The Exchanges

Q And speaking of that capital efficiency, it's often a big topic with regards Venture funding and choosing that venture model. You obviously chose the VC route and A-sixteen Z were one of the investors that you worked with. I've heard there's a good story about A-sixteen's check into Okta. So can you tell me, Frederick, how that came about and maybe why it was special?

A Yeah, absolutely. So if you roll back the clock to about 2005, I actually was fortunate enough to meet Marc Andreessen at a social event, and we chatted for a while, and we got along, and he and I stayed in touch, and then we started the company in, uh, Okta in 2009. And we were very fortunate. Our friends at Jawbone, Hossein Rahman and Alex Asali, who were the founders of Jawbone and were friends of mine from college, they were kind enough to give us a few desks in their office to start building Okta. So we said, great, man. We slowly started building our team there and building our company actually inside their offices. And then Ben Horowitz was actually a private investor of Jawbone's as an angel. And so we met Ben through Alex and Hossein, and then we went down and Ben said, Hey, we're starting a venture fund. We'd love to talk to you about it. We said, great. We actually went down, Todd and I, to meet with Mark and Ben and And Scott Cooper at the time was the three of them in their office. At that time, they didn't even have a sign on the office. So it was a piece of paper that was kind of taped to the window with an arrow that said Andreessen Horowitz this way. And then we went in and we had this meeting and I remember saying, wow, you guys, it looks like you just moved in. They said, how do you know? And I said, well, we're sitting at a Costco table and I know because I …

AI assessment note: “we were the first check that they wrote out of their first fund.”

Q Yeah, no, I'm sure I can absolutely understand that. We mentioned Andreessen there, though, and we mentioned Mike at Floodgate earlier. In terms of investor selection, how did you select the investors that you chose to work with, and maybe what advice would you give to founders who are contemplating their raise today?

A As you said, we've been very, very fortunate. I mean, the support that we got from Mark and Ben and Andreessen Horowitz that we got, obviously, from Mike at Floodgate, from Anil and the entire team at Greylock, and then from Vinod and David Wyden at Kosla, those were the major opportunities Backers that we had through the first couple of years of the company, and then we were fortunate enough to partner with Sequoia Capital. They led our CRD and our E, and then we were kind of off to the races there. So that's obviously a great group of folks. You know, what we were looking for primarily were people who had a lot of experience doing exactly what we were trying to do. So operators who knew how to build independent, large, hopefully public enterprise software companies. So again, we went through and built Opsware, which became LoudCloud, which became Opsware. And Neil had a lot of practice at PeopleSoft, which became Workday. And then obviously the folks at Sequoia had a ton of experience in seeing all of these large companies. You can go down the list of what they've supported and what they've backed over the years. And so we tried to put folks around the table who were operators, who had the experience doing exactly what we were trying to do, who weren't necessarily exactly the same Venn diagram overlap in terms of what they brought to the table. So that there was a lot of comp…

AI assessment note: “what we were looking for primarily were people who had a lot of experience”

Q up in the world of pharmacy and then starting PillPack. But then I had like Marco Thumbtack on the show who said that actually you can be a consultant coming out of Bain and do a SWOT analysis and come up with an idea that maybe doesn't have such founder market fit. How do you think about the two different sides there and the need for founder market fit necessarily?

A Yeah, well, I'm an enterprise software nerd, so I'll admit that up front. I learned to write enterprise software, you know, 20, 25 years ago. I really enjoyed that process. I loved getting into businesses and seeing how they worked. And then I loved being on the other side and providing some of that software back to companies to see how they would grow and how they take advantage of it and the opportunities that were there. So I'm very focused on a specific market, which is enterprise software. I think in enterprise software, you do have to have a lot of knowledge about the market. You have to have a lot of experience, a lot of understanding and a lot of vision, frankly, of where it's going to go. I think if you look at successful enterprise software founders, whether it was Mark Benioff and Parker Harris, Salesforce, or whether it was Anil Bushri, And Dave Duffield at Workday or whether it was Fred Luddy at ServiceNow, these are all folks who did not start as twenty-somethings out of college with an idea. These are folks who'd seen how businesses work, who'd seen the opportunities to improve the processes, the systems that were happening, and who'd seen a way to move all these companies forward. Now, don't get me wrong. It's I would be the worst person in the world to start a consumer company. I'm basically a Luddite. I basically only survive on email and calendaring these day…

