Sridhar Vembu, co-founder and chief scientist of Zoho, has urged the country to emulate China's tech-driven industrial prowess. In a recent post on X, Vembu criticised the prevailing business philosophies in India, advocating for a fundamental shift towards prioritising production and job creation over consumption and short-term valuations.
Vembu's message underscores his belief that America's elite is only now grasping the "miracle of China's transformation from the 'cheap labor, cheap goods' label to world-leading tech-driven industrial prowess."
"We in India must study China like a diligent student," the 57-year-old wrote. "Unfortunately, the ideas that dominate the Indian corporate world are still mostly from American business schools (and often Indian professors!)." This, he claimed, "caused the decline of American prowess by teaching spurious doctrines like 'shareholder value'." "The Chinese (like the Japanese before them) had no fascination with American business schools," he added.
Vembu also hit out at what he termed "intellectual charlatans" for teaching "nonsense like 'wealth at the bottom of the pyramid' i.e, big companies should sell to the poorest people." He passionately argued that "the only wealth at the bottom of the pyramid comes from transforming the poorest people into producers, not consumers, first." This, he stressed, highlights a persistent "basic intellectual confusion between production and consumption." He cited "financial inclusion" as an example, which in rural India, he believes, often amounts to "let's push even more debt to people who are already drowning in debt."
For Vembu, the solution is clear: "What our poor citizens need is the opportunity for productive work, first and foremost: jobs, jobs, jobs. Consumption only after production. Expense only after income."
This recent post echoes a similar message from last November, where Vembu, voiced his vision for Indian companies to prioritise sustainable, long-term growth over fleeting valuation goals and compared India's progress to that of China. He highlighted the crucial need for "$100 billion revenue" companies to drive India’s economic future, emphasising that "revenue—not valuation—should be the ultimate goal for Indian tech giants to lift millions out of poverty."
"Can we build $100 billion (revenue, not valuation!) tech companies from India? India needs a lot of them if we have to lift our people up," the Zoho boss had written, citing China’s success in nurturing tech champions over the past two decades as a compelling example. He explained that companies fixated on valuation often lose focus on sustainable growth, asserting that "Stock bubbles actually distract us from the goal because the focus shifts to optimizing the valuation short term—and company managements start to obsess about getting the stock price up." Instead, he advocates for businesses led by “visionary dreamers and builders” who aim to balance a long-term vision with the immediate need to pay the bills and sustain operations.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
