Up until COVID-19 pandemic, not so many people have heard of Zoom or its Founder and CEO Eric S. Yuan. The success of the product – Zoom – which he created has brought him so many admiration and popularity from different individuals and organizations. Zoom is worth $35 billion and is ranked the most successful IPO of 2019. For those who still don’t know fully what zoom is, let’s begin by getting to know about Zoom.
What is Zoom?
Zoom is a video communication company, providing software platforms for video meeting, video conferencing, video webinar, phone and messaging services. Zoom provides meeting capabilities that make it easy to start, join and collaborate across devices from any geographical location.
Zoom gives individuals and organizations a faster way to communicate relative to audio-only channel and in-person meeting, and it’s not restricted by geography. With its app, some employees have more flexibility to work from home or anywhere for that matter. The product is affordable, easy to use and scalable. It supports groups as few as two and as many as 1000 people in only video meetings. It has helped many businesses to upgrade and employees to work despite the quarantine measures adopted in response to coronavirus pandemic.
Zoom offers its Basic plan for free. This plan allows you to host up to 100 participants, have unlimited 1 to 1 meetings, have 40 minutes limit on group meetings, among many other features. This means that Zoom lets anyone host an online meeting for 40 minutes or less for free.
The company presently has surpassed 300 million daily Zoom meeting participants.
Early Stages – Eric Yuan and Zoom
Zoom wasn’t this popular. In fact, there was nothing like zoom in April 2007 when Eric Yuan was working with Cisco Systems as an engineer. Eric Yuan, a Chinese immigrant joined WebEx, an online conferencing company located at California, US in 1997 as one of its earliest engineers. Eric Yuan, having been rejected of US visa application for 8 times, was in 1997 issued a visa in his ninth attempt, he was 27 at the time according to Bloomberg.
When Yuan arrived in US to work for WebEx, he barely spoke English according to CNBC. He put all his time and effort on work. “For the first several years, I was just writing code and I was extremely busy” “I just learned it (English) from my team mates.” Yuan said.
While in WebEx, Yuan rose to become the company’s head of engineering, a position he held till 2007 when Cisco acquired the company for $3.2 billion according to CNBC. He was with Cisco for 4 years before he left to build zoom.
In a video interview credited to TiE Silicon Valley that I shared down this page, Yuan saw problems with the WebEx conferencing solution he helped created and he was highly troubled by the constant dissatisfaction WebEx customers experienced.
“Every day I woke up, I really didn’t want to go to the office. I felt very embarrassed to see so many unhappy customers. I was not thinking of leaving Cisco at that moment, I was trying to fix that problem. Cisco wasn’t ready to change. After 1 year I was unable to convince Cisco, I started to build a new solution to correct those challenges customers where having with WebEx.” he said in the interview.
Yuan wanted to build a more user friendly conferencing system that was easy and fun to use. Zoom provides a virtual background feature that allows users to display an image or video as their background during Zoom meeting.
It is to be noted according to Forbes, that Yuan studied applied mathematics and computer science at Shandong University of Science & Technology, China, and at age 22, got married while pursuing his Master’s degree. He worked for 4 years in Japan, there he was convinced he’d start a company someday. So, when he heard entrepreneur like Bill Gates spoke about the internet boom in 1994, he set his eyes on the US tech boom. Despise being denied Visa 8 times, he refused to give up. “I told myself, okay, great. I’ll do all I can until you tell me that I can never come here anymore. Otherwise, I’m not going to stop.” he said.
The Challenges and progresses
By 2010, Yuan was unhappy at Cisco Systems, according to an interview with Forbes. His unhappiness was as a result of problems with WebEx service. In his words: “The service simply wasn’t very good. Each time users logged on to a WebEx conference, the company’s systems would have to identify which version of the product (iPhone, Android, PC or Mac) to run, which slowed things down. Too many people on the line would strain the connection, leading to choppy audio and video. And the service lacked modern features like scree-sharing for mobile.”
Yuan pestered his bosses to let him rebuild and create a new solution but was not listened to. “Cisco was more focused on social networking, trying to make an enterprise Facebook,” he says. “Cisco made a mistake. Three years after I left, they realized what I said was right.”
His biggest hurdle was convincing his wife, who saw him throwing away a lucrative job managing 800 people, Forbes reported. “I told her, ‘I know it’s a long journey and very hard, but if I don’t try it, I’ll regret it.”
