Recapping the Okta Showcase21 Event

Note: This article originally appeared as a Twitter thread. Minor updates were made to formatting and paragraphs to make the content more readable as a standalone article.

Last week's Showcase21 event gave us a glimpse into the future of Okta and Auth0. A few takeaways about people, product, and growth.

People

The Auth0 acquisition and recent hiring have brought Okta a wealth of executive talent.

Auth0 CEO Eugenio Pace was impressive, as usual. There aren't many founders with the range to discuss broad trends about the future of identity and write code in a demo.

The amount of talented people Okta gained in the acquisition of Auth0 might be even more important than Auth0's product or customers. Yes, acquisitions come with vesting schedules. People can and will leave. From the outside in, the team still looks committed to the mission.

New CTO Sagnik Nandy's B2B and B2C experience at Google is a valuable hire. Okta has the deepest executive team in the market. The additions of Nandy, Susan St. Ledger, Pace, and Matias Woloski to existing Okta founders Todd McKinnon and Frederic Kerrest is a world-class group of people.

Product

Okta's Workflows product has a lot of unrecognized potential. It's now available as a standalone product with freemium entry options.

Automation is an under-appreciated area of need in Identity and Access Management. IAM is fraught with manual processes. There are companies with 100+ person teams to perform manual identity administration tasks.

To say that IAM needs help with workflow automation is a massive understatement. Workflows is a potentially differentiating product for Okta.

The long-term bet is whether generic automation products will win, or embedded automation within platforms like Okta is a better approach. Many companies use generic RPA tools for automating identity tasks. A purpose-built product like Workflows could be more effective.

The roadmap for Workflows is to use the product as a basis for integrations. Anyone will be able to create public workflows and make them available within Okta integration network — think Zapier for Okta. This has a lot of upside for both Okta and the ecosystem.

The (implied) message was clear about the combination of Okta and Auth0's products: be patient. The combination is still in the early days. If you attended the event expecting to see clarity or demos of a unified product, you'd be disappointed. It's a long term game.

Okta and Auth0 have two of the best products in their respective market segments. That's a good problem to have, but it's challenging to address. Despite previous mentions about combined mockups, there's no hurry to show anything yet. A totally reasonable approach.

The event had major feature announcements for both products.

Okta: workflows, custom admin roles, branding, device authorization grants
Auth0: multi-cloud, organizations, actions

Don't expect the company to let up while the long-term product strategy gets worked out.

The announcement about native multi-cloud deployment for Auth0 is more impactful than it seems. I've previously talked about on-premise deployments being a competitive advantage for ForgeRock:

There will be a customer base of large enterprises for the foreseeable future. Some companies can't, or simply won't, move to cloud identity providers. Ironically, this might be ForgeRock's biggest competitive advantage: being the "anti-SaaS" platform. Despite its late push to enter the cloud identity market, maintaining the option of on-premise deployments gives ForgeRock an advantage over pure SaaS products like Okta and Auth0. This advantage only holds in scenarios where customers demand an on-premise implementation, but it's an advantage nonetheless.

The option to deploy private instances of Auth0 on AWS or Azure isn't quite the same flexibility as ForgeRock, but it's close. This will be "good enough" for some customers who want the appearance of control but don't care about hosting the product in their own data centers.

A message that continued to be clear is when and how to choose one product over another:

If you need a polished product that addresses many use cases, choose Okta.
If you're a dev-focused team who wants flexibility and customization, choose Auth0.

Growth

Todd McKinnon and Eugenio Pace discussed some updated numbers about TAM and the companies' combined metrics:

"A $30B TAM might actually be conservative."
The combined businesses have $400m ARR in CIAM revenue
Overlap in customers is only 2%

The customer identity market still has a long way to go. This is where much of the upside for growth likes for the combined Okta and Auth0 organization. At $400m in revenue, it's already a good business. The future upside and potential could be much, much higher.

Okta's investment and commitment to Field Operations is a strategic move that hasn't been widely discussed. From Todd McKinnon:

"We're building out the largest field operation in the market."

A bold statement that breaks from the traditional paradigm of partnerships. Okta is building a full-stack Field Operations team instead of over-relying on channel partners to fuel growth: integrated marketing, sales, onboarding, customer success, and retention. This strategy is expensive to build but differentiating and sustainable if it works.

Long term, Okta's competitive advantage is trust. Sagnik Nandy made a statement that summarizes Okta's competitive moat perfectly:

"Trust has to be earned, and lots of people trust Okta."

Trust takes a long time to gain, and Okta is starting to reap the benefits.