Why the Zoho Finance platform is experiencing parabolic growth
I’m a huge fan of Zoho. Not just because it moved headquarters to my hometown of Austin, TX, but because I find the value proposition of creating easy-to-use, affordable software for a wide range of functions with cross-integrations potentially disruptive depths for the cloud software industry. . Therefore, I’ve been following Zoho for a while and recently wrote several articles along the way, tracking the progress as Zoho hit the eighty million user mark.
I recently saw a press release announcing 50% year-over-year revenue growth for Zoho’s financial platform, which supports over half a million businesses in 160 country. Fascinated by this recent news, I was delighted to speak with Raju Vegesna, Chief Evangelist at Zoho, to understand the reasons for the parabolic growth of Zoho’s financial platform.
Few financial platforms support growing global companies
Earlier this year, Intuit announced that QuickBooks products would no longer be available in India. Financial software is a market where major vendors are leaving countries, while Zoho is doing the opposite. Why is that?
Zoho’s financial platform includes solutions for accounting, inventory management, travel and expense management, billing and subscription management, and payroll management. The most popular app on the platform is Zoho Books, a cloud-based accounting app. Zoho Books supports 180 currencies and 17 languages and includes a comprehensive global tax engine that enables country-specific tax compliance.
Supporting Zoho Books in multiple countries, each with ever-changing tax and regulatory rules, is a significant effort.
The key to Zoho’s success is due to a combination of three factors: an integrated product strategy with software-as-a-service delivery and a unique Zoho philosophy called transnational localism – more on that later.
A family of apps that work seamlessly
As the business grows, applications are installed to solve specific business problems. Eventually, you end up with a hodgepodge of disparate apps and spreadsheets that don’t talk to each other. Unfortunately, many of us have been there.
That’s why I’m a away guy! A family of applications that work seamlessly is superior to an edge strategy. With disparate apps, the time and money spent on onboarding, maintaining, and getting new versions of apps is reason enough to upgrade to a suite.
The caveat is that the app suite must have an ecosystem to connect to any third-party apps through APIs. Since its inception, Zoho has been building apps on a single platform. The result is a consistent user interface with data integration between apps and an ecosystem of payment gateways, banks, travel partners and shopping carts. Businesses can also connect to third-party applications through APIs and Zoho Marketplace.
In summary, tightly integrated products form a powerful platform for running an entire business.
Only pay for what you use
Zoho adopted the cloud-based software-as-a-service subscription model long before many large enterprises. Zoho saw the ability in the cloud to significantly reduce system management costs and pass the savings on to customers in the form of a lower subscription cost.
With the subscription model, Zoho hosts the apps and makes them available through the internet. For many, it’s an attractive alternative to installing standard software, requiring building a server and installing and configuring the application.
Zoho is making changes, a significant advantage, especially with financial applications that must evolve with new tax and regulatory rules.
Zoho makes it easy for customers to try, buy and implement Zoho solutions, whether single solutions, bundles or the complete Zoho One suite. Customers can upgrade or downgrade editions and licenses at will and without a multi-year contract. Pricing for Zoho Finance Plus starts at $249 per month per organization and includes ten users. Zoho Books starts at $20 per month ($15 if billed annually) per organization.
Think globally, act locally
Transnational localism is Zoho’s secret sauce for successfully collaborating and customizing locally to meet the needs of individual markets. Zoho is trying to solve labor issues related to the rising cost of living, long commutes, and general imbalances between life and work by providing opportunities for people in cities and communities that lack ‘opportunities.
Transnational localism could be a solution to create a balance between working from home and in the office for employees, a challenge for every human resources department today.
Today, there are over twenty small Zoho offices in India. These offices function as hubs where employees collaborate across departments and work areas. New relationships with colleagues have been formed and employees can continue to support local communities. Employees sometimes visit a central campus, but local network and business tools support remote offices. Essentially, Zoho has created a hub and spoke model with a major population center as the hub and rural areas as the radius.
In my backyard in Austin, TX, Zoho has established a hub. Last year, the first spoke office opened in New Braunfels, Texas, an hour from downtown Austin. Shortly after joining the team in New Braunfels, Zoho opened another satellite office in Bastrop, a rural town about 40 minutes southeast of Austin. These two sites have proven that talent is everywhere and that many young people in small towns in the United States are simply looking for an opportunity.
The proof is always in the figures: eighty million users, twenty-six years of profitability since its creation and an annual growth of thirty-eight percent in a difficult environment.
Zoho’s approach of providing sophisticated yet easy-to-use software for a wide range of functions, with deep cross-integrations, appeals to many customers. Zoho innovates with a constant stream of new solutions and continuous improvements.
I also learned a new term, “transnational localism”. What I take away is that by integrating a business into a local community, not by selling there but by investing in it, by offering well-paid jobs in areas where they are scarce and by promoting local education, these communities become autonomous, and everyone wins.
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Patrick Moorhead, Founder, CEO and Chief Analyst of Moor Insights & Strategy, is an investor in dMY Technology Group Inc. VI, Dreamium Labs, Groq, Luminar Technologies, MemryX and Movand
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