Zoho’s Sridhar Vembu With Arnab: Flipping the Script on India’s Rise as a Superpower (Transcript)

So it’s very difficult to start off with first questions for you.

Why Tenkasi? The Rational Choice

ARNAB GOSWAMI: Let me start with where you are in life as of now. We read a lot about you—the maverick who is determined to take on the world, but from Tenkasi, from his village in Tamil Nadu. So why not from Chennai? Why not from Bengaluru? Why not from Silicon Valley itself? What is the reason for this life choice, the corporate choice, the business choice you’re making and where are you placed in business and personally as of right now?

SRIDHAR VEMBU: At this moment, yesterday, we’ve been scrambling with this massive growth in RTI. So that’s where I am right now, in Delhi. That’s why I’m here. And Tenkasi will come to that.

See, it’s actually rational once you understand my point of view. We hear about the demographic dividend. Where is the demographic dividend being issued? Where are the people having children? If you look globally, the talent pool that is waiting to be tapped—that’s in India, primarily rural Bharat.

That’s where I say perhaps the biggest untapped global pool of talent resides right now. It’s born, it’s young, it’s hungry, it’s ready for the opportunity. And whoever—I tell you this—there’s going to be hundreds of billion dollar companies that can be created out of rural Bharat if you have the determination, if you have the passion, if you have the patience for it. So that’s why I’m there.

ARNAB GOSWAMI: So you’re saying that you are not in Tenkasi only out of a personal choice because many narratives about Sridhar Vembu say that he wanted to be in rural India, he had his own choice to live in a village rather than in a metropolitan. You’re saying it’s not only that?

SRIDHAR VEMBU: It is not only that. See, I’m also a businessman, I’m a technologist and I also have a passion for rural development. To me these are not—holistically, they’re one and the same. And what is good for our business is also good for our rural children, rural talent that’s coming out. And we have to link all of these together.

And from another perspective, lifestyle, for example—today we are in a climate change world and we have to go back to nature, we have to connect back with nature, we have to live in harmony with nature. And where is it most possible? That’s in, again, rural areas. And we have to revive our soil, our water, all of that too.

So to me, it is not just one goal, it’s not just the business goal, it is the demographics. There is a blatant potential talent pool and it is also that lifestyle and the spiritual connection to soil, water, trees, plants, animals, all of it. It’s all come together for me.

The Philosophy of Simple Living

ARNAB GOSWAMI: Another question people would like to know the answer to is when people run billion dollar companies, it shows in their lifestyle. They would be flying private jets, maybe have a fleet of a hundred Rolls Royces. You pride on frugality. You actually advertise austerity?

SRIDHAR VEMBU: I hope not. It appears to be the case.

ARNAB GOSWAMI: Because you know, the images of you that come out in the media—sitting under a tree with your cycle, cycling in your village—what drives you if money is not for your personal consumption?

SRIDHAR VEMBU: First of all, I really enjoy it. I mean that’s—if, I mean, out of all possible choices, this is the life I want. Okay, so that’s the truthful answer. I mean I could have any of a variety of life, right? This is what I want.

So why do I want that? This is how I grew up. You know, a lot of people, they are the childhood memories, right? What you best liked about your childhood? This is the part I most liked about my childhood. All of this rural India and all of the connection to the soil, go swim in the pond. This was my childhood. I’m simply living the dream life.

I always envisioned technology, all of that is work I do. And today, see, I’m blessed to be able to do it anywhere. The broadband connectivity, the 5G now, the fiber optics, all of it—it simply was not possible even 10, 15 years ago. Maybe perhaps for the first time in human history, we’re hyperconnected and we have not completely realized the economic potential implications of it, the geoeconomic implications of it. How jobs distribute, where prosperity goes, how lifestyles can evolve, all of it.

And so I like to think of myself as one of the early movers on this. And I think the future will look more like this. And it also has to, if we have—again that comes to the lifestyle. See my particular, my parents, starting with my parents and the communities, the people that I’m most familiar with, we emphasized simple living and high thinking. And that was always true. Right. However, whatever money you have, you have to have a simple life.

My parents kind of exemplified it throughout their life. My father passed away last year. My mother still is there. She is the guiding force in that. What is a simple life? Let me just say it this way. I don’t want a lifestyle which would be uncomfortable for her. And I don’t, you know, she would not be comfortable in a private jet sitting with me. She’s comfortable in a train and a bus. And she’s not comfortable going to a five star hotel. She wants to eat in an ordinary place where everybody eats. That’s how she is even today.

So I don’t want to do anything that will make my own mother uncomfortable. So that’s a very critical part. I grew up that way. I enjoy that life. I genuinely enjoy the life. We had a chat in Bengali market today. We really enjoyed it.

ARNAB GOSWAMI: I think we had a wonderful 500 rupee meal for two this morning. I think it was surreal.

Enhanced Focus Through Lifestyle

ARNAB GOSWAMI: Does this lifestyle of yours increase your focus on your business? If I were to ask you compare Sridhar Vembu in Silicon Valley doing this job to Sridhar Vembu in Tenkasi doing this job. Obviously geography, different culture, different lifestyle, different. Does your lifestyle give you a more intense or pure focus on what you need to do? Can you go into detail?

