YouSaid · the spoken record

Frederic Kerrest

lines on the record: 34
first: 2019-05-03
most recent: 2019-05-03
sittings or episodes: 1
sources: podcast

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“Well, look, I'm excited every day to come to work because I feel like we're just getting started. The markets that we're in around workforce identity management, around customer identity and access management, these are markets that are tens and tens of billions of dollars being spent on legacy infrastructure software, which I think is a huge opportunity. And we're really helping companies take care of these three big waves they're riding, which is everyone's moving to the cloud and using more software and infrastructure as a service. Every organization has to become a technology organization, right? Every company has to become a technology company, figure out the way to do digital transformation, better connections with their customers, their partners, their vendors. And then finally, everyone's really worried about security and that priority only increases every day. So these are three big waves that we're riding. And the last five, 10 years have been very exciting, but I think the next five and 10 are going to be way more exciting than they have been.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 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, ten, fifteen, twenty years. It's not something that's going to be done overnight, but you got to show up every day. You got to put your hat on. You got to put your boots on, and you got to get back to work.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“I agree. I think life is all about momentum. I think life and building technology starts is all about momentum. Look, you're not going to make all the perfect decisions. And by the way, you're never going to have the perfect data. So if you're waiting to make that perfect decision, you're going to wait forever to get the data. And by then, you're already long gone. I mean, your competition has gotten in front of you. You missed the market opportunity. You didn't get that awesome customer, whatever the case is. Make good decisions as quickly as you can with the best amount of high fidelity data you have at the time, but it's never going to be perfect and you got to just keep moving.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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've 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 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 one 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 an entrepreneurs 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“In the middle, hire slowly and fire fast. I think the problem with hiring too fast is you're going to end up getting someone in the role, which is great. And look, in a high growth environment, we have to hire north of 900 people this year. So that's a lot of people, over four people every business day. But if you work too hard just to get people in the seat every time, you're not going to get the right people. And if you don't get the right people, that is actually going to push you back, you know, 12 or 18 months because it's going to take you a few months to figure out it's not the right person. It's going to take you a few months to exit them properly out of the company. It's going to take you a few months to get the search started back up again, to get the new person in the seat. So I'm really a big fan of hiring slowly. Look, you got to hit your hiring targets. Don't get me wrong, but hiring slowly, making sure you get the right person in the seat. But then when you know it's not a good fit, look, that other person also knows it's not a good fit. So just have that conversation and figure out a way to go forward.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“I think that there's a lot of sizzle and not enough steak in Silicon Valley. So I really would like us to see an increased attention on substance over flash. I think that comes from the investors. I think it comes from the entrepreneurs. I think it comes from the media that does the same thing. We really need to focus on significant impactful innovation that is moving industry, economy, and the world forward and less on a lot of these flashes in the pan.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 are 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's 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Are going to help you complement and who have the same vision and are going to be there with you to build because as we've already talked about, look, things don't always go smoothly. I'd love to tell you it's like easy and up into the right every single time. That's not the case. So you want to make sure that there are people who are going to have the intestinal fortitude to say, hey, we know things aren't going to go perfectly smoothly, but we are here with you. We see that right vision. We've got the same culture and we want to go into business together. And if you can do that, that's a great way to start.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 complementary approaches, whether it was in go to market, whether it was in how to build products and engineering, whether it was how to think about markets, whether it was how to think about our specific technology products and platform that we were building. So there's a lot of different things there. So we were very fortunate, obviously. When I talk to other entrepreneurs today and we talk about it, again, it's going back to what kind of business are you looking to build? How fast are you looking to grow? What kind of industries are you going to go into? What kind of expertise are you looking for? And then there's a whole bunch of other things. Like it's a personality fit, right? I mean, you're trying to build this company. It's a very hard thing to do. You're going to spend a lot of your time. This is going to be one of the only folks who really has the same vested interest as you do in building this kind of company. You have to make sure that the culture is right. You have to make sure they share the same values. You have to make sure that they can bring a lot of these different things, whether it's networks and hiring, whether it's networks and customers and prospects. You just want to find people.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“As you said, we've been very, very fortunate. I mean, the support that we got from Mark and Ben and Andresen Horowitz that we got obviously from Mike and Floodgate from Neil and the entire team at Greylock and then from Vinod and David Wyden at Kosla. Those were the major backers that we had through the first couple 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 then 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 doing.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Business, how we're going to get started, what our plan was, and where we're going to go at the very beginning. And that actually worked out pretty well. But yeah, totally intimidating when you're trying to build your first big technology company and you're sitting there trying to get 5, 10, 15 million dollars to get going as a company, very, very intimidating, absolutely.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, absolutely. I mean, when you're getting started, especially when you're really first-time technology founders like we were, I had a little bit of past history building, much smaller companies previously. But this was really the first time we're going to try and build a very large independent public software company that we're going to raise venture capital. Over the years, we ended up raising about $230 million from Andrea Sincoa Greylock. And then obviously we went public and we've done well in the public markets. It's easy to forget what it was like 10 years ago. It was definitely intimidating. I mean, you're trying to figure it out. We were getting a lot of no's, so we were visiting a lot of the existing venture capital folks and they were saying, no, we're not sure this is a good fit. Are you guys the right guys? Is this the right market? Todd and I, frankly, are not very good drawers. So our PowerPoints were terrible. Our pitch decks, and in fact, Mark said to us, hey, your pitch deck's not good. Why don't you just tell us the story? And so we actually told them the story of how he came to meet each other, why we thought this was going to be a big.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 own one of these in my house. And so Mark and Ben started laughing about that. They literally had didn't even have furniture yet. When we got to meet them, we were the first check that they wrote out of their first fund in the summer of 2009 was into our seed round. And then obviously they led our Series A in 2020.