SaaStr Podcast #388 with Okta CMO Ryan Carlson

SaaStr Podcast 388 with Okta's Ryan Carlson

Ep. 388: Ryan Carlson is the CMO @ Okta, the leading independent provider of identity for the enterprise. Prior to their incredibly successful IPO in April of 2017, they raised funding from some of the best in the business including Sequoia, a16z, Greylock, Khosla and Floodgate to name a few. As for Ryan, he has spent an incredible 9 years at Okta in numerous different roles starting with running the product marketing team before moving to run the marketing team, leading to his promotion to CMO close to 5 years ago now. Before Okta, Ryan was the Co-Founder and CEO @ Sproost, a bootstrapped online expert recommendation system.

In Today’s Episode We Discuss:

* How Ryan made his way into the world of enterprise SaaS. Why was joining Okta the most challenging interview process he has experienced? How did it impact how he assesses candidates today?
* How does Ryan distinguish between the company story vs the product story? When do they align and when do they separate? How should your strategy change as they move apart? How does the structure of your marketing team need to change with the evolution?
* What should the first marketing hire look like? What experience should they have? Why does Ryan believe you should hire two in marketing to start? How do you want them to work together? How does Ryan ensure cross-function working seamlessly from the very beginning with marketing?
* How does Ryan think about measuring success when it comes to product marketing? How does Ryan think about marketing attribution today? How should we think through SAL vs closed revenue as indicator of marketing success? Where does Ryan believe many go wrong with regards to marketing funnels?

 

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Jason Lemkin
SaaStr
Harry Stebbings
Ryan Carlson

Below, we’ve shared the transcript of Harry’s interview with Ryan.

Harry Stebbings:

Welcome. You are listening to the official SaaStr podcast with me, Harry Stebbings. Into the show today, and one company that’s blown me away over the last few years is Okta, with their transition to being a public company and all that comes with that movement. And today, I’m thrilled to be joined by their CMO, Ryan Carlson.

Harry Stebbings:

For those that do not know, Okta is the leading independent provider of identity for the enterprise. Prior to their incredibly successful IPO in April of 2017, they raised funding from some of the best in the business, including Sequoia, Andreessen, Greylock, Khosla, and Floodgate to name a few. As for Ryan, he spent an incredible nine years at Okta, in numerous different roles, starting with running the product marketing team before moving to run the marketing team, leading to his promotion to CMO close to five years ago now.

Harry Stebbings:

Before Okta, Ryan was the cofounder and CEO at Sproost, a bootstrapped online expert recommendation system. And this schedule really was a team effort. I want to say a huge thank you to Pat Grady at Sequoia, Fred Kerrest , and Mike Maples at Floodgate for some fantastic question suggestions today. I really do appreciate that.

Harry Stebbings:

That is quite enough for me, and I’m very excited to hand over to Ryan Carlson, CMO at Okta.

Harry Stebbings:

Ryan, it is so great to have you on the show today. I’ve heard so many good things, both from Frederick and from Pat Grady. So thank you so much for joining me today.

Ryan Carlson:

Thanks, Harry. I’m glad to be here. A big fan of all your podcasts.

Harry Stebbings:

That’s so kind of you, and I always like a good ego inflation, but I do want to start today with a little bit on you. So tell me, how did you make your way into the world of SaaS, and how did you come to be CMO of the juggernaut that Okta is today?

Ryan Carlson:

My path to being CMO at Okta is not a straight one and it is filled with a lot of luck. I started in Silicon Valley a long time ago. I studied electrical engineering. And so I came out to Silicon Valley and worked for semiconductor companies, both startups and big companies. And I was always on the product side, product management, product marketing.

Ryan Carlson:

Then I started to move my way into different systems companies, and I read about Okta when they were just getting started. And I thought it was a good idea, but more than that, I thought the founding team was interesting. And so I reached out to them to try to join them. And that’s a pretty interesting story as well, my path to actually joining the company, but once I did, I built the product marketing team, the product marketing function, and after a while, I decided I wanted to tell not just the product story, but I want to tell the company story.

Ryan Carlson:

And so for tech startups, when they’re small, the product story and the company story are one and the same, but as they get bigger, the company story starts to take on a different angle. It takes on more significance. And I wanted to tell the company story. And so I eventually asked them to give me a shot at being a CMO and they did. And that was about five years ago.