SRIDHAR VEMBU: In the last two years, maybe I’ve filed 25 patents. So that’s—I’m doing very deep technology work. A lot of patents are coming out of this. I run a very strong engineering team. About 70% of my time, personal time, is dedicated to technology, software. That’s where I am most. I mean, that’s my native environment, so to speak.

But it’s also the other part. See, I see Bharat from that one rural district up, not from Delhi or Chennai down. So it’s a very different perspective I get. So I go to the local temples and part of the local temple festivals, the rural—the tiny temples dotting everywhere. So I’m there. That gives me a very different perspective on life.

It’s not easy to explain it, but, you know, I see people who don’t have much, but very contented. And, you know, in rural areas, people don’t come to me and ask for money. It’s surprising. They have that, you know, that pride in themselves. They’ll give me a smile, they’re friendly. But it’s not like, “Hey, give me your money.” And everybody knows newspapers publish all the time. “Here’s a rich man living in your midst.” But nobody cares about that. So that is what there is, that contentment. So to me, that part of that whole thing is what I really enjoy about the life.

ARNAB GOSWAMI: So you feel you have more satisfaction running Zoho right now from Tenkasi than you did earlier?

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: You’re happier growing Zoho today. You think Zoho is growing faster today because you’re in Tenkasi?

SRIDHAR VEMBU: I believe so. And I am also personally more productive in a technical sense. Meaning I’m getting more work done.

The Bootstrapped Billion-Dollar Company

ARNAB GOSWAMI: Well, that’s, you know, this is the way you are and the way you’ve run this company. This company is also bootstrapped.

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: Now, how does one manage to bootstrap a billions of dollars in revenue company? Is it possible to do that? Because in today’s day and age, you’ve seen people only run after valuation and exit and valuation and exit and valuation and exit. And viewers, this is very interesting because here’s a person who doesn’t think of valuation and who’s never had an exit. Neither have you looked for private equity investment. Haven’t you been chased by all VCs, PEs, everyone the world over to invest in your company?

SRIDHAR VEMBU: Long time ago, an American journalist asked me the question, “What does exit mean to you?” I said, “Exit means only one thing. Death.”

ARNAB GOSWAMI: Morbid reality.

SRIDHAR VEMBU: Yes, exactly right. So that’s why I have never been interested in that question. I’m going to work as long as I possibly can and doing stuff I actually enjoy, living the way that I want to live and hopefully being able to invent technology however long I can.

But the reason also—see this is—and first of all to come this far, it also has taken time, 30 plus years now. And we never had—when you don’t have an exit in mind, this time also doesn’t matter, right? You are enjoying the journey itself. There’s no destination. The journey is the destination and that is why you’re coming to work every day.

Sometimes the growth is faster, sometimes the growth is slower, but you’re still enjoying it. And you are inventing, you are creating new things and you are hiring new, very young kids. Often when you are working with them, that energy comes. So that’s all that process itself that you enjoy. Then there is no destination, right? It’s a whole journey. And that’s why how fast other companies grow, what other companies treat as metrics has never been relevant to us.

Competing with Giants

ARNAB GOSWAMI: But you must be looking at the other companies. Who’s your biggest competitor?

SRIDHAR VEMBU: Of course, Microsoft today and Salesforce. These are some of the biggest.

ARNAB GOSWAMI: How close are you getting to them?

SRIDHAR VEMBU: Very far. See, this is also an opportunity, right? Microsoft is what, 350 plus maybe 400 billion approaching. Salesforce might be 30, 35 billion. And we are still maybe close to getting closer to 2 billion. I should say that’s still a substantial opportunity I see.

But also I don’t lose sleep over any of it. We are enjoying the journey, we are growing, we are making a difference. See, we are—I think, in fact I can say this now—we have crossed about 1 million paying organizations around the world. I think the first time I mentioned—1 million, 1 million paying organizations around the world now, which is a big milestone. We have not actually announced it yet and so I’m saying it here.

And of which about 20% are in India, 80% are outside India. So it is a big number—1 million paying organizations and we are adding at the fastest clip ever.

ARNAB GOSWAMI: What is your rate of growth compared to Microsoft?

SRIDHAR VEMBU: You’d be about at least twice as fast as them now, maybe three times now. And also the organic growth, the quality of growth, all of that is better. So that’s why we are—and we are serving a very large—for example, India of course is a major market. But also in the US, Middle East, Africa, Latin America, Europe, everywhere, Japan and China. We have 200 to 250 people in China. Everywhere we are seeing growth.

ARNAB GOSWAMI: I mean, you see yourself eating into a bigger and more substantial share of these global companies?

The Human Touch in Customer Service

SRIDHAR VEMBU: Yes, that is definitely happening. We are attracting a very large number of migrations away from them. And that’s worldwide, not only in India. That’s happening. And it’s because we offer a fundamentally better product and better value and better support.

