Published December 15, 2015
Volume 23, Number 12

Zoho Brings Innovative Business Software Suites to Market

Using a Traditional Business Approach

Zoho's building in Hacienda.

By Jay Hipps

There is a recipe for success that is well known to Silicon Valley startups: Start a software company, seek investment, and bring one product to market with the goal of either going public or selling out to another company. That is not the approach at Hacienda-headquartered Zoho, an international software company with an A-list clientele that will be celebrating its 20th anniversary in 2016.
“I guess we like business the old fashioned way, where you build something, make some profit, invest the profit back in the company, and grow from there,” says Raju Vegesna, Zoho’s chief evangelist. “All these basic values contribute to the kind of products we build. What do you do if your end goal is not going public or selling the company? You keep building. We keep building the various tools that a typical business needs. If you look at what we do, we build applications any business needs. In other words, you can pretty much run your entire business on Zoho.”
He is not exaggerating. “If you’re starting a business, let’s say a restaurant, you need a domain name, so you can come to Zoho and register a domain. You need a web site, so we offer a web site creation tool. You need to host your e-mail for your domain, so we offer e-mail hosting, and then you need to market your restaurant, so we offer marketing tools,” he begins. “You need to take care of sales, so we offer sales tools, customer relationship management tools. Of course you need to take care of your accounting and all of that, so we offer accounting tools. We offer access management tools, recruitment tools, HR tools, people management tools, collaboration tools, an office suite, project management tools. We offer about 30 applications that a typical business needs.”
It is a portfolio that is largely unmatched in the industry. “If you look at the companies that offer such a broad suite of applications, you can pretty much count them on a single hand,” he says. “We’re talking about companies like Microsoft, maybe Google, and then you’re searching for names, maybe Apple, and not even these companies offer the same breadth that we offer.”
Once again, it is a case of the company’s philosophy being reflected in its products. “When we take the long-term view of things, we look at the customer and think, why should they worry about all the things that are outside their core business? They should just focus on running their business. Unfortunately, they spend too much time on their IT. Why don’t we just offer all the tools that they need to run their business? It’s just like, you don’t worry about generating electricity for your business. You let someone else worry about it. Why should that not be the case for software? Why don’t you have someone else provide you all the software you need and you just pay based on the usage? And that’s the model here.”
Another novel element to the company’s business model is that Zoho itself runs on Zoho. “We are a 3,000 employee business. We have paying customers in 120-plus countries. At one point, we asked ourselves, ‘What if we run our own business on the tools that we offer?’ If we are able to benefit from it, any business that is less than our size — or in some cases, greater than our size — is able to benefit from it. So our company runs on the same software that our customers use.”
Because these applications are all developed by the same company, they are already integrated with each other — a factor which is a significant benefit to the company’s customers. “That is the angle that we come from, and we have seen the results,” Vegesna says. “This is a case where one plus one equals three. I think people certainly see the value.”
If the company’s user base is any indication, yes, they see the value. Zoho currently has over 15 million customers using their applications, with an accelerating growth pace currently over a million each year. The company was also honored last month with an Economic Driver Award from the Pleasanton Chamber of Commerce.

What drives Zoho’s growth is word of mouth. “People try our products, they like them, they recommend them to their friends. That has been the primary mode of growth for Zoho, and that gels well with the philosophy of the company. We are not under quarterly pressures to show numbers to Wall Street and all of that — we can take the long term approach and have a good, strong foundation of users and products, and the philosophy and culture that we do. We can focus on the things that matter.”
For additional information on Zoho, visit the company’s web site at zoho.com.


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