You need to really kind of reimagine the technology as a cloud service and how would — what — how should that work? What would that be like? That’s what kind of creates the good product. And then in terms of — yes, what — the reception from customers has been fantastic. People are very excited about Flink. They’re very excited about Confluent. They’re very excited about the pairing together. For many of our customers, they were already using Flink with Confluent. And so — yes, absolutely, people are excited. Some people are like, what took you so long? So yes, it’s great to hear. We think that there is — as with Kafka, there is a substantial existing installed base. And in an environment like this where there’s some pressure and there’s less kind of net new software projects overall coming out, having that existing installed base to grow into is obviously a really nice second dimension of growth beyond just kind of landing with the new things.
Kasthuri Rangan: Got it. One for you, Steffan. Well, how do you look at the — given the headcount reductions, how do you think about cost of customer acquisition, lifetime value? It looks at the commercial business did well, Cloud is definitely inflecting away from the platform. Given all that, how should we look at those metrics? Are they getting better or about the same pre-cloud? Thank you so much.
Steffan Tomlinson: Yes, thanks for the question, Kash. As we look through 2023 and beyond, as more of our business is coming from cloud and there’s the self-serve option or onboarding, et cetera, our LTV to CAC should be improving over time. And we’ve made some progress this year, the year that just ended in terms of optimization. But when we look at LTV to CAC over the longer term, we see that improving on an annual basis. And that’s a reflection of both the restructuring that we’re doing, but then also the profile of the revenue streams that are coming in that are just a lower cost of customer acquisition.
Kasthuri Rangan: Wonderful. Thanks so much.
Shane Xie: Thank you. Our last two questions today come from Eric at KeyBanc, first, followed by Fred at Credit Suisse. Eric?
Eric Heath: Great. Thanks Shane. Jay, this is for you. I wanted to get your thoughts on kind of how you keep that net expansion rate pretty strong in that 130% range going forward. Just given what is kind of a more technical sales as you kind of evaluate kind of the lower workforce going forward? Just how do you keep customers keep expanding at this pretty impressive rate while also trying to balance that profitability?
Jay Kreps: Yes. I think there’s a number of things that go into that. One is just we have a consumption model. So it’s very possible for customers to use either other parts of the product or use the product for new uses, and making that as easy and frictionless as possible. There’s a lot we can do and are doing to continue to drive that, making sure that, that folds well into the motion that the sales team has. We’re actually at our sales kickoff event right now. And that’s one of the big focuses for us is making sure people understand how to play well with that consumption motion, how the product help drive them into new use cases helped drive that expansion. I think it’s a huge area of opportunity for us and then making sure that we have the right use cases that we have the right senior connections and organizations that kind of blessing is critical to really get broad in organizations and get to larger dollar spend in organizations.