Harry Stebbings:

What a ride it has been since. And we’re going to talk about kind of the actual joining process there, but I’m so intrigued. You said there about kind of the company story and the product story and how they kind of differ with time. Tell us, when did you notice that they differ? Is it with additional product lines? Is it with scale of team? What causes the differing over time?

Ryan Carlson:

Part of it is typically when a tech company has their first product get traction, and they become successful and they scale, but sometimes they scale by adding new products. And we were certainly starting to do that, but I think more significantly, what happens is, is that product has a value proposition and it has traction, it has a story, but you really want to try to convey that there’s something bigger there than just that product, or that there’s more significance to the product than meets the eye. And the company’s story necessarily has to take on that in order to be the winner in that market. And I know we’re going to talk about category creation in a little bit, but if you are really going to win the market, the company story has to start to take on a significance more so than just the product story.

Harry Stebbings:

No, I do agree with you in terms of that company story significance. I do want to touch on the element of your actual joining, because I spoke to Frederick before the show and he said you have to, have to ask him about the interview process. He asked, was it the longest of your career and how do you remember it?

Ryan Carlson:

It definitely was because it took almost a year. When I first met Freddy and Todd, the co founders, I was interviewing for a product role, the first head of product management. And they were about nine people at that time. And that’s where I’d spent most of my career, was in product management. And the team really liked me, but I had no real experience in what Okta was doing, which was security and identity and enterprise software.

Ryan Carlson:

But I went through something like four or five rounds of interviews. And I think they came close to hiring me, but they ultimately decided, and they were right in doing this, that they needed somebody on the product management side who came from that industry, and the person they hired instead of me is still here. He’s a VP in the business development team. He’s awesome. He’s a good friend.

Ryan Carlson:

But when I met them, I became convinced, especially meeting Todd and Freddy, the cofounders, that they were going to build a company that was going to be special. Not just one that was going to be successful, but one that was going to be successful in what I considered to be the right way, that they were going to build a company that you’d be proud to be part of. They were going to build a great place to work.

Ryan Carlson:

And so I kept on them. I went out and interviewed companies that I thought could be their customers. I learned about their market. I learned about their competition. I kept sending them ideas. So about 10 months later, when they wanted to build the product marketing function, they reached out and said, “Do you want to come and do that for us?” But even then it wasn’t a slam dunk. I still went through many interviews with them. My final interview started at 7:00 in the morning on a Friday and finished at 7:00 PM that same Friday. I came back two different times that day, and that finally cinched the deal, and that was back in 2011.

Harry Stebbings:

I mean, I just love that in terms of the persistence. Can I ask, I’m sorry, we will get to the schedule, but does it change how you think about interviewing, having seen and been through that journey and the persistence that it took you to get the role? Does it change how you think about candidate assessment and experience importance?

Ryan Carlson:

100%. I don’t know if that in particular changed my view, but I do look for people who really want the job. Now, of course, everyone’s going to say they want it, but how do you measure that? Do they put in the time to research the company, to research you, to research the competition? A lot of times I will ask candidates for their thoughts on something, maybe a small project, and the effort they put into that in the interview process, to me, is a real signal of their drive, their desire for the role and just their hustle, because that tends to account for so much in success, in a hire. And so I 100% look for that kind of hustle in any kind of hire that we’re doing.

Harry Stebbings:

Product marketing is such a hard role to hire for today, and it’s just intensely competitive as well. Do you find that you can ask that of the best candidates, or they’ll say, “Hey, Ryan, I can go to Uber, or name your billion dollar company, tomorrow, and I don’t have to put in this effort and this mind mapping and all the additional work.” Do you find, of the very best candidates, you kind of can ask them to do the leg work up front, without them being a little bit disjointed?

Ryan Carlson:

It’s a great point. It can be off putting to ask them to do work as part of an interview process. And so you have to do it in the right order. First, I’m trying to sell the candidate. If I think they’re a great candidate, I am in selling mode. Obviously you’re always selling, but you’re selling them on the opportunity, on the role, on the impact they can make.

Ryan Carlson:

And then the way I position the work that we would do as part of the interview process, it is not a test. It’s more of a trial of us working together. It’s an opportunity for them to figure out what I’m like, to figure out what the company’s like. And so it’s really a way for both us and for the candidate to become comfortable working with each other. And I feel like the best candidates know how hard it is to assess a company, whether it be their culture, what they’re really like. And so the more time they can spend with you, the better it is for them as well. And I think that is a way to make it not an off-putting request.

