Auth0 CEO and co-founder Eugenio Pace spent over 12 years with Microsoft, but had to make a decision once he realized his entrepreneurial itch, one he constantly felt, would never go away. That’s when Pace in 2013 set out with Auth0 CTO to conquer the identity platform market before taking over the company as its CEO in 2017.
Ladders spoke with Pace about his journey leaving Microsoft, his experience transitioning to the CEO role, and insight on his management style.
Why did you decide to leave Microsoft to found Auth0?
“Auth0 is technically my second company. The first company I founded when I just finished college..that was a long, long time ago. I’m an engineer, so I’ve always been hands-on in solving technical problems. My first adventure didn’t go really well, not because of the problems or because we weren’t solving a real problem…that we did well. But everything else that is required to build a great company was not really there. So I learned the hard way that building a great company is a team thing. You need great co-management, marketing, communications, finance and customer care. So, having a great product that solves a big problem is not sufficient…it’s necessary, but it’s not sufficient for creating a great company.
So that experience essentially sent me to many years of working in bigger organizations. I was fortunate to join Microsoft in 2000. In 2003, I moved from Argentina. I was working for Microsoft, Argentina. Then I joined Microsoft Corp here in Washington state. That was the best thing that happened to me because it was really the school for building a great technology organization. I spent 13 years there.
In 2012, I looked at my life and I was eager to…the ‘bug’ of creating something from nothing was still in me. It was like a pending assignment in my life. I didn’t want to die with any regrets. So I decided to take one year and try it again…this time hopefully wiser and with a little bit more experience about how to do it. That’s how it all started.
So at the end of 2012, I resigned. I started the company in January of 2013 with a really good friend of mine…we’d been working together for many years. We’ve been working in this space for a while. So the last five years at Microsoft, I was working on what eventually became the Microsoft cloud computing, Microsoft Azure. So I became really intimately connected with challenges of building software within your paradigm. One of the biggest challenges that I found was identity management and security. So we decided to start the company in that space. That’s how Auth0 was born.”
Can you tell us your experience as an Auth0 cofounder?
“I was really lucky being a cofounder. I think that being a founder of a company…you’re on your own with so many questions that need to be answered, with so many decisions that need to be made, important decisions. It’s not like you stop making decisions later in the life of a company, but when you are starting there are two extreme feelings you have, euphoria or terror. Nothing in between. So having somebody to bounce ideas with, somebody that is next to you to help you cope with what seems to be life and death decisions has been really, really valuable for me.
Of course, I was very lucky to have a co-founder that…we’re very complimentary as well. We’re not identical. So his interests, his focus, his skills, are not necessarily the same as mine. So being complimentary also allowed us to cover more surface and to spread our tasks in ways that made us more effective.
We don’t have maybe the same skills and focus and interests, but we have the same values. So the things that we consider virtuous in building a company are the same. So we care about the customer, we care about being a team, we care about the longterm success of what we do. We care about the products that we offer, the quality of the products that we offer…we want to be proud of that. Those things continue to be the core values of the company as well. So I think that that’s what made our partnership a success.”
What’s the most surprising aspect of being a CEO since you took over the role at Auth0 in 2017?
“I was surprised how much I would like it, actually. I guess I was the CEO for the first year of the company because Matias wasn’t…he was more product. The way we divided our work was he was product and I was customers primarily, and everything else that was required in building a company….so legal and all the rest of the finance and whatnot.
Then I realized that I had little experience in some key functions or key competencies for CEOs. One of them was fundraising. So as our company grew and we became bigger, we could take two routes. We could continue to grow organically or press the gas pedal and go faster. That requires fuel and fuel requires money.
I didn’t know how to do that, frankly. As I said before, this is my second company, but I never fundraised. I never went through that process. So I hired somebody, to help us through the process, that was better than me. That was one of the best decisions that I made. I found somebody that I trusted and he helped us through the next years in building the core foundations of the company. Also, more specifically, he helped us a lot with connecting with the VC community and getting the right partnerships to fund our growth. So all that stayed until 2017 when, once again, we realized that building a company is not just fundraising. Fundraising is really important…critical, I would say, for a company of our style, our type, and our growth profile.