This is the other thing: we always pick up the phone when you call us. There will be somebody to pick up the phone. There’s a human. And in this AI era, companies are chasing AI. Chatbot will answer, AI maybe will answer your call. To me, it’s not just a technical question. We enhance our support. The support person uses AI. But we want the human element. We want that customer talking to a human being.

If it’s a human customer, they should talk to a human being. That’s respect. We don’t want them… even if a bot can do the job, I think it’s better to talk to a human. They appreciate that.

ARNAB GOSWAMI: But isn’t that much more expensive?

SRIDHAR VEMBU: It is, but it’s… to me, it’s… I’ll put it this way. Companies then go out and spend a lot of money on this and that, marketing this or that. We like to take care of customers. And then word of mouth. So that’s how it spreads.

Should Indians Switch to Zoho?

ARNAB GOSWAMI: You know, somewhere, somebody watching this conversation will have one question to ask. Should they shift to Zoho? I mean, because they’ll say, okay, so I’m a layman. I’ll say, if I shift to Zoho, do I get all the international backup that Microsoft gives me? Do I have the same backup that I would get? Is it as serviceable? Is it as manageable?

And if that is the case, then why are people shocked when, for example, Ashwini Vaishnav puts out a tweet saying I’m shifting to Zoho? People are saying, okay, that means that Ashwini Vaishnav, who’s a technologist himself by the way, completely like you, in a way, he’s a technologist. When he’s shifting to Zoho, which means it’s totally trustworthy. And then why aren’t more Indians switching to Zoho?

What if… what if a majority of Indians were to shift to Zoho? What would that do for the country, not your company? Is it possible to do that? Why aren’t we doing that? Prime Minister is talking about Swadeshi every single day. Especially since Operation Sindur. This has become something he mentions once a day at least.

SRIDHAR VEMBU: So first of all, I would like everyone to evaluate Zoho. Make your own decision. Take a look, good look at the entire suite of products and compare, and you will see the difference. You will see that it does make you more productive. It is much more usable. It’s much more well integrated, all of it.

And that’s what, you know, people see when they… a lot of people, the first time they see the whole suite, the first thing is surprise. “Hey, I didn’t know you had all this. Why didn’t you guys market this better?” That’s actually the question people ask. We say, well, we’d much rather that you discover it this way and we surprise you than we push it down your throat and you hate us. That’s how I say it.

ARNAB GOSWAMI: But you got to let people know.

SRIDHAR VEMBU: Yes, yeah, definitely. We have to do marketing and people know. But we’d rather that people also put us to the test, use it and see how all the products are. And that’s, I think, the surprise element that a lot of people get.

The second, you know, I do, of course, I fervently hope that majority of Indian customers will choose us and I believe they’d be choosing the best product. I’m confident, and with very strong support and all of that. But again, I don’t ever like to push it down anybody’s throat. They have to make that decision individually. I like it. That’s the way we like our customer.

In fact, we have a long-standing policy that if a customer is ever unhappy, we’ll refund them the money, no questions asked. We have always had that policy. The reason is we don’t ever want to take an unhappy customer’s money.

ARNAB GOSWAMI: Yeah, yeah. See, I think the most important thing on technology is that it needs to be totally globally competitive, right?

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: And because it should be about demonstrating…

SRIDHAR VEMBU: India’s capacity to the world.

Global Expansion and the India Brand

ARNAB GOSWAMI: Do you also feel you’re carrying that weight on your shoulders that wherever you go… How many countries are you in now by the way?

SRIDHAR VEMBU: About 80 countries. We have a direct presence in other countries. 80 in other countries. We do business through partners. Yeah. We have over 18 data centers. In fact, over the next five years that may become 50, 60 data centers. Practically every country where we have substantial business, we are putting data centers because we want to keep their data in their own jurisdiction.

And yes, see, as our nation goes from 4 trillion to 10 trillion, 15 trillion, there are bound to be Indian multinationals coming up. It’s about time. It’s in fact long overdue. We have to have that and that requires us to, of course, build all the capabilities in terms of technology and engineering, the scientific, technological, human resource base here.

In addition, the ability to manage global operations, which actually… because India is such a vast diverse country with so many languages, cultures, all that, there’s a natural affinity here for us to understand the world each on its own terms. We are not a country that goes and says you should live this way as some other countries like to do. Right. So that’s why I think the India brand is very strong. We are definitely benefiting from it. In fact, customers in…

ARNAB GOSWAMI: How has that changed for you? I mean you started as a bootstrapped company, then you’ve grown significantly right now globally. Are you more accepted, say in the last five to 10 years, today as an Indian brand? Are people more open to doing business with you?

SRIDHAR VEMBU: In fact, 15 years ago when we say “Made in India,” people would say don’t say it too loudly. Maybe it’s not good for brand or maybe customers won’t trust us, they’ll think Indian product is not good enough or something. Today, vastly different. “Made in India” is actually a very strong point in favor of us.

It’s true in the Middle East, it’s true in Latin America, it’s true in Africa and everywhere in Australia. “Made in India” actually sells now in UK. So that is why I think, and this is, I have to say I definitely have to credit our Prime Minister only for that vast… that “Made in India” brand. Yes, he has created an India brand globally and we as a company are benefiting from that brand building.