Harry Stebbings:

I totally agree. And I think kind of having that mindset removes a little bit of the risk for them as well by kind of giving them the freemium version of working with you. I do want to touch on the creation that you mentioned earlier, because, for my sins, a VC by day, and I’ve been trained for years, that the big wins in venture are when you bet on category creators, and we create new categories in the markets. But a little birdy tells me, when it comes to category creation, you’re a slight skeptic. So why is that, Ryan? Why are you a skeptic on category creation?

Ryan Carlson:

Well, category creation is so popular now in terms of a framework and a thought process, about how you make a winning company, that I think people have reversed the order and they’ve confused correlation and causation. Certainly, the winning companies have created a category, but I talk to a lot of founders who ask about marketing strategies and asking about marketing advice. And they say, “Okay, I want to create a category.”

Ryan Carlson:

And I say, the way you do that is, win the market. You don’t create a category and then win the market, you win the market and then that has allowed you to create a category. In other words, the winners rewrite the history. They write the rules. And so I feel like people put category creation as something that they want to do too early in the stage of a tech startup.

Ryan Carlson:

Now, it’s important to think about category creation because you want to think about the category you’re in. In Steve Blank’s terminology, are you a disruptive innovation or are you a sustaining innovation? And I think the reason that I’m a “skeptic” on category creation is because people think about it so much that they start to talk about their product or their company in ways that aren’t clear. They’re so focused on trying to create a new category that they describe their product or their company in an unclear way, because they’re trying to make it sound different.

Ryan Carlson:

Sometimes you’re just a better version of the thing that came before you. And that’s totally fine. And if you win the market by being a better version of the thing that came before you, then you will have created a category. But I think it’s the correlation and causation error that people make when talking about category creation, which makes me a skeptic.

Harry Stebbings:

Can I ask, how do you feel about the build in public marketing strategy that a lot of companies are pursuing, where they’re aggressively telling the story, trying to category create, and in a lot of cases, pre-product and pre-product launch to build the community and that engagement within the community. How do you feel about that build in public as a marketing strategy? I’m interested.

Ryan Carlson:

You mean build something while everybody’s watching you do it, they see the progress instead of waiting and then launching? Is that what you mean?

Harry Stebbings:

Yeah, absolutely. So if you look at like Fast on Twitter, for example, have really done a huge amount in terms of building hype, brand, community, ahead of time. And they haven’t launched a product yet. And it’s becoming more and more prominent as part of people’s campaigns.

Ryan Carlson:

I think that can work. But I think the ultimate test of that, you want to launch when you know you have repeatability in your go-to-market. I have a product, I know it solves this problem for these types of buyers, I know with some repeatability and predictability that if I get this many people into my funnel, I’ll convert a certain percentage of them to customers. I think you launch when you have some semblance of that. Now, you can’t wait too long, but if you launch before then, then you’ve wasted the opportunity to build a lot of pipeline, to build a lot of awareness.

Ryan Carlson:

And those things only matter if you can turn them into paying customers. And so I’m of the opinion that you build for a small audience, you figure out that you have something that they really want, and then you launch, but I can also see the fact that building awareness in general is hard, and any way you can do it can help, but I fall in the category of make sure you have repeatability before you launch big.

Harry Stebbings:

I’m interested. You said there about Steve Blank, and have many great writers in our industry, and many great books. Some have got kind of more seminal places in our hierarchy than others. Good to Great, being one of the many named ones. I knew that maybe you have a different view. And you said to me before, there’s a slight element of BS. And so I’m intrigued. Why do you think that when it comes to some of these more seminal books and how do you think about that?

Ryan Carlson:

Well, the Steve Blank mindset in his book and his whole approach to customer development to me is really relevant to your question, because Good to Great and Built to Last, those books, the fundamental flaw, I think, in those books in particular is survivorship bias and hindsight bias. They go and interview people who worked at companies that either failed or the companies that were really successful, and the way that those people describe what they did is inevitably influenced by the fact that they failed or the fact that they succeeded.

Ryan Carlson:

So for example, you can say the thing that made us really successful is that we didn’t get de-focused. We stuck to our knitting, we doubled down on our core, and we didn’t get distracted. Or you could say the thing that caused us to fail is that we did not diversify quick enough from our core product. We didn’t get into adjacent markets. Both of those decisions, at the time that they were made, are the same decisions, but you described them as a good decision or a bad decision based on the outcome.

