Entrepreneurship Journey of Sridhar Vembu of Zoho: Taking Silicon Valley to the Village
| Case Code: LDEN176
Case Length: 17 Pages
Pub Date: 2021
Teaching Note: Available
| Price: Rs.400
Organization : Zoho Corporation
Industry :Technology & Communications
Countries : India
Themes: Entrepreneurship, Entrepreneurial Strategy, Human Resource Planning,Leadership Style
Abstract Case Intro 1 Case Intro 2 Excerpts
Humble Beginings of The Venture
In 1996, Vembu had multiple discussions with his brothers Kumar Vembu (Kumar) and Sekar Vembu (Sekar) about starting a software company. Vembu said, “My brother Kumar and I were in the US together in 1995 and we constantly spoke about what we could do with our talent, about how we could make a difference in the lives of people back home in Chennai. We wanted to make money, but more importantly we were passionate about making a difference.”..
Re-Defining The Company With Cutting-Edge IT products
In 2001, Vembu took over as the CEO of the company. At that time, most networking businesses were undergoing a major downslide due to the Dotcom bubbleburst , as a result of which Zoho lost several of its clients. However, Vembu spotted a new opportunity during that phase. He realized that there was a new IT trend – a shift to cloud-based technologies . In order to leverage the trend, he decided to build a suite of products for the cloud, thereby diversifying the company’s offerings. A large part of the company’s resources and engineers who were idle were then diverted to the task..
The Business Principle – Absolute Bootstrapping
Right from the start, Vembu’s venture was completely bootstrapped without the backing of any external investment. In the early days, Vembu claimed that no venture capitalist (VC) had shown much interest in investing. Speaking about an incident with a prospective investor, he added, “We had a venture capitalist who came to our booth at a trade show in 1997 and told us we were thinking very small. But my thinking was that if I could make some capital doing products for companies, then I can think bigger.” ..
Molding a Software Engineer: Zoho University
As a start-up and even as the organization was growing, Zoho struggled to hire the best talent, as getting high-quality talent from the premier institutes of India to work for the company involved a steep cost. That struggle triggered the beginning of Zoho University (ZU) by Vembu in 2005, through which he wanted to identify and mold overlooked talent. Vembu embarked on a mission to build an army of software engineers, who apart from their conventional degrees, had in-house training..
The Move to The Village
In the early 2010s, Vembu established an office – with a six-member team — in seven acres in the village of Mathalamparai, around 650 km from Chennai. Vembu decided to set up an office there, after he realized that most Zoho employees hailed from around that area and he wanted to reverse the trend of rural-urban migration..
Does the village workplace model work?
Zoho’s move happened much before the Covid-19 pandemic struck India and the rest of the world. Vembu thought Zoho’s presence in rural India was providential, as it enabled people to work from villages at a time when Indian cities were starting to face major challenges due to Covid-19 related lockdowns..
Vembus’ Swadeshi Sankalp
Vembu made sure that Zoho helped student communities and the Government of India (GoI) in the tough times of the Covid-19 pandemic. In April 2020, the Jammu and Kashmir union territory administration in India launched the first Coronavirus Response Call Centre in Srinagar. ClearWire Technologies, the company which operated the call center, used the technology provided by Zoho Desk. Zoho planned to extend the free licences of Zoho Desk to all the other state governments in India to enable them to help Covid-19 affected people..
The Road Ahead
Vembu was awarded the ‘Ernst & Young Entrepreneur of the Year Award for the year 2019’ . In January 2021, the Government of India conferred on him the Padma Shri , the fourth highest civilian award in the country. Furthermore, he was appointed as a member of the National Security Advisory Board (NSAB) . Vembu said, “I returned to India to serve the cause of technology led rural development and this advisory role affords me another opportunity to be of service to the nation.” ..
Exhibit I: The Eleven Lessons of Entrepreneurship from Vembu
Exhibit II: Major Divisions of Zoho
Exhibit III: Benefits Gained by Shifting the Zoho Offices to Rural Areas
Exhibit IV: Zoho Apps for Swadeshi Sankalp Initiative
Exhibit V: ZOHO’s Presence Worldwide- 2019
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