India’s Missed Opportunities in Technology

ARNAB GOSWAMI: You know, we had this IT revolution in India almost 20 years back. Why have we not moved fast enough? Why is there only one big Zoho and one Sridhar Vembu? Is it because Sridhar Vembu was a bigger risk taker or is it something else that we may have done wrong? Did we do well enough given that we had already started becoming known in IT 25 years back?

SRIDHAR VEMBU: See, it came from our… see, we went in the direction of IT services and we should have gone into products more. We should have invested more into products, whether it’s software products, hardware products like network equipment, PCs, servers, all of that and phones, all of that which are now slowly emerging in India.

But we, I mean I’ll start with this: in the 80s we had a very strong PC industry started here, early 90s. It was there and we had it before the Chinese. The Chinese PC industry started after us. And you go back, we had a semiconductor fab in Chandigarh before the Taiwanese had that fab. And if we had built on that early lead, we would be a semiconductor superpower.

ARNAB GOSWAMI: Built in what sense?

SRIDHAR VEMBU: In a sense you have to see that first fab, then the second one, second one, third one. See, today the semiconductor fab is a very complicated industry. It takes 5 to 10 billion to set up a fab. But you obviously cannot just immediately come up with 10 billion and a fab quickly. It still takes time to build up the talent pool, all of that. We had that opportunity to build it that way, but unfortunately we missed that opportunity. The same thing in hardware. Exactly the same thing happened in software products.

ARNAB GOSWAMI: Why is that? Were we looking too much at the immediate financial return? Not looking at the long horizon?

SRIDHAR VEMBU: Definitely. The IT services is low risk, easy to make money business because you take a percentage of the human resources you deploy for a client, but you don’t build your own intellectual property. Body shopping, I wouldn’t… it’s consulting services, maybe, if you want to say that way. But still you’re taking percentage of what the client is paying for your… it’s really billable hours model. It’s like how an accounting firm or a law firm will work, but not the software.

But what you should have built, we should have built is the intellectual property. For example, the cloud infrastructure. This was something we could have easily built and unfortunately we let AWS and Google Cloud, all of that…

ARNAB GOSWAMI: Who do you blame for that? Who do you blame for that?

The Mindset Challenge

SRIDHAR VEMBU: I’d say it is, rather than blame, I would say it’s a little bit of a… now we didn’t have the sufficient daring or sufficient self-belief too. You know, sometimes it came out, it came from this: “We don’t have the domain expertise to do it.” That’s often… I’ve heard this 20 years ago, people would say, “Can we build this product here?” They’ll say, “We don’t have the domain expertise.”

But the truth is you build the domain expertise by doing it. The domain expertise doesn’t come before doing it. You do it, you fall down a little bit, you make mistakes, you learn and then you learn. Right? That’s for any business. It’s true. Whether it’s a media business, whether it’s software, all of it. You have to build something, put it out there, get beaten up a little bit. Then you learn. That kind of mindset… we had that expectation somehow we have to build the domain expertise first and then later we can do this. That was the problem.

The second one is our business houses broadly originally came from trading, buy and sell. In fact, all business, the world business was trading originally, but the balance shifted towards making and owning the proprietary know-how into making. There is no semiconductor trading. It is all making. Making is so complex. That’s the business, that’s where the value is.

So the value shifted from trading distribution to making complicated things and figuring out how to make those complicated things. We didn’t shift with that. That’s the first one.

The second one, this is actually little more insidious. We went from a Soviet socialist thing to an American financialized model. And without that, without realizing that the American financial model itself was de-emphasizing manufacturing, making things, all that. In other words, trading is one level and then the financial system is making money on money. And then the quarterly returns, the pressure, quarter to quarter pressure, that means predictable earning growth, earnings growth, you have to show 10, 12, 15, 20% every year, all of those.

So we went from one model to this model, American model. That also hurt us. And I have often argued this is also because we are very… too, you know, maybe our English language itself because we read that all the English media, English content, that’s all dominated by this finance. That also affected us.

Taking the Road Less Traveled

ARNAB GOSWAMI: Well, did you not think of taking the easy option?

SRIDHAR VEMBU: But you took a risk.

ARNAB GOSWAMI: What was the time when you took the risk?

SRIDHAR VEMBU: Yeah, that’s because I had a… see, I come from first principles. So I asked, “How did Japan develop?” This is a resource-poor country. What would have been considered at that time overpopulated for the tiny amount of land they have, still. In fact, if you think about it, population density would be considered overpopulated, right? Which of course nobody would say that now with the demographics and with no real natural resources, how did they develop to be one of the world’s richest nations?

To me that was the most dominating question of my youth. I would obsess about this when I was, say, 21, 22. I would read books and I would read books on Singapore, I would read later books on Korea. And in fact, maybe 10 years ago I read a lot of books on China because it was very clear to me something magical was happening in China in terms of this development takeoff.