AI assessment note: “balance that out with what's the market, who's the person”

Q But I do want to start today, Frederick. On the element of the idea, we're often told ideas are worthless, and it's all in execution. Today, it seems that there's little in the way of truly new and innovative ideas. Is that, in your mind, what about an idea makes it worth pursuing and investing in? Let's start with that.

A Yeah, that's a, that's a great question. I was fortunate some years ago to meet a gentleman named David Morgan Thaler, who started Morgan Thaler Ventures in the late sixties, early seventies. One of the first real industry venture capitalists actually did it out of the Midwest, but built a great organization over coming up on for 40 years. And David said to me, Hey, look, I look back at the history that I've done over the last 3040 years. And basically it's been 70% market, 20% team, 10% product. And so what he was saying was you want to invest in very big markets that are growing, right? You don't want to invest in large markets that are very stable. You want that growth in there. Number one, number two, you want fantastic teams. And then number three, you want that product. But if the market's really big and growing and you have a great team, they're going to be able to pivot and find the right exact fit for that product.

AI assessment note: “basically it's been 70% market, 20% team, 10% product.”

Q up in the world of pharmacy and then starting PillPack. But then I had like Marco Thumbtack on the show who said that actually you can be a consultant coming out of Bain and do a SWOT analysis and come up with an idea that maybe doesn't have such founder market fit. How do you think about the two different sides there and the need for founder market fit necessarily?

A Yeah, well, I'm an enterprise software nerd, so I'll admit that up front. I learned to write enterprise software, you know, 20, 25 years ago. I really enjoyed that process. I loved getting into businesses and seeing how they worked. And then I loved being on the other side and providing some of that software back to companies to see how they would grow and how they take advantage of it and the opportunities that were there. So I'm very focused on a specific market, which is enterprise software. I think in enterprise software, you do have to have a lot of knowledge about the market. You have to have a lot of experience, a lot of understanding and a lot of vision, frankly, of where it's going to go. I think if you look at successful enterprise software founders, whether it was Mark Benioff and Parker Harris, Salesforce, or whether it was Anil Bushri, And Dave Duffield at Workday or whether it was Fred Luddy at ServiceNow, these are all folks who did not start as twenty-somethings out of college with an idea. These are folks who'd seen how businesses work, who'd seen the opportunities to improve the processes, the systems that were happening, and who'd seen a way to move all these companies forward. Now, don't get me wrong. It's I would be the worst person in the world to start a consumer company. I'm basically a Luddite. I basically only survive on email and calendaring these day…

AI assessment note: “I think in enterprise software, you do have to have a lot of knowledge”

Q there. Peter Fenton said on the show he always laughs when he hears investors look for big markets, and then Sarah Tavel said that she looks actually for these niches or insertion points into small markets that actually open up into much bigger ones when you layer on additional products. How do you think about kind of market sizing and the potential to really expand into the larger, larger TAMs?

A Yeah, I read Peter Thiel's Zero to One a couple years ago, which I think is a very good book, and I recommend people will read. There's a bunch of good knowledge in there about everything from sales to go-to-market motions to engineering to, in this case, actually markets. He had a very good point, I thought, when he said that what he's looking for, and I agree with, is you want to become a monopolist in a small market with a lot of adjacencies. Now, I'd love to tell you that that was the plan when we started Okta a decade ago. I think Peter only wrote his book a couple years ago, so it's kind of like trying to fit that in after the fact. But that's basically what we did. We started Okta with a very focused market around web single sign on. We became monopolist in that market. And then we found a lot of adjacencies around multi-factor authentication. So strong authentication around life cycle management. So provisioning and deprovisioning of users and roles. And now we see more and more market opportunity around us. Once you start in particular in the enterprise, finding these point solutions where you can be a very, very strong player and then build the kind of platform, both technology and business automatically, Where you can build out from there and provide other solutions on top of that. If you make your customers successful, they're going to come back for more and more ti…

AI assessment note: “you want to become a monopolist in a small market with a lot of adjacencies.”

