May 16, 2023
Eric Olden is a maverick that has pioneered 3 major paradigm shifts in Identity and Access management. He founded, scaled, and successfully exited both Securant/ClearTrust (Web Access Management) and Symplified, (the first IDaaS company). He recently served as SVP and GM at Oracle, where he ran the identity and security business worldwide.
As a technologist, he was a co-author of the SAML standard, creating the first pre-integrated SSO platform, and is the visionary behind the Identity Fabric. With an obsession for simplifying the way we work as an industry, Eric wrote a new identity standard called Identity Query Language (IDQL) which provides a common language for policy management in a multi-cloud world.
Eric’s latest company Strata is the first distributed identity platform that solves the problem of fragmentation through a no-code software solution.
Julian:Hey everyone. Thank you so much for joining the Behind Company Lines podcast.Today we have Eric Olden, CEO and co-founder of Strata Identity. StrataIdentity is building the next generation of distributed identity management forthe multi-cloud world. Eric, I'm so excited to chat with you, not only becauseyou're kind of a low-key celebrity in the tech world from what you've built andwhat you've pioneered in terms of identity.
So it's reallyexciting to not only think about, kind of the conception of, of how companieswere thinking about identity and, and. The single kind of sign in process andhow that's been able to communicate with other technology, but also where is itgoing? We have crypto, we have all these different tools that are, not necessarilymeant to speak to each other, but we want them to as users and, and we'realmost, not willing to compromise that ease of experience.
I'm really excitedto see what you guys are building, who you partnered with. But before we getinto all that, what were you doing before you started the company?
Eric:Yeah. Thank you for having me on Julian. And great, great intro and, and to Ianswer your question about where I was before starting Strata.
I am a serialentrepreneur and I got my start in startups and identity well back in 27 yearsago when I was in college and I. Really, I guess didn't know any better that,my best friend and I from high school probably should have finished collegebefore we started a company, but we were just excited.
There was a lotgoing on. 19 95, 19 94, that's when Netscape had just come out and we werebasically like, Hey, let's figure out a way to bring security into this newwild world. And got right into it and. Two guys in an idea turned into a 300person company. We were ready to go public, but the.com crash resulted in ustaking an acquisition instead.
And it was, it wasa great outcome and a great way to, to get into startups and learn about how tobuild things at hyperscale. And, and we grew very quickly. Yeah. But that wasmy first company's Securent. And our product was clear trust, and I wasfortunate to work in the early days, co-found co-authoring a standard calledSAML and mm-hmm security assertion markup language.
And that we broughtinto the public market, made it a public. Standard and it's been a hugesuccess. All the clouds use it today and it's what allows people to use theiridentity in, in more than one place and do that in a secure way. After that Itook some time off and I got into venture capital, spend some time helping someother companies get off the ground and coincidentally in identity and security.
And then when mynon-compete went down, I started my second identity company, simplified andgrew that and that was a lot of fun. Coincidentally sold that to RSA as well.So I've sold two of my security companies to rsa and then I found myself. AtOracle and I had been yeah, responsible for running Oracle Security andIdentity Division.
And that meant allof the security and identity for the Oracle cloud, for the SaaS applications inthe enterprise software. And it was a very different experience than my startuproots, and was responsible for, hundreds of people and a huge portfolio andgreat customers and I learned a lot and.
Really enjoyed mytime at Oracle, but when I saw the direction at Oracle moving to just focus onthe Oracle cloud, I saw the opportunity for multi-cloud. And so I got the smallteam together and I said, Hey guys, let's go solve this problem. And it seemslike a very hard to do thing today. No one's doing it.
Everyone I talk tothinks I'm crazy for trying it. So that all sounds exactly like the kind ofmarket to go after. So, we left Oracle Yeah. And we started Strata and we'vebeen did that. Now we're going into our fourth year in August and it's beenjust a thrilling ride. But my whole background to net it out, startup, multiplestartups, venture capital acquisitions, exits.
Big enterprise andcoming back to my startup roots with Strata.
Julian:Yeah. Yeah, it's so excited to think about, kind of at the conception when youwere thinking about security, what that meant. Now we think about security asprotecting my personal information and for companies to who hold some of thatinformation not to be compromised and, and all that information be distributed.
Is that how youthink about security or, or we're thinking about security in regards to whatare the components for our audience context. Are important, in the securityspace and, and the different players and what, are you protecting? What's, howare you protecting it and why is it important?
Eric:Yeah. Identity management is a very nuanced niche within security and cyber andyeah, it can get really complicated quickly. Because there's so many differentvariations, but I like to start with first principles, right at the very core.Mm-hmm. Mm-hmm. What are we trying to do? And the way I see identity managementis real simple.
