Zoho CEO Sridhar Vembu dismisses IPO plans, citing risks to long-term innovation
Arattai, Zoho’s messaging app, records a 100x traffic surge and tops app store charts
Union Education Minister urges citizens to adopt the app as a secure Indian option
Sooner or later, start-up founders eye the public markets as a part of their growth journey. It is often viewed as a potential pinnacle of success. But software giant Zoho’s founder, Sridhar Vembu, has a different opinion about it. Once again, he has reiterated the calls for his company to launch an IPO (initial public offering).
In a post on X (formerly Twitter), Vembu argued that investor pressure would kill the kind of long-term engineering bets that define the firm’s identity. “Let me state the reality: Arattai would very likely not have been built by a public company that faces quarter to quarter financial pressure. It was a ‘hopefully foolish’ project,” the Zoho founder wrote.
“…Even our employees had expressed scepticism that Arattai would ever gain any traction. We built it because we felt we need that kind of engineering capability in Bharat. We need a lot more of such capabilities in Bharat and we are on it,” he said.
He further stated that Zoho has some ambitious, long range R&D projects which include compilers, databases, OS, security, hardware, chip design, robotics (not to mention AI), among others. “We have invested in many R&D intensive companies that we know won’t make money soon”.
“We essentially ignore short term profits, as long as we don’t lose money. And we have a culture of founders and senior executives living frugally, like how good scientists and engineers in ISRO would live,” he added.
Why Arattai Is Back in Spotlight?
To give context, Arattai is a homegrown messaging app built by Zoho. Headquartered in Chennai, the app is trying to position itself as a “made-in-India” alternative to global chat giants. It allows all the features similar to any modern messenger with end-to-end encryption. These include text messaging, voice and video calls, stories, channels, and media sharing.
The app has recently seen a 100x spike in user traffic over the past three days. The number of users surged from 3,000 to 350,000 sign-ups per day. In addition, it has also ranked first in the app store.
The Indian government has also given Arattai a boost, with Union Education Minister Dharmendra Pradhan urging people to adopt it as a secure and homegrown alternative.
What truly makes Arattai stand out, however, is Zoho’s uncompromising stance on privacy. In contrast to global players often accused of trading user data for advertising profits, Arattai pledges not to monetise personal information—an assurance that resonates with users worried about surveillance and data misuse.
The software giant built Arattai because Zoho felt that kind of engineering capability in Bharat. Zoho is a $1 billion-plus SaaS (Software-as-a-Service) firm, which is known for its low-profile yet fiercely independent stance.
