Okta CEO Todd MacKinnon | Dynamic Work

Hi everyone, I'm Sarah Gua, General Partner at Greylock. You're listening to Gray Matter, where we share stories from company builders and business leaders. This is episode three of our Work From Anywhere series exploring how the world has been turned upside down since the pandemic began. We're talking to an amazing set of founders and CEOs building for the digital first economy about how they're surviving and thriving in real time. We'll get their best predictions for what changes will sustain the bets they're placing and what they're struggling with. Our third guest is Todd McKinnon, the co founder and CEO of Greylock Portfolio company Okta and previously head of Engineering at Salesforce. From a team of just 12 or 13 engineers, I think Todd's also prize winner for fit as CEO, so I encourage you all to follow him on Twitter for business wisdom and on Instagram for some workout of the day inspiration. When I joined Greylock in 2013, the company was just getting into double digit ARR and still in that messy middle Post Series B Todd, thank you so much for being with us today. Could you please tell our listeners a little bit about yourself and the founding story of Okta?

Yeah, thanks for having me. It's exciting to be on Gray Matter. The name implies that I have something intellectually to add, which is flattering. Okta is 11 and a half years old now. Before I worked at Okta I ran engineering at Salesforce and then before that I worked at PeopleSoft. So I've been enterprise software my whole career. I focused on engineering and development and specifically around platforms. So at PeopleSoft I worked on their platform which was called PeopleTools. It was how the applications were built. And then at Salesforce I ran all of engineering. But in the time I was there we really took the product and the platform from being a CRM Salesforce automation tool with accounts and contacts database that was of course multi tenant in the cloud and then moved it to being what was the Force.com platform which was a way for people to build applications on and around Salesforce and in a lot of ways that you might say, well what does that have to do with Okta? First of all, the reason we started Okta, my co founder and I, Freddie Karas, was we knew each other from Salesforce and we got really excited about the future of cloud. So we saw the success of cloud and the potential of cloud inside of Salesforce. Especially at the time, this was around 2007 or 2006, 2007 you start to see not just Business applications like Salesforce going to the cloud, but you saw collaboration and communication. You saw email Gmail, they released something called Gmail for domains, which was basically business Gmail. And you could see that that whole collaboration and communication layer was not going to be on premise. Exchange, servers, companies managing email is going to be done in the cloud. And then also around that same time was aws. So the first storage service and then the Elastic Compute cloud service came out and you could see that, hey, even servers at the infrastructure layer was going to be done in the cloud. So we got really excited about fast forwarding, you know, 10 years and saying, what's it going to be like when everything in the IT stack is going to be a cloud service and people have an option of doing that from the cloud? What other things are going to be needed? And then back up to my experience from both Salesforce and PeopleSoft. I'd worked on identity products and I knew that if you could solve identity challenges in the old world, it was really advantageous. But in the new world, where there's going to be so much more remote access and so many more choices of different types of apps, the identity challenge was probably going to be more so strategic and imperative than ever. So that's really why we started it. We got excited about the macro opportunity. And anytime there's a lot of technical disruption in terms of moving from on premise to the cloud, we knew there'd be big opportunities. So there you go. Summarized 11 years of hard work in like four minutes.

Yeah, well, I think one thing that will be interesting to a lot of entrepreneurs living this period and hearing the podcasts. I know the story of thinking through taking this kind of risk in 2008, where you and Freddie are in pretty good spots at Salesforce. Tell us a little bit about that and how you thought about the risk.

My job was great, man. It was amazing. I was running engineering, so I had about 300 people working for me up from when I started. There were about, I think about 13 engineers working for me. So it was a ton of growth, ton of success. It was kind of the preeminent cloud engineering job. But, you know, part of the thing I saw is I'd lived in my career, I'd lived before that through the dot com bubble, and I saw all these people go out and start these companies that were amazingly successful, whether it was Yahoo or Google or all the dot com companies. A lot of them didn't work out, but a lot of them were amazingly successful and they did it during this time of transition. Technology from offline world to the online, the web world. And so I just knew in my gut that there was going to be a big opportunity here and I couldn't watch it pass me by. Again, as great as my job was, I couldn't live with myself if I didn't take a shot. So that was at a macro level. And then I got really excited about how big of something we could build. So I decided to do this. But actually the hardest thing was quitting my job. And before I quit my job, I had to talk to my wife about it. She's amazing. My wife, Roxanne. The other part of the story is we had a six month old daughter and my wife is great and one of the reasons why we're such a great team is because she's pretty different than me. I'll take risks and more entrepreneurial. She's, you know, she likes stability and in her mind and like the way she thought about things was you either have a job at a company people have heard of or you're a bum.