You've got tomanage the relationship between users and applications and the data that those applicationsdeliver. That's it. The three things to manage those relationship between thosethree. Is very, very complicated. And it's a simple thing. Yeah. But it's notsimplistic. And what that means is you, yeah.
You need to alwaysfigure out, well, how are we gonna manage those three main mm-hmm. Elements.And so when I think about securing that, You find the same patterns we've beenusing for a couple decades. All have a lot of the letter A involved. Yeah, sothe four a's the authentication. Are you who you say you are?
Access control.Mm-hmm. Can you get to what you're trying to get to authorization? Can youperform an action that you're trying to like, make a wire transfer or settle atrade? Mm-hmm. And audit. And that means being able to, is there a record ofwhat you did? You could argue the fifth A is administration and that's.
How you manage allof the compliance and the governance of all of those other things. So the fouror five A model has been really, really effective throughout all of thesegenerations of technology. Starting with the web back in the late nineties,going to software as a service in the mid two thousands and now where we are inmulti-cloud, all of those generations have those four, five, a's.
And what we'redoing now with Strata is applying those five elements to applications that runon different clouds and where your infrastructure runs in different places. So,fundamentally it comes back to distributed architectures.
Julian:Yeah. And how are you able to do that with systems that you know, don't, don'tcooperate, don't communicate our different languages, maybe even have,competing protocols.
What allows you theability to be able to, build something that can be used across, thismulti-cloud kind of ecosystem that we all are familiar with?
Eric:Well, from an engineering standpoint, in a software architecture approach, the.The key is two things. One is an abstraction layer and the second arestandards.
So I'll start withthe first one. When you think about the abstraction layer, when you, you lookat where abstraction layers have worked really well in, in technology the,probably the most successful one mm-hmm. That people would recognize areVMware. And how they turn physical machines into virtual machines and run thoseVMs and later docker containers and all of that.
But you're runningthese virtualized computers on top of something called a hypervisor, and thatallowed you to take your different vendors, maybe your Dell servers and yourIBM servers, and. Your sun servers and say, look, it doesn't matter whathardware I run it on, I just wanna focus on those virtual machines.
And if I wanna runthose on a machine that is in my data center, we'll call that a private cloud.If I wanna run that compute in a public cloud, then I'd use something likeAmazon or Azure or Google. So now you've got an abstraction layer that you canmove things around. And when you apply that to identity, instead ofvirtualizing servers, we virtualize identity systems.
So that means likeimagine Okta or Azure Active Directory or Oracle. So all of these differenttechnology that you use to manage identities. Have been normalized through anew layer of software, which is what we produce called identity orchestration.So that allows you to separate your applications and run those on whateveridentity system that that you want to.
So that's theabstraction layer.
Julian:Yeah. Yeah. And describe, one thing that always, comes to mind is, is theevolution of a lot of technology in, in, in the standardization of a lot ofthings, which is, founders building products that aren't necessarily thatrobust to build anymore.
Whether it's. Lowcode note code, but within this orchestration, there's all these other APIs andplugins to really create this experience that the user at least is, is familiarwith. There's a, there's the standardized service. How have the trends kind ofevolved in terms of identity and, and how have companies kind of tried thisdata with, giving people access to their platforms, whatever, with that levelof security?
Is it hard? Is iteasy? Do you typically have to build a team? What, what would you do if youdidn't have Strata?
Eric:Well, most of the time without software, you have to do it by hand, and thattypically means depending on how many applications that you're dealing with.You're gonna have to hire a big team to manage a whole portfolio ofapplications.
And the work thatis involved is refactoring an application. So it works with a differentidentity system. So it'd be kinda like you own a hotel that has a hundred roomsand you need to change the way the lock works because you wanna bring in a newfancy iPhone. Yeah, electronic lock or key, but you gotta change a hundreddoors.
Well, you couldeither swap 'em out each of the doors and whatever that costs and however longthat takes. Or you can come along with another piece of technology, put it. Onthe door that says if someone shows up with their phone or they use the oldfashioned room key card, that either one can be used with that door the way itis.
So metaphorically,that's what identity orchestration is doing, is we're putting a piece oftechnology on the door so you don't have to change the lock and the technology.Yeah. Changes the. Way in which your new form of key works with the door andbasically translates the new one into the old one. So the door's like, Hey, itworks the same way.
Everyone's happyand it was easy to roll out.
Julian:Yeah, that's fascinating in particular because is it, in that use case, is it,that you're kind of changing the way the phone communicates with the lockthrough its RFA system, or is the individual kind of room its own identity andthe keys kind of get changed per user?
How is that relationshipbetween the user and what they're trying to access? Is that different? Or is itjust adding another layout of technology onto it to make it. I guess morewidely adopted.