Q And speaking of that capital efficiency, it's often a big topic with regards Venture funding and choosing that venture model. You obviously chose the VC route and A-sixteen Z were one of the investors that you worked with. I've heard there's a good story about A-sixteen's check into Okta. So can you tell me, Frederick, how that came about and maybe why it was special?

A Yeah, absolutely. So if you roll back the clock to about 2005, I actually was fortunate enough to meet Marc Andreessen at a social event, and we chatted for a while, and we got along, and he and I stayed in touch, and then we started the company in, uh, Okta in 2009. And we were very fortunate. Our friends at Jawbone, Hossein Rahman and Alex Asali, who were the founders of Jawbone and were friends of mine from college, they were kind enough to give us a few desks in their office to start building Okta. So we said, great, man. We slowly started building our team there and building our company actually inside their offices. And then Ben Horowitz was actually a private investor of Jawbone's as an angel. And so we met Ben through Alex and Hossein, and then we went down and Ben said, Hey, we're starting a venture fund. We'd love to talk to you about it. We said, great. We actually went down, Todd and I, to meet with Mark and Ben and And Scott Cooper at the time was the three of them in their office. At that time, they didn't even have a sign on the office. So it was a piece of paper that was kind of taped to the window with an arrow that said Andreessen Horowitz this way. And then we went in and we had this meeting and I remember saying, wow, you guys, it looks like you just moved in. They said, how do you know? And I said, well, we're sitting at a Costco table and I know because I …

AI assessment note: “we were the first check that they wrote out of their first fund”

Q Well, so am I, but I would love to get the ball rolling today with a little bit on you. So tell me, Frederick, how did you come to found the very public now, Okta?

A Oh, we did. So we founded Okta 10 years ago, as you mentioned. I have a co-founder. He's slightly taller than I am, but not as good looking because we all have our things. His name's Todd McKinnon and the two of us met at salesforce.com back in the day. So I started there in 2002 and there's a couple hundred people there and Todd started in 2003. We worked together for about five years and obviously had a front row seat to the transformation going on from on-premises software that you implemented and manage yourself to cloud services. We drank a lot of Kool-Aid at salesforce.com and we came out of there and said, look, I think there's going to be a huge opportunity, software as a service, infrastructure as a service. They're just much better technology. For the economy out there, but to do that, there's going to have to be an enabling layer, and there's going to have to be a lot of new technology to enable all the software as a service to go into these companies. We looked around, we talked about it a bunch, and we saw that identity was going to be a huge opportunity, that identity has always been around. It's something that's been in industry for a long time, but it's been baked inside the platforms, and we saw it was going to come out of the platforms, and we took a bet on that 10 years ago, and so far, so good.

AI assessment note: “we saw that identity was going to be a huge opportunity”

Q Yeah, no, I'm sure I can absolutely understand that. We mentioned Andreessen there, though, and we mentioned Mike at Floodgate earlier. In terms of investor selection, how did you select the investors that you chose to work with, and maybe what advice would you give to founders who are contemplating their raise today?