Don't be a bum, Todd.

You know, job at Salesforce or in engineering, successful, some company no one's heard of that you're starting yourself, you might as well be a hobbyist in the basement, right? So when I told her, and then plus she had a baby and she was worried about and by the way, there was a big economic downturn with the financial crisis. So I came home and I told her that hey, I'm gonna quit my job. And she looked at me and she said, what are you crazy? She used colorful language. But it sounds funny now that it kind of all works out right? But the point of this whole story is that it was super scary. And I think entrepreneurs that are feeling this right now, I think everyone feels it. It's not, it feels lonely to you, but everyone that does anything amazing feels it. And not in a way like, oh, everything works out great. It's kind of a trivial thing in the past. It's really feel scary and that's normal and definitely did for me and my wife and I talked about it and I ended up actually to convince her, I actually made a presentation in a Google spreadsheet and the title of it was why I'm not Crazy. My proposal to be successful starting a company. It's funny if you look back at that thing today, it's. Some of it is pretty prescient, right? Like, you know, cloud is taking over the world. There's going to be the next Microsoft and Oracle and you know, are going to be started during these times, just like they were started during economic downturns. It's kind of forward looking, but then the other seven slides in there are all about like, covering my basis. Like I can get a job when it doesn't work, you know, we'll know quickly it's not going to drag on forever. So if you think I was that confident, I probably wouldn't have spent seven slides covering my downside case.

Well, I think it's an incredibly encouraging and authentic thing to hear. There's personal risk involved here and the downside cases are real. And I'm not sure there was a note in that slide of why I'm not crazy of Okta's definitely going to be a $25 billion company 11 and a half years from now.

I left that slide out. I don't know if you've looked at it, but there is a funny slide in there. I go through a few scenarios, like there's a scenario where we can't raise money and I just go get another job. And there's a scenario where we're able to raise money, but it probably doesn't. And the fourth scenario is the massive upside. And the massive upside was we go public for a market cap of $100 million. You can tell I had really bold vision there. Sarah.

Yeah, clearly a lot ahead still to be excited by. I think one of the things that has always inspired me about the Okta story thus far has been I'm an infrastructure and security nerd, but I also want to use software that is actually enjoyable. And I actually looked up, it was my former partner Anil's original note to the partnership about we should really do the series B in this company. And it was all the page. So you can write quite concisely about these things. But I remember it was two sides and it was a platform for security, but also usability and enablement. And so it's cool to hear how clear this story resonates today. Shifting gears a little bit. Let's talk about the world in 2020. So first let's talk about Okta's role in the world and then how you think about your people. How has your vision for the company changed or Okta as a product's role, as a platform's role changed in the work from anywhere era.

Well, you know, for me, this year has been crazy, like for everyone. Right. But one of the visceral things for me is that, you know, I've never really had to make decisions before that were kind of life and death for the employees. Our decisions and my decisions about going back to the office, sheltering, I mean that's like pretty serious. I don't mean to like over dramatize it, but that's kind of humbling, right? Leading this awesome company of 2,500 people and the decisions I make could lead to different health and safety outcomes for the employees. That's pretty humbling and something I think a lot about. And try to make the right decision is always the top priority on my mind. I think beyond that, I think that we're very lucky first of all, that we are in a business and an industry. I think a lot of people in not, well, not everyone in tech, but a lot of people in tech are in a position where the company can actually still operate. Right. A lot of companies have a hard time operating right now. So we're very lucky to be in a business that can operate. Whether it's delivering the service we do, building the products, helping customers. We can do a lot of that remotely, which is a great position to be in. And then layer on top of that what we do actually in this situation where every company is trying to connect with their employees remotely, every company is. Talk about fast forward to being digital transformation. When no one can come into your hardware store, you really have to figure out your digital transformation strategy because you got to get your product online so they can come pick it up, that you can deliver it to them. It's a fast forward button for digital transformation by many years and we're right in the middle of that. So not only do, you know, have our health and safety, we can operate our company. We're also benefiting from these macro trends that are being accelerated by this. What's really a bad thing that's going on in the world. So we're extremely lucky. So I, I try to make sure that the company realizes this and, and to the degree we can uses that as a motivating factor to, you know, when possible go after our mission and our vision even harder. You know, not that we don't want to burn people out and people are, have situations that are unique and challenging personally and so forth. And we want to be respectful of that. But you know, talk about an opportunity to not to miss, right? This is how we're thinking about the motivation and the, the purpose and the, the potential we have. It's good to not have to. Shifting a vision and a purpose for a company is really hard. You know, pivoting is really hard and costly. A lot of startup companies know that and it's another advantage that it kind of this whole world right now kind of reinforces what we're about, which is, you know, enabling any organization to use any technology, you know, now more important than ever and will be more important in the future. It's kind of motivated for me personally, it's. It fires me up and, you know, thriving or trying to survive and thrive through this adversity is very motivating. And then when I look at the opportunity that's before us, it's. It's pretty cool.