Eric:Yeah. I think the, the way that it works best is when you can roll somethingout that uses what people already have.
So in that example,yeah, of using your phone as a way to unlock a door, that it works in the sameway from a security standpoint, meaning, We can take your full, your, your facescanning that's on your phone or your fingerprint reader on your phone, and wecan say, look, instead of using a password, We will let the phone scan yourface and if that checks out, then we'll believe it's really you, Julian, andyou don't have to get a new password cuz you're born with the face that you'vegot and it's always with you.
Yeah. And so thatis a, a real simple way to make it easy for people who need to, log in or getto the application to say, look, I don't have to remember a password. Orremember some token I just put my phone to my face and it'll scan me, andthat'll be an even more secure way to get to the application.
Yeah, so in thatcase, you made it easier for the end user, but you also made it a lot moresecure because you don't have to deal with the password. Yeah. And then on thethe application side, that's where orchestration can say, Hey, The applicationwasn't written to handle the face scanning it. Maybe it's like five years old.
Instead, theorchestration abstraction will take that and then tell the application. We knowthat the user is who they say they are. So yeah, we're going to tell you whatyou need to know, Mr. Application so that you can treat this user as a secure,trusted user. And so that translation from the face scanning to the application,that's where the magic of orchestration kicks in, where you transform onesession into another and make the application more secure, the user more securewhile making everything easier across the board.
Julian:How does that change the, the experience that, or I guess for, for companies?How does that change their user experience and what does that mean from auser's perspective to be able, it's almost like this web three concept whereyou opt in and you opt out using your biometric. And so I'm, I'm interestedbecause that has such a beautiful play with community and jumping fromcommunity to to community and a physical space is different.
But what does thatmean for, companies who have, more physical experiences but, wanna give peopleaccess? Is that change kind of the, the modern experience or, or how peoplewill interact with, with places in technology in, in your mind?
Eric:Yeah, it has, it's really changed things. And I think there's probably two.
Communities ofusers that are top of mind. One is a company or organization's workforce andtalking about their employees, their contractors, partners. And on the othercategory, you've got the customers and you're talking about your mm-hmm.Subscribers if you're a media company or your patients if you're a hospital.
So, Workforce andconsumer, customer, and modern companies have to manage both of those. And whenthey're thinking about the user experience with a customer, the bar is reallyhigh. I think we've all become accustomed to buying things online, using yourphone, and we've all been in that experience where, oh, I wanna buy something.
Oh, I have tocreate an account before I can buy something. Well, if that means like seven oreight steps to create an account just to buy something, people bail on that.Yeah, I do it all the time. On the other hand, if you have that one, create anaccount with your Google ID or something like that, your Twitter id, then it'slike two clicks and you've got everything taken care of.
And so yeah, Ithink that. Kind of consumer experience where you really need to cater to thatconvenience and the ease of use. That's what's happening mm-hmm. In theconsumer market. And it's moving over to the workforce because Sure, whenyou're talking about your workforce, you're paying them to be employees.
And maybe in thepast it was like, all right, you gotta use this login. Authentication tokenthat's on your key chain. Mm-hmm. And it's a hassle if you lose one and all theother kind of overhead. So what's been nice is that the workforce is benefitingfrom all the advances in the consumer so that they also Yeah.
Can use their phoneto scan their face. And get into the applications that they need to as anemployee. So it's been an interesting cross pollination between the customermarket and the workforce, but doing the same thing, cuz at the end of the day,you need to authenticate, check access, authorize an audit, whether you'redealing with your workforce.
Yeah. Or you'redealing with your customer.
Julian:Yeah, it's so fascinating thinking about like, obviously the initial, I'm surevalue add to companies is, allowing people to use their product without, withease of, of, of signing in and opting in and things like that. But thinkingabout what Strat identity is.
It, it's so muchbeyond that because it affects the individual layer. So how do you think aboutthe other possibilities in terms of building and what are others kind ofsurprising or, or unconventional use cases for abstract identity that you'reparticularly excited about? Being that it's not just a business problem, it itcan solve, but it's an individual and a human problem in terms of opting intoalmost everywhere, doing everything you could do.
So at a concert youcould do. So it seems like the ability that this technology has for the users,It's just, I mean, it's, it's kind of blue ocean, like there's so muchpossibility out there. How do you kind of identify, or I guess managing whatyou're building now to the possibilities of it, seeing that, I mean, the usecases are just beyond imagination.
Eric:Yeah, you're right. It's, it's an exciting time to be an identity. I think onerecent project that we just a couple weeks ago brought to market at the RSAConference was a collaboration with Strata and ey, the consulting company andMicrosoft. And what we did together was bring the verified identity toLinkedIn.
