The recent remarks of Zoho CEO Sridhar Vembu on X platform raise a question for India’s booming tech industry. Are Indian startups aiming to create real economic impact or merely chasing inflated valuations?
Vembu is asking if Indian tech companies can reach $100 billion in revenue rather than in valuation. The distinction is important as valuations can soar with investor speculation and revenue growth reflects the ability of a company to deliver real value over time.
Vembu points out that the tech giants in other markets such as China built their empires on revenue growth. China’s largest tech firms have focused on long-term goals to grow diverse portfolios that serve real market demands. The lesson for Indian startups is clear and it is that sustainable growth requires a grounded focus on revenue as well as customer satisfaction.
Vembu warns that an obsession with market speculation can lead companies astray and prioritize stock price over sound business fundamentals. He describes stock bubbles as a dangerous distraction as it will pull companies away from building products, refining services and addressing market needs.
Vembu argues that easy money strengthens a lack of discipline and makes companies dependent on external funding rather than on generating revenue to sustain their operations. The dependence means that many companies never learn the critical skill of paying the bills and keeping the lights on. True business resilience comes from revenue-driven growth.
The conversation Vembu ignited also touches on another question that whether India should strive to build a few massive tech companies or simply nurture a diverse ecosystem of smaller firms. Both paths have merit and Vembu advocates for large as well as multifaceted companies that can compete on a global scale. The firms need capabilities across various domains and much like Apple’s expertise from hardware to cloud services.
Some argue that India should take a unique approach to growth and one that emphasizes worker rights, social equity as well as environmental sustainability.