Yuan could only convince his friends and former work colleagues who had faith in him to invest in his new solution, an idea everyone in venture capitalists thought was a terrible idea, due to the fact that video conferencing business was already saturated. Big players like Microsoft Skype, Google Hangouts (now Google Meet) and Cisco were already leading the market, and there were also multiple startups, including well-funded BlueJeans Network . They couldn’t fathom how any new entry could survive in this market category. “It would require flawless execution to win,” one investor who passed on Zoom says, as reported by Forbes.
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He was 41 years old when he decided to build zoom, and according to him, he thought he was old, and that was part of the reason investors didn’t want to invest in him. “As long as you have an idea and you really want to pursue your dream, the sooner the better.” “And one of the mistakes that I made after I started Zoom, I just realized that I should’ve left Cisco WebEx much longer” he said in video interview with TiE Silicon Valley.
“We kept improving the platform, making sure that it was solid. If your product foundation is not solid and you start selling, you might get customers, but you may need to fix problems at the same time you need to get new customers. It feels a bit like chaos and not well-organized.”
Yuan and his team worked quietly for nearly two years on their product. “We kept improving the platform, making sure that it was solid. If your product foundation is not solid and you start selling, you might get customers, but you may need to fix problems at the same time you need to get new customers. It feels a bit like chaos and not well-organized.” Yuan said in an interview with Forbes. And when Zoom launched in late 2012, it had several key differences from other similar products. Its lightweight Web client could figure out almost instantly what kind of device you were using, meaning Zoom didn’t need different versions for Mac or PC.
Unlike the conventional audio-first cloud architecture, Zoom’s architecture is video-first cloud architecture. This means Zoom prioritized the delivery of excellent video services coupled with audio and text messaging, making their product unique and highly competitive. Zoom could operate even on a 40% data loss, so with slow internet connection, it would still work. Aside its free version, paid versions starts at $14.99 per month, per host, which undercuts its rivals.
Since its launch, Zoom has gained so much acceptance from individuals and businesses. The company has over 30,000 corporate clients including Samsung, Walmart, Capital One, Uber, according to Forbes, enjoying over 300 million daily Zoom meeting participants.
According to the Financial Times, Zoom had one of the most successful IPOs of 2019, making the company worth more than Lyft and Pinterest. Zoom’s share price rose 72% on its first day of trading alone, Forbes.
Yuan has made nearly $4 billion in 3 months as usage of his video conferencing software skyrockets amid the coronavirus pandemic. Eric Yuan built a $35 billion video conferencing empire in nine years. His net worth has climbed to $7.18 billion in the past three months as the rest of the world braces for an economic crises caused by the novel coronavirus. He’s now number 223 on Bloomberg list of the world’s richest people, a list he wasn’t even on before year 2020.
Amid the coronavirus pandemic, zoom has taken the world by storm. Users from all over the world share their experiences with zoom. A twitter user said “there’s barely been an evening when my wife isn’t doing virtual drinks with friends. And then there’s the weekly toddler virtual play group which is mayhem.”
“I’m dining every night with friends via Zoom.” another user said.
Many people are hosting birthday parties, get-together parties, yoga classes, hangouts, among many other events via Zoom.
Zoom’s business model has forced Microsoft’s Team and Google’s Meet to make changes to their products in order for them to stay in the competition. Google has on April 29, announced that its Meet video conferencing service, previously called Hangouts Meet, is now free for anybody who wants to use it.
Zoom’s philosophy is to create a company that promotes self-motivation; an environment where employees can motivate themselves. A happiness culture.
Asked about the impact his new wealth will have on him, Eric Yuan has this to say: “If I was 25, maybe I would be excited. But those things don’t have any impact on me. Money is not going to bring me happiness.
“When I was very young, I always ask myself one question, – what’s the purpose of life? I did not have an answer for a long time. Later, I realized that the purpose of life is to pursue happiness. And what kind of happiness is sustainable? Not a dream of power and money, or by lots of other things. The sustainable kind of happiness come from making other people happy. That’s the personal philosophy that drives me in life and business.” Yuan said.
He shares more in this video:
I hope the story of Zoom and Eric S. Yuan has inspired you to dream more and be better.
Just as Forbes stated beautifully here: “Its sudden fame – emanating from its IPO – is a new feel for a company that takes its cues from a CEO who not only shuns the spotlight, but is so frugal he insists on reimbursing Zoom when he gives a friend swag like a Zoom backpack. Beneath the belated buzz: a story of perseverance and better execution, proving that an unexpected challenger can sweep the field, even in a crowded market.”
Featured image credit: Kena Betancur/Getty Images