And what this meansis that from a business standpoint, You can verify that an employee who says onLinkedIn that they work at ey, we've actually cryptographically verified thatthat's true and we create, yeah, in the block ledger a record that, forinstance, Eric is an employee at EY and EY will validate that.
In fact, I do workfor the company. I don't, but you get the idea. Then there's a record to say toanyone else that's on LinkedIn when they see, it's almost like a blue checkmark that used to happen on Twitter, but it's like being verified. Yeah. OnLinkedIn. And that motion creates a lot more trust and authenticity that Irepresent, that I work at a certain company that anyone that.
Takes thatrepresentation. Maybe an employer can say, yeah, actually it's almost like alittle background check that's put into your Yeah. Your online profile. So, ayear ago I wasn't thinking that that would be a thing, and here we are. We justbrought it to market very quickly. But I think that was an interestingunanticipated use of identity technology with the convergence of decentralized.
Block ledger andthe idea to really bring more confidence and trust into a social network in theform of LinkedIn. So that was pretty fun.
Julian:How do you do that? Do you men, smart contract on, on Ethereum and then usethat as your ledger and kind of everybody's tied into that or, yeah. What inparticular, what allowed you to use, not only, obviously cryptography has beenaround for for years, but obviously putting on a blockchain ledger is kind of anew and an inventive way to use it.
How are you able todo that? In, in the ability to verify a company individually, do you have tomint them at particular companies? Wh what is involved in that process?
Eric:Yeah. Well that was the, the interesting part in the collaboration. So, each ofthe groups brought something to the solution and the underlying decentralizedblock ledger technology comes from Azure.
And Microsoft'smade a big investment in the Azure Cloud so that you can build these web threetechnologies and have all of that complicated crypto and all of that done justin the, in the cloud platform. So that was really, yeah. Powerful. And then therole that Strata plays is. We need to run when you're getting this validationdone, right, the moment of minting, the validated id, then there needs to be acheck to say, go to EY in this example, to talk to their database and say, Hey,does Eric Olden with his email address.
Work at EY and theYeah. Database gives a yes or no and then to the, the Strata software, whichwhen we get that mm-hmm. Yes. This person is. A member of our organization,what Strata does is we wait for that signal, and when that happens, then wewrite to the other side to say, yep, take this person Yeah, Julian, and saythat they in fact do work with EY, and we have a record of that transaction, ofthat validation at that point in time.
Yeah. And it's,it's irrefutable because the. Cryptography behind making sure that all of thoserecords are something you can't Yeah. Tamper and counterfeit. So, and then EYwas the integration team that glued the technologies together. So, Microsoft providedthe block ledger, we provided the orchestration, which checked the different.
Cloud databases andEY stitched it all together and it runs on top of LinkedIn.
Julian:It's so fascinating. Thinking about also like, do you think about the challengeof having multiple, to think about how many emails I have for differentwebsites, one's for, newsletters and other ones for work and, but a acrossthose different platforms I have, different identities in how, in, in, in, intheir relationship to me.
How does Stratathink about, or is that a challenge that a lot of companies thinking about interms of one individual or one actor using multiple identities across differentplatforms? Do you compile those together? Do you, create different identitiesfor that? Have you thought about that challenge?
Is that somethingyou think about? You'd love for you to respond to that?
Eric:Yeah. Well there's, that becomes a really big problem and. Where, where you'vegot identities in a lot of different places and the, the security issue thereis the vast majority of these places use passwords. And the human nature sideof it is that people use the same password because we're lazy and you can havethe same password in 50 different places.
So the exposure. Isnot that the bank where you have your password is gonna get compromised. Why goafter the bank when you can go after, I don't know, your, your sneakerheadperson who likes to buy stuff off of this website that's, yeah. Put togethershoestring, but she used the same password.
Yeah. So a goodhacker is gonna go and break into the weekly. Protected system and find out, ohwell, this email address and this password, I'm gonna go now check it againstall of the banks. And that's how people steal your identity is they get it notfrom your bank, but from the random place that people reuse their passwords.
Okay? So that's theproblem. The more places you do it, the greater your exposure. And so thatcreates a bigger problem over time. So what do you do about it? Well, if youhave the option at any of the important places where money's moving and andlegal information is going on, opt for their multifactor authentication, a lotof banks are bringing that to market, and it's always better and more securethan a password.
Full stop. I don'thave to know much about any of the variations of the brands. I can just tellyou passwords are like, The worst. So step one, yeah. Use multifactor whereit's given. And then there's a cool thing that's going on with standards aroundthis in identity called Fido. And there's a new thing called Fido two and thetechnology is called pass keys.
