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Zoom Business Model and success story, funding and growth

Zoom business model and zoom success story 

Once you read the word ZOOM, you might relate it to cars or racing or even photography. But the zoom that you are going to learn about is not related to any of these. In this current pandemic, where companies have asked their employees to work from home, this App has become very popular. The business model of Zoom is to offers various products to help people connect via audio, video, and chat. Zoom Rooms and Workspaces are used by large scale organizations to conduct virtual meetings.

Zoom App Purpose:

Zoom is a cloud-based video-conferencing application that allows its users to connect with people through audio, video, and chat.

Zoom App Mission:

“Make video communications frictionless.”

Zoom App Vision:

“Video communications are empowering people to accomplish more.” 

How did zoom start? 

Zoom was founded in the year 2011 by Eric S. Yuan. It is headquartered in San Jose, California. He was a former executive at Cisco WebEx.

At Cisco, he came across the fact that customers were disappointed because of the poor audio and video quality when many people tried connecting to the App. He decided to start his own Video conferencing platform, which was initially named Saasbee later on rebranded as Zoom.

Zoom founding story 

Zoom launched its first product in 2013. Video conferences could host 40 people at the same time. With advancements in technology and improved updates, the number of people that can attend a meeting has become 500. 

By May 2013, Zoom reached a significant peak of 1 million participants. Zoom has simultaneously improved its database and included more proficient features, thus attracting many more users. Currently, Zoom App has 2.5k plus employees, 1 lakh plus followers on Facebook, and 2 lakh plus twitter followers. Zoom hosted Zoomtopia 2017 from September 25-27, 2017, its first annual user conference. Zoom announced a partnership with Meta to integrate Zoom with augmented reality, integration with Slack and Workplace by Facebook, and first steps towards an artificial intelligence speech recognition program.

It has two core products: Zoom Meetings and Chat as well as Zoom Rooms and Workspaces.

Zoom Rooms and Workspaces are used by large scale organizations to conduct virtual meetings.

Zoom funding

In May 2011, Zoom started with a seed funding of $3 million. 

This increased to $6 million in Jan 2013 in Series A from its investor Qualcomm Ventures.

In September 2013, it raised $6.5 million in Series B from its investor Horizon Ventures.

In December 2014, it raised $30 million in series C from the investor’s emergence, Horizon, and Qualcomm. 

In January 2017, it raised $30 million in Series D from the investor’s Sequoia, Emergence, AME cloud ventures, and Qualcomm, making it so-called Unicorn.

In April 2019, it raised $840 million in IPO.

Zoom app platform interface and accessibility features

Features Of Zoom App

  • Host Audio & video conferences
  • Host webinars
  • Host one – on – one & team meetings
  • Allows chatting during the meeting both from mobile and desktop 
  • Allows up to 500 participants
  • Allows screen sharing with the best quality directly from your android device 
  • Allows recording 
  • Easily invite phone, email, and company contacts.
  • Works with WiFi, 4G/LTE, and 3G networks

Unlike other Apps, this Zoom App doesn’t require one to have an account to access zoom meetings. The Zoom App is easily compatible with Mac, Windows, Linux, iOS, and Android, and this makes it easy for anyone to download this application from the Google play store and use it for free. The Zoom App has a rating of 4.0 on the Google Playstore. The Zoom business model charges businesses a subscription fee to avail of all its services. 

Zoom also offers a few more value added features like: 

  • Zoom Phone – with features such as intelligent call routing, automated attendants, voicemail, and call recording.
  • Zoom Video Webinars, a conferencing tool.
  • An app marketplace to install third-party applications such as HubSpot, Slack, or Trello to enhance the functionality of the product experience.

Zoom competitors are Google Meet, Pinterest, Uber, Lyft, Teamviewer, and many others. Zoom is operating on a profit while its counterparts are still burning money to stand a place in the market. ZOOM Partner programs help value-added partners to help customers to adopt the Zoom cloud meeting solution.

Zoom is booming during this crisis since companies are using this App to conduct meetings and schools to lecture students. One negative outlook on Zoom App is that there is a security concern for its users because of its privacy and corporate data sharing policies. This has lead to scrutiny of its software. Also, there were instances where unintended people joined existing meetings, a term which is called Zoombombing. Zoom has made sure to look into such discrepancies and have taken measures to resolve the issues. Some of the security tools that are available are the ability to lock the meeting once it has started so that no new people can join, remove current participants if they are causing any trouble during the meeting and disabling private chat to avoid interrupting other participants by personal chatting with them while the meeting is on.

How does the Zoom make money? 

How is it growing economically despite this existential crisis? Let’s have a look at it in detail.

As mentioned earlier, the Zoom App has many features, and this attracts a large number of users. The Zoom App has a free accessible option wherein the user has to install the App from the Google play store and sign in. This will allow the user to gain access to Zoom meetings where one can host group meetings with around 100 people on board and for 40 minutes as well as join Zoom meetings and also avail the chat option.

The next option where the user requires to host a group meeting for more than 100 people and requires organizing a more extended conference, i.e., more than 40 minutes, then the user must sign up for a premium account that provides the above services.

Zoom meetings & chat

This is the basic form of the Zoom App, where one can host or join a group meeting and chat. This can be accessed by using the desktop or one’s mobile.

$14.99/mo/host while billed monthly 

$12.49/mo/host while billed annually.

Zoom rooms & workspaces

What is a Zoom Room? 

Zoom Rooms are nothing but a conference room just like the one which exists in a corporate office. This Zoom conference room allows one to organize video meetings. Users can either use the hardware providers such as Cisco or buy from Zoom-certified hardware providers.

Then the conference room is installed successfully. 

$49 a month per installed conference room

$41.58 per month when billed annually

Zoom phones

This service helps users to have voice calls and not video calls.

Other features in Zoom phones:

  • AI-assisted call management and routing
  • Call recording and voicemail
  • Secure HD audio for clear conversations


$12.49 per month when billed annually

Zoom video webinars

This option helps the user to host a webinar that allows 10,000 view-only attendees. The host can share his/her screen, images, video, and audio. The attendees can clarify their doubts via chat option or Question & Answer options. 

$14.99/mo/user (when billed monthly). 

The price of a webinar license depends on the number of attendees hosted. 

Zoom also provides special packages for Education, Telehealth, and Developers.

Zoom Basic – Free (Can be used for personal meetings. One can host any number of meetings for 40 minutes but meetings can’t be recorded.)

Zoom Pro – $14.99/mo/host (For small teams, this allows hosts to create personal meeting IDs for repetitive Zoom Meetings, meetings can be recording and the duration lasts up to 24 hours.)

Zoom Business – $19/99/mo/host (For small & medium business)

Zoom Enterprise – $19/99/mo/host (For a large enterprise with 1000+ employees and one can avail offers on webinars and Zoom rooms.)

Presently Zoom is providing its users who sign up to choose to buy a Pro Annual Plan with ZOOMCARES and can avail an additional discount of 20%, and this means a $60 savings. 

Zoom annual revenue and valuation

Zoom was already profitable before its IPO and earned $7.58 million in net income for the fiscal year 2018. Its annual revenue in 2019 was $622.7 million, up 88% year-over-year. In Q1 2020, the revenue was $188.3 million. Currently, zoom is valued at 68B.



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