A As you said, we've been very, very fortunate. I mean, the support that we got from Mark and Ben and Andreessen Horowitz that we got, obviously, from Mike at Floodgate, from Anil and the entire team at Greylock, and then from Vinod and David Wyden at Kosla, those were the major opportunities Backers that we had through the first couple of years of the company, and then we were fortunate enough to partner with Sequoia Capital. They led our CRD and our E, and then we were kind of off to the races there. So that's obviously a great group of folks. You know, what we were looking for primarily were people who had a lot of experience doing exactly what we were trying to do. So operators who knew how to build independent, large, hopefully public enterprise software companies. So again, we went through and built Opsware, which became LoudCloud, which became Opsware. And Neil had a lot of practice at PeopleSoft, which became Workday. And then obviously the folks at Sequoia had a ton of experience in seeing all of these large companies. You can go down the list of what they've supported and what they've backed over the years. And so we tried to put folks around the table who were operators, who had the experience doing exactly what we were trying to do, who weren't necessarily exactly the same Venn diagram overlap in terms of what they brought to the table. So that there was a lot of comp…

AI assessment note: “what we were looking for primarily were people who had a lot of experience”

Q Well, so am I, but I would love to get the ball rolling today with a little bit on you. So tell me, Frederick, how did you come to found the very public now, Okta?

A Oh, we did. So we founded Okta 10 years ago, as you mentioned. I have a co-founder. He's slightly taller than I am, but not as good looking because we all have our things. His name's Todd McKinnon and the two of us met at salesforce.com back in the day. So I started there in 2002 and there's a couple hundred people there and Todd started in 2003. We worked together for about five years and obviously had a front row seat to the transformation going on from on-premises software that you implemented and manage yourself to cloud services. We drank a lot of Kool-Aid at salesforce.com and we came out of there and said, look, I think there's going to be a huge opportunity, software as a service, infrastructure as a service. They're just much better technology. For the economy out there, but to do that, there's going to have to be an enabling layer, and there's going to have to be a lot of new technology to enable all the software as a service to go into these companies. We looked around, we talked about it a bunch, and we saw that identity was going to be a huge opportunity, that identity has always been around. It's something that's been in industry for a long time, but it's been baked inside the platforms, and we saw it was going to come out of the platforms, and we took a bet on that 10 years ago, and so far, so good.

AI assessment note: “we saw that identity was going to be a huge opportunity”

Q The first one from Mike, and it's a tougher one than I was asking. What were the hardest times Okta went through pre-reaching product market fit?

A Thanks for that, Mike. I really appreciate it. Well, I think early on in the company, look, we had a good idea, but you got to remember, we started in 2009, 2010. These were not the best years in the economy. People were not investing in new kinds of technologies. The world was trying to figure out how it was going to come out of the great recession. And then also when you're building an enterprise infrastructure platform like we built, it takes a couple of years. So getting that going and then trying to get customers to adopt it while you're doing that, that can be very hard. Frankly, if I look back at 20 11 and I look at what our revenue projections were versus how they actually ended up, the projections, of course, were up and to the right. The results were actually pretty flat. And those were very, very tough times. And we questioned everything. We questioned, did we have the right product? We questioned, did we have the right approach to the market? We had to be candid and transparent with ourselves, both my co-founder and I, but also with our team, because at the time we had 20, 30, 40 folks. You're all working in one room that's, you know, a couple thousand square feet with open desks. And things aren't going very well. And everyone's asking themselves questions. And there were tough times. We had a top engineer who left the company. We had some customers who couldn't ge…

AI assessment note: “the projections, of course, were up and to the right. The results were actually pretty flat.”

Q Now, I hope it's okay to go off schedule this early, but you mentioned the five years at Salesforce. Salesforce and kind of seeing that incredible hyper growth in those early days, in those five years, what were the biggest takeaways from you from seeing that firsthand?