And the. Technologybeyond is very sound. It's cryptographically managed and secure. And why I saythat is there's no password involved, but there's a cryptographically reliableinstance of your identity in your device. So all of the big platform vendorsgot together and said, we're gonna implement this.
So Apple said,we're gonna build it into the iPhone. And Google said they're gonna build itinto Android, and Microsoft said they're gonna build it into windows. And applealso put it into Mac. So what does all that mean? It means that you can connectyour face, scan with your digital identity in the form of a passkey that's onyour phone.
And when you go toa website or something else that says, Hey, you can use your pasky here, thenyou can use that as a, bring your own multifactor authentication. Yeah, soit's, it's a really cool way to put the power in people's hands. And say, look,you wanna bring Yeah. Better security than a password. Use pass keys.
It's free. And thenyou can use it at all the places that accept pass keys which is becoming moreand more every day because it's a standard. Yeah. And the bank can say, look,we'll support 5 0 2, we don't care if you use Apples or Microsoft or Google.They're all conformed to the same standard. So it makes it really easy for thebanks and others.
To accept it. So,that's what's new. It's coming out and it's definitely worth checking out. It'spretty cool.
Julian:Yeah. Thinking about, switching gears here, thinking about whether it'sexternal or internal, what are some of the biggest risks that you think, thecompany faces today?
Eric:Risk is something that we live in a world that you can't get away from risk.And so we're always thinking about the, not whether or not it's secure, butwhether or not we can manage the risk related to that. And so, companies thatare startups are the, the bigger you get, the more risk that you're exposed tobecause your surface area grows.
And so you reallywanna make sure that you have ways to mitigate and manage that risk. You'renever gonna get rid of it altogether. So instead you want to quantify it andunderstand it. And so we do a lot of work all the time really training our teamabout. Hacking and security breaches and how to be on the lookout for peopletrying to fish you and things like that.
So we train ourteam to notice, Hey, you get a text. It's not coming from the CEO asking for, afavor because you're busy. We get fishing attacks on the daily, probably doubledigits at my company. So this is something that literally every single day youhave to be on the lookout. And so, we really take that very seriously.
And then we alsomake sure that there's no passwords in our world, meaning on our platform. Wedon't allow passwords to be used to log in. So we just by designing it out inthe beginning, we were able to avoid vast majority of compromises that happenbecause, People get hacked and they lose their passwords.
So we no ever usepasswords in the first place. So we don't have any of that exposure. And we didthat by kind of drinking our own champagne and bringing this multifactorpasswordless technology into our product itself. So those are kind of therisks. People are always trying to hack us, but we don't ever take anything forgranted.
Always be vigilant,always be on the lookout, always be paying attention and designing things sothat your security as a first principal doesn't get outta sight.
Julian:Yeah, it's so fascinating. Thinking about, so you built, a lot of the tech I'msure, like was it when you were building Strata and you were bringing on peopleonto the team?
When you say bringon, say, slack for instance, did you already start building the kindaauthentication piece with Strata in mind with that company? Or that product orplatform, or say you're using Salesforce or these other tools and if you're notusing that password, but you're using Strata. Are you then kind of using thatrelationship in a way to pitch it to that potential client or customer?
Like, it seems likeyou already have this accessibility in use case with this relationship. It'salmost that much easier to kind of break through and talk about other waysthat, platforms like that can utilize, your, your technology. Have you thoughtabout that? Has that been an opportunity for you, or is that, am I justdreaming here?
Eric:No, you're not dreaming. And it is a, an opportunity, I think one of the thingsthat we lean into is security first. And when customers of Strata, they see thementality, they see the discipline, they see the investment that we make andall of our experience. Yeah. Having done this, like collectively the executiveteam, Has over 200 years of experience, so insecurity in cyber, so, we are theteams that have built all of the security products.
Not all of 'em, buta large number of the most popular products from Oracle, from rsa, from Salesforce,from you name it, ping Identity, Azero, and Okta. Right? So we've taken all ofthat experience and put it into this software platform that we built, and itcomes through when. Our customers bring us through a compliance process andthey ask a hundred questions on, Hey, show us how you do this and show us howyou protect against that.
And we have it alldocumented and it's all there for them to see. And that's usually one of thefastest things for us to get crew is the ability to prove that we do things theright way. And so I think that's been a big. We've turned something thatwould've been a barrier into a accelerator, right?
And so instead ofgetting, oh, we gotta explain all of this, we fe, we productize it and say,yep, here's how it works, here's how it is. Prefer the world to see. So, makespeople feel a lot more confident.
Julian:Yeah, it's, it's a brilliant idea and, and it's such a, seems like an easyentry into a lot of, opportunities for clients and partnerships in, in a way thatyou kind of show it's, it's value already.
