Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News

      World Bank set to back South Africa’s big energy grid roll-out

      20 June 2025

      The algorithm will sing now: why musicians should be worried about AI

      20 June 2025

      Sita hits back at critics, promises faster, automated procurement

      20 June 2025

      The transatlantic race to create the first television

      20 June 2025

      Listed: All the MVNOs in South Africa – 2025 edition

      19 June 2025
    • World

      Watch | Starship rocket explodes in setback to Musk’s Mars mission

      19 June 2025

      Trump Mobile dials into politics, profit and patriarchy

      17 June 2025

      Samsung plots health data hub to link users and doctors in real time

      17 June 2025

      Beijing’s chip champions blacklisted by Taiwan

      16 June 2025

      China is behind in AI chips – but for how much longer?

      13 June 2025
    • In-depth

      Meta bets $72-billion on AI – and investors love it

      17 June 2025

      MultiChoice may unbundle SuperSport from DStv

      12 June 2025

      Grok promised bias-free chat. Then came the edits

      2 June 2025

      Digital fortress: We go inside JB5, Teraco’s giant new AI-ready data centre

      30 May 2025

      Sam Altman and Jony Ive’s big bet to out-Apple Apple

      22 May 2025
    • TCS

      TCS+ | AfriGIS’s Helen Hulett on how tech can help resolve South Africa’s water crisis

      18 June 2025

      TechCentral Nexus S0E2: South Africa’s digital battlefield

      16 June 2025

      TechCentral Nexus S0E1: Starlink, BEE and a new leader at Vodacom

      8 June 2025

      TCS+ | The future of mobile money, with MTN’s Kagiso Mothibi

      6 June 2025

      TCS+ | AI is more than hype: Workday execs unpack real human impact

      4 June 2025
    • Opinion

      South Africa pioneered drone laws a decade ago – now it must catch up

      17 June 2025

      AI and the future of ICT distribution

      16 June 2025

      Singapore soared – why can’t we? Lessons South Africa refuses to learn

      13 June 2025

      Beyond the box: why IT distribution depends on real partnerships

      2 June 2025

      South Africa’s next crisis? Being offline in an AI-driven world

      2 June 2025
    • Company Hubs
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • AvertITD
      • Braintree
      • CallMiner
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • Incredible Business
      • iONLINE
      • Iris Network Systems
      • LSD Open
      • NEC XON
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Tenable
      • Vertiv
      • Videri Digital
      • Wipro
      • Workday
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Motoring
      • Public sector
      • Retail and e-commerce
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Cloud services » Lockdown mints another Internet billionaire: Okta CEO Todd McKinnon

    Lockdown mints another Internet billionaire: Okta CEO Todd McKinnon

    By Agency Staff28 August 2020
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    News Alerts
    WhatsApp

    The coronavirus pandemic, for all its human and economic tragedy, has spurred a once-in-a-generation opportunity for the technology industry, seized most visibly by the sector’s giants such as Apple, Amazon.com and Microsoft, and productivity players like Zoom Video Communications and Slack Technologies.

    A lesser-known beneficiary is Okta, a decade-old cloud computing company based in San Francisco. Its software gives corporate customers a kind of border control for the Internet, helping them authenticate the identity of their employees and customers as they connect remotely to a sprawling system of online applications.

    The Covid-19 outbreak, which has cast most workers out from behind their corporate firewalls and into their home offices, has helped to further popularise Okta’s software. It allows companies to manage their employees’ use of the Internet seamlessly and to protect the corporate data on their devices.

    The stock has more than doubled since March, when lockdowns began, and has surged more than 10-fold since its IPO in 2017

    The stock has more than doubled since March, when lockdowns began, and has surged more than 10-fold since its initial public offering in 2017. The software maker has become an integral part of our new daily life, with its technology used by organisations as varied as Adobe and FedEx. The boom has some investors betting that Okta and similar companies will accelerate their revenue through the crisis, even as it raises questions for executives about their good fortune at a time of suffering and massive job losses in the nation at large.

    “It can be mentally and psychologically confusing for me to both read the news and then see customers asking for our service,” said Frederic Kerrest, Okta’s co-founder and chief operating officer. “Because the world is not in a good place, but, you know, we seem to be able to provide some solutions that people really need, which is great.”

    Identity Cloud

    From March to July, Okta’s main product, called Identity Cloud, was used almost 16 billion times to access an app or website. The multi-factor authentication service saw usage nearly triple in the period compared to a year earlier, and it hit a single-day peak of 145 million unique logins, the company said.

    Wall Street has bought into the story. The stock has soared 106% since 12 March when US President Donald Trump imposed travel restrictions on Europeans. Now Okta must live up to the lofty expectations that come with a company valued at US$27-billion. (The shares slipped late on Thursday after quarterly results reminded Wall Street that the company may not be able to accelerate sales growth forever.)