Ryan Carlson:

And so I feel like that’s a fundamental flaw in those books. They’re backward looking. And the people who are interviewed as part of them have these biases that influence their responses. And so I feel like another book, it’s not very well known, that I think should be alongside those, it’s called The Halo Effect by Phil Rosenzweig. And it does a really good job of talking about how hard these decisions to make are in the moment, when you don’t obviously know what’s going to happen after the fact.

Harry Stebbings:

Can I ask a really hard one? In terms of making decisions in the moment, and do say if it’s too lofty and out there, but the hardest thing for me, when I look at a role like yours, is the amount of decisions you have to make with imperfect data. How do you think about getting comfortable with that, executing at speed on those decisions, and how do you kind of address that?

Ryan Carlson:

I think a really important framework for making all kinds of decisions, but decisions about marketing as well, is knowing whether it’s a reversible decision. Something that’s irreversible, that you can’t undo, you have to be sure about, and you should take your time and you should get more data and you should test and all of those things. But if a decision is reversible, and there’s very few decisions that are truly irreversible, then get as much data as you can quickly, and then go for it and test and be willing to change your mind and be willing to adapt as you learn from putting the decision into practice.

Ryan Carlson:

So many people analyze the decision before making it so long that they can also, and this is another important part of this, they become so tied to their viewpoint because they spent so much time on the decision and the analysis, that they think they’re right. Sometimes putting a decision into practice earlier than you think can also ensure that you keep an open mind because you don’t get biased. You don’t fall prey to confirmation bias, looking for things that confirm the analysis you just spent six months on.

Harry Stebbings:

Totally with you in terms of that confirmation bias and kind of being aware of it. In terms of moving a level deeper, I guess, into kind of functional areas of expertise, we’ve spoken a little bit about marketing. So let’s start on that one. And I spoke to Frederick, as I said, before the show, and he said, do you agree with Frank Slootman, that the CMO should have the pipeline target tattooed on their head? Talk to me about that.

Ryan Carlson:

I do, but with a giant caveat. In fact, I agree so much with that quote that I put it in a presentation that I gave to a thousand salespeople at one of our sales kickoffs, to emphasize how important pipeline creation is to the marketing team. But that really got me into trouble. I made a giant mistake with that approach. I believed so much in that. And the way you measure pipeline in many companies is you look at the dollar value of the opportunities that marketing has created, that sales is accepted, and you add that up and you say, we’ve created this much pipeline and dollars.

Ryan Carlson:

We did that. And we made that the number one metric. And to really make it clear that I was tattooing that on my forehead, the thing that I did is, every meeting I had, whether it was a staff meeting, whether it was a marketing leadership meeting, whether it was a marketing all hands meeting, the first agenda item every meeting was a review of our pipeline creation to date in the quarter. I did that for about a year and a half.

Ryan Carlson:

And I was doing that to tell everybody in all parts of marketing, that pipeline matters. Sometimes if you’re in PR or if you’re in product marketing or you’re in sales enablement, you don’t look necessarily at pipeline creation, but I wanted them all to know that pipeline creation was the thing that matters. But what I did that was a mistake is my emphasis on that one number worked, and everybody focused on that one number. They focused on sourcing and creating pipeline, but there’s a lot of things that you do in marketing that may not source pipeline today, but will make it easier to source pipeline in the future. And the team stopped doing those.

Ryan Carlson:

So I accidentally and inadvertently caused them to focus on the short term and not the long term. And of course, you have to have a blend of both. And so the way we fixed that is we still have everybody focused on pipeline, but now we have a very holistic scorecard to measure all aspects of pipeline creation and it starts with PR awareness. And then it goes all the way through to the pipeline that a sales team needs. With that, I very much agree with the Frank Slootman quote, but I had to learn that the way you measure pipeline was an important part of that equation.

Harry Stebbings:

Can I ask in terms of the measurements in that pipeline, I always believe that it has to be tied, when you’re measuring marketing team success, it has to be tied directly to a revenue number. And my question there is, association with pipeline, is that on closed contract signed or is that just on sales accepted leads? And then how do you think about the right stage qualification, where it can be attributed to marketing, so to speak?

Ryan Carlson:

We could do a four hour podcast on this question of how you measure pipeline, multitouch attribution, how far down in the funnel do you go to measure marketing. I think the next giant marketing tech company, if somebody is going to solve this, it’s really hard. The way that I’ve come to think about it is it does have to be tied to revenue, but it’s more effective if you focus on sales accepted opportunities, because then you always have this cliched argument between sales and marketing.

