↑ BACK TO TOP

What does Okta do?

Okta is an enterprise-focused identity provider: they take care of managing usernames, passwords, and permissions.

cybersecurity

Last updated: July 4, 2025

The TL;DR

Okta is an enterprise-focused identity provider: they take care of managing usernames, passwords, and permissions so you can focus on your apps. 

  • If you’ve ever used “sign in with Google” to log into an app, you’ve used Single Sign On (SSO) - a way to outsource identity to third-party providers
  • When you build SSO into your app, you use Identity Providers (IdPs) like Google or Okta to take care of the actual authentication
  • Beyond just basic authentication, Okta also helps with provisioning user accounts, mobile device management, and directory sync
  • Enterprises (really big companies) have tight security requirements – they’re often not allowed to sign contracts with vendors that don’t support SSO

Okta's share price has fluctuated since their 2017 IPO, reaching highs of around $270 in 2021 before settling lower. As more enterprises move to cloud apps, Okta continues to grow revenue 20%+ YoY.

Terms Mentioned

Companies Mentioned

Okta logo

Okta

$OKTA

The core Okta product: identity

Every app you use requires authentication – you have an account, and every now and then you need to prove that you are who you say you are, so you can use that account. The most popular method of implementing that is username and password, stored on company servers. But for reasons that are obvious to anyone sharing a Netflix account, this auth method is _not _ideal: you need a different username/password for every service you use, and passwords are very hackable. If you’re a large enterprise, you don’t want your employees creating new accounts with vulnerable usernames and passwords for all of the tools they’re using. So instead, you will outsource authentication.

Okta is one of the companies that you might outsource this to. The easiest way to understand this is through the perspective of the user: let’s imagine today is your first day working at FedEx corporate (an Okta customer). FedEx uses a bunch of tools that you need access to: Looker for data, Salesforce for a CRM, and Gmail for email.

If FedEx is using SSO (they are), instead of a username and password for each of those tools, you have one Okta login that you use for all of them. When you load the Looker app, it will prompt you to sign in via Okta, and you’ll get redirected to an Okta login screen. If you authenticate with Okta successfully, you’ll get sent back to Looker and can get started.

Single Sign On and IdPs

Every app you use requires authentication – you have an account, and every now and then you need to prove that you are who you say you are, so you can use that account. The most popular method of implementing that is username and password, stored on company servers. But for reasons that are obvious to anyone sharing a Netflix account, this auth method is not ideal: you need a different username/password for every service you use, and passwords are very hackable. 

Access the full post in a knowledge base

Upgrade to learn more about SSO and IDPs like Okta, plus the rest of the Okta product suite.

Knowledge Base

Analyzing Software Companies

The products and business models of leading software companies.

$199/month

What's a knowledge base? ↗