And they all had the same underlying source. It’s the whole idea that they got into the making of complicated things. Whether it’s complicated software, technologies, all of it.

ARNAB GOSWAMI: They figured out jet engines.

SRIDHAR VEMBU: Yes, jet engines, everything. Robots and pharmaceuticals, all of it. And we didn’t get into it in sufficient force. We can do it then. Zoho’s existence proved that we can do it, but we have to set our minds to do it.

ARNAB GOSWAMI: So what are the new areas that you’re getting into?

Medical Technology and Strategic Investments

SRIDHAR VEMBU: Yeah, so we are looking at now medical technology in a big way because we are importing huge amounts of billions. If you go to any hospital, you’ll see everything is imported. That’s something that we are getting. We are investing aggressively in that area and we are investing in robotics. Outside of Zoho, I’m talking about, we are investing in semiconductors, chip design, all of that.

We have not invested in a fab, but we are investing heavily in chip design. And once the FAB in Gujarat, Tata’s FAB comes in, we’d be one of the… We would like to be one of the early customers to fabricate our own chips there. Fully made in India. They’re designed and made in India. Right now we are making it and we are fabricating in Taiwan.

And we are also looking at other adjacencies, for example, sensors. So this is how we get information from physical world into the computer. We are actually weak in sensors. That’s very important for a variety of industries. Ultimately, everything connecting to the real world is sensing something. And we need sensors. And so we are looking at that. And that is high technology. There’s a lot of technology in it, variety of sensing techniques. So we’re looking at that.

ARNAB GOSWAMI: So I mean, all these, all these investments that you’re making, are they purely Swadeshi companies? Are they Swadeshi in the sense, 100% Indian?

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: Or is it assembly line work going on?

SRIDHAR VEMBU: It’s all we, our always. Our investment thesis is companies that have a long gestation period in R and D, people who need that backing, people who are hardcore engineers, all with a nationalistic spirit that we have to do this in India, we have to show that we can do this in India. That’s what I’m looking for.

What India Is Getting Wrong

ARNAB GOSWAMI: I think you’re an exceptional person. I think you’re a role model. Simple living, high thinking, frugality, austerity, high capitalism in the sense that you are chasing profit, you are chasing revenue, and you are trying to take on the world’s biggest companies.

So from where you are, can you be a little critical now and tell us what are we getting wrong in our country? You also served on the National Security Advisory Board. You have a deep spirit of service for the country which brought you back. Piyush Goyal, I think did a service to the country when he said at a startup conference that your job is not to do startups that deliver food to people. You must get into innovation and R and D.

And nobody liked it. Especially a lot of youngsters didn’t like it. Everybody was looking at valuation and exit. I think he did a great service by actually saying that. What are we doing wrong, Mr. Vembu, because we need to move faster than we are. What are we doing wrong as a country?

SRIDHAR VEMBU: We definitely need these patient entrepreneurs along with patient capital that can get into these areas. And that includes all of the things I said because many of these areas require five solid years to get that first product. Sometimes maybe 10 years to really show something meaningful in the market.

That’s the kind of, you know, if you are 22, maybe you have to say by the time I’m 32, all of this is going to be fruitful. That patience is required. Patient capital and patient engineers, patient entrepreneurs. That’s widely required. And we have, as I said before, taken too much to maybe the American exit model, the financialized capital model. I don’t believe that suits our nation. In fact I will quote that’s almost…

ARNAB GOSWAMI: Like, you know, it’s like a plague everywhere. Yes, everyone wants it.

SRIDHAR VEMBU: Exactly.

ARNAB GOSWAMI: That’s what entrepreneurship has become.

Dharmic Capitalism

SRIDHAR VEMBU: And I will submit to you that that model cannot result in lasting companies. In fact, the problem for American economy itself is the short term, this quarter to quarter pressures and they are thinking to move away from it too. So while we are borrowing that model, they are rethinking that model themselves.

In fact, I will actually on this occasion I want to mention my mentor and the great philosopher Sri Gurumurthy. He says “capitalism is Vaishya Dharma minus the Dharma.” I’ve really taken a liking to that quote. So it’s the Vaishya Dharma. There is a dharma in business and that we have to keep that in mind. To me that is the patient long term capital. It’s very much capitalism, but it’s a kind of a dharmic capitalism. That’s what we need.

ARNAB GOSWAMI: What is dharmic capitalism?

SRIDHAR VEMBU: So it means…

ARNAB GOSWAMI: So you…

SRIDHAR VEMBU: I’ll give you actually one thing from our Tamil culture. So I was born near a village where the Gangaikonda Cholapuram, the Rajendra Cholan temple, the Rajaraja Cholan’s is the big temple in Thanjavur. His son built a big temple. This has been standing a thousand years. As a kid I would go there and be inspired by it. I would think, how could somebody build this that lasts a thousand years? Can we build anything that lasts a thousand? Those were my thoughts then as a kid.

And just about a kilometer from there, there’s a place they call in Tamil, Maligai Medu. That’s the kind of the mound where the palace used to stand. So this king built this temple that lasted a thousand years. Why is the palace only a mound? Earthen mound. And you dig it, you see the earthen walls, all that. Why couldn’t he build a palace for himself that will last a thousand years? Obviously he could have, but he didn’t want to. It was a choice. That’s the dharma.

