Okta, a leader in the identity and access management (IAM) market, makes a significant portion of its billion-dollar revenue by selling multi-year subscriptions for its software.
The San Francisco-based company, which serves over 19,000 customers globally, made $2.12 billion in revenue last year, out of which around $1.79 billion came from subscriptions alone.
Now, the company sees a significant opportunity in AI that could potentially double its revenue– it wants to provide identity to AI agents.
In an interaction with AIM during his recent visit to India, Eugenio Pace, Okta’s president, business operations, said that in the future, AI agents will carry out actions on behalf of us humans.
“AI agents will make reservations for you and book hotel or flight tickets. But what happens when an AI agent makes a wrong payment?” Pace asked.
Okta Could Provide Identity to Billions of AI Agents
In today’s interconnected world, distinguishing whether an action was undertaken by you or an AI agent can be challenging. Imagine a future where every person with a smartphone has their own personal AI assistant, interacting with one another and performing various tasks simultaneously.
By 2025, the world is projected to have 7.4 billion smartphone users, which could potentially mean 7.4 billion AI agents. These AI agents need not be limited to smartphones; they could be accessible through your PC or a device like Amazon’s Alexa.
“You can envision a world where I delegate certain powers to an agent to act on my behalf from an identity standpoint. However, we would set clear limits, specifying that my identity can only be used, for example, to pay specific accounts up to certain limits.
“Okta could play a crucial role in managing identities as we transition into a future where AI agents handle various tasks,’’ Pace said.
AI Agents Could Deepen Okta’s Pockets
Now, picture Okta selling multi-year subscriptions for its Okta Identity Cloud platform and services for a billion AI agents—this could significantly boost its revenue.
“We sell software based on the number of users who leverage the software. Most enterprise SaaS software operates under this user-based pricing model. Until now, this has been straightforward: if a company has 1,000 employees, they pay for 1,000 users.
However, if each employee now has their own AI assistants, theoretically, the user count doubles. “This presents a significant challenge and an intriguing evolution in our industry, not only from a security perspective but also in terms of our business models,” Pace pointed out.
Nonetheless, he also stresses that this is a very forward-looking statement. While AI agents are expected to be the next iteration of the generative AI lifecycle, we are yet to see widespread deployment and integration.
Okta AI
Last year, at its flagship event, Oktane, the company announced a host of generative AI features for its customers. Pace said Octa AI includes capabilities to predict suspicious logins or activities that could be potentially not real or from bad actors.
“In its simplest use case, we provide an authentication service that acts as an intermediary between a user and an application. When a user attempts to log in, they go through our service. Being positioned in the middle of this transaction allows us to assess how it unfolds,” Pace said.
To validate this, Okta utilises generative AI, which analyses over 60 different signals, such as device type, time, IP address, location, and the specific application involved, to verify the authenticity of each transaction before permitting it to proceed.
In 2023, Okta admitted that a hacker managed to steal all of its customers’ data by using a stolen credential to access its support case management system.
Interestingly, Okta, which also provides identity solutions to OpenAI, also leverages generative AI to provide in-product guidance on system configuration.
“We observe how users configure their systems and understand their intent. Based on this behaviour, we can make recommendations, such as enabling certain features or disabling others, tailored to their usage patterns.
“Essentially, it functions like an automated consultant within the browser, offering personalised advice to optimise user experience,” Pace added.
Okta in India
Okta, with approximately 20,000 customers worldwide and handling 20 billion logins every month, established its first office in Bengaluru, India, last year. Since then, the company has grown to employ 300 staff members.
The company plans to further strengthen its presence in the country and attract more customers. It has offices in Tokyo, Osaka, Singapore, Amsterdam, Dublin, Frankfurt, Manila, Munich, Sydney, Seoul, Stockholm, and Toronto.
According to Pace, the company’s growing presence in India is one of its biggest growth investments.
“We have a robust partner ecosystem in India, which means we don’t just directly sell to our customers, but we also do so through our partner ecosystem. While the US is a more mature market since that’s where we had our origin, India is a fast-growing market and will become a big market for Okta in the years to come,” he concluded.
