitals and enabling e-health right. So you know, for them to do that to go from I'm a utility to I'm a service provider providing world-class solutions it's required them to rethink. You know what their skills are, how they deploy technology, how they sell their value prop huge transformation right To our customers. To do that so that's the third element right Is they have to go from being a, you know, slow moving utility who, quite frankly, doesn't have to worry about things like marketing and selling, to a service provider that's bringing these world-class capabilities to transform their communities, which they see economic growth, they see businesses moving in, they see people, you know, getting educated in different ways. So those three transformations, calix, the community and, of course, our customers.
Speaker 2:to enable that, you know that's been you know, really the heart of what we've been working on at Calix for the last, you know, five to ten years.
Speaker 1:Wow, well done. Well, it's great to see success. Many transformations fail, as you no doubt saw at places like McKinsey and IBM. It's not easy to get right and what you know. What impact has this made on the communities that you know you serve and your customers serve? You must go out and about to these small towns and villages, small cities and beyond. It must be quite intriguing and satisfying to see change for good there. Maybe talk a little bit about what's happening in the field.
Speaker 2:So yeah, going out to see our customers, so I get the opportunity to talk to our customers every day. I actually kind of make it a thing where I want to talk to a customer every day Now, fortunately, we have Zoom right, so living in.
Speaker 2:Vermont that makes it easier, and Teams and other technologies like that. But to your point, my travel schedule. I had a customer who invited me out to their board meeting, which was at the Canibie Ranch in the West Texas Hill Country, and that was quite a trip, right. And so it's fascinating to visit our customers because they live in these communities that you know you can't get on a jumbo jet and fly to from New York City easily, right, but when I look at what they're doing for their communities, it's phenomenal and it is so rewarding, right. So one of our customers, paul Bunyan, it is so rewarding, right. So one of our customers, paul Bunyan.
Speaker 2:And again, our customers have names like Paul Bunyan, right, they serve communities around Bemidji, minnesota. Fantastic company. But what was amazing is that they actually started, with Kallax Technology about eight years ago, this gaming conference in Bemidji, and they said, hey, we have this world-class technology, we're going to invite people in, and it's grown from a few dozen people to thousands. And in fact, last year, steve Wozniak actually showed up on his own. They didn't pay him, they didn't say, hey, steve, we want to give you $100,000 to show up to headline. He just showed up, right?
Speaker 2:Not only that, but their community was as a place to relocate, and Paul Bunyan and Gary Johnson, their CEO, spearheaded a company called 218 Relocate where they worked with their communities to create hoteling opportunities and provide broadband and set up concierge and invite people in. Fundamentally, I mean a place you've probably never heard of number eight on that list, right, and that's the kind of dedication that our customers have to their communities, some of which you've heard of, like Lincoln, nebraska, some of which you've never heard of, or maybe you have heard of Bemidji, but you know that is. You know we have nearly 2,000 customers and those are the communities that they serve and those are the kinds of transformations they're driving. They're actually building better communities.
Speaker 1:Oh, I love that. One of my clients is the. It is exciting. One of my clients is actually the state of West Virginia, where I went as a kid. We had a cabin there, a beautiful country side there and you know investment is really flowing in due to policy and things like broadband, rural broadband and investment in community infrastructure and it's amazing, there's some great success stories despite the you know kind of socioeconomic challenges they have there. So it's great to see this kind of happening across the country and across the world. But there's still challenges remain. When you talk to customers, what are their challenges to achieving their full possibility? I'm sure there are technology challenges or investment challenges, economic challenges. How do you see that landscape?
Speaker 2:Well, I think if you look at their challenges, you know one of them is just, it's an incredibly complex technology ecosystem that they have to deal with. Right, you have solutions, you have software, you have security concerns, right. So a big part of what we try to do is support them to be innovative. Right, our tagline is simplify, innovate and grow. Right, and for a smaller company to innovate at the pace of a Comcast, right, it's impossible. Right, they don't have teams of armies of developers and hundreds of millions of dollars to invest in solutions. And you know, honestly, what was happening in our industry was, you know, someone would say look, I want to roll out an IoT or connected camera solution.
