Zoho breaches $1 billion revenue mark

NEW DELHI: Zoho Corp on Tuesday, announced it has breached the $1 billion revenue milestone even as the software as a services (SaaS) major witnessed growth slowdown this year compared to last year.

Giving an overview of its performance and plans, Sridhar Vembu, CEO and co-founder, Zoho Corp, said, “Our diversified product portfolio that saves money for customers has helped us. We will serve our customers by bringing the highest quality offerings at affordable prices.” Revenue, costs and profits, he opined, were key components that drove investment and growth cycles. “Profit drives investment in capabilities. This is elementary. Building capabilities is how we build companies and the nation,” the business leader said. Heavily investing in R&D has paid off for Zoho.

Vembu said India continues to be leading Zoho’s growth as the annual revenue surged 77% in 2021. While US and Europe are its top two markets, the current pace of growth would elevate India among the top three markets. The Middle East and Japan are also showing traction.

Praval Singh,VP-Marketing and Customer Experience, said that over the last five years, the company’s compounded annual growth rate in India was 65 per cent. “India might continue to be the fastest growing region, since we are the most affordable business software and tech platform. We are seeing a surge in migration of users from other vendors,” Singh said.

Over 80 mn users around the world rely on Zoho and its 11,000-member workforce. “At Zoho, we believe technologists should practice more humility,” said Vembu, on the sidelines of Zoholics India, the company’s annual user conference. “After all, we cannot code more food, nor compile new energy. Unfortunately, recent developments in our industry amidst a backdrop of rapidly deteriorating global economic outlook, offer rude reminders of our own limits as technologists.

“Our industry has to learn to lower the friction of technology, so that technology becomes far more affordable,” added Vembu. “We own our tech stack,” he said, adding the company would look at opportunities to invest in silicon chip design companies.

The Chennai-headquartered company also announced its plans to open 100 network Point of Presence around the world in the next five years for providing users with faster network, and also double investment in blockchain and AI.

Zoho, which spends three times its marketing spend on R&D and has received 25 patents in the last three years, attributes its growth to strong R&D capabilities, diversified portfolio, and to businesses choosing unified offerings over single products.

Zoho has built its technology stack from scratch—from apps and platforms to network and data centres. To offer value and user experience, Zoho invests in developing core R&D capabilities and product development.

To a question, Vembu said, Zoho in the last decade had been able to come out with products that compete with Google, Slack or Salesforce. “The accounting software Quickbooks has exited India and Mexico, which is proving good for us,” he said.

Drawn by Sanskrit and the northern charm

Sridhar Vembu is known for pushing boundaries. He tells people to ‘use common sense’ when asked about his views on moonlighting. And he is keen on offering self-reliant solutions. Innovation has been possible due to sustained investments in new technologies. The company’s R&D to marketing ratio is 3:1. For instance, Genrobotics, a Zoho-backed company, has deployed 200 robotic machines across 17 states to address manual scavenging. Zoho is working to add an Indian language support for AI and blockchain technology for universal validation. This time, he spoke about an interesting machine translation approach using Sanskrit to translate between Indian languages. A full-fledged team in Tenkasi is working on this unique possibility. He also said the AI models would be built with privacy at the core so that results can be generated with less data and without personally identifiable information (PII). Vembu is planning a rural skill centre in eastern UP. Impressed by the infrastructure and the abundance of talent in this part of the country, he said, the company is mulling a R&D centre in north.