Okta now has more than 100 million registered users, a major milestone for the 10-year-old software company, Okta co-founder and CEO Todd McKinnon confirmed to CNBC in an exclusive “Mad Money” interview.
“We’re changing their world,” McKinnon told CNBC’s Jim Cramer on Thursday. “We’re making it incredibly easy for them to connect to all their technology, whether they’re logging into their business applications at work or they’re a customer of one of our customers logging into a website.”
Shares of Okta, which provides companies including Adobe and Twenty-First Century Fox with a secure, cloud-based system for managing employees’ and customers’ access to digital tools and information, climbed nearly 150 percent in 2018. It was also the second-best performing stock in the Russell 1000 index, which tracks large-cap companies.
Okta also says it has outpaced Slack in terms of paid daily active users, a data point that has never been publicly reported. Slack, a large enterprise technology company known for its messaging platform, is an Okta customer and does not compete directly with Okta’s business. Slack did not immediately respond to CNBC’s request for comment.
Now, Okta has 5 million-plus paid daily active users, a company representative told CNBC in an email. For comparison, Slack — which has created buzz on Wall Street about its reported intention to go public — has 8 million daily active users, only 3 million of which are paid customers, according to the most recent public data.
According to McKinnon, the main factor driving Okta’s success is the rise of cloud adoption, which he told Cramer is still in its “early days.”
“We’ve benefited from several trends that are really lifting us to these new heights. The main one is cloud,” McKinnon said Thursday. “It’s really just getting started. If you look at the overall [information technology] spending market, it’s over a trillion dollars of IT spend. But cloud — everyone talks about the cloud, they think the cloud has come of age, but it’s still only 20 percent of that. It’s about $200 billion. So we’re still in early days of cloud adoption, and we’re very excited about the runway ahead and the value we can provide in that context of, really, cloud taking over the world.”
International Data Corp., which conducts market intelligence research, estimates that companies spent $1.1 trillion on IT in 2018, the Wall Street Journal reported last week.
Okta’s 10-year anniversary comes at a particularly meaningful time for the company in terms of growth, both in its end markets and in the business itself. In 2009, the year Okta was founded, the entire software-as-a-service market was valued at just over $5 billion. Now, Gartner estimates that it sits at roughly $50 billion.
In the 10 years since its founding, Okta has grown from two employees to more than 1,400; from zero customers to over 5,600; and from zero dollars in total revenue to above $392 million. The company’s market cap currently sits at about $8.8 billion.
Okta’s stock climbed to a new 52-week high of $80.64 in Thursday’s trading session, closing up 1.35 percent at $79.33 a share.