Ryan Carlson:

The sales team says those leads aren’t great. Marketing says sales isn’t following up on those leads. And so if you tie them together and say, marketing is going to get measured on pipeline that sales has accepted, then you bridge that gap as much as you can. But you can’t go too far down the funnel because then you lose any tie to what marketing’s really doing. So I do think that this holistic scorecard that we’ve talked about is a way to do that. You don’t look at just one number, although everybody wants to look at just one number, you look at a variety of them and you just know that there’s a priority order in the metrics that you’re considering when measuring pipeline creation.

Harry Stebbings:

I love the idea of doing a four hour podcast on that, which shows how much I need to get out, probably. But I do have to ask, in terms of having it as the central number, we mentioned sales enablement, we mentioned PR, product marketing, some of the functional areas which aren’t so tied to pipeline as the core metric. How do you not discourage them when you put it so front and center? Do you know what I mean? Cause if it’s so front and center, and it’s not a core focus for them, but what you do is still really important. Is that a challenge?

Ryan Carlson:

It totally is. And that’s actually one of the challenges in leading a marketing team that gets quite large, that has a lot of different disciplines associated with it. How do you ensure that they all see themselves in pipeline creation? They see the hand that they play in it. And so a big part of that is when we do a campaign, an advertising campaign or a marketing campaign, it is meant to be very cross functional so that the PR team is trying to get stories written about this new product, and the way in which we pitch those stories it supports and it compliments the way that we’re going to do advertising around that new product.

Ryan Carlson:

And the sales enablement team has already educated every SDR and sales executive and sales engineer to know that this is the way we’re positioning this from the PR aspect, all the way through to the advertising aspect. That’s what we try to do to make sure everybody sees themselves in pipeline. It is really hard to do well, but it’s something that we focus on.

Harry Stebbings:

No, I totally see the challenge there. You mentioned the scaling of the team itself. I’m really intrigued, ’cause I get a lot of founders say to me, “Harry, I love the shows, but often my biggest question is simply the first marketing hire. What should it look like for me as an enterprise company?” I’m intrigued. When you have this question posed to you, how do you answer? What should that first marketing hire look like for an enterprise company today?

Ryan Carlson:

I talk to a lot of startup founders about this question and they always typically say, “I’m looking for a VP of marketing. What kind of candidate should I look for?” And if this is their first hire. And I say don’t hire a VP of marketing. I think, and this advice is very particular to enterprise software, I think you should hire two marketing people to start with; a product marketing person and then a demand gen infrastructure person, because you’re iterating and you’re experimenting and you’re refining two different things at the same time.

Ryan Carlson:

You’re refining your message, your value proposition. How do I describe the product? What problems it solves, how you quantify that, how it’s better than the competition. That’s all product marketing. And early stage, you’re iterating on that. You’re trying to find the messages that work really well, that accelerate your sales process. And at the same time, you’re also iterating and experimenting on the channels and the method you use to get that message out.

Ryan Carlson:

Is it webinars? Is it in person events when we could do that? Is it virtual events now? Is it digital advertising? And you want to instrument that demand gen part as much as you can as early as you can. So I advise a lot of founders to hire a product marketing expert and a demand gen infrastructure expert, and have them team up. Iterate on the message and iterate on the tactics at the same time.

Harry Stebbings:

You mentioned the VP of strategic marketing there. I often have a lot of founders also, I’ll say, what’s the difference between VP of marketing and CMO? CMO sounds more grandiose and more important, and maybe I should go for that. And that’s what the candidate’s requesting. How should I think about the difference between VP versus CMO and how that should look within my org? How do you think about that?

Ryan Carlson:

That probably is related to how you have company titles. I think if… This is specifically for early stage. If early stage leaders are coming in and they’re hung up on CMO title versus VP of marketing title, that probably is a red flag, frankly. If this is specific to early stage, you want somebody who’s going to come in and run the function. And I do think that function changes in the ways that we were talking about before.

Ryan Carlson:

A CMO at a company that has scaled has to care about things like investor relations. They have to care about things like internal communications, crisis communications. There’s so much more that you have to take on in a marketing function, once a company has scaled and they’ve reached a large size, that an early stage person wouldn’t. And so that’s probably maybe a difference between a VP of marketing who knows product marketing. You can figure out demand gen, but they don’t know anything yet about creating an S1 for a company that’s going through an IPO and things like that.

Harry Stebbings:

I’m really pleased you said that. Cause I spoke to Frederick about this before and he said, ask him, what was it like being CMO during the IPO process? And do you have any big takeaways from that experience?

