When Todd McKinnon wanted to quit his well-paying job to launch a startup in a recession, he knew he’d have to convince his wife, Roxanne, that he was not a lunatic.
So that’s exactly what he did. McKinnon, who was also a new father at the time, created a PowerPoint presentation in 2008 for his wife subtitled “Why I am not crazy,” outlining his plan to start a new business without hurting the family’s finances – even if the new venture failed.
Beyond being assured of their financial security, McKinnonsaid Roxanne wanted him to promise something else: That he’d be home for dinner every night.
His campaign to win his wife over worked. So he left his job as head of engineering with Salesforce and cofounded Okta (OKTA), acloud security company. Among other things, Okta (OKTA) streamlines and secures the sign-in process to a company’s IT systems, so employees need just one user ID and one password to access every program they need for work.
McKinnon now believes that his promise to be home for dinner helped make him a better CEO. He said he would leave the office no later than 7:00 pm to be home for dinner with his family.
Leaving while others were still in the office made him feel guilty and he would get back online later in the evening.
But thegoing home by 7 every nightforced McKinnon to take a breather, yield some control at work and gain a broader perspective. That became increasingly important, he said, as Okta grew from being just two people – McKinnon and his cofounder, Frederic Kerrest –in 2009, to over 2,000 employees across a dozen offices in six countries today.
“It’s really hard to go from completely nothing when starting a company to scaling a business,” McKinnon said. “When you have nothing, everything that moves in the company is because of you. That’s a very, very different way to operate than three to four years in when you have a team and a growing business. Less of your success is determined by how productive you are every minute than by you making the right decisions that will lead other people in the right direction.”
McKinnon and his wife had a 6-month old daughter at the time he started the business, and would later welcome a son. He saysraising kids also taught him something valuable about building a successful company culture with his employees. Both will watch you like hawks and take their cues from how you behave.
“You can talk about things [with your employees], but the culture is really set by how you act. … They don’t care what you say, it’s about what you do,” McKinnon said.
Early on, he chose to foster a transparent, collaborative culture where every employee feels like they have a stake in the company’s future.
Even though his initial instinct was to keep bad news to himself, he communicated openly with his team, even when things weren’t going well for the company and his investors were getting a little concerned.
“It really had a solidifying effect on the team. It made people rally together. It made people in the company feel like it was their company,” McKinnon said.
He made that feeling of ownership more tangible by paying employees in stock in addition to their paychecks, which he described as “undermarket.” And, he said, his employees’ stake was a key motivator to take Okta public.
“The real reason we went public is because I felt like the employees … needed a good way to get that return. I felt it was time for those employees to cash in their stock,” McKinnon said.
It’s been a pretty good ride so far. The stock has been trading around $129 a share lately, up roughly 660% from its $17IPO pricethree years ago.
McKinnon said he has never had an office and eschews other displays of top-dog status.
“If you want to make it feel like everyone’s company, the CEO and the rest of the leadership team can’t act like too much of bigshots. If they’re doing all these special things the employees can’t do, like having a big fancy office, then the employee by association is not going to feel like its theirs because they don’t have that.”
That sense of ownership and empowerment that McKinnon wants his employees to have also has translated into a pretty flexible work environment. For instance, he said, the company’s engineers wanted at least one day without meetings. “No-meeting Thursdays” have now become a big work-from-home day, too.
Similarly, he said, the company is bringing on more remote workers because Okta’s goal is to attract the best talent. “As we grow and are tryingto hire all these great people in all these various disciplines, we’re working in a more remote culture.”
