Interview with Raju Vegasna of Zoho

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This is first installment of the two part series interview I am conducting with Zoho founding team.

In this interview, Raju Vegesna shares the history of Zoho and talks about the future plans. If you have any questions for Raju, please leave them in the comments section.

Please share some information about Zoho’s founding team.
Zoho is part of AdventNet which has been around for 11 years. AdventNet was founded by Tony Thomas and Sridhar Vembu. Zoho is a division of AdventNet focusing on online applications

What was your trigger behind starting Zoho?
Around 2001-2003 after the telecom bubble burst, we had lots of engineering resources on hand. So we decided to enter different market segments. Online applications is one of them. We truly believed in online applications and Zoho was born from there.

Till date, Zoho has mainly used Bloggers (TC/GigaOm etc) for increasing product awareness. Being a product from India, how do you plan to reach out to global audience?
Most of the awareness actually came from users and bloggers talking about the product. Our focus is primarily on the product. If you have a good product, people will come to you. This is how we gained traction for our other products at AdventNet. We let products do the marketing. Also, many companies spend a lot on marketing. We dont do that. But instead, we have a very good free versions of our products (there is a free version for almost any product in AdventNet). The free versions of our products is our marketing investment. Currently, with minimal marketing investment, 50% of our user base is outside US.

How do you plan to compete with biggies like Google (in online office suite), Salesforce.com (CRM) and MS? Do you plan to target different market segment or play on price?
Price is definitely a very important factor and we will compete on price. But competing just on price is not good enough when we go against gorillas. We need to have a very compelling product. In some cases, we need to be 50% better than the biggies to gain 10% of the market share. So we focus on providing better solutions to our customers. A better product that is rightly priced definitely can get decent market share.

Very recently, Google launched Google gears – Do you plan to come up with similar offering?
You’ll have to wait and see. 🙂

Online office suite – one of the major challenges is convincing the IT depts to use such tools. While Google can always play on “free” software (and brand equity), how do you plan to increase user adoption of Zoho tools? Especially with regards to concerns over data security?
Enterprises with IT Depts are not our target markets. We focus on SMBs (Small and Micro Businesses) who cannot afford a full time IT staff on board. Online applications are ideal for these companies. Zoho essentially becomes an IT department for these SMBs. There is also Home office market. When you purchase a new computer at home, how comfortable are you spending for your office suite that you occasionally use? Thats a great market for us. In fact, ZOHO has derived from SOHO (Small Office and Home Office) which is our target market.
Note that all Zoho tools will remain free for individuals. For businesses, we have some offerings coming soon. Security concerns for online applications will be addressed by different vendors (including us) going forward. It’ll be a non-issue in most cases one year from now.

If possible, please share Zoho’s future plans/products in the pipeline?
In the near future, we are focusing on integration across multiple Zoho applications. You’ll see some announcements from us on this. We will also continue releasing new applications over the next few month.

stay pluGGd.in for the second part, as Zoho’s founding team will share few of their insights/ advice on entrepreneurship and will also answer candid questions on the web2.0 noise in India!

tags: , , adventnet

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