A Well, the first thing is as a young guy in my career, seeing that growth is extremely exciting. It's very invigorating. You feel as though anything's possible. There's a lot of opportunity to try new things, to push the lever. In a case like that, software service obviously was brand, brand new. When I started Salesforce, it was a So you were trying new things and you really got to innovate in a lot of different ways, obviously the software and the technology itself, but also the business models and partnerships and go to market approaches. And so just that kind of innovation was very invigorating. And then secondly, I also saw what value companies got out of using salesforce.com. So prior to that, my background, I started as actually as a software developer, I got a computer science degree and I started writing software in the client services or on-premises traditional model. And so I kind of had seen a little bit of that in my early career, but seeing the value that companies were getting out of Salesforce.com, out of a service that you could subscribe to over the internet, and you could just start using right away, as opposed to spending all of your precious resources, implementing software, getting it right, deploying it to servers, putting it in data centers, just that value, the return on investment, the time to market, the total cost of ownership was such a clear, powerf…

AI assessment note: “Well, the first thing is as a young guy in my career, seeing that growth”

Q What motto or quote do you frequently revert back to?

A Oh, there's a few of them. First of all, keep the main thing, the main thing. This is a big truism in building technology startups. I think there's a lot of things that are going to come at you. You got to just remember what are you trying to do? What's the main goal? What's the thing that's going to move the dial and 80% this year versus like the 20% that's noise. And really at the end of the day, as a startup founder, there's probably three or five major decisions you have to get right every year. And that will really dictate what's going to happen with your company in the future. So just make sure you get those right. That's what I love. The other one is actually a quote from Herb Keller, founder of Southwest Airlines. He had a great quote, which is we have a strategic plan. It's called doing things. And I highly recommend entrepreneurs to think about that in particular in the early days, because look, Again, you can have all these plans, and you can have all this vision, and you can have all these strategic roadmaps of where you're going to go. At the end of the day, you got to show up every day, and you got to deliver, and you got to keep moving, and you got to keep going, and even if you make a mistake, that's okay. Hit the wall, take a right, and keep going, but you have to keep doing things. That's the name of the game.

AI assessment note: “First of all, keep the main thing, the main thing.”

Q I am super interested. You said that about the incredibly aggressive growth that you enjoyed in the early days and throughout the journey, to be fair. So what is then does capital efficiency play into one's mindset when they are growing as aggressively as you are?

A I mean, the capital efficiency is key, right? I mean, in these markets, we certainly live in a capitalist world where growth is king, and you see that whether it's in the private markets or the public markets, growth is what people get paid for. That being said, you still have to build a long-term, sustainable, independent company. And to do that, you really have to Think about growing and we talk about growing aggressively, but running the company like adults. So what does that mean? That means that you have to have certain ratios or certain ideas or frameworks around how fast you're going to grow around what you're willing to spend around what the right ratios are, whether it's cost of sale, cost of goods sold, you know, whatever, any of those quote unquote magic numbers that people talk about today are cost of customer acquisition, lifetime value, whatever makes sense for your business. I know there's a whole staple of these Numbers today. I don't know if they all apply to all the businesses. And I talked to plenty of startups where the founder will say, you know, it's too bad that these are kind of the standard numbers because my business is a little bit different. Well, that's okay. Use whatever numbers make sense for your business. Just realize you're going to have to explain that to others, which is fine. And if you really believe in that, that'll go very, very well. In …

AI assessment note: “we want to have a certain amount of payback on the investment”

Q Now, I hope it's okay to go off schedule this early, but you mentioned the five years at Salesforce. Salesforce and kind of seeing that incredible hyper growth in those early days, in those five years, what were the biggest takeaways from you from seeing that firsthand?

A Well, the first thing is as a young guy in my career, seeing that growth is extremely exciting. It's very invigorating. You feel as though anything's possible. There's a lot of opportunity to try new things, to push the lever. In a case like that, software service obviously was brand, brand new. When I started Salesforce, it was a So you were trying new things and you really got to innovate in a lot of different ways, obviously the software and the technology itself, but also the business models and partnerships and go to market approaches. And so just that kind of innovation was very invigorating. And then secondly, I also saw what value companies got out of using salesforce.com. So prior to that, my background, I started as actually as a software developer, I got a computer science degree and I started writing software in the client services or on-premises traditional model. And so I kind of had seen a little bit of that in my early career, but seeing the value that companies were getting out of Salesforce.com, out of a service that you could subscribe to over the internet, and you could just start using right away, as opposed to spending all of your precious resources, implementing software, getting it right, deploying it to servers, putting it in data centers, just that value, the return on investment, the time to market, the total cost of ownership was such a clear, powerf…