So fast forward Okta today, what are the core offerings for customers? You know, you don't need 13 engineers anymore. What does the team look like?

It's fun to talk about the early days and especially when we can. And Freddie does this as well, my co founder, a lot about trying to help entrepreneurs and share perspectives. So it is good to do. But one of the most important things about our job is to make sure the company stays hungry and stays fired up about the future. Because if you look at things, it's really we are still relative to what we could be. We're very small. You know, we have 2,500 people, which seems big when you go back to two people 11 years ago, but on the grand scheme of things, it's very small. I think Salesforce has, you know, I forget the exact number, but I think it's over 50,000 people now. Google has a hundred, nearly 100,000 people. I think Amazon has 500,000 people. So we're just little pipsqueaks, right? I spent a lot of my culturally and in a leadership perspective making sure people keep stretching and keep striving and keep. The day they walk into Okta, it's the first day of the impact they could have and that they will have. And that's important to keep in mind. But that being said, it's 2,500 people. And the other thing about all the founders listening would know is that to be successful, you have to do something. That's crazy, right? So in a way that my wife saying I was crazy was a compliment because it has to be crazy in terms of what you're trying to do. And for the crazy thing for us was everything's going to be cloud. That was not totally a shock to people, but that was crazy to some people. But the crazier thing was you're going to do security and identity from the cloud because people thought about cloud as like business apps and things that aren't core. But identity and security, that's crazy. You would never do that from the cloud. And we looked at it and we said that's going to change because when the center of gravity of all your tech shifts to being outside, then it's going to be more advantageous to have your security outside too because of all the advantages that gives you. You can connect more closely to the technology, you can keep it updated, you can monitor it better, you can get all the other benefits of the cloud. So that was the crazy thing for us. And if you look at what's powered our success would be the fact that identity is even more strategic and more important than ever. And this is a big one, that it's unlike previous generations of technology. Identity before was always a part of other platforms. It was a part of Windows, it was a part of Oracle, it was a part of IBM. Now it's its own platform and it's so important and has to connect to so many things and it's so connected to security and customer experience and employee experience that it's its own platform. And that's what's led to our success now. So we have the identity cloud, which is our platform. And that platform addresses, there's a bunch of products, there's, there's single sign on, there's life cycle management, there's multi factor authentication, API, access management. But the products address under the identity umbrella two main use cases. One is for workforce, so employees logging into business applications and then customers, so customers logging into our customers websites and mobile apps. And those are big markets. Each of those markets, the employee side is, it's a $30 billion TAM. If you look at what we, the value we deliver to our 8,000 customers today and you multiply that by every company in the world that could really use this, that's a big $30 billion TAM. And then on the customer identity side, it's another 25 billion. Because every company has to get better website, mobile apps and every one of those needs login. You got to get that content to a person. So that's what we're going after again. We've got 2,500 awesome people and need to keep growing and keep building products and keep innovating to reach our potential.

So let's break that into two pieces. Like you've said before, you have this survive focused phase of internal, like let me make sure that we're. What's the right word for octa people? Octans, Badasses. Badasses. I'm sorry, what's the right way to make sure all of our badasses are in a good place. So let's talk about survival first. Like, what was the sequencing of reacting to all these events?