Speaker 2:They'd spend 12 to 18 months integrating it into their back office by the time they got it to market it was obsolete, right, and so our goal is to essentially integrate all of those technologies into our platform, so our customers can integrate it into their back and front offices once, and then, when new things come out, they can have it ready to go in days and weeks. Right, that could be a new system, a new technology like Wi-Fi 7.
Speaker 2:It could be a new solution like Bark, which is a social media monitoring solution that enables parents to monitor their kids' use of social media, and it uses AI to detect if they're being subjected to cyberbullying or they're having suicidal ideation right, these are really amazing new technologies, and for them to figure all that out. You know, you're a company with 30,000 subscribers and you're in a couple of cities. You've got a team of a few hundred you don't have the wherewithal to provide great service with, and you're in a couple of cities. You've got a team of a few hundred. You don't have the wherewithal to provide great service with what you're doing today, and then figure out how to do all of that innovation. So that's a big challenge, and that's central to what we take on for our customers is simplifying their operations with great cloud technologies and then helping them innovate with sort of pre-integrated solutions that they can snap in and roll with.
Speaker 2:Another big challenge is dealing with governments.
Speaker 2:Right, that could be local, it could be state, federal. There's a lot of complexity in that, and so we make a big commitment to help them. I've got a team that focuses on doing consults with all of our customers who, again, they can't afford an army of lawyers and an army of regulatory experts, so we play a role to come in and advise them on how to deal with government programs, like the B program that's coming out that I know you're familiar with. You know how do you deal with all the complexity around. You know how do I, how do I put in an application, how do I deal with compliance when I do win right. So these complexities are huge, but the other thing that we're trying to do is help our customers with solutions that you know, frankly, bring value to the governments and the communities they serve. Like we have a solution called SmartTown, which is secure content control they serve. Like we have a solution called SmartTown, which is secure content control, authenticated Wi-Fi and broadband that you can mesh across an entire town, right.
Speaker 2:Oh, wow. And the idea is you bring that to a community, like our customer, tom Bigby, and you can basically say look, I'm going to create a secure, private network for all your first responders for free, right? They basically run it on top of the infrastructure they've already got. So what does that mean? You're in an ambulance. You pull up to a farmhouse, you can't get a mobile connection. They're in smart town, you can get right on their Wi-Fi on a secure, private, authenticated network, right. And so as our customers start to bring more value to their communities in really tangible ways, it helps them deal with, you know, what I'll frankly call the red tape that they have to deal with, because now they're more relevant. And you know, as I said, our third tenet of our tagline grow. They're growing their value for their communities. And those are two examples.
Speaker 2:The third one I'll highlight is, which is not unique in this environment, is there's a big labor challenge, right, these are communities that are often, you know, aren't the places everyone's flocking to. We're in a very tight labor market, and so, you know, they are looking to build the skills of the future and, you know, helping them think through the ways to develop their workforce. We do a lot of training and we have a lot of, you know, free educational programs and help them work with, you know, different organizations to build their workforce. Right, and so those are sort of the three big challenges and we want to play a role in helping them with all of those, you know, and there's always also technical solutions.
Speaker 2:So one of the big things that we're working on now is helping our customers. Do, you know, basically self upgrades, so the subscriber can do certain things that they used to have to roll a truck for, right, and so, you know, making them more efficient. Right. We've had customers who adopted our cloud technology where their truck rolls have dropped 50 to 70 percent. Right, that's massive operational savings for them, massive operational savings for them, and they can take that resource and say, hey, let's put that resource on building a next generation network that's going to bring 10 gig service versus dealing with, you know, giving someone a new gateway, right. So those challenges are really really complex, but we're committed to helping our customers deal with all three of them.
