From Chennai to California : Journey of a Silent Entrepreneur

Sridhar Vembu, CEO,  Zoho Corporation.

Forbes quoted him as “Smartest Unknown Indian Entrepreneur”. He is unorthodox: it is pretty common to be so. He is frugal: typically Indian middle class. He is both, which might be why Marc Benioff is afraid of him and Mike Moritz wants to invest in him. By turning them down, he has proved his passion to be unbound. He was quoted saying “Freedom is delicious”, and rightly said too. We are certain most of you would not have heard of Sridhar, but you will surely be influenced once you start reading, just as we did. He is, yet another successful entrepreneur in his chosen, less trodden path.

GSG Team had an exclusive interview with Sridhar Vembu, CEO, Zoho Corporation. Zoho Corp formerly AdventNet is an Indian start-up was started in 1996. It has three divisions Web NMS, ManageEngine, and Zoho.com. Zoho is the online collaborative and productivity applications suite which competes with Google Docs, Microsoft Office, Salesforce.com and a lot of biggies in the market. ManageEngine is the IT Management Software division which is trusted by IBM, Infosys, NASA, US Army and many more. Web NMS, the first product of Zoho Corp, has had its impact on networking giant CISCO, NOKIA, Sony-Ericsson, Motorola and quite some others.

GSG team had the privilege of interviewing Sridhar. He talks about his childhood, college life, his mentors, Zoho and it’s future.

1. We have not heard much about your family background and childhood days.  What was your state of mind, dream and primary goal as a student?

I was born in a small village called Umayalpuram, which is in Tanjavur district in Tamil Nadu, India. It was the custom at that time (and still the custom in most rural areas in India), I was born in the home of my maternal grandparents.  My parents were from a rural background, and had moved to Chennai a few years before I was born. I grew up in Chennai but spent every summer and many major holidays in my father’s village, so I had an early exposure to both urban and rural India.  I attended fairly modest free government-supported schools in Chennai, was educated in Tamil medium until my 10th standard, with English as the second language. Until I reached 8th standard, we used to sit on the floor, because our school could not afford benches. I still see many such schools – in fact, my guess would be that majority of Indian kids attend such schools, so it was not unusual.

The best part about my schooling was that there was no homework – I never had homework through my entire school years. There were periodic tests, and I had the habit of studying just the night before the test, which was adequate because I had fairly good memory. This meant I had a lot of free time, which was devoted to reading and sports – I was an avid reader of Tamil magazines, novels and political commentary and I played a lot of street cricket. Even at a young age, I was well informed about Indian politics. For example, I hated the state of emergency that Indira Gandhi had imposed in 1975, and I remember passionately supporting the Janata Party in 1977 which came together to unseat her, to the extent of going around my village in a bicycle to campaign for them – I was 9 years old at that time.

When I was a school kid, I used to aspire to be a scientist some day, but that was some distant goal, not something I thought about much. More than any particular life goal, I had passionate views on things I witnessed as a kid – for example, un-touch ability, which was still practiced in rural areas, and the fact that Hindu widows were treated as second-class citizens. I felt those were fundamentally unfair and unjust. I could also feel the contradiction of our textbooks teaching us that un-touchability was evil, read about Mahatma Gandhi’s teachings, yet see this evil practiced.

Around 14, I started to ask a lot of questions about poverty. I remember pestering some school teachers with “Why do they say India is a very poor country? Why are we so poor?” The standard answer would be “Population” or “Lack of natural resources” or even “We need a communist revolution” (some of my teachers really believed a revolution was coming, this was around 1982), none of which really satisfied me. I remember challenging one of my revolution-is-coming teachers with “If the revolution makes us all government servants, which is what you say would happen, wouldn’t everything be as inefficient as government offices or the telephone department or Electricity Board or the Railways? So why would such a revolution be good?” He would give a vague answer like “We would develop a new socialist consciousness” or such thing. But he enjoyed debating with me, he did encourage me to think for myself, and not accept statements made by authority, which was a good early lesson in life.

As a result of my fairly good memory as a kid, I did really well academically, so I was a favorite of my teachers. One of my middle school teachers had a significant influence, because she took a special interest in me, and pushed me to work harder. I had a mixture of fear and respect for her, and sometimes would resent her for pushing me hard,  attempted to rebel a couple of times, but too afraid to carry it out. Being a favorite of teachers is not often fun! One of my neighbors took a special interest in me, and he would tell me I should aim to get the top rank in the 10th standard state-wide public examinations. He was the one who planted that idea, and in 10th standard I worked harder than my usual level to get to that goal; in the end I got to 4th rank, which was disappointing. I remember feeling down about it for some time, but then my parents, who never had big expectations, cheered me up.

During my 11th standard, my school attracted an influx of “good” or “serious” students (because my school got a state rank in the 10th standard exams!), and one of them challenged me with “If you are so good, you should attempt the IIT entrance exams, and I bet you won’t do as well as you did in the 10th exams.” I didn’t know what IIT was at that time, but feeling challenged, I enrolled in a coaching class along with some of those “serious” students who had joined my school. That was when I discovered that my education until that date wasn’t that great, because the mathematics and physics problems were so hard. I slowly made headway, and I ended up doing well in IIT JEE, getting admitted to IIT Madras. In IIT, I was mostly an unmotivated student, cramming just the night before exams, settling for a respectable grade, without having to work too hard. One reason I was fairly unmotivated as a student was that the faculty in IIT was worse than I thought, given its billing as the best institution in India and the system simply didn’t challenge the bright students it had taken. The best things I remember about IIT were political and philosophical debates with some very smart friends, and an article I wrote in the student newspaper asking if IITs were worth funding for the government because most of the faculty were not very good, most students were not very challenged, and most anyway went abroad, so why should the government subsidize all this when there were other pressing problems in India?