AI assessment note: “Well, the first thing is as a young guy in my career, seeing that growth”

Q dive in on that because we often discuss the importance and why we place emphasis, me and my partner, Fred, that is market people product. And we often say that backing truly special people leads to them finding the market, so to speak, if it's not maybe originally there. How would you respond to this and maybe our waiting of 70, 20, 10? And is that maybe wrong of us?

A No, look, don't get me wrong. Founders are essential. Founders are a key piece of the puzzle. I was reading the other day, someone had looked back on their career, one of the investors from, I think it was Sequoia, who'd invested in Cisco and Apple and all these other well-known brands, and they'd said, look, I might've been even more successful if I'd thrown away all the business plans and just read the resumes. So what they were saying was it was actually all about the entrepreneurs and whether they had the idea right or they had the market right, they would figure it all out. So clearly someone who's had that amount of success would definitely agree with you, but I think it's a combination of the two, right? You can have a super special founder, but if you don't have that big market opportunity and there's not that opportunity to create the growth and to figure out the go to market strategy and all these other things, I think you're going to be kind of constrained in how great that founder can make that business just because of the market dynamics. So I think they go hand in glove. I don't think you're going to be able to do one without the other, but I do think that you want to have that big, powerful, growing market where a lot of the incumbents are not able to react. They're not able to change what they're trying to do. And then also have those founders who know how to ta…

AI assessment note: “I think it's a combination of the two... they go hand in glove”

Q The first one from Mike, and it's a tougher one than I was asking. What were the hardest times Okta went through pre-reaching product market fit?

A Thanks for that, Mike. I really appreciate it. Well, I think early on in the company, look, we had a good idea, but you got to remember, we started in 2009, 2010. These were not the best years in the economy. People were not investing in new kinds of technologies. The world was trying to figure out how it was going to come out of the great recession. And then also when you're building an enterprise infrastructure platform like we built, it takes a couple of years. So getting that going and then trying to get customers to adopt it while you're doing that, that can be very hard. Frankly, if I look back at 20 11 and I look at what our revenue projections were versus how they actually ended up, the projections, of course, were up and to the right. The results were actually pretty flat. And those were very, very tough times. And we questioned everything. We questioned, did we have the right product? We questioned, did we have the right approach to the market? We had to be candid and transparent with ourselves, both my co-founder and I, but also with our team, because at the time we had 20, 30, 40 folks. You're all working in one room that's, you know, a couple thousand square feet with open desks. And things aren't going very well. And everyone's asking themselves questions. And there were tough times. We had a top engineer who left the company. We had some customers who couldn't ge…

AI assessment note: “We had a top engineer who left the company. We had some customers who couldn't get deployed.”

Q I am super interested. You said that about the incredibly aggressive growth that you enjoyed in the early days and throughout the journey, to be fair. So what is then does capital efficiency play into one's mindset when they are growing as aggressively as you are?

A I mean, the capital efficiency is key, right? I mean, in these markets, we certainly live in a capitalist world where growth is king, and you see that whether it's in the private markets or the public markets, growth is what people get paid for. That being said, you still have to build a long-term, sustainable, independent company. And to do that, you really have to Think about growing and we talk about growing aggressively, but running the company like adults. So what does that mean? That means that you have to have certain ratios or certain ideas or frameworks around how fast you're going to grow around what you're willing to spend around what the right ratios are, whether it's cost of sale, cost of goods sold, you know, whatever, any of those quote unquote magic numbers that people talk about today are cost of customer acquisition, lifetime value, whatever makes sense for your business. I know there's a whole staple of these Numbers today. I don't know if they all apply to all the businesses. And I talked to plenty of startups where the founder will say, you know, it's too bad that these are kind of the standard numbers because my business is a little bit different. Well, that's okay. Use whatever numbers make sense for your business. Just realize you're going to have to explain that to others, which is fine. And if you really believe in that, that'll go very, very well. In …

AI assessment note: “we kind of had a governor on how long it was going to take”

Q What motto or quote do you frequently revert back to?

