Amid global macro headwinds, Zoho on Wednesday said it has decided against layoffs but will adopt a prudent approach involving a hiring freeze for engineering roles and pruning marketing spending, although selective recruitment for customer-facing roles will continue.
The software-as-a-service (SaaS) company announced investments across its entire portfolio to accelerate momentum in the mid-market and enterprise market – a segment it collectively refers to as ‘upmarket’. The company, during a briefing, said it has logged a 65 per cent compound annual growth rate (CAGR) within the mid-market and enterprise segment, in the last three years.
Praval Singh, VP of Marketing and Customer Experience, noted that while there are economic shifts, CIOs are looking to optimise on cost and value, and Zoho solutions are even more relevant in these times.
“That is the silver lining and that is the reason for us being bullish more so in India. Certain parts of the world are more challenging but in India the opportunity we have, the headroom that exists, the solution capabilities that we have, and customers we are bringing on board, there are reasons to be bullish,” he said.
Zoho also witnessed a 65 per cent three-year CAGR within the mid-market and enterprise segment globally. This segment now represents one-third of the entire business. Overall, Zoho now serves over 90 million users across more than 6,00,000 businesses.
Asked about hiring plans for FY24, Mr Singh said, the company is “taking one month at a time” and “there is a hiring freeze definitely on the engineering side.”
“We are making selective openings on customer-facing roles (sales and marketing, customer support) because you need that to be able to serve customers, but in general, there is a lot of thought going into large-scale hiring. We are not hiring people en mass because of how things are,” Mr Singh said.
The company, he asserted, has been clear from the beginning that there will be no layoffs.
“We never went overboard in our marketing spends or hiring a lot of people, and right now, we are being a lot more prudent in keeping that in check. But no layoffs that is one thing we have decided. Also what we have decided is to cut down on our marketing spends,” Mr Singh said.
The company has 12,000 people.
India, he said, is still shielded from economic headwinds to quite an extent.
On the company’s approach to Artificial Intelligence, Mr Singh said that in the short-term Zoho focused first on integrating its portfolio with generative AI.
In the mid-to-long term, the company is developing proprietary Large Language Models (LLMs) which will be capable of conversing, summarising, paraphrasing and adapting to new tasks with zero-shot learning techniques empowering seamless AI-driven communications and knowledge discovery.
“We are working on our LLM but that is a long-term plan. These things take time. The short term is about integration, but tomorrow you will have an offering from Zoho also, depending on what you choose to plug into it,” he said.
Zoho’s growth in India is led by banking, financial services and insurance (BFSI), manufacturing, retail, fast-moving consumer goods (FMCG), pharmaceutical, and IT sectors. PTI