Zoho: Inside the 'Wal-Mart' of Small Biz Services. Humility, Customers. Loving Competitors (Video interview)

Walk into your local Wal-Mart and look around. If your family needs food, you can get it from Wal-Mart. If your car needs parts, you can get them from Wal-Mart. If you're in need of medical services, you can get it. If you need clothes, you can get it. Need a new patio?

Zoho is like this for many small businesses.

Zoho is an online service that offers 22 hosted applications which enable businesses to do just about everything they need: Email, CRM, invoicing, presentation and more. Much more. Need to manage your staff? Check out Zoho HR.

The company, its CEO and management team, are quite amazing.

Sridhar Vembu, CEO and co-founder of Zoho does not appear as a "typical" dot-com executive. He dresses simple, very simple. Has a fast laugh. Takes life easy. Is brutally honest. Doesn't spend money frivolously. Some might call him cheap. Maybe he's this way because he (and his colleagues) bootstrapped Zoho and built it to be one of the leading providers of online services to small businesses. Maybe it's because he was brought up to not waste.

When it comes to Zoho, Sridhar's philosophy is very, very simple: Customers. Customers. Customers.

In fact Sridhar said that If it's best for his customers to work with Zoho competitors, he'll do it. Hence a big sign on Zoho's web site pointing people to Google Apps Marketplace. (Google competes head on with Zoho).

One of the reasons Zoho can love its customers and work with competitors is because Sridhar said there is NO room for arrogance at Zoho. All employees, need to be humble. This humility does not just mean towards competitors, but even internally. The engineer who just started working can give direct input to the CEO!

Zoho's vision is to be the extended IT department, for software, of small (and large) businesses.

Raju Vegesna, Zoho's customer evangelist told me that since Zoho provides so many services (22 and growing), there's no reason for a customer to look beyond Zoho for any of their day-to-day operation software needs.

I asked Sridhar, since Zoho had so many applications, is there concern that Zoho is quite broad but not deep.

Meaning, are Zoho's applications just churned out quickly but not as robust as many of their competitor's applications who have entire companies or divisions focused on one application. For example, Citrix has Gotowebinar. Can Zoho Meeting compete?

Sridhar told me that Zoho's applications are designed from the ground up to stand on their own. These are not hastily programmed, lite-weight applications, but applications run like individual companies, whose managers run them with their own P&L.

Zoho has been around for 10 years and they still don't spend money on advertising, fancy pool halls or other perks of their dot-com brethren.

The bulk of Zoho's money, privately held money, is spent on research and development, therefore Zoho does not have a lot of the overhead of many of its competitors. Part of the reason for this frugality is how Sridhar and his team started out, which guides them to this day.

In the early days, they struggled quite a bit, for many years in fact, to be where they are today. (if you meet Sridhar or Raju - I highly recommend that you take 10 minutes to hear their story). A VC did not hand them millions of dollars and say, "go play" (not that VC's do this in any case - as I learned from New York Entrepreneur Week - The "Funding Bill of Rights").

Zoho scraped and scrapped together a variety of evolutions and iterations of "Zoho" to make it, what it is today.

Sridhar told me that part of the reason for Zoho's low prices (and in fact most all of the services are free up to a certain level) is to ensure that the "little guy", the business professional just starting out and with a small budget can afford Zoho's services. As they grow, they can then upgrade to fee based Zoho services, which are still quite affordable and low cost.

What does this mean for your business?

As you consider hosted applications for your business, the culture of the company's executives behind the product you are using matters. Zoho is clearly a great company, led by ~~great~~ awesome leaders.

See the 3 minute video interview with Zoho's CEO