Speaker 1:Yeah, it's amazing to hear all the impacts you've had on customer operations, having done it yourself. Now you can see the challenges and inform customers on best options, and I assume that applies to every aspect of their business. Now it's front office, back office, billing, operations, provisioning. How deep do you typically have to go to kind of make an impact there? How deep do you typically have to go to kind of make an impact there? Even now, of course, automation and AI are, on the topic, top of mind for people.
Speaker 2:Is that something you go into as well? Yeah, we and our partners touch pretty much every aspect of our customers' business, right? So there are certain aspects of the business, like operational software, that they might use for billing and other purposes.
Speaker 2:We have partners who we work with on that, and the key is they're integrated into our platform so it's really easy for them to work together. But in terms of their core business processes that are most important, we get into all of it. So certainly AI is a big area for it. I mean, so certainly AI is a big area for us. I mean, as an example, you know, one of the things that we're going to be rolling out is an AI enabled chat bot. We've already got AI and machine learning built in solutions right so that they can provide customer support in an intelligent way for people who just want to go on and, you know, deal with the chat bot. That's not as annoying as some of the ones that we've traditionally had to deal with. We think AI can make it much better.
Speaker 2:But I mean, I'll give you an example marketing. We have a thing called the Market Activation Program. So our customers again, many of whom are very small, they might have a marketing team of a couple of people, maybe even one in some cases. So we actually have a program where we have a content builder, a webpage builder, video editor, where we literally versioned thousands of pieces of content around our solutions that they can take and brand and put in market. We've partnered with a comedian, jerry D you may have heard of the show, mr D and he's created a bunch of videos that we think are phenomenal and very entertaining. You know, most of our customers could never create something like that and we're like hey you know what?
Speaker 2:If they're all using our technology to run their networks and their operations and, more importantly, for this purpose, provide the solution to their customers, let's give them a way to take the content, brand it, because that's a key point. It's their brand, it's not calyx.
Speaker 2:they don't see the calyx brand, the subscriber they see paul bunyan or tom bigby right or etsy telecom. But the point is it's world-class content that they can very easily take, particularly with the guidance of our success team, and turn it into world-class marketing. That's something that. That that that I announced at our big conference connection seven years ago that that was our intent to do that, and it's very different. But we get into everything right. We have over 100 customers on our various advisory boards and we're asking them the same question you asked what are your challenges?
Speaker 2:Like where do you need help? And our help, you know really ends where they don't need it right. And most of our customers you know we're helping them. You know build, you know great support organizations, operation organizations, marketing teams, network teams and you know our goal is to be there with our partners for whatever they need and we touch, you know pretty much every aspect of their business which really helps us stay grounded, I think, and be a better partner for them, for their transformations.
Speaker 1:Wonderful mission, great, great insights. So what's next? Looking ahead, what can you share on your trajectory? And maybe a peek into the future, technology-wise, roadmap-wise, otherwise?
Speaker 2:So I'll start with one of the announcements we've made recently called Manage Biz. So we built a platform that is predominantly in the residential market, so in your home or in an apartment, right, that's where our technology has played predominantly. A little over a year ago we announced a product, smartbiz, which was made as an integrated solution. That's for a small business, so think 25, 30 employees down. Today. What they largely get is connectivity, right, and, by the way, what's interesting is they tend to pay more for it. They're basically getting your residential service. So that solution brings in world-class security, mesh control, content control, mobile backup and wired backup so that if something happens to your primary connection, your point of sale doesn't go down, which can be really bad if you're a small business, on a weekend, for instance, and you're running a retail shop. And what we announced is that we're going to be taking that same sort of fully integrated, fit for purpose, simple to manage solution up to the mid market Right, where we see a lot of fragmentation and complexity and, quite frankly, cost Right. I mean, if you buy a business solution today, you could be paying fees of five hundred to a thousand dollars a month for some of these more capable solutions that are for more complicated environments and we look at what we're doing with connectivity and security and management and bringing that together and then working with our customers to help them penetrate this market with a different solution. That's a huge, huge opportunity for us, right? Is you know how do we take our value prop from residential to community with SmartTown, to business with SmartBiz and ManageBiz? We're going to be coming out shortly with an MDU solution, you know. So these multi-dwelling units, as you probably know, can be very complicated environments, right? So the whole idea is to take a value proposition which we're proving out into new markets, markets and then enabling our customers to grow with us. So that's a big, big area.
