After the great recession, every business Moghuls and economists thought that the worst was over and they will never live to see such a crisis in their life again till Covid 19 happened. Amidst the great depression and chaos, few stood out.
One of the astonishing success stories of 2020 was the emergence of Zoom video conferencing. Eric Yuan, the founder of Zoom, encashed on social distancing, Bubbles and Work from home concept when the world shut down. This start-up communication platform was founded nearly a decade ago by a Chinese immigrant to the US. It was built on providing a solution after experiencing a long-distance relationship that often required a 10 hours train journey to see the other.
The Great Turnaround
The new world order changed from the real world to the virtual one during the 2020 pandemic. From daily work meetings, workout sessions at the gym, and Friday night outs for drinks, everything changed and suddenly moved online. Zoom platform came as a savior and facilitated the connectivity between people. This resulted in the Zoom’s user skyrocketing with 300+ million participants on video calls every day during April 2020.
The founder of Zoom saw his net worth soaring by almost 400%, and his shareholding worth $17 billion. But crediting the success of Zoom to Covid-19 only would be unfair to Zoom. Though many people did hear about Zoom until the pandemic, Eric Yuan had been steering the company steadily since its inception a decade ago. He always focused on the user’s experience, and making the customer happy and satisfied was his top priority. Zoom always stood out among its competitors. Its recent success in a crowded market showed that quality or cream always rises to the top.
The Journey
Eric Yuan was born in Shandong Province in eastern China. He completed his engineering education at Shandong University of Science and Technology and was always interested in technology. His idea of connecting instantly with people came when he traveled a 10-hour train journey to meet his girlfriend. This meant the couple could meet only a couple of times in a year. The idea of having an intelligent device that one could click, talk and see the other person far off. The picture had already taken place in Yuan’s mind even though the technology was not ready at that time.
After completing his master’s degree, while working in Japan in 1994, he attended a speech by Microsoft CEO Bill Gates. Internet was gearing up for release, and Eric Yuan felt that his future lay in the Silicon Valley. His aspirations to migrate to the US met with multiple hurdles as his Visa application was rejected seven times. He finally succeeded in his eight attempt. Settling down in San Jose in California, Yuan got a job at Webex, a video conferencing company, in 1997. Eric Yuan spent 14 years at Webex. Yuan was also instrumental in establishing Webex as a leading player in video conferencing. By the mid-2000s Tech Giant Cisco understood the value of Webex and acquired it for $3.20 billion.
Yuan parted ways with Webex in 2011 and went about setting up for his next venture. The new start-up was on the same lines of video calling and conferencing but focusing on better communication quality and user experience, which Webex lacked. Zoom was born.
How were Investors Won over?
The company, right from the beginning, focused on customer satisfaction. Yuan’s priority was to make everyone right, from the customers, employees to video participants to be happy in their interactions with the Zoom platform. When Zoom was founded in 2011, the market was already crowded with well-established players such as Skype and Google Hangouts. Zoom pursued the video first platform with a more customer-centric focus than the audio platform pursued by others.
The unique approach with a clear vision attracted investors, and Yuan raised $3 million. Working with his team of engineers brought from China, the first model was launched in 2013. This model was a success. Very quickly, Zoom had one million participants on its video calls which secured them another round of funding of $10 million.
Zoom USP
Right from the beginning, Zoom was different from its competitors and was ahead in many areas:
- The platform had low data usage. This meant users could still use video calls even when the internet was not consistent.
- Easy installation of the software based on its cloud technology
- Used the same version for any device used by users by adjusting accordingly.
- The monthly user fee plan was lower than competitors with better functionalities.
The growth of Zoom led to Venture Capital giant Sequoia Capital investing $100 million in the Series D funding in 2017. This huge investment saw the valuation of Zoom becoming $1 billion, making them a tech unicorn. Zoom continued posting profits for consecutive years, unlike others. In 2019 it achieved revenue of $330 million which led it to go public. The shares of Zoom rose by 72% on the day of its listing. By the year-end, it has become the most valued tech company overtaking Lyft.
Before Covid-19 struck, Zoom was primarily used only in the corporate world as a business communication tool. Till this time, nobody could have predicted that one year down the line, it will become a household name. The lockdown imposed by the pandemic meant social distancing, and work from home became the new norm. Zoom became a vital tool that facilitated business meetings and connecting friends and extended families.
Takeaway
Covid-19 has changed in many ways people think about how and where to work. Even after the lockdowns were withdrawn, many continued working from home. The new generation has also realized that they can get work done from home without going to the office. Maybe Covid could be the catalyst about how the world will work a decade down the line. If this happens, then the Zoom platform will continue to remain sustainable.
Today, more than 750,000 companies use Zoom to keep their employees connected across several office locations and keep the business operations moving. The real-time face-to-face interactions help daily interactions smoother. As of 2021, Zoom has 467000+ business customers and annual meeting minutes crossing the 3.30 trillion mark.