After IIT, I went to Princeton University to get a PhD in Electrical Engineering, with the intention of becoming a Professor eventually. My Princeton years were fairly boring and sometimes lonely (new country, new culture), other than meeting my soon-to-be wife, which was the most enjoyable part of it! I came to Princeton with a dream of becoming a Professor, but during the course of my work, discovered that I had serious differences of opinion with the state of academic research in my area, as well as broader academia. When I was finally done with my PhD, which was highly abstract and theoretical (and increasingly out of touch with reality), I resolved to myself to seek employment as an engineer, and do something practically useful.

2. Who,  would you say, influenced you in defending your dreams and pushing your limits further?

I had many influences, starting with my middle school teacher who pushed me hard, my high school communist teacher who I vigorously debated. In IIT, I remember hitting the library to read authors like Bertrand Russel, George Orwell and Ayn Rand, none of which were part of any syllabus or official course of course, which meant it was really interesting! I spent more time with such books than any official text book in Electrical Engineering. The one benefit of all that eclectic reading was that I learned the habit of thinking clearly about a problem.

After finishing my PhD, I joined Qualcomm in 1994, which proved be a very stimulating environment. I enjoyed working with many outstanding engineers, whose talents impressed me, inspired me. and often humbled me. I felt challenged, and worked hard to learn. I stayed only 2 years in Qualcomm, but I learned more in those 2 years than I had in the previous 5 years of academia.

One of my big inspirations is Dr. Andrew Viterbi, a co-founder of Qualcomm, who has had an outstanding career as a professor, technologist, inventor and businessman.

3. What motivated you to become an Entrepreneur?

My brother Kumar joined Qualcomm as a software engineer in late 1994, because he wanted to be close to me, and because I told him Qualcomm was a great place to work. He had worked in India as a software engineer, and around 1995, we would discuss ways to do something in India.  After achieving some degree of personal prosperity – I was always frugal, so my needs were fairly modest – I remember feeling “My destiny is not to live the good life now, I have to do something in India.” It always bothered me that we are so poor in India, and by 1995, I had a good idea that business and enterprise were the key to prosperity. While I had a really good job, and enjoyed the work, this gnawing feeling about India made me take the plunge, rather than keep thinking about it.

4. What are your suggestions for students who are caught between onsite opportunity and Higher Education?

I don’t know why these two are the only choices! There are other choices too – like working in a good company, starting your own thing etc. A lot of “onsite opportunity”, unfortunately, is fairly boring outsourced work, so be careful what you aim for. On higher education, read my response to the next question!

5. Is Higher education(phd) a must to become an entrepreneur?

Absolutely not. Take the top entrepreneurs in technology: Bill Gates, Steve Jobs, Larry Ellison, Michael Dell and Mark Zuckerburg. They are very different people who built very different companies, but one thing common among them is that none of them finished college.

6. What, in your life, would you say was a failure?

I consider my PhD to be a failure, though I published the requisite papers in the requisite prestigious journals, completed the dissertation and so on. One thing I learned early on was to think clearly and face reality head on rather than deny it to myself, and once I made a somewhat belated realization that my PhD was a failure, I resolved to not stay in academia as faculty (which was the natural and expected path until then), and changed my path. I consider that to be one of the best decisions I made in my life.

7. Tell us little about Zoho Corp and the story behind the name zoho?

Zoho Corp used to be known as AdventNet, which itself had its modest start in 1996. The two most important contributors to its early success were Tony Thomas and my brother Kumar; Tony had envisioned and implemented early product ideas that made us money, and Kumar set up our engineering organization in India which is the core of the company to this day. The Zoho name was suggested by Raju Vegesna, who serves as the Zoho evangelist. He persuaded me to purchase the domain for $5000 in 2003 in spite of my initial reluctance. Little did I realize at that time that we would end up changing our name to Zoho Corporation, which we did in 2009.

8. What are your dreams and plans in the future for Zoho?

We will continue our tradition of investing heavily in engineering R&D. We hope to introduce interesting new products, to address a variety of customer needs. With the continued growth of the company, I feel fortunate that we can attempt many interesting projects, which excites the engineer in me. One thing we don’t plan on doing is to take the company public, which I believe will destroy our freedom to do interesting things.

9. When we had an opportunity to talk with one of your employee, we asked what interests him to work in Zoho Corp? He said, ” We have an excellent work culture and environment which keeps us going. I can say, with no doubt, this is one of the best places to work.” What do you say about this?

Wow, I hope we are not brainwashing that much!

Seriously, I hope we can keep it that way. That is a challenge as we grow. That is one of the challenges that I worry about. It is all too easy to become a soulless bureaucracy.

10. We also heard some of your employees say, “More than an employer-employee relationship, Sridhar is very concerned about the welfare of every individual.” Is it because you personally feel a gentle human touch can make miracles than enforcing laws? How well is it working for the organization?

What is an organization? It is a community of people who come together for a common purpose. If we don’t have that community, if we don’t have a sense of belonging, it is merely a place we go to work. In such a place, there is no soul, no spirit, no passion, and as I like to say “God has left the temple.” We have to make a profit, because without it we will not survive as an organization, unless we expect deeply immoral actions like getting bailed out by tax papers. To make an honest profit, we have to serve customers. We have a commercial motive, because I consider commerce to be one of the key enablers of culture and civilization. By figuring out and serving a customer need, we become better people.

*****

It  was a great honour for GSG Team to write about him and we would like to seize this opportunity to, not only thank him for his time, but also to wish him and his organization a great and successful journey.

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