Right when this started, we had a. This is in late February and March. We had our Octane conference scheduled for April 1st. So the first thing I remember is like, Octane is a big deal. We spend a lot of money on it. It's symbolically in the company. It's a rallying point to get a bunch of stuff delivered in terms of like the sales teams. It's a pretty important demand gen and closing event. It's a big deal. And the first thing is like, we're stressed about this. It's like, how is this going to happen? What is it going to mean? Like, you know, can we still close deals? Can we still deliver our marketing message? So we scrambled around to make that happen. And I think that through that process we learned what kind of was born out in a lot of different other areas of the company that I think we underestimated our ability to adapt and be flexible in these changing times. You know, I think we had a lot of preconceived notions about what Octane had to be and what the inertia was around that. And we really kind of impressed ourselves in our ability to adapt and have an effective event. And I think that was a lesson, you know, like we had 6,000 people that were going to be there in person in Moscone west and San Francisco. It ended up being 20,000 people online. And not only online, but then we have all this reusable content. We have these talks and breakout sessions that were all recorded now and all presented in a way online. And the demos were presented online in a way that was much easier to follow, that was much better. And it was all just because we were forced to break our inertia. The inertia that had to be in person, that you had to get everyone in the same room. So I learned a lot through that and then taking those lessons through just running the company over the next. The biggest thing for me was be really clear about from a leadership perspective. And I think these, these lessons apply to any situation, any size of company. As a leader, it's really important to make the high level priorities clear. And especially in our. In all the, you know, people listening. The businesses are. The people are super talented, driven. And it's. You gotta like, make the priorities clear. And then that helps the teams kind of figure out what to do. Right. And for us, it was just being really clear about, hey, the first thing is that we're gonna prioritize the health and safety of everyone. So if that means that instead of trying to, you know, when we started to shift for octane, it was like, hey, maybe, maybe we can rent a smaller studio space and produce the event in person and then broadcast it. But we're like, you know what health and safety would mean that we don't even want to make the people that are producing this thing and the presenters get together in a physical space. So you know what? It's not going to be done in Moscone West. It's not going to be done in a studio that we rent. It's going to be done from my living room. And as hokey as that sounds, that's what we're going to do. Because the number one priority is health and safety. And if it comes across as hokey and my kids walking behind me in the video, then that's what it's going to be. And that's the first priority. And the second priority is, you know, customer success. So customers are going to have problems. Customers are going to not be able to pay. Customers are going to be like, going out of business, God forbid. We need to be flexible and prioritize that, even though if it may be, we took a hit in the short term. And then the third thing was. And part of customer success, by the way, is keep the service running, because what we're doing is mission critical. So if we need to reprioritize stuff to make sure that everyone can support the service and that the infrastructure is good, we need to do that. And the third thing is, you know, rip up the playbook. This is, you know, we had our playbook. We were rolling along, we made our plans, we had our annual planning cycle. Everyone got their plans. You know what, the plans changed.

I think, like, the best anyone can hope for right now is adapting to it. As you said, like, those priorities, it's so clear when you express them right now. How did you get those across to your 2,500 people? Right. Did you have good channels for it already? Is it flowing down the organization? Is it like, internally, we're going to do the. We're going to do all hands. What? What did you do?

That's a good segue to my. The second part of my answer. So I mentioned, like, leadership lessons. One is the. The priorities, getting them out there. And then the second thing is, like, as a leader, being visible and especially in times of stress and where everything is kind of up in the air for everyone, you gotta double down on visibility and leadership. And, you know, I Learned this lesson in the early days of Okta where it was pretty hard. You know, we weren't one of these startups that was just rolling out of the gate. It took a while, it was a grind. And then there were some times where we missed sales numbers. We, the board wasn't happy with what we were doing. And my first instinct in those times was, you know, I'm gonna try to like hide things and internalize things and figure it out myself. You know, I'm independent, I'm strong, I can figure this out myself. And what I did at that time is like I kind of flipped it around and said I'm gonna share the problems. I'm gonna be like, tell the team. We're kind of in trouble here. You guys got any ideas on how we can figure this out? Cause I, I'm, you know, I have some ideas but I, I don't have the answers. And that was a lesson in like, even if it doesn't feel right, you got to be visible, you got to get out there, you got to show up, you got to be an example. And Fast forward to 2020, I think, you know, beyond just the priorities, it's about being hyper visible. And you know, when the office, we would have our all hands meetings and I would get up there every week and I would be walking around the halls and that was gone. You know, I couldn't show up in the all hands meetings physically. But what I could do is I could double down online, I could double down on social media, I could double down on slack, I could double down on email, I could send videos to people, I could be, try to be more visible and transparent and available, you know, as ever. And that's important because people want to, in their, at their work lives, they want to see that their leaders are people and that they're dealing with this too and that they're as best they can trying to adapt and thrive and that's something for people to rally around. So I think that that has served me well and will continue to. And it will, you know, people listening to this, any kind of leadership lesson, it's going to serve them well as well. The one thing I would also add there is that it's hard to, it's like you have to with your team or your organization or your employees. You can't just start this from zero day one. You got to build up that equity, so to speak, that relationship, that authenticity and your voice and how you interact with people. You can't just when there's a crisis, you can't just show up and be like, all right, I'm going to have town halls every week. You know, because the first reaction is going to be, people are be like, why is he having a town hall every week? We must really be screwed. This would really be bad. Like, he must be about to get fired because he's, like, talking to us every week. You have to build that up over time. And then when a crisis does hit, or when you really need the company to pivot or you need the company to re emphasize something, you have that relationship and that authenticity and that voice where you can sit down and say, hey, here's the deal. We thought this, this plan was good. Now it's not good. This is why we need to figure this out. And I think that that's another lesson to take away from this in thinking about.