Ryan Carlson:

I mean, it was one of the most interesting experiences that I’ve been through, because in our case, in Okta’s case, what we do is simple on the surface, complex underneath, and to really understand the depth of what we do, it takes a while. And so I was helping with the S1 process by bringing the bankers and everybody who was helping us go public, helping them understand the story, and then together crafting that in a way that we would go out and bring to investors.

Ryan Carlson:

And so that was interesting in part, because it was, like I said, the Okta story is complex, but there’s a lot to work with there, but it was also interesting because as a marketing person, you want to be as bold as you can. You want to be as brash as you can. You want to be as audacious as you can. We had a lot of jokes in the process because the lawyers typically are trying to keep you from being as brash as you can. And that dynamic was pretty fun.

Ryan Carlson:

You do this thing after the IPO where you have a dinner with everybody that goes through the process, the bankers and the lawyers and the company, and our lead bank that took us public during that post-IPO celebration dinner, created a PowerPoint presentation, which pretty much made fun of me the whole time, because they were calling back to the fun we had in the rooms debating about how we should tell the Okta story.

Harry Stebbings:

I love that in terms of them taking the piss. I do have to be honest, you said there about kind of the different layers of complexity to the business. I’m interested because, going back to the product marketing aspect, you said before, tech product marketing is easy to describe, but actually hard to do. I’m interested. How do you describe it and why is it hard to do? And why do you think there’s that kind of conflict between the two?

Ryan Carlson:

When I describe product marketing to people, the vision for product marketing is, you’re describing the solutions that your product provides, why those solutions matter, and why you’re better than anybody else at solving them. And that second part, why those solutions matter, a lot of times, you’re trying to quantify it. It’s simple. It’s simply that. But people get so caught up in describing the features of their product. In many cases, because they’ve worked on those features and defined those features. They want to bring the features to the surface and say, “Here’s the main thing about our products.”

Ryan Carlson:

But the features don’t matter. It’s what solutions they provide and why those things are relevant now, and why you are the only product that they should choose. And people get too far away from just the core answers to those questions. And I think they get too caught up in what Steve Jobs would say are speeds and feeds, and not really what is the primary job that your product is providing.

Ryan Carlson:

And I think measuring product marketing is especially hard because how do you know it’s working? And so this is also something that we could do a four hour podcast on, but I feel like the primary metrics for product marketing are, are you shortening the sales cycle? Are you increasing the competitive win rate? And are you increasing the average selling price over time? Because you’re doing that, you’re conveying to people that they should buy your product, you’re doing it more efficiently because they’re buying your product more quickly. They’re buying it more than your competitors at an increasing rate and they’re paying more money for it. You’re demonstrating value. Those are the primary quantitative metrics, I think, for product marketing.

Harry Stebbings:

How do you think about product marketing, working with the wider marketing team? Not that it’s a challenge, but it can be challenging to integrate them so efficiently. How do you think about that integration, communication and workflow between product marketing and wider marketing?

Ryan Carlson:

I think a lot of tech companies, marketing generally gets a bad rap, because you’ll hear people say, “I have to wade through the marketing BS to figure out what’s really going on with this product or this technology.” And I think that reputation is sometimes deserved, because a lot of people in marketing are trying to say what sounds good, and they forget to say what is true and authentic and genuine to their product.

Ryan Carlson:

And so I think product marketing can help because they can educate the broader marketing team on, what really does this product do? What really is it not good at, from a competitive standpoint? What gaps does it have? How do you know that? And ultimately, and this is probably the most important part, pulling the customers into this discussion. There’s a lot of marketing people in general who start to tell their own stories, and the way that it sounds good to them, and they forget to validate that with customers.

Ryan Carlson:

When I joined Okta, the first thing I did on the very first day I started was I called the five customers that the company had at that time, and I asked them to tell me why they bought the product. Because if I understood that, that was going to make the product marketing that we built much better. So I think product marketing can help educate the rest of the team and ensure that customers are always part of that discussion.

Harry Stebbings:

I love that, in terms of calling the five customers there, and I think it’s a totally great way to do it. I do want to dive into the team a little bit before we do the quickfire round. And if we think about kind of team assembly and team scaling, you’ve said before that actually a high performing team can produce the unintended side effect of stifling innovation. Help me out here, Ryan. Why is this? And then I guess, do we want a high performing team then?

