Okta To Buy Workflow Automation Startup Azuqua For $52.5 Million

Okta has agreed to purchase Azuqua to better automate the business processes and flow of identities between applications and services for employees, partners and customers.

The San Francisco-based enterprise identity vendor said its $52.5 million acquisition of Seattle-based Azuqua will enable customers to automate more of their business processes and connect to more apps. IT teams, meanwhile, will be able to use pre-built connectors and logic to create streamlined processes and increase operational speed, according to Okta.

"We've actually looked at this workflow identity process automation space for quite a bit and talked to a lot of different companies, and we are pretty fortunate to have found Azuqua and found a team that's so like-minded with us," Okta CEO Todd McKinnon said during the company's earnings call Thursday.

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Azuqua was born and built in the cloud with the same kind of engineering philosophy and vision of the world as Okta, McKinnon said. As a result, McKinnon expects concrete integration of Azuqua's workflow automation capabilities into Okta's life-cycle management product to be delivered in less than a year.

Since Okta's life-cycle management tool is already in the marketplace today, McKinnon said the company already knows how to sell and market the product and has an existing base of customers. The addition of Azuqua's capabilities should "supercharge" Okta's existing product and go-to-market motion, according to McKinnon.

"With the integration of Azuqua’s technology into our platform, we plan to rapidly deliver more advanced use cases by connecting more apps and supporting more complex workflows," McKinnon said. "We are excited by how this acquisition can accelerate our innovation and enable deeper value for our customers."

Okta's stock fell $5.71, or 7.03 percent, to $75.50 in after-hours trading Thursday. The company also said that quarterly revenue climbed 50 percent on a year-over-year basis to $115.5 million, with Okta's loss in the quarter ended Jan. 31 increasing to $30.8 million, 33.9 percent worse than a $23 million loss in the year prior.

Azuqua is a no-code cloud-based integration platform that helps customers automate data integration and workflows between different applications. McKinnon said Azuqua's capabilities around customizing and extending any business process will be focused on Okta's life-cycle management product.

"You can think about it as taking that breadth and depth of integration to a whole new level because you will be able to talk to any system, any identity, attribute in those systems and fully control very little code with a high degree of expressability," McKinnon said.

The deal is expected to close by the end of April, Okta said. Azuqua was founded in 2013, employs 61 people, and has raised $16 million in four rounds of outside funding, according to LinkedIn and CrunchBase.

Azuqua will make Okta's life-cycle management product more valuable to customers, McKinnon said, allowing Okta to drive more penetration to the customer base, land new customers, and maintain its strategic advantage. There's also the possibility that Okta will break out Azuqua as a separate product independent of life-cycle management after it's integrated and customers see the benefit of it, he said.

"When you think about integrating Okta to various different systems and the depth and the way you can model those integrations, Azuqua enables us to do that at a much deeper and more comprehensive level," McKinnon said.

This is Okta's fourth acquisition in the company's 10-year history, according to CrunchBase. The company most recently purchased cybersecurity startup ScaleFT in July 2018 to enable customers to more easily validate users, devices, applications and network information and securely grant access to data.