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“In view of the various challenges and opportunities facing us, including recent major developments in AI, it has been decided that it is best that I should focus full time on R&D initiatives, along with pursuing my personal rural development mission,” the Zoho boss said, on social media platform X.
“I will step down as CEO of Zoho Corp and take a new role as Chief Scientist, responsible for deep R&D initiatives,” he added.
While no specific reason was provided for the Zoho co-founder’s sudden move, the fact remains that Sridhar has himself spoken at great length about his passion for rural development, especially on the academic and tech front.
The Zoho boss has also been embroiled in a legal battle on the personal front, where his estranged wife, Pramila Srinivasan, has accused him of abandoning her and her son with special needs.
Pramila’s allegation is that Sridhar moved to India for good, while also transferring a majority of his stake in Zoho to his sister, Radha and her husband. Sridhar responded, claiming that the allegations were “unfounded” and “complete fiction”. The case is sub-judice in a California court.
However, with Sridhar’s recent departure as Zoho CEO, the company will see a host of changes: Zoho’s co-founder Shailesh Kumar Davey is expected to take over as its new CEO while another co-founder, Tony Thomas will assume charge of the SAAS major’s US markets. The company’s enterprise arm, Manage Engine, will be led by Director of Product Management, Rajesh Ganesan.
Sridhar’s announcement is especially significant since it involves him moving away from a position he has held for nearly three decades. Zoho, founded in 1996, has always had Sridhar at the wheel, even as the company has remained stoically bootstrapped. However, the company has seen many a milestone with him at the helm.
Rural product building:
Perhaps Zoho’s biggest leap came 20 years after its founding, in 2016. Around this time, the company launched a brand-new product development centre, in Tamil Nadu’s Tenkasi district. What this meant was Zoho would continue to invest and build products for customers around the world, but now do it from a small town in Tamil Nadu. Today, Zoho’s Tenkasi office is a major Zoho hub, with an employee headcount of nearly 1,000.
Launch of Zoho One:
The very next year, Zoho launched one of its most keenly awaited products. Zoho One was a comprehensive business suite that saw the SAAS major bring 35 of its applications managing various businesses processes – sales, marketing, finance and HR – onto one platform. The move came hot on the heals of Freshdesk rebranding to Freshworks the same year, thereby prompting SAAS companies to take stock and provide a one-stop shop for all its SAAS applications.
Billion dollar baby:
Nearly half-a-decade later, Zoho crossed one of its most significant milestones – a billion dollars in revenue. This was especially significant given that it was a milestone crossed by a privately owned company that has never raised funding. In FY-23, Zoho registered revenues of north of ₹8,700 crore, which approximately converted to a billion dollars, which in itself was a 30% growth over the previous year.
Semiconductor foray:
Two years later in 2024, Sridhar Vembu confirmed in an exclusive chat with CNBC-TV18, that the company was foraying into semiconductor production. The company announced the start of a separate business unit, Silectric, which Sridhar said would focus purely on semiconductor production. Reports pointed to a $700 million investment and a possible production base in Karnataka’s Mysuru electronic cluster. However, the company hasn’t confirmed these developments yet.
With Zoho all set to begin a new chapter in its three-decade-long journey, the question on observers, customers and employees’ minds would be: how much of this legacy can the new leadership shoulder, as it shepherds the company into a new era? Navigating the AI boom, changing SAAS pricing, and a slowing economic growth might be a challenge, but for the leadership, it is a ripe opportunity to prove that the Zoho spirit may be made of finer mettle.
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