Ryan Carlson:

So this was another lesson that I learned. I took somebody out to lunch, she’s a rising star on the team, and so I was just taking her out to lunch to figure out what she wanted to do in her career. What does she want to do longterm? How can I help her with that? How can I give her opportunities? And she was asking me for feedback on her. And I said, “Well, one of the things that I think you could do is give more direct feedback to Todd and Freddie.”

Ryan Carlson:

This person is in PR. She worked with them a lot. I said, “You have really good ideas. You should tell them your ideas more than I think you do.” And she said, “Okay, great. Can I give you some feedback?” I said, “Yes, please do.” And she told me that we had such a high bar for quality in the marketing team, that many people were afraid of failure. And I was just shocked and embarrassed by that.

Ryan Carlson:

And it comes back to some of the things that we were talking about before, reversible decisions and irreversible decisions. A high performing team, some things need to be done really well. Some things need to not fail. They have to be done perfectly and you can’t mess them up. But not all things. In fact, few things need to be like that. And knowing the difference between something that has to be done right, where there is no room for failure, and something where there is room for experimentation, where there is room for trying something in a new way, where there is room for innovation, knowing the difference between those two is important.

Ryan Carlson:

And so I’ve, since that time, I’ve really focused the team on knowing the difference between something that has to be done really well, and something that can fail if we’re trying something new. And obviously nobody’s setting out to fail, everybody’s trying to do their best, but if we’re going to keep growing and keep scaling the way that we have, we need to find new and innovative ways of doing what we’re doing. And if people feel like there’s no room for trying something new, that’s never going to work.

Harry Stebbings:

Can I ask, as you said there about imbuing that to the team, as a leader, it’s your responsibility to ensure that people feel that they have the safety, internally, to present those ideas, to present whatever it is that they’re presenting, in a safe and secure environment where it doesn’t matter if it’s shot down. How do you think about what works in terms of providing that environmental security to the team, that they can bring whatever they have to the table?

Ryan Carlson:

There’s a couple things that I do specifically for that. One is, every time that I make a mistake, I talk about it in an all-hands presentation or in a leadership meeting. I will talk about how I screwed something up, because I want everybody to feel like it’s okay to say that they screwed up. But we also do things like we have a leadership meeting that we do across the marketing team. It’s the cross functional leadership team. And we do that every month or two. And we set one of those meetings aside and we did nothing but let people come in and talk about issues that were not working. They didn’t have to have solutions to the problems. I’m not of the opinion that… Some people say don’t bring me a problem unless you also have a solution, because I think that it ties people’s hands.

Ryan Carlson:

Maybe they see a problem. They don’t know how to solve it. You want to know about that as a leader. And so we set aside a meeting where we did nothing but talk about things that weren’t working and it created the space where it was okay, because nobody was focused on, why isn’t it working? Why are you not getting your job done? We just wanted to get these problems out in the open for everybody to know about. And then you see this magic happen, where people from other groups chime in and say, “Well, have you tried this? This has worked for me.” And formally creating space for people to talk about things that aren’t working helps with that a lot.

Harry Stebbings:

Totally. And I love that in terms of the transparency around kind of mistakes that you’ve made. So that’s super interesting to hear. Can I ask, speaking of stifling innovation, one that I thought was fascinating was when someone said to me on the show, you don’t want to have an amazing customer success team. Because if they’re so good, they can actually stifle product innovation because they just deal with it all themselves. Would you agree with that? And how do you think about that one?

Ryan Carlson:

I would slightly agree with it in that a customer success team that’s really good can mask the problems in the product, and then the product team doesn’t know about them, but you still won’t have amazing customer success team. So I think what you need to do is have a feedback loop. Here are the top five problems that we are having to solve with the professional services team or with getting in and helping the customer do a custom deployment. If that is fed back into the product team and the product team looks at that, then I think that’s a winning combination. I would never say you don’t want to have a great customer success team, but I wouldn’t want your really great customer success team to try to do it all on their own.

Harry Stebbings:

Yeah, no, I think having a deliberately mediocre CS team would be a challenge. I do want to touch on one final element, though, before the quickfire, and it’s in terms of companies scale, obviously kind of company culture becomes more and more important. How do you think about your company culture at Okta? And I guess, how does it relate to brand specifically?

Ryan Carlson:

I think in general, what I’ve learned as managing a larger and larger team, culture becomes the most important tool that you have to lead a large and diverse team. And what I mean by that is, and maybe this is specific to Okta, but we don’t have a very much of a top-down hierarchy. “Here’s a plan. Now go execute it.” We have a very empowering culture. We believe that people who are closer to the action are better able to make decisions and they will act quickly. And that’s the way we’re going to get things done.