Speaker 2:I mentioned AI as another one. We're going to continue to innovate on the network side. So a big thing there is. We're going to be coming out with something called 50 gig PON on our access intelligent access solution, and you may know this or not, but Verizon's been building their next generation network with us for the last five years using a technology called NG-PON2, which enables basically 40 gig service using wavelengths over a single PON, single fiber. So what does that mean? You can run mobile, business, residential, et cetera, on one physical network. Think of the operational and capital saving. So with 50 gig PON we're going to be able to serve even more markets with that same value prop. A little bit different technology, but the same principle right, which is, you know, basically significantly reducing the cost to serve multiple markets over a single network. That's going to be a big, big game changer for our customers and the market in general.
Speaker 2:And so that's a huge play. And then the third one is we're going to continue to fourth one. I guess it is innovate on the cloud side. So we've built cloud solutions for customer service and operations and marketing. We think there's a huge opportunity for general manager roles and sort of analytics around running your business finance. So that's an area that we're working on right now to take the value prop of Kallax Cloud and continue to bring it to more personas, Because when we think about our customers, we think about it that way in terms of personas. If you're in marketing, your job is very different than a general manager or a network operations person, and we want to enable them all to basically liberate the data, use it to run a better business. So those are some of the key innovations that we're focused on at Calix and, to be frank, AI will be a core part of all of those, as you can imagine.
Speaker 1:Wow, phenomenal. Well, it's so intriguing to say at least you have so much going on. You could probably spend at least a few hours, but sadly we'll have to let you go. And last note, you're in Vermont. I'm super jealous. One of my favorite vacation destinations. What's the state of play these days with broadband in Vermont and all the great little towns and hamlets and villages around the state? We're moving in the right direction, I think.
Speaker 2:We are. We are. I'm very excited. I've been following all the movement with CUDs. Some of our customers, like Waitsfield, are making big pushes to try to, you know, essentially put all of the great focus to work to bring great broadband to communities.
Speaker 2:I mean, as you know, right now in Vermont we are not the most technology-enabled state from a communications point of view. I live between Brattleboro and Manchester, which are two of the bigger towns in the state, and I can't get a mobile connection for 90% of that trip right. I have a good broadband connection because I live very close to Stratton Mountain, but there are members of my broader community who don't. But between federal and the BEAT program and the work the state broadband office is doing, which is phenomenal in the local communities and the organizing they're doing, we have an incredibly bright future and I think it's going to be a tremendous boom for the state of Vermont. I love it here but I know there's a lot of businesses that don't come here because they can't get broadband and I think in the next five years that's going to be a dramatic change and I think, like so many communities across, you know, the United States and beyond, but certainly in the United States you're going to see a lot of these communities in Vermont embracing that new technology.
Speaker 2:It's going to help people live a better life. I have people in my community who have to travel to New York City to see their doctor because they can't really do telehealth, right? That's more than an inconvenience if you live where I live in Vermont, right, so just think about it.
Speaker 2:But the great news is that I think the state and the local community leaders are really taking a great focus to this problem and planning to take advantage of things like Bede, which will be transformational, and I'm super excited that some of our best customers are a part of making that happen.
Speaker 1:Well, wonderful news, wonderful mission onwards and upwards. And thanks so much, matt, for taking the time to share insights and really educational work you're doing. And thanks everyone for watching, follow Calix on all the social channels. They put out great content, have great events. Really worth a look. Thanks Matt, thanks everyone. Thanks Matt, take care. Bye-bye.