Chennai-based global tech firm Zoho Corp recently announced that mid-market and enterprise segment businesses accounted for over 50 percent of its annual revenues in India. In a statement, the company said that revenues from India and globally for this segment also grew by 65 percent CAGR in the last three years. As far as international revenue shares were concerned, enterprise businesses accounted for only a third of the company's overall revenues.

Share Market Live

NSE

The announcement points to one important reality: Zoho Corp, which began as the go-to software platform for small and mid-sized businesses (SMBs) in India and the world, may just be pivoting to serving a more upmarket clientele, starting with India.

"India's upmarket momentum is faster than the rest of the world," said Praval Singh, Vice President, Marketing and Customer Experience, Zoho Corp, "We enjoy some tailwinds in India being a homegrown brand — it's about time that other regions also start to benefit from this momentum. So, our one-third share occupied by the upmarket segment, globally, should go to 50 percent soon."

There are a wide gamut of reasons for Zoho's growth in the upmarket or enterprise segment. The first of these is the company's successful shot at enhancing existing platforms. Zoho's recent products have also been upmarket-focused and built for contract management cycles. In this time, tech firm has expanded teams and worked with larger enterprise customers directly, offering them end-to-end consulting, implementation and adoption as services.

However, what has worked best for Zoho is that the company has helped bring about a shorter implementation cycle. At a time when companies are trying to be frugal with spending, Praval points out that shorter implementation cycles are like gold dust.

"Given the tech and economic landscape today, companies want to lower implementation costs and the time taken to implement solutions," he said, "For every dollar spend towards software licensing, companies spend about five dollars in software implementation. So, if a platform takes forever, however good it is, it slows down the enterprise."

The question, however, remains: Is Zoho Corp, the platform that most SMBs run their business on, now pivoting towards being a more enterprise-focused SAAS company? "We will continue to invest products for MSMEs and small business and won't be leaving this segment aside," said Praval, "With our newfound confidence in handling complexities and our ability to ensure shorter implementation cycles, we are now investing in the upmarket segment."

First Published:Jun 27, 2023 7:26 PM IST