That is, he wanted everything he built for the public benefit. And he lived in the earthen mound that has now gone to the earth back. And we call the place the earthen mound. Really the palace mound. So that is to me essence of it.

So to me, the capitalist in me, I ask, I personally don’t need money anymore. My needs are simple. I’m going to live this way. I’m 57 years old. I’m not going to develop new taste to spend money. Then why should I make money at all? But there’s so much need in our society, so many things. The investment in these long term R and D, all of it. That’s one.

The second also in the villages I see a lot of, for example, educational needs. We want to run rural clinics, we want to run skill development programs. All of that obviously need money. So money has a purpose to me that linking these two, that is dharmic capital.

Public Life and Gandhian Capitalism

ARNAB GOSWAMI: And do you ever see yourself entering public life?

SRIDHAR VEMBU: I think I have my hands full now in business. I have a long way to go still, as I said, we are only maybe 1 or 2% of Microsoft still. So I think no, no, no, no.

ARNAB GOSWAMI: As of now, or no, no. Why are you not going public now? Do you not want to see your name among the richest people in the world? Dharmic capitalism, which you mentioned. Also one of your recent tweets about Gandhiji was also controversial. Can you tell us what you had said in that sense which I said there’s a Gandhi ruffled a few feathers.

SRIDHAR VEMBU: Yeah, well, anything I’d say would ruffle a few feathers. Right? That’s just how social media is. I said Gandhian capitalism and to me it means respect for reverence for everything that is. See, Gandhi was a deeply spiritual human being. That’s why we call him Mahatma. Right? That’s the part he brought spirituality into politics.

But your spiritual nature. To me that is necessary in capitalism too. We think of this as all these separate realms. There is this realm of what you measure and money, all of that. And then there is your separated. In our dharma, we don’t separate those things. We actually have to live in a holistic way.

To meet today the urgent need that true Gandhian capital would mean sustainability in the environmental sense. Respect for nature, life, all life on the planet, including human life, and respect for trees, water, animals, soil, all of it. To me that is what would be Gandhian capitalism today. That’s what I said.

Arattai: India’s Alternative to WhatsApp

ARNAB GOSWAMI: And one of the reasons there is a renewed focus on you and a great interest in you as an individual and Zoho as a company is because of the thrust on Swadeshi. Tell me about Arattai. You know, because some people are saying here that here is a person, Sridhar Vembu. He is our very own Elon Musk. Please don’t mind the comparison.

SRIDHAR VEMBU: No, I think that’s not. I’m not, I’m not any. I’ve not done anything near his achievements.

ARNAB GOSWAMI: So you’ve done it. You’ve built a great Indian company and you are now building Arattai. Is Arattai… Tell us about Arattai. Is it alternative to WhatsApp?

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: Or to Twitter? Or is it a mix of both? And we heard recently that there was a 10 to 100 fold increase in the number of downloads of your social media app. Why are…

SRIDHAR VEMBU: Why is there a thousand fold increase now?

ARNAB GOSWAMI: Thousand fold increase now? Are you ready for it?

SRIDHAR VEMBU: Yes, we have the last one week. Our engineers have been working flat out.

ARNAB GOSWAMI: What is Arattai? I mean for those who are not yet totally familiar.

SRIDHAR VEMBU: You are actually saying it, pronouncing it exactly.

ARNAB GOSWAMI: Means what? And what is it?

SRIDHAR VEMBU: Arattai in Tamil means kind of a good natured fun chit chat.

ARNAB GOSWAMI: Okay.

SRIDHAR VEMBU: And it’s like maybe idle chit chat kind of thing. It’s like in a village, people sit around and chat about something. That’s Arattai.

ARNAB GOSWAMI: What you would call adda in Bangla is in Bangladesh or in Bengal also. Adda means sitting around. And what would the English word for it be? It would be shooting the breeze. You and I just sit and shoot the breeze. There is no purpose or end to this conversation.

SRIDHAR VEMBU: Correct. Shooting the breeze would be a great way to put it. That’s our Arattai. We named it just for fun. This is a messenger product. It’s like WhatsApp. It has differences. We actually have some significant differences. We are building it like a platform. But we wanted to keep the fun element. That’s why we named it that way.

And we didn’t expect it to take off this quickly or this soon. It’s like a chain reaction that happened. But we have been getting ready for it. We actually had a big plan, say November or December but we just had to accelerate everything. And we are scrambling but we’ve been keeping up.

And it is a… see the reason we built the product. I felt someday our nation will need to use products that are in our strategic technological control because technology is weaponized against us, will be weaponized and is being weaponized. And national sovereignty, national security, national prosperity. All of them depends on mastery of technology and your ability to control the technology for your own uses. That’s why we invested in it.

We have always said messaging technology is very critical. Everybody, all of us on this. So we need to build this. That’s why we have been building this. And a lot of engineering effort has gone into it. And the name is kind of a fun name but the technology is very real and deep and that has been the motto from the beginning.

