He stressed that revenue, not valuation, should be the primary objective for Indian tech leaders.
Zoho CEO Sridhar Vembu recently issued a compelling call to action for India's tech industry, emphasising the importance of prioritising sustainable growth over short-term valuation gains. In a series of tweets, Mr Vembu envisioned Indian companies striving for "$100 billion revenue" to propel the nation's economic progress. He stressed that revenue, not valuation, should be the primary objective for Indian tech leaders, as it holds the key to lifting millions out of poverty and driving meaningful economic impact.
The Zoho CEO warned that an overemphasis on immediate stock valuations or high, loose funding can detract from this goal, as they push companies to focus on raising their stock prices rather than building lasting value. Mr Vembu argued that valuation should naturally emerge as a byproduct of consistently doing things right, learning from mistakes, and maintaining financial discipline. When valuation itself becomes the primary goal, it loses its meaning and effectiveness, a concept illustrated by Goodhart's Law, he explained.
''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. China has such world champions in plenty now, and they grew up in the last 20 years. I will tell you what won't get us there. What won't get us there is endless focus on valuation. What will take us some visionary dreamers and builders are in it for the long haul and are able to balance their long-term vision while learning to pay the bills and keep the lights on short term,'' he wrote.
''Stock bubbles actually distract us from the goal because the focus shifts to optimising the valuation short term - and company managements start to obsess about getting the stock price up. An extremely loose funding environment also distracts us because we never learn the discipline of paying the bills,'' he added.
See the tweet here:
Many internet users agreed with his stance and remarked how India's startup landscape is overly obsessed with swift growth and lofty valuations. Some also argued that India's startups are hindered by inadequate financial resources and structural support, unlike China's tech giants Alibaba and Tencent, which benefited from a more conducive environment.
One user wrote, ''India should not mimic China's growth story, and instead should carve its own based on a value system that is empowering for the workforce. China has often relied on a top-down approach with a limited focus on worker rights, environmental sustainability, and social equity. India, on the other hand, has the opportunity to create a growth model that balances economic development with human dignity and environmental responsibility.''
Another commented, ''I think a lot of people should focus on $1m ARR companies. Valuations and fundraise will get you press and eyeballs that most founders are after; just to 'feel like' a founder.''
A third said, ''Completely agree. Valuation without long term view is the biggest problem. Unicorn - kind of things to be looked at only long term.''