    “We’re still being prudent about the rest of the year and the macroeconomic consequences ahead of us,” CEO Todd McKinnon said in an interview. “Headwinds to the business will be a little stronger in the second half.”

    The company has also lost money for most of its existence. However, investors are often willing to look far into the future when assessing cloud-based subscription businesses such as Okta. These companies spend heavily on sales and marketing to win as many customers as quickly as possible. Once the user base is large enough, distributing extra versions of the software online costs very little, and a highly profitable business can emerge — one example being Salesforce.com.

    Okta must lure as many paying customers as it can during this rare work-from-home boom, and then keep hold of them as the world slowly returns to some semblance of normalcy. Its work with FedEx suggests that this is possible.

    The logistics giant first partnered with Okta about a year ago, and now has more than 85 000 workers using the software maker’s service to access the FedEx virtual private network. Warehouse employees were given additional iPads to access apps with Okta, so they didn’t have to share devices and could maintain social-distancing rules, said Gene Sun, FedEx’s chief information security officer. Many of the company’s customer-service workers have Okta on their phones for the first time in order to securely pull up customer information while working remotely.

    Okta’s successful navigation of the pandemic has paid off… McKinnon, 48, has become a billionaire on paper

    Sun said the company greatly reduced its legacy sign-on system the week of 16 March in favour of Okta. “Okta really has enabled us to prepare the workforce to work from home in the March timeframe in a really smooth manner,” he said. “The thing about the backdrop of this pandemic is we have come to a conclusion that we should try to be moving aggressively toward using cloud services providers” whose subscription payment plans help FedEx manage user prices.

    When the coronavirus began to spread in March, Okta was among the first US companies to publicly grapple with how to work around the pandemic. The company was scheduled to host a splashy San Francisco conference for customers, partners and analysts — a software industry ritual to strengthen future sales and telegraph the company’s strategic direction.

    Bodybuilder

    McKinnon, the CEO, had to decide whether to cancel the event, delay until some unknown date or take it online. He opted for a remote conference, appearing from his home, and filmed a sketch in which he said his family promised not to interrupt him. His son walked into the frame anyway.

    The playful tone was a professional departure for McKinnon, a 1.88m-tall bodybuilder and a former CrossFit athlete. Pat Grady, a venture capitalist at Sequoia who invested in Okta and remains on its board, said that in an industry full of CEOs who use lofty language to explain how their apps are changing the world, McKinnon presents his company’s mission in a just-the-facts way that has gained him credibility, and a little criticism.

    Okta’s successful navigation of the pandemic has paid off for its co-founder. During these last five months, McKinnon, 48, has become a billionaire on paper. Bloomberg estimates his net worth has climbed to about $1.7-billion from about $900-million at the start of the year. Through a spokesman, McKinnon declined to verify his net worth.

    Newly minted billionaire Todd McKinnon

    Despite persistent rumours Okta may sell itself to a larger tech company, McKinnon’s long-term plan is to grow the business he co-founded into one of the world’s largest software makers. He says big challenges motivate him to work harder. Years from now, after the Covid-19 virus has been defeated, he expects his slice of the software market will only grow more essential.

    “We’re technology believers,” McKinnon said. “We think it’s not perfect. We think that there’s a lot of work we can do to make it better, easier to use, more secure, more helpful for users. But that’s what’s exciting about we’re trying to do. It’s an almost boundless thing.”  — Reported by Nico Grant, (c) 2020 Bloomberg LP



    Frederic Kerrest Okta Todd McKinnon top
    Subscribe to TechCentral Subscribe to TechCentral
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleWhy kids love TikTok: A primer for the rest of us
    Next Article Interview: Introducing Dimension Data’s Smart Virtual Workplace

    Related Posts

    Hackers stole customer support data in Okta breach

    29 November 2023

    From Mad Men to machines: big advertisers shift to AI

    18 August 2023

    Suspected Okta hackers arrested by British police

    25 March 2022
    Company News

    Making IT happen: how Trade Link gears up to enable SA retail strategies

    20 June 2025

    Why parents choose CambriLearn for online education

    19 June 2025

    Disrupt first, ask questions later – the uncomfortable truth about incident response

    18 June 2025
    Opinion

    South Africa pioneered drone laws a decade ago – now it must catch up

    17 June 2025

    AI and the future of ICT distribution

    16 June 2025

    Singapore soared – why can’t we? Lessons South Africa refuses to learn

    13 June 2025

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    © 2009 - 2025 NewsCentral Media

    Type above and press Enter to search. Press Esc to cancel.