We also, from a business point of view, we have actually a product in the business software, it’s called Zoho Cliq that has been doing quite well and that product and this share the same technology foundations. So we felt when we build this it could also cross fertilize into the other product. So there was also the rationale like that that we could put the learnings from this technology into the business software arena that would give us a competitive advantage.

So in fact that has been true because now we are really getting a lot of exactly how to run it on very low end devices, very low bandwidth. All of this is an advantage in business too.

ARNAB GOSWAMI: So it’s more alternative to WhatsApp.

SRIDHAR VEMBU: Yes, WhatsApp. WhatsApp. But it’s also much more of a platform. We are envisioning it like a WeChat in China which is much more than a WhatsApp. That’s what we are thinking.

ARNAB GOSWAMI: So how many months away are you from taking it to the level of technological back end development that you would really push marketing on the product?

SRIDHAR VEMBU: Probably next month or two. We are trying to accelerate all of this next month or two and then the development will continue.

ARNAB GOSWAMI: What’s your ambition for…

SRIDHAR VEMBU: Yeah, we want this to have a billion plus users.

ARNAB GOSWAMI: So in everything you want to compete with the WhatsApps and the Salesforce and the Microsoft, you get a kick out of it. Don’t you.

SRIDHAR VEMBU: Well, definitely I would. Yes. And I want to show that our talent, our rural talent, we can build all of this. That’s also part of the mission here.

ARNAB GOSWAMI: Is it rural talent? That’s big.

SRIDHAR VEMBU: Yes, definitely.

Building a Team from Rural India

ARNAB GOSWAMI: A lot of people see you work in Tenkasi. How many of the people who work there with you are from the place?

SRIDHAR VEMBU: About 80% of the people are from surrounding rural districts, a couple of districts. The IT team itself, about 40% of the team is in Tenkasi. But I see them when I go to office. I see the IT team often. But I had a meeting just before I came here. I said, “Guys, now is the time.”

ARNAB GOSWAMI: You were saying it’s not required that you need to fly down people from the US, US-trained people to work with you in Tenkasi.

SRIDHAR VEMBU: It is all homegrown. It is all learned by doing, experiential learning. That is how the team has been built. That is how the products have been built. And these people are very, very good now in their craft.

Addressing Misinformation About Zoho

ARNAB GOSWAMI: And you gave an explanation a few days back on Zoho. When you become so big, Sridhar, you must also get a lot of attention and unwanted attention. You actually went on X and you gave out an explanation that we are completely an Indian company. Our back end is Indian, our people are Indian. Why did you have to go and make that explanation?

SRIDHAR VEMBU: Yeah, there were people spreading all kinds of completely false information that somehow we are an American company that pretends to be Indian, or all of the data is in America. All of that is completely false. So we had to clarify: all the code is written here. The company is headquartered in Chennai. They can go check, download from the Department of Corporate Affairs because that publishes this info, all of it.

And we pay our taxes in India. And data centers, our Indian data is in India. Of course we have 18 data centers. So for example, Middle East data is kept in Dubai or Saudi Arabia, all of that. And EU data is kept in Netherlands or in Ireland. So we have data centers in Germany, in Canada, in of course US and Mexico, all of that. But Indian data is in India. So all of that I had to clarify.

ARNAB GOSWAMI: So you know you do get a share of attention, but you’re on social media a lot. Doesn’t it put you on the back foot?

SRIDHAR VEMBU: No. First of all, I have a thick skin and if somebody calls me random names, I just smile. So I don’t really… I never get angry or anything because to me both praise and being called names are approximately the same. I just react the same way.

ARNAB GOSWAMI: You don’t react to people on social media. You don’t engage in…

SRIDHAR VEMBU: I never attack back anybody. If there is a criticism, I offer that’s on the ideas, not personal.

The Legacy and Vision

ARNAB GOSWAMI: So what is your legacy you are working towards? What is the headline you wish to have? You said you’re 57.

SRIDHAR VEMBU: Yeah.

ARNAB GOSWAMI: That’s relatively young, by the way. I mean, if you were in the Congress, you would be a youth leader like Rahul Gandhi. You’re just a year older than Rahul Gandhi. Don’t worry. Sorry about that, but I couldn’t resist it. But you’re relatively young. You have a long way to go. What is the headline that you are seeking?

SRIDHAR VEMBU: Our nation needs to be a technological superpower. And it has to have… that’s the destiny. If our nation has to be strong, it has to be very strong in technology because technology permeates every aspect of our existence today. We cannot even do farming without technology today. Medicine without technology. Schooling, universities, everything is technology now.

So we have to be really good at it and we have to be strong. And we want to trade on equal terms with the world. See, I’m all for trade, but we have to trade on equal terms. We cannot simply be consumers, be on the receiving end. We also have to be on the sending end. This has to be established. That’s why there has to be hundreds of companies like us taking our technological leadership forward in every field, every technological discipline. That’s what I want to see.