And I always, Ilove asking founders those questions because it's, it's such a unique way youkind of, like you said, you turn, say, a problem or barrier into an opportunityin a conversation. I always like this next session, I, I call it my founderfaq. So I wanna hit you with some rapid fire questions and I wanna see what yougot from me, so, real quick.
I always like toopen it up with an easy one. What's particularly hard about your job day today?
Eric:Hard thing about my job day-to-day is that we're creating a new market and sowe have to do a lot of heavy lifting just to have people understand what we'redoing different than say adding a new feature or, or bell or whistle tosomething that people are familiar with. Mm-hmm. So we spent a lot of our timeevangelizing.
Hey, multi-cloud isdifferent than the past. So when you get to that point, this is where our kindof software is gonna help you. So a lot of evangelism. Yeah. In these earlymarkets.
Julian:Yeah. What is it, what are the different tactics in being like an evangelistfounder versus, someone maybe a founder of a commodity or a founder of, aplatform that has a competition so they don't have to necessarily build up thestory as much, but how is the philosophy and the tactics different from, say, aproduct that you know already has, strong product market fit.
It's got a big,total addressable market. All, all the buzzwords you hear. When, when you'rethinking about scaling business, but the evangelist founder has a lot of, justa lot in front of them in terms of the education component. How is yourphilosophy different? How are the strategies that you deployed different beingan evangelist founder?
Eric:Yeah, it's a it's very different than other models where you're doing anincremental thing or you're building into something that people know. And theadvice that I would give. Is to spend the very beginning, really obsessingabout the customer problem. And don't write software. Don't write marketing.
Just really findout how to interview the market about the problem that you wanna solve. And atStrata, we spent over a year and a half doing that, and that meant interviewingdozens of companies and asking them. What is your top priority that isn'tgetting done and having a really open-ended conversation where you're notbiasing what they're saying based on what you want them to say.
And that's reallyhard because oftentimes founders, you're like, oh, I'm gonna build this, thisthing. So why don't ask people if they wanna buy that thing? Sounds like it'sthe same thing, but it's totally different because. What happens is the biasthat people, they say what they think they that you want them to say, and sothey don't wanna say, your baby's ugly.
So they'll tellyou, oh yeah, that's a great product. I would definitely buy that. And then yougo down, you build that, and you go back to them and say, well, I built it. CanI have your order? And you go, well, it's actually not an important thing forme. I've gotta buy 10 other things. Before I could even look at that.
So why don't youcome back later? Yeah. Because you're number 12 on the list. If you're notnumber one, two, or three on their list. Don't build that product. Don't startthat company. Yeah. Because it's very, very hard to get onto someone's prioritylist. You can't make someone's priority. You need to fit into that.
And so I thinkthat's probably. The evangelist kind of market making approach is to really bea reflection of what people are saying is their top one, two, or threepriority. And then once you start to focus on a market, the next content thatyou produce isn't about your product. It's about the problem.
Mm-hmm. And so, InStrata's case, we wrote all these, I wrote probably seven in white papers, allabout the problem of multi-cloud, all about the problem of identity, all theproblems of modernization and authentication, and all of these things. And Iwas creating this corpus of thought leadership. And you put those PDFs out, put'em on your website because you will need the search engine.
Optimization tokick in, right? So the sooner you plant that content, the sooner you're gonnahave an index. And relevance, what are we doing this for? Because what we needto do is know when someone searches that we don't know, they go onto Google andthey search, how do I solve identity for multi-cloud?
At that point,Google is gonna say, ah, I came across this content written by this person. AndI'm gonna give you a link to that. Yeah. And the more that people start to goto that content, it starts to build more and more credibility. So all of thisstuff takes a long time, and it's very, you need to be very humble because youdon't want to talk about you or the company or your solution, because peoplearen't searching for that.
They don't searchfor something. Yeah. They search for. That exists. They search for the answersto their problem. So it's kind of taking a long way in many sense, in, in acertain sense. But yeah, that's the only way to go. And when you do that, yeah,the right way, then all of a sudden, if you're lucky and your problem becomes amarket, Then you've got all of the track record that puts you into that highranking on the search results.
And that's mattersfor enterprise companies. It's not just like consumer companies that care aboutGoogle ranking. So, sorry, that's a long answer, but it's, it's unconventionaland I think that's the, isn't it?
Julian:Yeah. Yeah. Yeah. And, and thinking about, obviously that was great advice forother founders.
What's something inparticular that you're better at now as a founder that you wish you were betterat earlier on? Anything kind of come to mind?
