Identity authentication technology provider Okta agreed yesterday to purchase US-based identity verification platform developer Auth0 in a $6.5bn deal enabling corporates NTT Docomo, Telstra, Deutsche Telekom and Salesforce to exit.
Auth0’s software platform enables app development teams to secure and authorise access for users, mobile devices and other applications. The acquisition is an all-share deal and is expected to close by the end of 2021.
Salesforce Ventures, a subsidiary of enterprise software producer Salesforce, led a $120m series F round in July 2020 valuing Auth0 at $1.92bn that included DTCP and Telstra Ventures, which represented telecommunications firms Deutsche Telekom and Telstra.
Bessemer Venture Partners (BVP), Sapphire Ventures, Meritech Capital, World Innovation Lab, Trinity Ventures and K9 Ventures also took part in the round, which increased Auth0’s overall funding to $333m.
The company had secured $103m in a mid-2019 series E round backed by Sapphire Ventures, BVP, Trinity Ventures, Meritech Capital, K9 Ventures and World Innovation Lab at a $1bn valuation, following $55m in series D funding from the same investors the previous year.
Meritech Capital had led Auth0’s $30m series C round in 2017, investing with NTT Docomo Ventures, a subsidiary of mobile network operator NTT Docomo, Telstra Ventures and existing backers BVP, Trinity Ventures and K9 Ventures. Its earlier investors include Silicon Valley Bank, Portland Seed Fund and NXTP Labs.
Eugenio Pace, Auth0’s co-founder and CEO, said: “Okta and Auth0 have an incredible opportunity to build the identity platform of the future. We founded Auth0 to enable product builders to innovate with a secure, easy-to-use and extensible customer identity platform.
“Together, we can offer our customers workforce and customer identity solutions with exceptional speed, simplicity, security, reliability and scalability. By joining forces, we will accelerate our customers’ innovation and ability to meet the needs and demands of consumers, businesses and employees everywhere.”
Morgan Stanley is financial adviser to Okta on the transaction while Latham & Watkins is legal counsel to Okta. Auth0 has retained Qatalyst Partners as financial adviser and Perkins Coie as legal counsel.