What's probably really hard right now for leaders at any scale is, as you said, you're making a lot of decisions that are very high stakes very quickly. And, you know, you're public company CEO. There's also more visibility into what's going on in the company than in many other of our portfolio companies. How do you think about a planning cycle and like, adapting, but not like thrashing. Right? This is something that I've seen, you know, a lot of the CEOs I work with think through right now.

There's no silver bullet. It's kind of a timeless question, like, what's the difference between being adaptive and being decisive? One thing I would say is you get both sides of this advice. You get like, the side of the advice which says you really need to listen to people. You know, you need to take input, you need to be open to suggestions and so forth. And then the other side of the advice is you got to be decisive and you got to, like, make decisions. You got to go. I would say in general, people I've worked with tend to take too much advice. People should be more decisive because I think in general, people are smart enough to kind of do the math and the probabilities. I mean, obviously there's lots of flaws people make about probabilities and so forth, but generally speaking, people can narrow down the bad choices pretty quickly and then they get to this range of choices. That is, the difference between the different choices relatively is pretty much probably not as bad as the negative impact of not making a choice. So trust your gut. I mean, you're probably good and trust your, you know, run it by people and of course, but trust your gut to get to a pretty good Decision, and then sooner rather than later. Decisiveness is valuable, especially vis a vis indecisiveness. When Covid hit with my direct reports, which is, you know, eight people now the key leaders of all the functions in the company of Okta, pretty quickly we were on daily meetings, like talking about what we were going to do and how we're going to adjust things. But it got pretty quickly where we needed to make some calls, like, what are we doing to the headcount plan? What are we doing? What are we forecasting on the business? And after a pretty short period of like me trying to open up the perspective of what was possible, now we got down to some pretty relatively small number of key choices for the business. And we made them pretty quickly. So I thought that was a key balance of those two things, like openness for discussion, but decisiveness. I mean, so far it seems like we made some good decisions, but the other thing I'll say is, like, this is not over. You know, this is gonna be a longer term thing. And we're resisting the temptation to pat ourselves on the back.

But philosophically, it sounds like you feel like the cadence and the consistency of decision making, even if you're aggressively going in a new direction is more important than like the sort of exact. Right. Right answer.

Yes. I mean, the biggest danger ever is trying to over generalize things. But I think people, I've seen people make the mistake of analysis process more than being too decisive too fast. People are, I mean, you know, especially for, like, for the, for entrepreneurs and leaders of companies, maybe earlier companies. You know, what, you know, who knows the most about your business and your situation? You. All these, like icons of Silicon Valley and all these super smart investors, they don't know as much about you and your business. And so it's up to you. You need to make the call. There's a reason why there's, you know, people leading your company and it's you.

That's a very clear and clearly right point here. So the second half of what you said was, you know, we have to, we have to survive and then we have an opportunity to thrive. And without patting you guys on the back, because this is not over. Like, what are you doing to go on the offensive? Like, how have you changed how you interact with customers or the roadmap or whatever else you think is around making the best of the situation.