Being the CEO of a company requires more than just that. So we made a decision to make a change. So I became the CEO again, focusing on the rest of the things that are required for a company…things like culture, team, longterm view, strategy for the company. I realized that, maybe back to your question of what was surprising, the biggest change for me was that I realized that the product I was working on was no longer the actual product. The product for me is the company, and the team, the leaders, the leaders that we have to bring in, the new functional teams that we didn’t have before, that we have to specialize and nurture. So my job today, and the product of my job, is the company itself. Not the service that we offer to our customers.”
How do you describe your management style? Has it changed as Auth0 has grown since its founding in 2013?
“When people ask me what advice would you give your 20-year-old self or your 15-year-old self, or even like my 2017 self… I’m hesitant because all the things that happened to me in life made me who I am today. So in a way I hesitate because I wouldn’t want to change those things…even the hard things. The things that I went through that didn’t work out or were not really successful, they shaped me in one way or another. I am a strong believer that the challenges are there for a reason. Even if you don’t believe in faith or that your life is already written….I don’t believe in that, but I do believe that the things that you encounter in life are always positive. They’re always there to make you better. So, if there’s one piece of advice I would give myself…that piece of wisdom is, instead of looking at problems as being bummers in life and being a victim of them, embrace them and turn them to work in favor of you.
You asked me about my management style. I think it hasn’t changed really significantly. I’ve always been somebody that has relied on great teams. It wasn’t like that early, really early in my career. One thing I learned quickly was that you can go fast on your own, but you can only go far when you build a great team. So being relentless in building awesome teams, bringing great people into the mix…people with different skillsets, with different interests, with different personalities. People with different aspirations and ambitions that make the composition of our team much better. So building the team it’s a trait in my management style.
I like to think of myself as a ‘leading by example’ kind of leader. So I don’t really ask people to do things that I wouldn’t ask or put myself through. So maybe it’s my background, the way I was raised, or my earlier experiences in life even before I started a professional life. I really always admired people that set examples for everybody else. That’s what I try to do.”
What’s your advice for leaders trying to stay ahead in a competitive space?
“In this business, it’s really tempting to focus on your competition. So, when you are in a space that it’s an attractive space…if you’re on your own, you’re alone solving these problems, you’re either way ahead of time, or you’re crazy and delusional. So typically, those are the two things. Being ahead of the time, being brilliant and such a visionary, it’s very rare. So it’s more likely that you’re delusional if you’re alone. So if you’re alone, that’s kind of like a red flag or a yellow flag. If you’re competing with somebody else, it’s usually a good sign.
It’s easy to obsess on the competition as opposed to being yourself. So if you focus on chasing your competitors, doing what they do, or maybe mimicking the tactics and mimicking their message, and the way they develop in the market, you will lose your authenticity. You will lose the opportunity of being unique and everybody is unique. Everybody has his own way of solving problems.
So I think a better recipe is to actually focus on your own strengths. Focusing on your own beliefs and having convictions. Having trust in your own instincts. Then, be humble to recognize when your instincts were wrong and fix them. Correct them and not be stubborn on things that are not working for too long.”
What’s the best piece of advice someone has given you?
“I was lucky to have good mentors and good teachers as well from all walks of life. So relying on a team, being authentic, being empathetic, being kind…those are things that I received from, well, gifts and advice. Pieces of advice that I got. From my family, from my parents, from my wife, from, as I said before, from teachers. They all revolve around those things. The core value or the core belief is this notion of focusing on the things that you have control, and not focusing on things that you don’t have any control of.
I live in the Pacific Northwest. Guess what? There’s not a lot of sun in the winter. It’s cold and it’s dark and it’s rainy and wet all the time. What can I do on those things? Not much. It’s the way it is. The one thing I can do is I can move somewhere else if I don’t like it.
If I were to imagine a life where you’re waking up every day of the winter in Seattle, and complained because it’s raining or it’s dark. Your life would be miserable because you have no empowerment to change that. So, the essence of what I do in business or in life is this notion that I focus on the things that I can do. Where I am empowered to change. Where I am empowered to put a dent in the universe. If I don’t have the full power, then I can focus on the things that I can influence. Maybe not full control of that, but I can influence and I can trick it and make the most of that. So, that’s the key message that I’ve learned from a bunch of people actually.”
Has Auth0 ever tried something that failed? What did you learn from that experience?