Eric: Ithink one of the things that, now I've been a venture backed CEO three times.One of the things that I have is a. Recognition that you need to make decisionsbased on very limited information, and it's better to acknowledge that youdon't have enough information to make a data driven decision than toextrapolate from a tiny bit of data to think, oh, I've, I'm convinced based onthese two data points that I'm right.
And consequently,I've been more deliberate about managing expectations, about decisions that Ineed to make that require a lot of data. I try and put those off for as long asI can, as I get as much data around that as I can. So I have a thing I like to,to say. I think Voltaire was the first to say it, but don't make perfect theenemy of good.
And so what I meanby that is, Yeah, you may not sell to everybody that you talk to, but it'sbetter to talk to more people than just the ones that buy from you because youget better data and it's the data set that you need in order to make aninformed decision or a forecast. And so really saying, look, I don't want tomake a forecast if I don't have confidence in the data, and don't say I can'tgive a forecast.
Go get the data andthen come around with the forecast. So it's just being data driven and it'salways a lot more work than you may wish it would be to get that kind ofinformation.
Julian:Yeah. Well it's, you bring up an interesting point being that, the landscapes change,VC dollars are not as, readily available and, and I think, there's a lot ofchanging in the ways that they invest in terms of thinking about profitablecompanies that drive revenue versus.
Users and eyeballsand things like that. I feel like there's a little bit of a paradigm shifthere. So for those founders out there, what can they be doing to create, abetter narrative, a better product, or even just a, a better case? For acompany or for a venture, group to invest in that founder being that, thelandscape has completely changed.
And, and I thinkfrom what I've seen is there's a, a big incentive to be a mature company with,strong operating principles so that you can kind of, not only, even if you'renot growing hand over fists month over month, you can at least track what thatprogress is. In, in that vein, what are some things that founders can startdoing to start making themselves more competitive for when they need to startfundraising?
Being that thelandscape's changed?
Eric:Yeah. I think the, the thing that's really changed in funding, it's allcyclical, right? So it's some constant change and the thing that has changedspecifically in probably the last 12 months has been a shift from. The priorityon startups grow at any cost, and now it's to extend runway as long as you can.
And so it's, it's,it's, you're lucky if you can make that pivot in strategy before you're in oneof those rounds, right? And so mm-hmm. You can come up with an operating planthat you can be successful with, and that fits the. The climate that you'regoing into would be specific. Yeah. In the end of 2021.
Right. So thefourth quarter of 2021 people couldn't get enough of startups and thevaluations were astronomical. And you could go and you'd have VCs. Saying, oh,I'll give you a better valuation cuz whatever the reason. Right? And sovaluations were very much in the favor of the founders and that shifted verymaterially within six months.
So by the secondquarter, mm-hmm. Of April is when I saw it, April of 2022, the conversation hadsnapped all the way in the other direction where it was, hey, Yeah, the worldhas changed. The public equity markets are re correcting, and thereforevaluations are a fraction of what they were three months earlier.
And why does thatmatter? Well, when valuations are higher, you can raise more money at the sameamount of dilution. And with that higher amount of money, you can hire morepeople and. Ostensibly, if you're hiring sales teams, you're gonna get morerevenue because each sales team is gonna produce, sales.
So when the amountof money that you can raise goes down because valuations collapse in terms movein the favor of the investor. Now you're thinking, well, I may have half theamount of capital I was expecting, and therefore it's not about getting all ofthe the top line revenue. It's about making that smaller amount of capital lastlonger so that you can prove whatever stage you're in, you can prove you'regetting to product market fit.
If you're a seriesA company or you can prove you've got a good repeatable go to market if you'rea series B company and the yardstick or the goal line had changed, where nowit's all about survive and don't raise money for as long as you can. So that, Ithink is, is the kind of thing that I keep my eye on all the time.
I'm alwayswatching. The burn rate, and we basically have said, look, we're not gonna hireour way into growth. We're gonna execute our way into growth. And so instead ofhiring headcount, we get a focus on productivity. So the sales teams are allexpected to do, hit their quota. And in our case, fortunately that's gonereally well, but that's, A market, different plan than if we had gone out tofund in, the end of 2021.
We had a verydifferent playbook. Mm-hmm. So being really responsive to the marketconditions, I think is what will separate companies from those who need to dolayoffs from those who didn't hire too many people in the first place. And youcan hit equilibrium. One on either way, but it's easier if you don't have tolay people off because that's very disruptive and no one wants to go throughthat.
So yeah, beingreally adept at reading those signals and adjusting your hiring plan and yourcapital, I think that's the, the balance that entrepreneurs need to focus onright now. I do anyways.
Julian:Yeah. Yeah. I know we're coming to the close the episode, so I always like toask this question cause I love how founders extract knowledge out of anythingthat they ingest, whether it's early in your career or now, what books orpeople have influenced you the most today?