For Okta, one of our biggest opportunities is we're still evangelizing this mantra, which is identity is at the center of your technology. And whether you're thinking about making your employees productive, or you're thinking about enabling remote work, or you're thinking about doing that securely, or you're thinking about your customer experience, getting your customers online and connected to you. That's an identity challenge. And people don't. Most people don't. If I asked 10 CIOs or 10 CEOs if those business challenges were identity challenges, I'd probably get eight out of 10 would be like, what are you talking about? And two of them would be like, you're right, it is identity. And by the way, they're probably already Okta customers. So we have an evangelical thing we're doing here. You know, we're very lucky in that this whole situation gives us a bigger platform to tell the story. So if I get out there from a media perspective or we can tell a story broadly about, you know what all these challenges, employees, access, security, digital transformation, they're identity challenges. And here's why. We're more relevant than ever. That's an offensive move for us, right? That's one example. Another example is what we can do with M and A. The fact that we have valuable equity that vis a vis other companies may not be as valuable. We can use that to our advantage. From an M and A perspective, we're all obviously going to do the right thing in terms of deals, but if this gives us an opportunity to bolster technologies or teams or businesses, we're going to be super open to that. That's an offensive move. It all gets back to those priorities, though. It's like, we're not gonna do anything that doesn't reflect those priorities of health and safety of the employees and broadly speaking, just the community making sure customers are successful. We're not gonna do any PR thing or any positioning thing that's at the detriment to customers and certainly any ma thing that's at the detriment to customers or their success.

So thinking more about priority two from a customer success perspective, I'm sure Okta had a lot of in real life field facing people. What's the best thing you've done in terms of how you change your interactions with customers?

Again, I think we benefited from. We weren't Johnny come lately in terms of like being customer centric. One of the most proud things I am about our brand is that if you talk to customers and talk to people out there in the market, they get the sense that we really care. You know, we care about what we're doing, we care about them, which I think is powerful because we're in a complex business, it's like identity is seen as complex and cumbersome. And so if you can have that brand of a company that cares about this and cares about helping the customers understand it, that's powerful. So I think we're not turning that on right now. It's something we've built up and then now you put it in this pandemic. A company that cares about making them successful. So one of the products that's done really well is this. Our product called Advanced Server Access, which is essentially what you think of Okta as a way for employees to log into web and cloud applications. Advanced Server Access does the same thing for server admins. So you log into Linux servers in the cloud to do your job. Server access helps you do that. Super easy, super secure, takes accounts in and out, makes it auditable, et cetera. And talk about audience that they were not really allowed to work from home. It was like on the network, on the vpn. Now guess what, they can't be going to work. So they have to log in securely, remotely. And that's been, hey, can you guys help us with it? We're like, yeah, we have this product that can help it and it's gonna keep them safe and it's gonna make it more secure. And by the way, it's probably gonna help your overall customer digital transformation experience. Cause you're building more in the cloud and we can help you with that. So having a product set that can help them, having a culture that can help them, and delivering it with a team that's super flexible, super agile and can do it remotely, a lot of products can't be done remotely, which is another advantage we have. So, yeah, those would be my reactions to that question.

So, last piece on this before we go to your broader thoughts on the ecosystem and the impact of ongoing remote work. You said this isn't over. What do you think are the remaining jobs to be done or big questions for you guys as to how you operate?

It's interesting. I talked to my peer CEOs of companies similar size and you get different reactions about kind of innovation and product creation. Some people were like, oh, it's better than ever. You know, the engineers and the product people have more time than ever to build stuff. I'm a little bit less assured that it's a panacea there. I think for four months we've been able to, from a product and innovation perspective, we've been able to finish stuff we had started. You know, so the productivity has been good. But I'M a little less. Our lifeblood is innovation and creating the next great product and the next great solution. And maybe it's an innovation around our current products. It's a new product, but that's our lifeblood, and I want to make sure we can do that. And I think it's not the jury's out in terms of, like, the company's abilities to do that in a working environment that's changed dramatically. You know, groups of engineers that can't get. I'm not saying that we have to be in person to innovate. I'm just saying I want to make sure we're on top of that and making sure we're facilitating that and make. And assuring that we are awesome and innovating in this new world because it is very different. And I don't think four months of success assures that you can do it over a long period of time. So it's something I'm focused on a lot.

Yeah. Something that's come up in the conversations. I think some of it's made it into this podcast. Podcast as well, is there's this sort of understanding of how to do traditional remote. That is, everything is asynchronous. Right. Make humans APIs and write it all down. And I think everyone is seeing that they can, to some degree, continue to execute in this environment. But I think there's a very open, softer question of if you believe that actually a lot of innovation happens in teams and that recording everything and writing it all down and driving asynchronous communications means that there's going to be less, like, brainstorming and that maybe synchronous communication and figuring out how to do that well is really important for breakthrough innovation. I think that's definitely an open question. I don't know if you guys have theories on how to drive that at Okta.