Ryan Carlson:

If you have an empowering culture like that, where decisions are getting made at the lowest level possible, the thing you need to do, I mean, what I’ve found to make those decisions effective, is to make sure that the culture, the values around which we make decisions, are really clearly understood. If people know how we value customer success or how we value integrity, or how we value transparency, those are three of Okta’s core values, if they know that, then the decisions that they make on their own, quickly, and the actions they put into place, quickly, are going to be the right ones.

Ryan Carlson:

And so I feel like culture is a way to get a team aligned and to get a team moving in the same direction without having to tell them exactly what to do. Now, how that relates to brand is I’m very much in the Ben Horowitz school of thought that what you do is who you are, and your brand ultimately is a byproduct of the actions of every single person at your company. And that’s closely related to your values and to your culture. Every Monday at our company, we have a new hire orientation.

Ryan Carlson:

And one of the first presentations they get is typically from me or somebody on the marketing team where we’re giving them the company pitch, but we’re also talking about the company’s values and how that feeds into our brand, because the brand for your company is not just the responsibility of your marketing team or your sales and marketing team. It’s the responsibility of everybody. If you’re in finance, you’re going to work with vendors. If you’re in engineering, you’re going to talk with a partner, for example, and how you interact with people outside your company is going to affect your brand. And that comes down to your values and your culture in many cases.

Harry Stebbings:

I can agree with it being everyone’s responsibility. I think that’s always a big problem in terms of everyone, they should be seeing it just to marketing. I do want to dive into my favorite though, Ryan, which is a quick fire round. So I say a short statement, and then you give me your immediate thoughts. So you ready to rock and roll?

Ryan Carlson:

Let’s do it.

Harry Stebbings:

So what’s your biggest challenge with your role today at Okta?

Ryan Carlson:

Getting people to continue to think bold. As you get big, as you have something to protect, people can sometimes be conservative. When you’re small, you have nothing to lose. And I want people to think boldly and be aggressive as they can.

Harry Stebbings:

What do you think makes Frederick the great leader that he is?

Ryan Carlson:

There’s an excerpt from a Malcolm Gladwell book, where he describes the type of person known as a connector. I think it was in his book, The Tipping Point. And Freddy is the most connector of connectors that I’ve ever met. He thinks about so many people. He makes connections between them in ways that help them. And he does it in a very selfless way. And I think that’s one of his biggest assets.

Harry Stebbings:

Speaking of his attributes, he did offer me one fantastic question here. Why are you not in the NBA?

Ryan Carlson:

Yeah, that would come from Freddie. I’m not in the NBA because I’m not good at basketball. I am way better at basketball than Freddie is, which is probably why he thinks that. But I’m not that good.

Harry Stebbings:

That is hilarious. Tell me, what moment in your life has maybe kind of served as like a transition point or changed the way that you think?

Ryan Carlson:

Coming to Okta was, from a professional standpoint, one of the things I realized is that, and this sounds dumb in hindsight, I am only going to be as good as I make the people around me. I think a lot of people younger in their career, they try to really work hard themselves and stand out and be the top of the class, or get the highest rating and get the best performance reviews. It took me longer than it should have to realize that I’m only going to be as good as the people that I make around me, and the better I make them, the better off I’m going to be. And so that was really a foundational part of me, my professional career. And it kind of coincided with me joining Okta, actually,

Harry Stebbings:

Let’s put on the element of hindsight hat. What advice would you give to a younger self of yours, when you think about the experiences you’ve had now?

Ryan Carlson:

I think a lot of people have a longterm plan for their career. And I think you should have a much shorter view for your career. Technology changes so fast, things change so fast that if you look too far out for your career, you miss a lot of opportunities. And I wish I’d had that advice when I was young.

Harry Stebbings:

Ryan, it was such a joy to do this one. As I said, I had so many good things from Frederick and Pat, so thank you so much for joining me today, and I really appreciate it.

Ryan Carlson:

Thanks, Harry, it was a lot of fun.

Harry Stebbings:

My word, I just loved doing that show and I actually moved completely away from the schedule with those questions. So Ryan was incredibly patient in putting up with me for that. And if you’d like to see more from us behind the scenes, you can on Instagram at @hstebbings1996. 

Harry Stebbings:

As always, I so appreciate all of your support, and I can’t wait to bring you a fantastic episode next week.

Published on October 22, 2020

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