Okta's CEO is betting big on AI agent identity
My guest today is Okta CEO Todd McKinnon. Okta is a platform that big companies use to manage security and identity across all the many apps and platforms their employees use. Most of us run into it as login management at work.
SaaS companies like Okta are under a lot of pressure in the age of AI, which Todd even said on an earnings call he's "paranoid" about. But you'll also hear Todd say that for Okta specifically, there's also a world of opportunity as the very concept of a digital "identity" has to expand into things that aren't really people.
Links:
CEO ‘paranoid’ as vibe coders stir SaaSpocalypse fears | The Register
$300B evaporated. The SaaSpocalypse has begun | Forbes
How AI assistants are moving the security goalposts | Krebs on Security
What everyone’s missing about AI and development | CRN
Agents run amok: Identity lessons from Moltbook’s experiment | Okta
Breakup of IBM is Antitrust goal (1972) | New York Times
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EP 122: Okta CEO Todd McKinnon on Scaling to $13B, High-Stakes Decisions, and Market Dynamics
What does it take to scale a company from an idea to a $13B industry leader? In my latest episode, Okta CEO Todd McKinnon dives into the essential lessons he’s learned on high-stakes decision-making, managing up to the board, and competing against tech giants like Microsoft.
Todd also reflects on his journey to founding Okta, his bold choice to team up with a co-founder he hardly knew, and the motivations that have fueled him for over seven years as a public company CEO. Some key takeaways…
[0:00] Intro
[0:33] Todd McKinnon's Early Career and Founding Okta
[1:38] Challenges and Psychological Shifts in Leadership
[2:49] Decision Making and Company Culture
[6:10] Milestones and Early Successes
[18:03] The Importance of Market Timing
[30:34] Hiring and Building a Strong Team
[39:22] Setting Expectations with Board Members
[40:50] The Shift in Board Dynamics
[41:41] Maintaining Context and Strategic Input
[43:15] Navigating Public Company Governance
[45:21] Trusting Instincts and Founder Mode
[47:11] Breaking Out of the Echo Chamber
[51:00] The Importance of Prioritization
[53:05] The Loneliness of Innovation
[1:05:33] The Role of a CEO in Decision Making
[1:18:17] The Journey to IPO and Beyond
Executive Producer: Rashad Assir
Producer: Leah Clapper
Mixing and editing: Justin Hrabovsky
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About the Show
Logan Bartlett is a Software Investor at Redpoint Ventures - a Silicon Valley-based VC with $6B AUM and investments in Snowflake, DraftKings, Twilio, and Netflix. In each episode of The Logan Bartlett Show, we sit down with the people behind today’s most important startups and extract the tactics, lessons, and frameworks they’ve learned the hard way. Conversations span hiring to GTM, product, growth, fundraising and everything in between - collectively forming the ultimate playbook to make you a better CEO, investor or board member.
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20VC: Okta CEO Todd McKinnon on How To Approach Effective Decision-Making in Leadership, When Is The Right Time To Hire Recruiters and Heads of People, Balancing the Expectations of Wall St with Long Term Vision and What Truly Successful Board Management
Todd McKinnon is the Co-Founder & CEO @ Okta, the identity layer for the internet, providing one trusted platform to secure every identity, from customers to your workforce. Prior to their IPO in 2017, Todd raised over $229M for the company from some of the best in the business including Sequoia, a16z, Greylock, Khosla and Floodgate to name a few. Prior to founding Okta, Todd was VP of Development @ Salesforce.com where he spent an incredible 5 years and before that enjoyed an 8 year run in the software development team @ PeopleSoft.
In Today's Episode You Will Learn:
1.) How Todd made his way into the world of startups with PeopleSoft and Salesforce? What was the a-ha moment for Todd with the founding of Okta? What were the biggest management takeaways from his time with PeopleSoft and Okta? How did Todd convince his wife that leaving a safe job with Salesforce to found a company was the right decision?
2.) How does Todd approach decision-making today? What frameworks does he use to optimise his decisions? How does Todd analyse reversible vs irreversible decisions? How does Todd know when he has done enough work and is ready to make the decision? Who does he debate the most important decisions with?