A Oh, there's a few of them. First of all, keep the main thing, the main thing. This is a big truism in building technology startups. I think there's a lot of things that are going to come at you. You got to just remember what are you trying to do? What's the main goal? What's the thing that's going to move the dial and 80% this year versus like the 20% that's noise. And really at the end of the day, as a startup founder, there's probably three or five major decisions you have to get right every year. And that will really dictate what's going to happen with your company in the future. So just make sure you get those right. That's what I love. The other one is actually a quote from Herb Keller, founder of Southwest Airlines. He had a great quote, which is we have a strategic plan. It's called doing things. And I highly recommend entrepreneurs to think about that in particular in the early days, because look, Again, you can have all these plans, and you can have all this vision, and you can have all these strategic roadmaps of where you're going to go. At the end of the day, you got to show up every day, and you got to deliver, and you got to keep moving, and you got to keep going, and even if you make a mistake, that's okay. Hit the wall, take a right, and keep going, but you have to keep doing things. That's the name of the game.

AI assessment note: “First of all, keep the main thing, the main thing.”

Q This is a tough one. What do you know now that you wish you'd known at the start of your Okta journey?

A Well, I think I wish I'd known that it was a marathon, not a sprint, but you still have to run six minute miles. Okay. So it's a marathon. You've got to play the long game. You can't be sprinting every single day, but you do have to run pretty fast the whole time. So kind of getting that right balance going, because you got to remember building a large, independent, successful company, it's going to take three, five, 10, 15, 20 years. It's not something that's going to be done overnight, but you got to show up every day and You got to put your hat on, you got to put your boots on, and you got to get back to work.

AI assessment note: “I wish I'd known that it was a marathon, not a sprint”

Q So your favorite book and why, what must I read?

A You know, the thing is I read a ton of books. I read a little bit less over the last few years. I have three kids under the age of six, but it's hard to think of one. Recently, here's some of my favorite recent books. How about that? Battle cry of freedom. It's a Pulitzer prize winning book by James McPherson. It's a very long book, but it talks about the U S civil war. So it just gives you an idea of what was going on before the civil war, what actually happened in the war, what happened after the war. People forget America is only 150 years old. So if you look back or 250 years old now, but the civil war is 150 years ago. So if you look back at when that happened and how that shaped things, I mean, that is pretty recent history. Compare that to what happened in Europe, and it's so influential in actually how America operates today, good, bad, and ugly, and I think particularly in today's political environment and what's going on, it's just good to have that historical basis, and it's been super valuable to me recently.

AI assessment note: “Battle cry of freedom. It's a Pulitzer prize winning book by James McPherson.”

Q pleased you said that about perseverance because it's always such a tough question for me. I always think when you have a company that maybe is struggling to find that product market, How can founders determine whether to stick to their guns, stick to their mission, and really go for what they originally believed in versus actually whether they need to be realistic and change their strategy and potentially pivot?

A Yeah, I mean, that's the ultimate question, right? And so you have to have a certain amount of conviction as a founder, because if you're going to build a very large independent public company like we have here at Okta, you're going to start, everyone's going to tell you it's a bad idea. The incumbents are going to say, that's terrible. We've got a giant monopoly here. The industry analysts are going to say no way. I mean, think about this. This is 10 years ago. People were just getting to saying, okay, I'll put my sales data in the cloud, putting my identity in the cloud. That's crazy. And so everyone is really pushing against you and saying, no way, not going to happen. Hard to find customers, hard to find employees to join you in your mission, hard to find investors. I mean, we had dozens and dozens of investors turned us down when we got going with the company. And so you do have to have a certain amount of conviction. At the same time, you can't walk around with blinders on. You have to be sensitive to getting that feedback. And frankly, that's a huge power if you have the right investors, which we did. We had Ben Horwitz, obviously, who built LoudCloud to a public company and then sold it to HP. We had Anil Bushery, who'd previously been part of building PeopleSoft and was at that point starting to build Workday. Those were two of our board members in 2010, 20 11, who rea…

AI assessment note: “At the same time, you can't walk around with blinders on.”