ARNAB GOSWAMI: I sort of understand your sentiment. It’s our aspiration at Republic, that we are able to take Republic globally. And we keep saying let’s get at least 5% to 10% of the global viewership.

SRIDHAR VEMBU: It’s about time. There is an Indian network that’s global, globally respected as a news source, all of that. So it’s about time. So my really best wishes to you.

SWOT Analysis of India

ARNAB GOSWAMI: And to you as well. I hope you know that we are both able to do what we need to do for the country. Sridhar, finally, what is the biggest… if you were to ask you to do a SWOT analysis of India today. What is our biggest strength, our biggest weakness, opportunity and threat? I want to wrap this interview up with your clear thoughts on these. And you know, maybe this will be the big takeaway for everyone today, also for young entrepreneurs, technologists watching it, for those for whom you are a big role model today.

SRIDHAR VEMBU: So our biggest strength is that youthful, passionate talent that’s there everywhere.

ARNAB GOSWAMI: Demography.

SRIDHAR VEMBU: And the demographic dividend, as people say. That’s the biggest strength if you properly use it. That comes to the weakness. The weakness is that a lot of our own elite, our own educated elite, don’t realize the full magnitude of it, don’t understand the real potential of it to be able to really properly channelize it. That’s our weakness.

And that also comes from… see, today our elite and our common citizens, we speak a different language altogether. And that’s why I’m passionate about reviving our languages for technical work. Not simply chit chat, not simply RTI, but also do technical work, all of it in it. So that connection has to happen. And that’s the only way that we can actually fully realize our strength.

The opportunity, of course, is to be a global leader. That’s the opportunity. That’s what demographic dividend means. That you have the youthful talent to emerge as a leader in every field. There’s really young people who inherit the world. So that’s the opportunity.

The threat is our own internal divisions by a hundred different things. And you know, even on X I see this where they announce something. Take even the name Aratai. There’ll be somebody attacking it because it is a Tamil name or somebody attacking it because of the opposite. There’s all this very… there’s a lot of pettiness.

But take the name Aratai. People are, I know, happily buying a phone called Xiaomi. It’s even hard to pronounce for us Indians.

ARNAB GOSWAMI: Yes.

SRIDHAR VEMBU: And we are okay with foreign brands that are unpronounceable names. And those things took off here. So if we stay focused, it can take off. That’s not the problem. But we must actually believe in ourselves, and that not believing in ourselves, that is where our efforts kind of disintegrate. That’s the threat. So we can be our own worst enemy in that sense. That’s the threat I see. There’s no external threat. We are our threat.

Authenticity and Civilizational Values

ARNAB GOSWAMI: We are our own threat. Absolutely. So just to wrap it up, I’d like to say one thing to you, Sridhar, that I think what is magnificent about you as a person is your authenticity. And anybody watching this conversation, it will go viral. People will watch it. The biggest takeaway I have is that if you are yourself, then everything comes with you. You don’t have to pretend to be anyone else. And we have a living example of a person who’s so sure of himself and who’s doing things his own way.

But this interview will not be complete without my asking you one question which I asked to our common mentor and philosopher guide, Gurumurthy Ji, about Bharat as a civilization. Does that also… is that at the back of your mind beyond the economics, beyond the coding, beyond global competition? Does the revival of Indian culture…

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: Our civilizational heritage, is that also on your mind? And is there something you would like to share on that with all our viewers?

SRIDHAR VEMBU: It’s a kind of a millennial goal.

ARNAB GOSWAMI: Right, millennial goal.

SRIDHAR VEMBU: Millennial goal. That is, it’s a slow process, but we have to revive our civilization, be strong. And what does it mean to be our civilization? In fact, Gurumurthy Ji taught me this. He said humility and contentment. It’s not about this technology, all of that, that’s all there, that’s good. But we are fundamentally, you know, what makes an Indian wanted in Mexico or Colombia or wherever we go? They are humble people. And I want us to stay humble people. That’s one: humility.

And then this contentment, you know, because our potential wants are infinite, insatiable, and we will destroy the earth by our own wants. We keep on wanting. So in fact, for the world to be at peace with itself, not just peace within, but peace even in the war and peace sense, you have to have that contentment.

And he would often emphasize to me how the core of our spirituality, our civilization, is the spirit, humility and contentment. That simple living and high thinking. Truly, that is our civilization. Truly.

ARNAB GOSWAMI: Well, that’s another word which has always stayed with me and I’ve loved this conversation. There’s a lot of learning in this. I hope to come to Tenkasi to see you and to see what you’re building.

SRIDHAR VEMBU: I would love to have you ride the auto with me.

ARNAB GOSWAMI: Yes.

SRIDHAR VEMBU: Electric auto.

ARNAB GOSWAMI: Yes, we will ride the electric auto.

SRIDHAR VEMBU: And drive the electric motorcycle which you are going to…

ARNAB GOSWAMI: I’m going to do it. And you’ll pillion ride with me.

SRIDHAR VEMBU: Yes.

ARNAB GOSWAMI: Wonderful to meet you, Sridhar. Wonderful to know you and thank you for doing this.

SRIDHAR VEMBU: Thank you.

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