Eric:Well, books or people. Yeah. I think in terms of, of books, there are. Acouple. I was just talking to my daughter this morning and we were talkingabout two different books and one is a book by a called Siddhartha by HermanHess. And it's kind of an explanation of, of the story of Buddhism basically,but yeah, in a very accessible way and that framed a lot of my outlook on life.
And my daughter,she's 16 and she was asking, what, what's an important book to read? And, and Iwas telling her that I think would be a early foundational one. And thenthere's another one that I think would be good for anybody, but I'm thinking ofmy daughter to read in a few years, and it's a book called The Fountainhead byAnne Rand.
And that affectedme a lot when I was trying to figure out like, am I gonna go out and dosomething on my own and be an entrepreneur and have that conviction and to gofollow the discipline in, in direction? I'm gonna go. When everyone's gonnatell me that I'm wrong to have the ability to choose my line and, and followthat I thought that book Fountainhead was, was really powerful in that.
And it, I read ityears and years ago. Yeah. But I like, those are two good books that are top ofmy mind right now. Sid Siddhartha and the Fountain Head. Maybe the only personwho put those two together, but that worked for me.
Julian:Yeah, you definitely are. I've never had those examples, but I, that's why Ilove to ask that question because I think founders, it shows maybe their periodin time or even just what impacts you and, whether it's strategy or philosophyor.
Autobiographies is,it's a way to kind of take your way out of the present moment, kind of do somepersonal professional spiritual growth, but then kind of recharges you backinto, and it, I'd love to kind of, get at what inspires other, other people.But last question before we give you a chance to give us your LinkedIns andTwitters and all that good stuff, is there any question I didn't ask you that Ishould have?
Is there anythingthat we didn't talk about that I should have brought up? Anything at all thatwe left on the table here today, Eric?
Eric: Ithink you covered a lot of, of all of the, the, the brass tack and, and waysand inspiration to to become an entrepreneur. I guess what I would, I would sayless of a question, but more of just share a point of view is that there are,Certain types of people that lend themselves to working in startups.
And there are thosewho probably would not survive or thrive in a startup world. And I would justencourage people that are thinking about making the plunge to leave corporateworld and go into a startup. Is to have a really clear-eyed conversation withyourself about what the world, how different the world is in a startup than itis in a big company with a lot of stuff set up.
And where I've seenpeople that thrive are the ones that deal with change and they don't get putoff. And also, Noper perfectionist because you don't have time and the luxuryto get it perfect. You just need to get it good and make it better. And so Ithink really for people who have a good, who love startups, right?
Like myself, I love'em and I, I can't imagine not doing a startup, but I also like to do thingsthat are really hard and. I, I love the challenge and the ambiguity and therapid change. But I have seen people who thought they liked it or they, itseemed almost like romantic. Like, oh, I'd love to work in a garage.
And then they'reworking in a garage and then, oh, well where's the cleaning service that comesin? And we don't have that. There's a garage, so, be careful what you ask for.Yeah.
Julian:Yeah. Yeah. I always like to think about like, when I was making the plunge, itwas like, I guess coming to terms with the life I was okay to lead versus whatis prescribed out there for you.
I like how youbucket it up and there's no right or wrong, decision. It's just what's rightfor you. And then just being okay with it's not glamorous during the first fewyears. But the, if, if you enjoy it and you like it, you learn. Exponentiallyin terms of what you would learn in, in the other bucket if, if you're not thattype of person.
So I love how youkind of summarize it there and last little bit, Eric, is where can we find you?Where can we be a fan? Give us your plugs. What are your LinkedIns, yourTwitters, where can not only be a fan of Strata, but also you as afounder?
Eric:Yeah. Wonderful. So on the company, if you like, what I've been sharing aboutidentity orchestration and securing these complex worlds, Our website is agreat place to start, and you can find that at strata.io.
That's S T R A T Aio. And if you go and share a challenging use case in identity we've got a, anice little promotion on our website at Strata io slash podcast where you cansend in your identity challenge and if we can. Show you a demo of it. We'll, inpractice we'll solve it and we'll give you a pair of the Apple Air AirPod Pros,and that's kind of fun.
And then if you'reinterested in, in following me, I'm on LinkedIn and at the LinkedIn profile my,my handle is bought, not sold. And that's the way you can find me on LinkedIn,Eric Olden. Also I'm bot not sold and yeah, I would love to be in touch,connect with me on LinkedIn or follow however you'd like to continue theconversation. I'm happy to help.
Julian:Absolutely. Thank you so much, Eric. It is been such a pleasure chatting withyou. I hope you enjoyed yourself on Behind, Company, Lines, and thank you somuch for joining us today.
Eric:Thanks for having me.