3.) What does Todd believe makes for a truly great enterprise software entrepreneur today? What were the first elements to break in the scaling of Okta? When is the right time to hire your first recruiters and Head of People? What should you look for in those people? How did Todd make mistakes when it comes to hiring recruiters?
4.) What are Todd's biggest lessons on successful board management? How would Todd describe his style of board management? How has it changed over the years? What can CEOs do to extract the most value from their board? What were the biggest mistakes Todd made in the early interactions with his board?
5.) How does Todd balance the growth expectations of Wall St on a quarter by quarter basis with the long term vision and strategy? Why does Todd believe that Okta has been able to make the transition from unsexy to one of Wall St's most loved companies? What is the secret to investor relations as a public company?
Item's Mentioned In Today's Episode
Todd's Favourite Book: Slaughterhouse 5
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SaaStr 410: 10x Your Organization's Performance with Todd McKinnon, CEO and Co-Founder @ Okta and Jason Lemkin, CEO @ SaaStr
In today's SaaStr insider episode SaaStr CEO and Founder Jason Lemkin catches up with Todd McKinnon, CEO and co-founder of Okta. Together they discuss what it takes to build, maintain and grow a high-performance organization.
Video and blog post: https://www.saastr.com/10-learnings-from-talking-with-todd-mckinnon-ceo-of-okta/
Todd McKinnon - Creating and Defining a New Market Category - [Founder’s Field Guide, EP.7]
My guest today is Todd McKinnon, co-founder and CEO of Okta, the leading provider of identity management for enterprises. Todd started Okta in 2009 after realizing that enterprises would need a robust solution for identity management in a world where everything was quickly moving to the cloud and today counts over 7,000 enterprises as customers. Our conversation focuses on how Todd decided to leave Salesforce to start Okta, the painful early years of growing the business, how companies can create and define a new market, the different roles he's had to play as the company grew and went public, and the frameworks he's put in place to continue to innovate and test new things as public business. I hope you enjoy our conversation.
This episode is brought to you by Microsoft for Startups. Microsoft for Startups is a global program dedicated to helping “enterprise-ready” B2B startups successfully scale their companies. If you’re a founder running a B2B company targeting the enterprise, you should definitely check them out.
For more episodes go to InvestorFieldGuide.com/podcast.
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Show Notes
(2:19) – (First question) – Best slide in his presentation for starting Okta
(5:21) – The early days of Okta and what they were trying to do
(8:36) – Challenge of building the company from an engineering perspective
(10:32) – First version of the Okta product
(11:03) – An overview on identify management
(13:55) – The major innovation in the early days of the product
(16:11) – The early struggles of starting a company
(18:49) – Becoming a default mode solution
(20:39) – Most interesting ways the company has grown its services
(22:10) – Future of platform businesses
(24:24) – Expanding into an infrastructure business
(25:59) – Important shifts that they are paying attention
(28:21) – Future of our digital identity and Okta’s potential role
(32:20) – The chapters of Okta’s story so far
(35:03) – Challenges they had to overcome in growing the company
(37:31) – Recruiting the right talent and fostering it early on
(39:12) – Biggest mistakes he’s made with the business
(41:06) – Benefits of extreme focus vs having a broader view of the problems
(43:35) – Innovating within Okta
(46:02) – How software businesses define cost of revenue and cost of goods
(48:23) – Lessons they’ve learned about selling the services of a small company into the largest company
(49:54) – Lessons from working with bad clients/customers
(51:06) – Their inside view into the future of business today
(51:10) – Jeff Lawson podcast Episode
(52:36) – Best way to maintain the growth of Okta over the long term
(53:30) – Lessons he would give to business students today
(54:51) – Being scared as a founder
(55:27) – Kindest thing anyone has done for him
Learn More
For more episodes go to InvestorFieldGuide.com/podcast.
Sign up for the book club and new email newsletter called “Inside the Episode” at InvestorFieldGuide.com/bookclub.
Follow Patrick on Twitter at @patrick_oshag