Humility, Right, is probably the foundational thing here. Don't think you have the answers or don't think you have it solved. That's the main thing. And I think that if we can get people to collaborate in a spirit of we don't have the answers and we can get better, that's as good of a solution as anything. This is gonna be hard. It's different. How we doing? How could we do it better? What worked, what didn't work, let's try this, let's evolve. I think that is a powerful thing to get you through anything. But the second you start thinking like, we got this, we're zooming in, we got our Slack channels. We did our, you know, JIRA board and we got this. How hard could this be? That would be like, bad because you know what's going to happen in a year. I would bet that you could have done better on some of these dimensions. And I think innovation might be one of the ones where there's. It's not a solved problem in terms of remote being perfect for it.

Dangerously projecting forward because you just said you don't, you don't have the total answer. Three years from now, we better have a vaccine and effective treatment. You've said that Okta's future is dynamic. Like, what does that mean to you?

A year and a half ago, we started this initiative internally. We called it Dynamic Work. And the vision is that people would have much more flexibility on how they utilize the office. Right? Dynamic in terms of I can be productive from home. I will not have a bunch of false barriers on my productivity. If I want to work from home, I can use the office as a collaborative space, as a customer visit center. It'll be much more flexible in terms of how it's built, built out, how it's designed. Dynamic, right? And the reason we did this is because two reasons. One is that we wanted the best people in the world to come work at her. We figured if we removed the constraint of being physically by an office, we could have a better chance to get the best people to come work for us and be collaborative and be productive. The second thing was real estate costs. We just looked at the numbers and said, five years out, we want a million square feet in San Francisco or do we want 500,000? Probably 500,000 is better going to be, you know, much less cheap. And then multiply that by every great city in the world that we're in, whether it's Seattle or London or Paris or Munich or Tokyo. We want to take that real estate cost down. Now, interesting lesson here is about inertia, right? And it's one thing for the CEO to have this idea and the team, the real estate team and the HR team to have this idea about dynamic work. It's another thing to get the company to do it right. Because if you think about a manager trying to do something, trying to build a team on the margin, it's kind of easier for you to keep going with your processes and your work in the office and hiring people that are close. And so it was hard to get the company to make meaningful progress. But guess what? We've proved to ourselves over the last four months that we can be productive. We still have questions about is it the panacea, but we can be productive. So maybe this dynamic work thing has legs. So I see a future just like for Octane, our user conference that we did remotely, I see a hybrid future of it. It's like there's going to be a much better online part and there's going to be a much better in person part just for work, right? I think this dynamic work model is good. It's like you can have super first class support for remote people, but also when you need that space together, whether it's for personal reasons, you want to get away from home or you want to collaborate, or you have a customer that wants to meet in person, you can do it. And that's, I think this has helped us move toward that future as well.

So I didn't know that the drive, it makes a ton of sense. But the drive for dynamic work for you guys internally was really around talent access.

That's the main thing, right? One of those obvious things that is so important it bears repeating. 75% of our costs are people. And by the way, we're in a business where it's 80% gross margin. So the best people moving the needle in terms of the success of the business is powerful.

So you've been somewhat vocal on like the importance of access to immigrant talent and global talent. And like now you're going down this direction of dynamic work as well. Like how do you think about immigration restriction in the US and sort of how you're going to continue looking at the talent market.

US immigration policy is not seeing the big picture. If you think about technical talent and the ability to innovate, technically it's every company, every organization in our entire US economy has to do this well, and that means every company in the U.S. every organization in the U.S. needs technical talent. It's every organization, every organization needs to figure out how to be the Amazon of their industry. Right? Or Amazon's going to do it. Every government organization needs to get more connected to citizens, needs to be, get their message out there digitally and that means developers and that means technical people and that means people that can do this. So it's not just about, I mean Okta is going to be fine, right? We can hire people in Toronto, we can hire people in other countries. We're a US based company, we'd love to hire them here, but there's not enough of them. And by the way, it's not just us looking for them, it's every other company, every other organization in the country. And to make the country strong, we need the best talent from all over the world. So we don't have it. We'd love to hire US Citizens for every job. Every organization would love to, but there's not enough of them. So we got to make sure there's more of them. We got to educate people, we got to bring people up, but we also need people to come into the country and help us. And I feel like we're missing that big picture with the immigration policy.

Okta is recruiting globally and will recruit globally wherever you can get it. The best technical talent.

Yeah, for sure. Yeah. We're aggressive. I mean, we have a Toronto that engineering, that R and D center is mostly because it's, you know, it's easier to get people there than it is here in terms of visas. And that'll continue.

