Zoom, the video conferencing company, had an IPO on Thursday April 18 2019. Shares jumped 72% on its opening day, putting the company’s valuation at nearly $16 billion. Eric Yuan, Zoom’s founder and CEO, owns 20.5% of his company’s stock. At the price Zoom closed at Thursday, Yuan is now worth more than $3 billion.
Unlike most Silicon Valley tech unicorns, Zoom is profitable AND it has been growing like crazy. The company saw $7.5 million in profits in 2018. The company brought in $330.5 million in revenue in fiscal 2018, up 118% from $151 million in fiscal 2017. With COVID-19, Zoom is booming.
Here is a few facts you might not know about Eric Yuan:
He moved to the United States in 1997 after his visa application was rejected 8 times.
He spoke very little English when he moved to the U.S. Instead of taking English lessons or going to an US graduate school, he chose to learn English from his colleagues.
He founded Zoom in 2011 when he was 41 years old.
He started a company in a super crowded market against incumbents such as Cisco/WebEx, Google Hangout, Microsoft Skype, and GoToMeeting, but he still succeeded.
He was a key engineer and later VP of Engineer at Cisco/WebEx. According to a Forbe Article: “ Yuan was not happy with the way Cisco was managing WebEx when he left in 2011. As he said, ‘I was paid very well as a VP at Cisco. But WebEx was my baby. In 2010 and 2011, I did not see happy customers. I was very embarrassed that I spent so much time on the technology. Why are the customers not happy?’”
He has 99% approval rate by his employees on Glassdoor, and won Glassdoor’s top CEO award.
I happened to know quite a few early employees of WebEx. I’m a big fan and an user of Zoom’s software. I also have a number of coaching clients who are former and present Cisco employees. So I know quite a bit about the background of Zoom and WebEx. Putting aside media hype, this is a remarkable entrepreneurial, business, and career success story. I feel that we can all learn a few important lessons.
First, don’t let your background limit yourself. Eric started from a very humbling beginning: spoke very little English, didn’t attend any college or graduate school in the United States, and had no connection in the Silicon Valley. But, he continued to work on improving his skills. Watch this CNBC interview of Eric Yuan.
Second, it is never too late or too old to start a company. Eric started Zoom when he was 41 years old. The media liked to portray young entrepreneurs who dropped out of college to start tech companies. The reality is very different. According to Harvard Business School (HBS) research, the average age of successful startup founders is 45 years old. It’s very different from what you might have heard or read from Media. From my own coaching experience, I have helped folks in their 50s and 60s to land impressive positions at Google, Amazon, etc. Age is just a number; it’s about your skills, leadership capability, and drive.
Third, no matter how crowded a market is, there is always room for a much better product to replace incumbent products. The notion of “first mover advantage” is overrated.
Fourth, your professional network is critically important. Eric’s initial angel investor was the former head of business development at Cisco. Key founding members of the Zoom engineering team came from WebEx. Here is a key piece of career advice I can offer you: the #1 thing you can do to accelerate your career is to find ways to work with really smart and brilliant people. You’re the average of the 5 people you’re associated with on a daily basis — if you work with really talented people, they’ll lift you up.
Fifth, people want good people to win. Eric is a good guy and a great CEO. I read the reviews on Glassdoor.com. Sometimes companies have faked reviews on Glassdoor.com. But, Zoom has so many positive reviews on Glassdoor that you can feel employees really like their company and CEO. I have talked to many people in the Silicon Valley. Here is a consensus among entrepreneurs, venture capitalists, and employees: “You will be hard pressed to find people who have met Eric and don’t support team Zoom.”
Sixth, do not stay at large companies for too long. Cisco acquired WebEx when it was the clear market leader. Like most acquisitions, the pace of innovation at WebEx slowed down significantly after it became part of Cisco. Eric Yuan even mentioned that some of the codes he wrote for WebEx 20 years ago are still running today. Over the years I have coached many clients who worked at IBM, Cisco, Microsoft or other large companies for 10-25 years. You get very comfortable in the large companies, but your skill set and drive are slowing down every year. You’re running the risk of losing your edge if you stay at large companies for too long.
Seventh, if you want to strike IPO rich, you need to find companies like Zoom to join — great CEO/leader, strong culture, great product, and high growth. This type of company is “under the radar” a little bit — startups like Uber, Lyft and Pinterest get the most media coverage. Ironically, Lyft had a horrible IPO and its stock price has been plummeting. How to identify high-potential, pre-IPO companies that are the “real deal”? You need to build and grow your network, and meet great people who are working at these companies. They’re brilliant, hard working, and customer-focused. Their companies’ financials are solid — strong top line growth while showing path to profitability (or even showing profits). Their customers are happy. And their employees are happy.
If you want to figure out a plan to join a high-growth, high-potential company such as Zoom (either pre-IPO or post IPO), I have designed an expanded “all in” 1-on-1 coaching program (4 1-hour personal coaching sessions, mock interviews, unlimited email based support, $1,499) that will help you define a target list of 3 companies, customize your resume and LinkedIn profile, thoroughly research and prepare interviews for each of the 3 targeted companies, and practice mock interviews. Email andrew@NailYourJobinterview.com to sign up.