Q dive in on that because we often discuss the importance and why we place emphasis, me and my partner, Fred, that is market people product. And we often say that backing truly special people leads to them finding the market, so to speak, if it's not maybe originally there. How would you respond to this and maybe our waiting of 70, 20, 10? And is that maybe wrong of us?

A No, look, don't get me wrong. Founders are essential. Founders are a key piece of the puzzle. I was reading the other day, someone had looked back on their career, one of the investors from, I think it was Sequoia, who'd invested in Cisco and Apple and all these other well-known brands, and they'd said, look, I might've been even more successful if I'd thrown away all the business plans and just read the resumes. So what they were saying was it was actually all about the entrepreneurs and whether they had the idea right or they had the market right, they would figure it all out. So clearly someone who's had that amount of success would definitely agree with you, but I think it's a combination of the two, right? You can have a super special founder, but if you don't have that big market opportunity and there's not that opportunity to create the growth and to figure out the go to market strategy and all these other things, I think you're going to be kind of constrained in how great that founder can make that business just because of the market dynamics. So I think they go hand in glove. I don't think you're going to be able to do one without the other, but I do think that you want to have that big, powerful, growing market where a lot of the incumbents are not able to react. They're not able to change what they're trying to do. And then also have those founders who know how to ta…

AI assessment note: “I think they go hand in glove.”

Q So if that's kind of how you kept going during those tough times, another one from Mike that's a challenging one, what did you have to get right to keep scaling as founders?

A So I think the biggest thing for us in building a venture backed software company, Harry, was that we knew that we were going to keep growing and we're going to keep growing aggressively. Look, that's not the only kind of business to build. You can build a lifestyle business. You can build a cashflow business. You can build businesses where it's a very good way of building a different kind of business. And you're not going to be hiring aggressively. You're not going to be growing into new markets and into new businesses and into new geographies, but that's not the business we were in. We were in the high growth business and we have been right. So If you look at what we were trying to do when we started the company, I was the head of sales. I was the CFO. I was the general counsel. I was the head of HR. You kind of go down all the lists. And then all of a sudden, you know, you start being able to hire people who are better than you in these other jobs. And that's how you start to scale. So it's kind of thinking about how can I hire myself out of these jobs by hiring experts? So we hired a head of sales. I mean, one of the big turning points in And a professional head of engineering because my co-founder Todd was also doubling as head of engineering at that time. And over the years, we've had a fantastic general counsel has joined us. A great CFO has joined us. Fantastic head of …

AI assessment note: “how can I hire myself out of these jobs by hiring experts?”

Q So your favorite book and why, what must I read?

A You know, the thing is I read a ton of books. I read a little bit less over the last few years. I have three kids under the age of six, but it's hard to think of one. Recently, here's some of my favorite recent books. How about that? Battle cry of freedom. It's a Pulitzer prize winning book by James McPherson. It's a very long book, but it talks about the U S civil war. So it just gives you an idea of what was going on before the civil war, what actually happened in the war, what happened after the war. People forget America is only 150 years old. So if you look back or 250 years old now, but the civil war is 150 years ago. So if you look back at when that happened and how that shaped things, I mean, that is pretty recent history. Compare that to what happened in Europe, and it's so influential in actually how America operates today, good, bad, and ugly, and I think particularly in today's political environment and what's going on, it's just good to have that historical basis, and it's been super valuable to me recently.

AI assessment note: “Battle cry of freedom. It's a Pulitzer prize winning book by James McPherson.”