Pressure to manage stock price would be brutal: Zoho founder Sridhar Vembu amid top deck rejig at Freshworks

Pressure to manage stock price would be brutal: Zoho founder Sridhar Vembu amid top deck rejig at Freshworks

Zoho Corp’s founder and chief executive Sridhar Vembu on May 2 said on X platform (formerly Twitter) that running a public company is a lot harder than running a private company and added that being private has helped Zoho to invest long term in R&D without worrying about how quarterly numbers.

“Personally, as a public company CEO, I won't be able to live in a remote village and work on my own deep tech projects along with the school, the farm and rural works - the pressure to manage the stock price would be brutal and then I would have to transmit that pressure to everyone else in the company. That relentless pressure leads to employee burnout and attrition. We remain private because I want to work with our people long term on critical projects,” Vembu wrote on the social media platform.

Zoho, one of India’s most profitable privately held firms, has been bootstrapped since inception, with not a penny in external funding.

While Vembu didn’t give context for his tweet, the timing didn’t go unnoticed. He posted hours after Freshworks founder Girish Mathrubootham handed over the CEO reins to company President Dennis Woodside and transitioned to executive chairman.

Freshworks, founded by Zoho alums Girish Mathrubootham and Shan Krishnasamy, was also founded in Chennai but took a different path in terms of funding and scaling. It raised money from investors such as Accel, Sequoia and Tiger Global, and went on to become the first Indian SaaS firm to list on Nasdaq a few years ago. A number of SaaS entrepreneurs who started up in India have either worked at Zoho or Freshworks.

Zoho and Freshworks also have a bit of an unhappy history, as the former sued the latter some years ago alleging misappropriation of trade secrets, a matter which was later settled.

In an earlier interview with Moneycontrol, Vembu had said that there will ‘definitely doesn’t have IPO plans.

On May 2, Girish Mathrubootham, who was the chief executive officer (CEO) of Nasdaq-listed Freshworks, transitioned to become the executive chairman of the company while Dennis Woodside, has been named his replacement and is now the chief executive effective May 1.

Post the announcement, Freshworks' shares dropped nearly 25% on May 2nd and are trading at $13.75 apiece.