From Near-IPO to Crash: How Strata Identity’s CEO Turned .Com Era Lessons into Category Creation Success

The moment is etched in Eric Olden‘s memory. It was 2001, and he was perfecting his IPO roadshow presentation when an investment banker walked into the conference room with news that would reshape his entrepreneurial journey: the IPO was off.

In a recent Category Visionaries episode, Eric recalls that pivotal moment: “I just remember thinking, that’s not supposed to happen. We’re supposed to go through this whole process and we’ve been getting ready for it and all that. I just remember having such a hard time accepting that.”

The Rise Before the Fall

The story began in 1995 at Berkeley, where Eric and his high school best friend spotted a critical gap in the emerging internet landscape: security. “Everyone said, oh, the Internet’s just for academic. You’re not going to use it for commercial purposes. And I thought, well, that’s not going to last. And the reason that people will hesitate to do things of substance on the Internet would be that they couldn’t secure it.”

Their company, Securant, grew to 300 employees and seemed destined for a successful IPO. But the .com crash had other plans.

Learning to Filter Signal from Noise

The crash provided harsh but valuable lessons about market dynamics. “What we’re finding at that time was how to sift out the bad ideas and find the ones that were substantial,” Eric explains. While others chased trendy but ultimately doomed ideas like Pets.com, Securant focused on Fortune 500 enterprises – a decision that proved crucial for survival.

The aftermath of the crash was visceral. Eric recalls a telling moment in a San Francisco restaurant: “The waitress was asking us for our drink orders, and everyone just ordered water… She yells back to the bar… ‘Can we get around for.com blowouts?'”

The Kung Fu Panda Principle

Years later, explaining his persistence to his son, Eric drew an unexpected parallel: “Remember the movie Kung Fu Panda, where he runs up those steps all the way, all the way, all the way, eventually gets to the top at the temple door… We had done the work. We’d gotten all the way to the door, and right as we’re supposed to go through it, the door got shut and we got knocked down those steps.”

This metaphor captures Eric’s philosophy on entrepreneurial resilience: “Get up and you go back up those steps. And if you fall down, then you get back up and you go back up again.”

Applying Lessons to Today’s Market

These experiences shape how Eric approaches today’s market enthusiasm around AI. “Now we go into the modern technology landscape and the new hotness is AI… people are now just saying whatever the business problem may be, and they’re going to throw some AI onto it, as if that somehow makes it a good thing, and it doesn’t.”

With Strata Identity, his third venture in the identity space, Eric spent almost a year interviewing potential customers before writing any code. “Wait, don’t start writing software,” he advises. “Get your hypothesis as vetted and validated as you can and document it.”

The Paradox of Difficulty

Perhaps the most counterintuitive lesson from Eric’s journey is his perspective on challenges: “If it was easy, anybody would do it and we wouldn’t have an opportunity. So if it’s going really easy, probably isn’t going to work.”

This wisdom informs Strata’s 2024 strategy: “The product expands, but our message contracts. And so I like to think about it as market the vision and sell the product.”

For B2B tech founders navigating today’s market uncertainties, Eric’s journey offers a valuable reminder: setbacks, even dramatic ones like a cancelled IPO, can become the foundation for future success – if you’re willing to keep climbing those steps.