Zoho is well-known as a technology vendor for the SMB market. The company has products that support the whole range from single proprietors to larger companies. This range in itself is remarkable. For some time now, the company is diligently working on moving upmarket and to also support enterprises. This is not in the least, as with a growing customer base, more and more existing customers grow into the enterprise segment.

The transition from SMB to enterprise is far from trivial. Sales models change, messaging, consulting approaches, support infrastructure, even the demand for the size and structure of the ecosystem are different in the enterprise sector.

So, how does Zoho fare? To find out, I had a conversation with Parl Johnson, “Chief Nerd” at Nuvia Smiles. You can find our complete conversation on YouTube.

Nuvia Smiles is a dental implant company and currently has 1,500 Zoho seats. The company has more than 30 locations across the United States. Its specialty is to provide a 24-hour turnaround time to get permanent teeth into the patient’s mouth. This way, they do not have to wait long periods of time to get dental replacements. This requires a very rigorous process and having a lab at every location. Decision making is highly decentralized to support this fast process. The challenge with this degree of decentralization is that there are many disconnected applications and with that also very decentralized data. Nuvia Smiles identified 80 different applications with a scope of consolidation across the 30 locations. While this initially facilitates fast growth, it can become a liability once a certain company size has been reached. Applications and especially data become too siloed to be helpful anymore. Sooner or later, every company needs to establish a central governance framework to be able to ensure compliance and coordinated growth, even the ability to work effectively, or  negotiate favorable prices – in summary, to leverage the economies of scale that being a large company offers.

This need for consolidation across a variety of different applications is what brought Nuvia Smiles to Zoho, after looking at Salesforce and finding that it didn’t meet Nuvia Smile’s requirements or fit into the company’s budget.

The broad implementation scope and the need for fast results that Nuvia Smiles looked at, made it important to work with a partner. This is where a good ecosystem with different partners that have different skill sets – and the possibility to identify them – comes into the picture. Nuvia Smiles identified its first partner during a regional user group event and subsequently another one that could help out with more specialized knowledge via the partner marketplace.

One way to achieve the first successes fast is a focus on data and analytics. It didn’t take Nuvia Smiles long to see first benefits. In the words of Parl Johnson: “I would say it's because of Zoho Analytics and as soon as we started feeding some key metrics into Zoho Analytics, getting results was almost immediate from an analytics perspective. So, we got some benefit out of that right out of the gate and then some of the other benefits were bringing in some less important data, I guess, into Zoho where we can play around with it, where it had previously just been in spreadsheets or other things. And so, you know, we kind of picked off the lowest hanging fruits right out of the gate.”

How to go on from there? One thing that surely is important beyond measure is including the users. Says Johnson “I would say our first attempt at core a process was an absolute failure, and it was largely related to that. the users was a big failure on our part because we came in with a development mentality. We were using an agile methodology. We were using sprint cycles and we were developing but we were developing to the software we were trying to replace, instead of to the actual user experience. We were so focused on the technical parts though that we ended up failing miserably on the user experience.” The team learned from the experience and very successfully started to migrate and consolidate patient processes and the internal communications platform from Slack to Cliq. The latter he considers a big win “because Cliq has a lot more HIPAA-compliance relevant elements to it that helps us be HIPAA compliant in all of our conversations.”

OK, but how about integration? In significant projects and especially in bigger companies, new software finds a lot of legacy software that is needed to perform business processes. While Zoho offers integration and workflow tools, moving away from legacy integrations fast is not always possible. “We knew right off that we needed to have some element of control in the middle between Zoho and many of the apps that we're using. And so, we went ahead and decided we were going to invest in at least a cloud service that would be in charge of doing all that handshaking where it's necessary. Sometimes there are some data that's just simple enough we can just stick it into Zoho, and we're done with it. But a lot of the baggage that came with some of the old systems are things like Zapier and you know "zapping" some data into Zoho and then zapping some data back and there is a lot of moving parts and we're trying to figure out how to migrate those into workflows or Flow itself so we can get off that platform .”

This, in turn, might require quite some documentation and support. Documentation is readily available, but sometimes confusing. Support initially ran into some hiccups but improved as well. Both strike me as ubiquitous challenges across all vendors.

My analysis and point of view

Given all this, one can say that Zoho is well on the way to be a strong enterprise player. For sure, there are things that can be improved, like documentation or the support infrastructure. But then, this is nothing unusual and a challenge that every contender has as well. Is this an excuse? Certainly not! And, judging by what we hear from Nuvia Smiles, Zoho is actively addressing weaknesses, which is also in line with the principles that Zoho’s CEO Sridhar Vembu laid out during the recent Zoholics event in Austin:

• Invest into a full product portfolio with breadth and depth
• Offer attractive bundles that have deep value
• Invest into exceptional service and support
• Improve interoperability with more prebuilt integrations
• Get close to the customer with a strong local partner ecosystem

From a Nuvia Smiles perspective, it appears that Zoho offers a portfolio with more than sufficient breadth and depth, with attractive bundles and a strong local partner ecosystem. Given, that Nuvia Smiles opted for investing into what Parl names “middleman software”, there appears to be scope for additional prebuilt integrations and flows. The other topic that initially seems to have been a cause of frustration for Nuvia Smiles is support. This improved with the growth of Nuvia Smiles’ Zoho footprint. This is a mixed message, as Zoho is still predominantly an SMB player.

So, back to the original question: How does Zoho fare on its way to be a strong player in the enterprise market?

As measured by the own aspirations and the Nuvia Smiles experience, the company is on a good way. Some principles show a high degree of maturity, others are addressed. Something that Parl did not talk about, but which is worthwhile looking at, is the value of the combination of product (bundles) and implementation effort with its consulting rates. I do not say that SIs overcharge – none that I know does – but bigger implementation projects can cause high efforts and cost. These can increase the time to value for customers considerably. This is certainly a dilemma. Still, it is in the best interest of Zoho and its implementation partners, to find a solution out of it. Preconfigured (industry) bundles and so-called consulting solutions may be part of this way. The solution for the deep value challenge may very well lie in the partner ecosystem principle.

In summary: No one is perfect, but it seems that Zoho fares better than many and is certainly ready for enterprise prime time.

Zoho’s annual main customer event Zoholics took place in Austin, TX last week. The company presented updates to products and strategy and gave partners the opportunity to present themselves on a big show floor. In parallel to the event, Zoho published some interesting news about product enhancements in four areas, namely security and privacy, CRM for Everyone, collaboration, and platform tools. In addition, Zoho reaffirmed its AI strategy.

Of course, CEO Sridhar Vembu set the scene in his usual humble, yet no-nonsense way. He detailed out, why Zoho is truly different. Zoho’s strategy of transnational localism with a clear focus on investing into employees is well known by now, and we see it working. Explaining the strategy with another twist, Vembu laid out five principles that will continue to be essential for every business software vendor to thrive:

• Investing in a full product portfolio with breadth and depth
• Offering attractive bundles that have deep value
• Investing into exceptional service and support
• Improving interoperability with more prebuilt integrations
• Getting close to the customer with a strong local partner ecosystem

With 55 tightly integrated apps and growing, value-oriented bundles, and a thriving ecosystem, Zoho is certainly on a strong way following these principles.

Another topic is the way applications get built by software developers. Vembu compares developers to artisans and postulates that software development will become ten times more efficient with the help of generative AI. The developer’s role will change to become far more one of a scientist, leaving the mundane tasks to the system. This way, the whole development cycle as such changes considerably, also enabling vendors to deliver more value by keeping cost in check – or ultimately at close to the cost of the infrastructure that is needed to run the necessary code generators. It will be interesting to see how Zoho’s internal as well as external development environments evolve, based on this prediction.

AI

Apart from development tools, Zoho’s aspiration is to sprinkle AI contextually across the board, i.e. have relevant – productivity increasing – AI capabilities in all applications. Doing this, Zoho focuses on use cases where AI actually adds value. What is interesting is that, defying the current LLM hype, Zoho insists that not one LLM fits it all but that there is an ongoing need for more specialized, narrow, small, and medium models.

Acknowledging user choice, Zoho besides the own ZIA also supports systems delivered by OpenAI, Anthropic, cohere and Vertex.ai.

Collaboration

Zoho Projects as well as Zoho Notebook get enriched by AI capabilities by adding NLP capabilities to Zoho Projects and smart summarization, tagging and task management plus more in a significant upgrade to Zoho Notebook.

In addition, Zoho invested into making Blueprint, the company’s visual workflow technology available in Zoho Projects, Zoho Workdrive, Zoho Sign. What is more interesting is that Zoho uses collaboration and workflows to offer vertical capabilities, first for the construction, healthcare, manufacturing, and aviation industries on top of the collaboration apps. The overall goal is improving collaboration through a combination of industry specific workflows, automation, and AI. Taking the manufacturing industry as one example, manufacturing companies can now leverage Blueprint in Zoho Projects to chart and manage their process pipeline, as well as automate steps in processes like prototype testing, phase gates, or inventory management. Manufacturing companies can also take advantage of Project's integration with Zoho Lens, allowing off-site managers to track and troubleshoot on-site operations using AR technology. Or, Zoho Workdrive now includes workflow automation. This empowers users to map, manage, and automate content procedures across departments and teams — which in turn reduces human error. This includes legal policy or contract review and approval, streamlining data collection for seamless onboarding, consistent HR operations, and more transparent task management.

Integrated security

“Security should not be the price any of us should be paying” is a good headline for this topic. To follow through on this aspiration, Zoho offers a suite of 4 integrated applications with

• Ulaa, Zoho’s privacy first browser, which got enhanced by M/L-based phishing detection, crypto mining detection in addition to the already strong ad blocking
• Zoho Directory, Zoho’s workforce IAM. It now helps businesses manage their users, apps, devices, and networks securely and from one single console with one secure credential. With conditional access and routing policies IT Admins can securely automate access management Users can upload their own encryption keys from an external key manager to encrypt their data thereby ensuring that only they have access to it using the Bring Your Own Key (BYOK). With Zoho Directory Cloud RADIUS, businesses can also now authenticate enterprise WiFi networks and VPNs. Additionally, Windows, Mac, and Linux devices can now be authenticated using Zoho Directory.
• OneAuth, Zoho’s multi-factor authentication solution, now offers Smart Sign-In to provide faster ways to log into their Zoho accounts by scanning a QR code. MFA can be enforced more easily. Accounts can be locked via a tool named Restrict Sign-In. Unauthorized sessions can be easily killed using Remote Logout.
• Zoho Vault, the company’s enterprise password manager. It offers a password generator, policies, breached password detection, compliance reports, browser extensions, and mobile apps. Additionally, Vault provides storage of confidential data, including credit card information, private notes, and software licenses, allowing administrators to set and maintain access privileges for employees based on need and compliance. Vault offers browser extensions, mobile apps, and desktop apps for all popular platforms.

CRM for Everyone

CRM for Everyone is what puzzled me most. It is the implementation of the idea that by far not all teams that are involved in customer operations activities have access to the CRM system, which leads to siloed information and broken workflows – or in the words of Mani Vembu, Zoho’s COO, lacking context. “This is fundamentally antithetical to a great customer experience. Zoho CRM for Everyone breaks down those silos for the first time, enabling different teams in a sales process to contribute productively by reducing CRM complexity and encouraging participation.”

CRM for Everyone is a strategy to break the silos and to enable cross-departmental workflows and collaboration, in an enterprise security context. One can think of it as a step towards breaking down the artificial differentiation between front-end and back-end users. CRM for Everyone does this with the help of three main innovations:

• Team modules that can be built by business teams while being governed by IT, to support their specific needs. Team Modules can have their own fields, permissions, workflow automation, and other customization that is specific to each team. These modules are housed within a dedicated space for each team. Together, this helps unite all customer-facing processes onto a single platform enriched with complete customer context.
• Requester Profiles support the raising of trackable requests of deliverables from, or the contributions of, a colleague from a different team. A requester can simply raise a request in the appropriate team module and track the status of their own requests, eliminating any guesswork involved in collaborative work.
• A refreshed user interface that supports better organization of data and a better usability.

Customers and partners

Zoholics is predominantly a customer and partner event. So, I spent what little spare time I had on the shopfloor talking to some partners and customers about what traction they see in the Zohoverse.

The short version is that the present partners are quite happy. One objective for participating in an event like this being leads, I heard general happiness with the quantity and quality of attendants. They were also happy with their own access to Zoho. Good news.

Customers came with various objectives in mind. The ones who are already Zoho customers, however, often claimed getting fast and efficient support as one of their main challenges. This means that Zoho – like pretty much every other software vendor – is still on a way of fulfilling. However, this is something the company actively works upon, and it is also something that partners can and do help with.

One other topic might become a bit more of a challenge. Zoho wants to provide value while maintaining a reasonably low price point. And the company does a good job at this with a wide set of fairly well integrated apps. Still, at one point, partners come into the picture. They need to charge market rates. This reduces the cost advantage that Zoho has to some extent. And there is no perfect solution for this, as consulting is a people business. I am quite interested in seeing how this topic evolves – and of course also happy to help.

All this together shows how unusual Zoho really is. Starting from a culture angle, the company looks at challenges vastly different than the usual software or technology company. The breadth and width of software and the hardware stack that reaches from communication via collaboration, business apps and productivity apps, on an own technical infrastructure is matched – ok, probably surpassed – only by Microsoft. No other vendor has this broad and deep functionality, not Oracle, not Salesforce, not SAP, not Odoo, and surely not any other mid-sized vendor.

Kudos!

Early May, technology vendor Zoho conducted its annual signature event Zoholics in Austin, TX. During this event, Marshall Lager and I had the opportunity to have a conversation with Jason Yoffy, director of engineering at RJG, a training and technology company that on one hand trains plastic injection molders how to make better parts with less waste and on the other hand also provides technology to support better production processes. RJG exists since 1985. It mainly serves companies in the automotive and medical industries that create safety critical and precision parts from plastic with close to 200 employees.

We were interested in learning the good, the bad, and the ugly about their journey with Zoho; the needs they had, the experience on the way and, of course, where Yoffy sees scope for improvement.

You can watch the complete interview on YouTube.

RJG used an “antiquated, server-based”, i.e., an on-premise CRM system that the company wanted to replace as it left much to be desired. The chief concern was “enabling our sales team to sell better.” A lot of processes still were manual, which did not keep pace with the company’s fast growth. Reporting was difficult, of low accuracy, and slow. Lots of relevant data didn’t even make it into the system. Given that, there was lacking transparency in the state of the business; the teams did not get an understanding where everybody was, what the state of initiatives was. Creating a quote for a customer took far too long.

While all this is not uncommon, “we wanted to grow up and find a solution that would help us move into the future.”

Naturally, one of the contenders for the new system was Salesforce. After all, Salesforce is the undisputed industry leader; it simply is not prudent to not at least consider Salesforce. In addition, RJG assembled a group of people to do some research additional options. This is, where Zoho piqued their interest. Why? Because of the usability and UX implications that Zoho One, built on a single consistent platform, can have as an operating system of the business. 

During the final assessment, RJG started to partner with regional consultancies to help “us do some initial discovery and understanding of some high-level needs, for each part of the organization and then helped us with the process and looking at our projected return on investment.”

As a result of this evaluation, the company chose Zoho for the reasons stated above plus an ROI advantage. As Yoffy maintains, “with Zoho it was all under one cost. So, if we wanted to end up using, you know, instant messaging or Zoho Writer or other aspects of the Zoho suite, we didn't have to pay extra. And with Salesforce everything seemed to be an add-on and an add-on, add-on; and we liked the business model that Zoho had to give us you know, more bang for our buck and allow us to grow into different applications.”

RJG started with the implementation of Zoho CRM and Zoho Desk, as these applications cover the most pressing needs. From there on, the company moved on to also implementing marketing tools. These implementations 

Being a 30-year-old company, RJG already had a lot of established processes that, however, were poorly documented. Consequently, to get value fast, the first implementation was done without much configuration. From there on, RJG underwent a detailed process discovery with the individual teams and their partner AspenTech. “AspenTech helped us understand our business needs and map it out in the software as a solution. They would say you can do it this way, or you could do it this way. And we looked at how putting our processes into software can then grow and scale for us later on. And I think that was a big advantage of having a partner like AspenTech. They were really good at understanding our business needs and requirements and helping us kind of see that in the application.”

What also became visible during the event is that AspenTech and RJG personnel managed to create not only a trusting relationship but also a personal one. This combination of three parties that mutually trust each other and build a good relationship makes a winning team.

Fast-growing companies share a number of challenges for an implementation project. These range from a lack of documented processes to integration with other systems. Not surprisingly, RJG encountered them, too. 

How to deal with them? How to overcome them? Especially, if the company has offices in several locations and countries.

The solution is actually as simple, yet profound, as involving people early, to work with them on the system, and to talk with them. That way, processes can be modeled and later implemented, that are efficient and to the needs of the users. While this has the appearance of creating an extended project, it is actually the faster way, as it reduces the number of time-consuming issues in the course of the project. Yoffy has some best practices to share.

 “Making sure your processes are good before you put them into the system, because you know it's kind of garbage in garbage out. So, that was our biggest issue. Our second issue was we have offices, you know, we have 150 people, we have offices in seven countries. So, we took the strategy of getting them on the systems and then work with the individual country offices to do that. And so that was a bit challenging, you know. They wanted to be included in the first wave and understand what we're doing.”

This approach works for system integration, too. Not every system is as good at integration as Zoho’s. 

“I think, our approach is that we got together in the beginning, you know. We had representatives from each department, sales marketing, customer support, training and consulting and then international offices.”

Lastly, as after the project is regularly before the project, it is important to keep a core team of key users closely involved to keep the ear on the ground and to be able to continuously improve the systems for the users. The original implementation team forms a “core team of people that still exist today. It's not their full-time job, but we named ourselves the Zoholics, just like the conference, because we're, you know, imbibed on Zoho; and they continue to optimize the system and update our business processes and connect things that haven't been connected before.”

There are some good lessons for us to learn in the RJG journey. For one, a think big – act small approach based on a slim start can bring value fast. 

Second, it is important to get the users on board early and make them part of the solution. Third, Zoho can very well be a solution for startups and small companies, as it doesn’t need much configuration and can run right “out of the box” – if there is something like a box for SaaS software – but also cater for the more complex requirements of an enterprise thanks to broad and powerful configuration abilities and available customizing tools ranging from no- to pro code.

Zoho is well known as a vendor for business applications geared towards SMBs. As many other companies do, Zoho wants to support the upper mid-market and enterprises, too. After all, successful SMBs may grow into become enterprises and that might attract other enterprises. So, there are a good number of good reasons to also support upper mid-market and large businesses. The company has actually followed this path for about five years and has set up an enterprise business solutions team to deliver solutions for enterprises.

Still, it is a better kept secret that Zoho already has considerable momentum in the upper mid-market and enterprise segments. Zoho achieved a 65 percent year-over-year growth. The enterprise segment now represents about one third of the business. 

During its signature event Zoholics in Austin, the company on May 4, 2023, changed this and revealed its enterprise strategy. This strategy ultimately rotates around four pillars: Go-to-market, platform, new applications and enhancements, plus security and privacy.

Zoho also backed up its continuing success story by inviting some customers to present their journey with Zoho as a panel and talking individually to analysts and media. 

Marshall Lager and I had the opportunity to speak with Zoho’s head of CX marketing strategy, Prashanth V K. We had a lot of questions and opened up with a barrage about what the customer profile for the Zoho enterprise business is. The interview can be watched here.

Starting with the definition of mid-market: Zoho defines mid-market companies as companies ranging from one hundred to one thousand employees; and Zoho has considerable momentum in this range of companies. In conclusion, enterprises are above this threshold. The second consideration is complexity, which tends to increase with size. Revenue is no consideration, as this is too volatile across regions and industries.

Add growth into the equation and Zoho naturally expands into the enterprise sector. With its platform, Zoho facilitates business growth, and grow Zoho’s customers did, as they could concentrate more on their business, as opposed to their business systems. As Prashanth maintains, “It was a natural logical extension” for Zoho. For some years now, Zoho addresses the enterprise market more strategically, by building internal capabilities like account management, customer success, onboarding, implementation capabilities, etc., that are bundled in an Enterprise Business Solutions unit. To increase its reach and implementation abilities, Zoho also established and continues to establish partnerships with SIs around the world, enabling them to sell the simplicity of the platform and therefore drive value for their customers, including a focus on industries, while Zoho focuses on the horizontal platform “to make it efficient for partners to build the vertical solutions”. These partners are also increasingly brought in to deals. This is crucial to increase trust in the SI ecosystem. Joining forces like this also helps making a successful bid as this demonstrates product-, industry- and delivery experience in a cooperative setting. It shows one face to the customer. 

The starting focus was on global SIs. As Prashanth notes, Zoho wants to regionalize the go-to-market approach and “to eventually establish regionally relevant partnerships”. This allows Zoho to deliver more and better industry solutions, as regional implementation partners not only have deep regional but also deep industry experience.

The third factor taken into account is product maturity. Here, the CX line of solutions is certainly leading. Additionally, Zoho being Zoho, it is also about where customers see value. “We're also seeing, based on the region, a certain amount of larger enterprise traction for various products. Some prefer our finance products some our employee experience products. In some cases, our workplace productivity and collaboration platforms as well” says Prashanth, continuing, “There's a whole ton of no code and local extensibility that we already offer as well. So, we are able to punch way above the weight of an individual product. If you take an individual product to put it under a microscope, you may find that it may fall short in some cases in terms of Enterprise. But because of this vast layer of extensibility, we're able to jump in and cover those.”

Lastly, by continuously analyzing use cases across industries for commonalities, Zoho can bring back commonalities into its horizontal platform, making them available to all customers. The result is that customers need to maintain less and less custom code, as more and more of these use cases are already covered in the horizontal platform without harassing partnerships. This, again, increases the value of the deployment.

All this boils down to the platform. It provides the simplicity that enables businesses to move fast while not depending on the IT department. That way, business decisions can be taken faster, changes can be implemented faster and important personnel can be assigned to do more beneficial and less onerous work to enable the business to enter new avenues of growth. In some instances, where Zoho replaced another software, the customer was able to “maintain the Zoho deployment, with, as many as 10x fewer people, something like that up to 10x fewer people”, which is an extraordinary display of value. 

In summary, Zoho has and continues to evolve around two main axes, technology and target customers. From a technology point of view, there is a move from single applications to solutions and platform, while the addressable market grew from small businesses to now also include enterprises. This evolution revolves around value for customers, driven by a good customer experience.Or in Prashanth’s words: “the thing with Zoho is that we've spent over 20 years, building out this vast mountain of capabilities. I may say that we've also successfully transitioned from a product mindset to a platform mindset, six or seven years ago. And from there, we've transitioned from a small business mindset, largely to an all-business mindset where we do have to approach each segment with the customer experience requirements that it deserves. And the one thing that remains constant across all of these, is the Simplicity that we bring to the market, to the customer to the customer experience to all of this, right? That Simplicity is that is the core tenet, which we want to be identified and we want to be the vendor who simplifies the CX stack or the EX stack, or the workplace stack when large organizations move from their incumbent vendor to us.”

The News 

On May 4, 2023, Zoho held its Zoholics conference in Austin, TX which included a media and analyst track in addition to the customer track. After all, Zoholics is a customer event. During this event, about 80 participants of the former track had ample opportunity to learn about and discuss the latest news at Zoho. We also had the opportunity to listen to - and question - a panel of customers who gave candid answers about their journey with Zoho and challenges they faced. Of course there was plenty of room for mingling and networking with Zoho executives and, of course, with analysts and customers. In addition to the breaks between the tracks, there was a pre-evening reception, a dinner on the event day and a casual brunch at the Zoho farm just outside of Austin. 

As usual for Zoho, the sessions were less about feeding us with PowerPoint (or Zoho Show, to be precise. Why would Zoho not use a Zoho product?) but about giving good information and a genuine interest in getting feedback. This was evident not only during the sessions but also by the customer panel and an open Q and A with representatives of the Zoho leadership team.

Of course, the customers were reference customers. Still, they openly admitted challenges. In one case e.g., it became evident that Zoho's HR software has scope for improvement, another example was users preferring MS Teams to Zoho Cliq. 

The sessions covered four grand themes:

• The release of Ulaa, a privacy orientated browser
• Zoho’s upmarket momentum
• A kick-start set of solutions to help solopreneurs and very small businesses to get running
• Zoho’s AI strategy and OpenAI integration

Ulaa 

Zoho announced the release of Ulaa, its new privacy orientated browser. Here an edited summary of the ChatGPT+ generated summary of the announcement. The full announcement can be read here.

Ulaa is a privacy-centric web browser designed to protect user data from online tracking and surveillance. This browser aims to counter the dominance of tech companies over user data, offering built-in advertisement and data tracking blockers, privacy customizations, end-to-end encryption, and a multi-ID model for enhanced user privacy. Ulaa does not share user data with any third parties and prohibits DNS pre-fetching, which can cache data, and motion sensors that track mouse movement and clicks. 

Ulaa also introduces dynamic mode switching, with five unique modes: Personal, Work, Developer, Kids, and Open Season. Each mode offers a tailored browsing experience and is isolated from the others for added privacy and functionality. These modes can accommodate a variety of user needs, ranging from online banking and shopping to professional web development and safe browsing for children.

On the productivity front, Ulaa provides integrated apps like Zia Search and Zoho Notebook, tabs management options, and a built-in feature called Annotator for screen capture and annotation. The browser also supports all Chrome browser extensions.

Ulaa is free and its desktop version is available for download, with iOS and Android versions in beta testing.

Upmarket Momentum 

For about four years now, Zoho has been working on expanding its customer base into enterprise territory. Zoho announces where its focus for the company's further upmarket growth lies. The full announcement can be read here. Here is an edited summary, generated by ChatGPT 4.

Zoho Corporation, a global technology company, has announced significant investments across its entire portfolio to expedite growth in the mid-market and enterprise segments. After witnessing a three-year, 65% CAGR in these sectors, which now account for one-third of the entire business, the company is set to expand its offerings and services. Zoho currently has over 90 million users across more than 600,000 global businesses.

The planned investments are targeted at go-to-market services, new products, platform extensibility, AI, and privacy and security. They are intended to transform the enterprise customer experience and enable customer success systematically. Specific highlights include:

1. Go-to-Market Investments: Zoho is growing its Enterprise Business Solutions (EBS) group to offer expertise across solutions engineering, implementation, and customer success. It is also strengthening partnerships with technology consulting firms and expanding regionally to support large organizations better.
2. Platform Investments: Zoho is focusing on the expansion of its Marketplace, which allows businesses to extend Zoho and integrate it with incumbent software. It also promotes no-code and low-code extensibility to streamline deployments.
3. New Applications and Enhancements: Zoho is introducing Zoho Contracts, a comprehensive contract lifecycle management solution, and integrating Zoho DataPrep with Zoho CRM for efficient customer data management.
4. Security and Privacy Investments: Zoho is launching Zoho OneAuth, a comprehensive multi-factor authentication application, and Zoho Directory for secure workforce identity and access management. It is also introducing Ulaa, a privacy-centric web browser designed to protect users' personal information and internet activity.
5. AI Investments: Zoho is investing heavily in its AI strategy, launching ChatGPT for Zoho and broadening the capabilities of its internal AI engine, Zia.

Kick-starting a small business 

Without a press release, Zoho's Raju Vegesna announced the availability of five solutions to support solopreneurs and the starting phase of new businesses. These solutions are initially only available in the US, some even only in regions of the US, which in all likelihood is the reason for not issuing a press release - Zoho being an engineering first as opposed to a marketing first company. 

These solutions are

• Zoho Solo: Zoho Solo is a one-stop mobile-only app for the management of a one-person business that covers customer management, task tracking, expenses, invoices and taxes. It is currently in private beta.
• Zoho Start: Zoho Start is a helper for aspiring entrepreneurs to legally set up their business. it is intended to take all the hassle out of this sometimes scary process.
• Zoho Domains: Zoho Domains is a domain registration and hosting service that also ties in to Zoho Sites to enable the quick building of business websites.
• Zoho Publish: Zoho Publish is a reputation management service that enables businesses to drive visibility and build trust for the business from one single platform. It enables listings on various directory services, to monitor and react to incoming ratings and reviews and to get actionable insights via analytics. Zoho Publlish is currently in beta and will be integrated into Zoho One.
• Zoho Tables: Zoho Tables combines the ease of use of a spreadsheet with the power of a database application. Many organizations still are run using spreadsheets. Zoho Tables adds no-code automation, custom fields and collaboration into the mix and is delivered using a variety of templates.

AI Strategy 

The third announcement covered Zoho's AI strategy considering generative AI. The full release can be read on Zoho's website; the edited ChatGPT summary is right below.

Zoho has announced the integration of 13 generative AI extensions and applications powered by ChatGPT into Zia, their in-house AI engine. This integration blends Zoho's decade-long AI investment with third-party intelligence, thereby enhancing customer experience, value, and privacy protection.

This move is grounded in Zoho's AI strategy, which is based on three core principles: enhancing customer experience, safeguarding customer privacy, and providing customer value. Zoho's AI solutions, built in-house, deliver a more intuitive and efficient user experience, protecting customer privacy without compromising data, and offering multifaceted value by improving productivity, ease of use, and cost-effectiveness.

Zoho's suite of applications, including Zoho CRM, Analytics, Desk, Writer, and more, have been updated with generative AI integrations. These new features offer a wide range of benefits, from summarizing key customer records, offering predictive analysis on ongoing deals, to automatic summarization of customer tickets and generating personalized emails.

Customers wishing to harness the new generative AI capabilities within Zoho's applications will need to enable these features actively. This can be done using their existing OpenAI account API key. The cost of using the generative AI features will be determined by the number of APIs used, and customers will be billed directly by OpenAI. This move offers customers the flexibility to choose and pay for only the AI capabilities they need, further enhancing the value offered by Zoho.

Looking ahead, Zoho has a clear AI roadmap and vision. In the short term, Zoho plans to continue Zia's integration with third-party intelligence, such as ChatGPT, to leverage the latest technology in its broad portfolio of business solutions. As part of its long-term strategy, Zoho aims to internalize generative AI technology, providing its 90 million global users with intelligent experiences while maintaining its high value and privacy standards. Furthermore, Zoho is developing proprietary Large Language Models (LLMs) that are capable of conversing, summarizing, paraphrasing, and learning new tasks with zero-shot learning techniques, aiming to revolutionize AI-driven communication and knowledge discovery.

The bigger picture 

This is quite a lot to digest. Zoho is broadening its scope in a variety of dimensions from CRM/CX for SMSs, its sweet spot of earlier times. The breadth of the application portfolio increases and covers an increasing number of business functions. Simultaneously, the application depth increases and delivers increasing capabilities. This includes big investments into AI. 

For about four years, Zoho expands its target market into the enterprise arena. Now, we see a foray into very young and very small businesses.

On top of this, Zoho ventured to create its own privacy-first web browser. Although this browser is based on the existing Chromium engine, it has taken considerable effort to "de-Google" it.

My point of view and analysis 

Zoho announced a potpourri of new things during this event. Let me analyze them in the order of announcements and end with some general points.

The addition of a privacy-orientated web browser to the product portfolio of what is a business application vendor turned technology vendor initially sounds a bit strange. But then, it increases Zoho's credibility on the privacy frontier. It also opens up some quite interesting roads, see below. 

Ulaa 

I have been using Ulaa for about eight months now and find it quite on par with other browsers. Not being one to switch between different modes frequently, I find the delivery of five different ones quite appealing. What I also find appealing is that Zoho does not have a revenue model that remotely bases on advertisements. So, Zoho's privacy pledge stays more than credible. On top of this, I can easily see numerous business use cases for Ulaa. Zoho already has a good number of points of presence around the globe. With the different modes it is easily imaginable to offer a Zoho VPN that can be tied to a mode, or something like Apple's Private Relay to add a layer of protection. Additionally, Zoho offering business applications, it would be possible to add a layer of management controls with a console to manage web permissions.

Enterprise strategy 

As Zoho is moving upmarket for some years now, it is gratifying to see that there is significant traction, especially given the current difficult economic environment. A 3-year CAGR of 65 percent shows that customers do see value for money, which is exactly one of Zoho's core promises. To me, the investment priorities make perfect sense, although some people asked why there is no more investment into marketing. The answer to this question is probably by observing the size and affiliation of the media and analyst track. While there have been quite some known faces, many have been new.  Some of them are focusing more on the enterprise markets, some are leaning more towards the SMB arena. And, they got some tough questions answered. If this approach is successful - and I do not see any reason why it should not - Zoho has enhanced its marketing chops significantly by engaging with some well-connected influencers.

Between this, and the relentless work of the EBS group, any doubt about visibility should vanish. 

The enterprise strategy largely revolves around Zoho's more mature applications, in particular the CX stack. This serves as a strong basis for a land and expand approach, as there is also a strong account manager, or in Zoho lingo, a directly responsible individual, DRI. Still, to avoid being pushed into a niche, this means that other, less mature, applications need to mature fast.

Zoho has also made big inroads with SI partnerships. One of the big successes was the ability to partner up with a good number of global SIs. While this is big, it is equally important to also win bigger regional SIs, as these are closer to Zoho's target markets and to industries than the big ones. They also often have a better reputation. As one analyst stated, in contrast to smaller SIs the big SIs also want to totally control the projects. This can be damaging to the vendor. I second this statement from my own experience. The current way of embedding Zoho EBS into the SI project team scales only so far. Given this, it might be interesting to strengthen the partnership strategy by rolling out an implementation methodology. This would further increase Zoho's credibility.

With regards to partnerships it now should also be the time to look deeper into industry solutions together with knowledgeable SIs and VARs. As this requires some investment on the partner side, some smart incentivizes are needed for this. Zoho's offerings are still largely horizontal, albeit with a wide scope.

What remains, is Zoho internal. As Prashanth V K, head of Zoho CX Marketing Strategy, said to me when I told him about a software selection for an upper mid-market company that resulted in exhibiting rather SMB market behavior: "I can confirm what you observed was not systemic and was more of an anomaly. As Vijay said earlier, old habits die hard". it is here, where Zoho's strength of deploying long tenure employees into new markets to establish the unique Zoho culture has its challenge. While I am sure that this challenge is not insurmountable, it is important to address the enterprise market being different from the SMB market. Single occurrences can hurt the whole organization. Even more so, if the opportunity is not about extending the footprint in an existing account but gaining net new names. 

Kick-starting small businesses  

The kick-starting and solopreneur offerings are a stroke of genius. While they are available only in selected regions, their potential is ginormous. It is hard to overestimate it. In particular, looking at Zoho Solo with its mobile first approach, has a TAM that is in the billions of businesses. The only thing is that the backend needs to scale fast and big enough. Zoho Domain tying into Zoho Sites for building websites offers direct added value. 

All in all, this set of solutions immediately becomes a funnel for the Zoho solutions that address bigger companies. This means that Zoho can support the growth of a company from a one-person shop to a worldwide enterprise. If I had heard about these solutions from many other companies, my reaction would have been deeply cynic: A marketing plot to lock in the companies. Not so when offered by Zoho, where these offerings totally fit into the value proposition that is at the core of Zoho's culture. 

Considering, that Zoho already now has more than 600,000 customers, this opens up another avenue, as colleague Josh Greenbaum observed astutely.This can become the foundation of a business network. Zoho has all the ingredients, from procurement and order management software, via a portal, product and inventory, commerce functionality, etc. This is an intriguing thought.

AI strategy 

The sudden success of OpenAI and its GPT models caught Zoho flat-footed, just like all other business software vendors around. This can be clearly seen in the flurry of announcements and pre-announcements covering great and not-so-great ChatGPT-integrations that every vendor around made in the past few months. Naturally, Zoho could not avoid jumping on the generative AI bandwagon, too. And Zoho did an impressive jump, covering nearly 50 business use cases across 13 applications.

The challenge here is that the usage of OpenAI is not conducive to Zoho's privacy pledge in itself. It is clearly what I would consider a stop-gap solution, as the press release suggests and co-founder Tony Thomas confirmed in a conversation. The partnership with OpenAI was established after considering several LLMs, with GPT coming out best for Zoho's use cases. Still, is a deviation from Zoho's usual DIY mentality, and from the terms of its privacy pledge, namely usage  of own data centers and  complete oversight of customer data, privacy, and security. To accommodate for this, it is a good move to also deviate from the usual procedure of enabling improvements automatically. The OpenAI-integrations are turned off by default. They require a customer-owned API key and the API usage is billed by OpenAI and not by Zoho after the integrations are activated by the customer.

Going forward, Zoho intends to build and deploy its own generative technology. Expect this to happen by leveraging and improving open source technologies. Also, expect this to not happen in 2023 anymore. As there are further use cases for generative AI in progress, the migration paths from old scenarios to new scenarios will be interesting.

 General points 

Zoho is clearly punching way above its weight. Being a company of "only" 12,000 employees, it has an incredibly rich and steadily growing offering. Additionally, the company's values of being independent and pursuing a non-extractive capitalism put a limit on Zoho's growth and therefore finances. Not to be misunderstood, personally I endorse this! It is the right way.

However, it raises the question when a big bite becomes too big a bite to swallow. Or the other way round: How to avoid being stretched too thin? This question has two facets, an internal one and an external one.

I asked Raju Vegesna, Zoho's head of North America. His response to the internal aspect was: it is a matter of leadership that needs to be in place to leverage the strengths of a decentralized organization.

This leadership is clearly in place. Zoho is a very decentralized organization that places decision authority where decisions are needed. This works through a strong set of shared values. I have rarely seen an organization that is as decentralized as Zoho and at the same time lives shared values.

The external facet is a bit more difficult. It is about factors that are disruptive to the potential business. The prominent example is OpenAI. The challenge is that generative AI develops extremely fast, models are huge (GPT four is estimated to have more than one trillion parameters) with corresponding compute requirement. Training is expensive and access to the necessary training data can be expected to become increasingly difficult for privacy and IP reasons. Zoho's data centers might lack compute power, while Zoho at the same time lacks the finances to build up additional data centers fast enough. After all, the infrastructure market is a platform market, and platform markets favor their biggest participants.

Vegesnas solution? Use smaller and more specialized models in an orchestrated manner. It is a typical Zoho solution. It is outside the mainstream, forward thinking and pragmatic. And it is one that might just work.Everything considered, I believe that Zoho's momentum is still increasing. Many a vendor would be well advised to have a look at how Zoho manages how to adapt and overcome and to consistently deliver solutions that convince.

May 11: corrected a quote that was too short and added a bit of context to it in the Enterprise strategy analysis section