Yep. An unfortunate thing I'm already seeing in our companies is people who were going to move here already have visas or in the application process in some way. I'm sure you're seeing this at much larger scale. They're saying one of two things, which is like, hey, I don't know if that's actually a good idea culturally anymore. Like, I don't feel welcome. That's a really sad thing for me to hear as an American or like, I can't get there. It's logistically impossible. Right. And I look at that and I'm like, all of these companies and these people, like, they'd be doing a whole lot of good for an American company. But we'll see if we can continue to get that talent.

It's tricky running a company and not trying to, especially public company. And you want to be respectful of customers and their political opinions and employees of their different political opinions. Because I believe strongly in diversity of political opinion. So you don't want to be like, on your soapbox about what politically should be done or what the company supports. But I will get on my soapbox about immigration and the importance for Okta and the importance for the US And I'm very passionate about that, as you can hear. And the other thing I'll get on my soapbox about is democracy. Right. I want people to vote. Right. I want people. I'm not going to tell you who to vote for. You can probably figure out who I want you to vote for. Just you kind of listen to me long enough. But I won't tell you al, but I will tell you to vote. It's like, pretty embarrassing to me, the low level of voter turnout in this country.

Message is heard And I think hopefully many people are hearing that the stakes are very high. Okay. Before we run out of time, I want to make sure we get to our quick takes. Stuck in your house last five months. What's a. What's a content recommendation you have for me? Anything. Book, movie, tweet, podcast.

Halt and Catch Fire. It's a series on AMC I started watching. It's about. It's kind of like set in Texas during the PC revolution. It's about these people that are building a PC company. It's pretty great.

Great, actually. I'll give one back to you. This is not actually part of the podcast, but if you've not read Masters of Doom, it's about like, you know, Doom and Quake and like the formation of the gaming companies. And also technically Texas based, which is funny to see Shreveport, Louisiana and Texas produce, like these massive cultural movements.

You know me well. That's gaming and tech companies. That's something I want to look into. I haven't heard of that one. I'll check it out.

Okay, so shout out one person on your team that stepped up over the last couple months.

We have the guy who runs all Go to Market for us. His name is Charles Race. I mean, it's been hard running Go to Market and all these changes. And he's been doing a great job.

Awesome. Good job, Charles. And okay, discovery. One thing you're learning about yourself, Roxanne, the kids, the team during this time.

Well, yeah, I mean, Roxanne, she's a rock. She's done a lot of the work around homeschooling and let me focus on work and she works too. But she's kind of been an amazing job of doing everything, which is impressive. I've learned that I think people that were software developers in their career, like I started my career as an engineer, I sat in the front for hours and hours and hours and hours. I can remember thinking to myself, why would anyone need a calendar? Like, why there's a calendar? Like, what? Annoying. I know what I do. Wake up and code. There's my calendar. People that have did that in their career, I think this whole thing is easier for them because they sitting in front of the computer for 12 hours a day is not something they've never done. So my co founder is different. Freddie is different. He's. He got a computer science degree, but very short time. He was an engineer. He's more extroverted. He likes to get out more and it's hard for him. So I think the takeaway is like, it's pretty individual. So be careful about blanket solutions, especially when you're running a company. It's pretty individual. People are different, have different situations, different psychological makeups, and don't try to overgenerize.

And to close out Advice one thought for entrepreneurs or other business leaders navigating.

Now Remember that it's hard to be the only person doing saying what you're doing and believing in your vision. It's scary and it's not like kind of, you know, in a cool it all works out well, it used to be scary kind of way. Like it's really scary and really lonely. But I think that remember that you know, it can work out well. So that's something to give you satisfaction. But also when it does work out well because you're the only one doing it and saying it now, you own it right now. That's your voice. And what can be like feel really lonely can turn into a huge advantage because you're the leader and you're uniquely owning that voice. And that's something that's certainly worked out for us and I think can be true for a lot of people listening as well.

Okay, that's powerful and I hope we all continue to rely on Okta and hear more of your voice and the Okta platform story. Thanks a lot, Todd.

Yeah, thanks for having me. I'll work my hardest to keep up my end of that bargain.

Okay, everyone, that concludes this episode of Gray Matter. Next up, I'm incredibly excited to talk with Kurt Schrader, co founder and CEO of Clubhouse, and Dylan Field, co founder and CEO of Figma. Find our episodes wherever you get your podcasts or get episodes and blogs on our website greylock.com and on Twitter reylockvc. I'm Sarah Gua and thanks for listening.