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, absolutely. So if you roll back the clock to about 2005, I actually was fortunate enough to meet Mark 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 Octa in 2009. And we were very fortunate our friends at Jawbone, Hossein Raman and Alex Hassaley, who were the founders of Jawbone and who 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. Then 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 jawbones as an angel. And so we met Ben through Alex and Hussein. 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 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Explain that to others, which is fine. And if you really believe in that, that'll go very, very well. In our case, it was always about how fast can we grow, but we want to have a certain amount of payback on the investment that we made in sales marketing. So we kind of had a governor on how long it was going to take to get paid back for a dollar invested and go to market. And in our case, it's an enterprise business. And so you have three and five year contracts and you know those are committed contracts. So when you invest, you get that $1, you're actually going to get it for a few years down the road, which helps with all those numbers. But that's how we thought about. We thought about it as how fast can we grow while still doing it in a mature way. And if you've looked over the last couple years as a public company, we've continued to get that leverage more and more inside the business. And we're getting much, much more efficient at running even as we grow continuous scale.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 your willingness 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 that they all apply to all the businesses. And I talk 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 makes sense for your business. Just realize you're going to have.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 joined us, a great CFO has joined us, fantastic head of HR. You kind of go down the list and you're hiring these experts who know what to do so much better than you that you're like, not only am I okay giving that up, I'm excited because I know that that's going to move us forward. I think one of the biggest things just being introspective enough and knowing what you're really good at and what others can be better at and when it's time to hire yourselves out of those jobs, and I think we've done a very good job with that.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 cash flow 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 a 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 ahead of HR. You kind of go down a list. 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 2012, frankly, was we hired a professional head to go to market.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Venture capital funded company. So we had to raid the next round of venture capital, which we did in the summer of 2011. And I'll always be grateful to David Wyden and Coastal Ventures for helping us put that around together. But, you know, we just kind of had to keep going and got to stay positive and find some of the nuggets. But yeah, there's no doubts about it very, very tough times.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“It's not easy. Hopefully, you have a co-founder, right? I think if you look at the data, the data says that solo founders always have a tougher time. I think you really see a lot of success into the two through four group of co-founders. I think once you get five co-founders or more, there's just too many cooks in the kitchen. No one can make any decisions and move forward. But I mean, in our case, we were fortunate. We had someone else. So you're not in it by yourself, right? You're able to at least look at someone else and ask a hard questions. Are we doing the right things? Having some of that debate, in our case, it was actually even better because we weren't necessarily best friends when we started. We were acquaintances, but in a business capacity. So we knew each other and obviously we got along very well, which we still do today, a decade later, but it was really more about how are we going to build this business together and what are some of these things, maybe taking a lower the emotion out of it, which I think is still very hard to do, but it was really hard. You work, you know, 12, 14, 16 hours a day. You'd be there Saturdays and Sundays trying to figure it out, you know, the customers weren't coming, the revenue numbers weren't there. Obviously, we were.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 data.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 get deployed. And I think just by being transparent and by sharing with the company, we still have to this day. That's when we actually started doing a weekly all hands with the company at that time in those tough moments in 2011. We still do that today. Every Friday morning, a high def audio video around the world, all hands, one hour with the entire company just talking about what's going on, being transparent when you hire awesome people, they just want to know what's going on. They want to get information, they want to get data, and they want to be able to make decisions. And then finally, I think at the end of the day, it's about perseverance. And it's about you got to keep going. When the going gets tough, the tough get going, you got to keep grinding at it. You got to keep pushing through. You got to keep finding those different ways to do things. And I think, you know, we were successful. We came out on the other side and things started to go well.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 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 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 2011 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 time and time again.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, I read Peter Tiel 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. You 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 lifecycle 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 encountering these days. So I would have no idea what the new thing is that the new millennial generation wants. So I think you just have to balance that out with what's the market, who's the person, and kind of what's that timing that fit, right?”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, I'm an enterprise software nerd, so I'll admit that up front. I learned to write enterprise software 20, 25 years ago. I really enjoyed that process. I love 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 Neil Bushery and Dave Duffield at Workday or whether it was Fred Luddy at ServiceNow, these are all folks who did not start as 20-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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 take advantage, how to capitalize on those moments.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“No, look, don't get me wrong. Founders are essential. Founder 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 Sequoya, who'd invested in Cisco and Apple and all these other well-known brands. And they'd said, look, I might have 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 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“Don't stay, 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. It's that, in your mind, what about an idea makes it worth pursuing and investing in? Let's start with that. Yeah, 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 60s, early 70s, one of the first real industry venture capitalists actually did it out of the Midwest, but built a great organization over, it's coming up on 40 years. And David said to me, hey, look, I look back at the history that I've done over the last 30, 40 years and basically it's been 70% market, 20% team, 10% product. And so what he was saying was you want.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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, powerful mission that that was actually what really got us started on Okta and has us where we are today. Incredible to hear and quite funny for me because I've actually never worked in a world of on-prem. And so I have actually only worked in a world of software as a service, which you're a lucky man. Harry, keep it that way. Don't change anything.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 as a service obviously was brand brand new. When I started Salesforce, it was a $500 million revenue company. 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source
“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 managed 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.”
2019-05-03 · The Twenty Minute VC · 20VC: Okta Founder Frederic Kerrest on Why You Want To Be A Monopolist In A Small Market, The Biggest Challenges in Scaling Okta To IPO and Being a16z's First Ever Fund Check · IDENTIFIED FROM THE TRANSCRIPT · source