Hi Charles,
You do not need to purchase Azure AD licenses to use Okta as your identity provider for Single Sign-On to Office 365.
Okta can be used instead of the multiple tools/products ADFS, DirSync and Enterprise Mobility Suite (Azure AD & Intune). Okta is a single system for identity and mobility management for your Microsoft cloud applications and is the best for any non-Microsoft applications you have as well.
Read more about Okta & Office 365 here: