Can India Build $100 Bn Revenue Generating Tech Co? Zoho CEO Sridhar Vembu Explains

Zoho CEO Sridhar Vembu questioned the possibility of building a $100 billion revenue-generating tech company in India via a post on X (formerly Twitter). He believes that India requires many companies that earn revenues to the tune of $100 billion, which will uplift people’s living standards in the country.

He posted, “Can we build $100 billion (revenue, not valuation!) tech companies from India?”

The Zoho CEO wrote, “India needs a lot of them if we have to lift our people up. China has such world champions in plenty now, and they grew up in the last 20 years.”

Vembu stressed on the need to give priority to revenue generation rather than stock valuation. He said that companies should be able to manage their short term as well long term goals.

“I will tell you what won't get us there. What won't get us there is endless focus on valuation. What will take us there are visionary dreamers and builders who are in it for the long haul and are able to balance their long term vision while learning to pay the bills and keep the lights on short term.”

He also highlighted the weak funding environment that is diverting the attention of the companies from their goals.

“An extremely loose funding environment also distracts us because we never learn the discipline of paying the bills.”

While reiterating about the stock bubble, Vembu pointed out that the (stock bubble) phenomenon is shifting the focus towards short-term valuation concerns. Stock bubble refers to a scenario, where the price of a share is determined by a speculation rather than the perceived value.

Vembu said, “Stock bubbles actually distract us from the goal because the focus shifts to optimising the valuation short term - and company managements start to obsess about getting the stock price up.”

Goodhart's law

Vembu advised companies to follow Goodhart’s law and urged them to focus on long-term valuation.

He posted on X, “Valuation should be the long term outcome of a million things done right (along with a million other things that went wrong and taught us lessons along the way!) but when that valuation metric becomes the target, it becomes useless (Goodhart's Law).”