“All the time. If you’re not failing, you’re not doing enough. If you’re really afraid of failure, if you’re really afraid of making mistakes, then entrepreneurship is not for you, because you’re making mistakes all day long on everything. That’s the nature of the beast. It’s most of the game. If you’re not failing, I would argue that you’re not doing your job. I tell my team all the time, if you’re succeeding all the time, you’re not pushing the envelope far enough. You’re not questioning the status quo and there’s all kinds of things that will not work. As long as they don’t kill you entirely, if you don’t kill the company in the process, then you should embrace all those failures. Those so-called failures are really inputs into you. Now you know, it’s feedback. It’s a learning opportunity.
So you tried a new product, it didn’t work out. Nobody bought it. Nobody bothered. Nobody cared about it. Then you learn that you’re not solving the right problem. You thought it was a problem, but it’s not a problem for the market. So now you know that you don’t… Now you know an area where you don’t need to spend any more efforts.
The same happens with everything. You’re making decisions all day. Again, you should embrace failures. I always say, and this is not my phrase either. I heard it somewhere else. In this business there’s no success and failure. There’s success and there’s learning. It all falls into those two categories.
How do you describe the company culture at Auth0? What did you learn at Microsoft about shaping company culture?
“Our culture revolves around three core values that we have. The first one we call it ‘give a s**t.’ It’s about care. It’s a label we use for caring about everything we do. Taking pride over your work. Taking pride of the customers that we serve. Taking pride over the product, the things that you build. Making everything better.
The second one, it’s about continuous improvement. You can build the perfect thing that takes 10 years in creation and then it might be too late. So we believe in a culture that it’s always permanently becoming better. Maybe one small step at a time. Sometimes you take bigger steps and so change doesn’t need to be always small. You might ship a new feature a new product and entire new subsidiary. Everything is better than before. This notion that improvement is like a constant thing. You’re never done. As a side note, I’ll come back to the culture, although this is kind of related. It’s the notion of there’s no end. There’s no finish line for us. Therefore, we take a very longterm view on the business, right? I love really this concept that Amazon pioneered as a part of their culture as well. That every day is day number one for them. It’s very much the same for us. Every day you’re not done. It’s a permanent work in progress. So this is the second culture value of continuous improvement.
The last one it’s about teams. So it’s ‘one team, one score’. So sales, I don’t really like when people say or ask me, are you a sales driven organization, or are you a product driven organization or an engineering driven organization? I kind of cringe at that notion.
As I told you from my very first experience building a company, which was very much an engineering driven organization, we cannot go anywhere. We’re just engineers. Yeah, you can build a product, but that’s it. You need people to sell it, you need people to maintain it. You need people to market it, to make it well known to the world. You need all professions…everybody in Auth0 is here for a reason.
So there’s no superfluous role in our company. We don’t consider an engineer as more important than a salesperson, or more important than a marketing person or more important than a demand generations person. If we have that role in the company, it’s for a reason. Everybody has a role and is an important component of the whole. So it’s ‘one team, one score.’ We win as a team or we all lose. There’s no engineering loss or like a, ‘Oh we lost because we didn’t have that feature.’ No, that doesn’t happen.
As I said before, Microsoft was the best thing that happened to me in life. In professional life. It was a very good thing in personal life, too. Professionally, I learned so much about team and collaboration. Ironically, people have this perception of Microsoft being this competitive, pointing guns at each other, competing company. It might have happened in bigger teams, but I never felt that inside a team in Microsoft. I felt this strong collaboration between different disciplines, with high respect for all the disciplines. You could be an individual contributor in a team. You could be an individual contributor in engineering in Microsoft and make more money than your manager, and make more money than a salesperson because it was a reflection of how important that job was. So there was like all these attributes of value and teamwork, and global reach and longterm planning and strategy that I have carried over to my job here of CEO as well.
What advice would you give to someone interviewing at Auth0?
“The best piece of advice I would give somebody considering us is that we are a company of doers. We’re not a company of big ideas and no execution. So if anything, I would put an emphasis on what you’ve done as opposed to who you are or what your credentials are or where did you study or where you are from…yes, those things are elements.
But we care more about what you’ve done, what you’re capable of doing. Ideas are worth a dime. That’s the saying, right? I would say ideas are worth a penny. They’re not worth even a dime. It’s great to have great ideas. There’s a lot of people with great ideas, but turning ideas into action, it’s a skill and it’s really hard. And doing it well is really hard.
So I think the best would be to focus on what you’ve done. What your journey has been. What you’ve been able to accomplish in life. What you’ve been accomplished in your profession. How do you think those accomplishments can be translated or transferred into your experience inside Auth0? To getting things done here.”