'Silicon Valley people are generally used to layoffs.'
'Every person who has been in the industry for 15-20 years would have been laid off at least 3-4 times.'
'In India, we aren't used to that concept.'
'So when it came here, people were shocked.'
The world is yet to come to terms with the recent collapses of Silicon Valley Bank, Signature Bank, and Credit Suisse.
But for Sridhar Vembu, founder and chief executive of the software-as-a-service (SaaS) major Zoho Corporation, the current global downturn is still quite nascent.
For the SaaS industry and Zoho, it is "time for caution and not expansion", he said.
In an exclusive interaction with Business Standard, Vembu said the industry should be concerned about two big things -- the current global financial situation, including the failure of SVB and Credit Suisse, and the evolution of artificial intelligence.
"We have to take time to digest all this," Vembu said.
"See, what the shape of future business is.
"We have navigated two big crises -- the dotcom bust in 2001 and the global financial crisis in 2007-2009.
"Experience shows it is the time for caution, not expansion," he said.
With the SVB collapse affecting the banking tech and start-up sectors, it is widely believed this may have a cascading effect on India's tech industry.
Asked about the impact the global crisis could have on India, Vembu said: "This downturn is very young. I don't think we have seen much yet."
Vembu's comments on expansion come at a time when the company has opened two 'hub' offices in Tirupur and Trichy, and plans to open offices in Tirunelveli and Madurai districts in Tamil Nadu, along with one in Uttar Pradesh.
Regarding the recent layoffs in India, the Zoho founder said this was expected in the Indian market too.
"We had absolutely crazy stuff going on in the industry -- you leave a job and get a 3x offer and again get a 2x offer, all this was going on in Bengaluru.
"We have not seen this in India.
"Silicon Valley has seen it and you also know what happens next.
"Silicon Valley people are generally used to layoffs.
"Every person who has been in the industry for 15-20 years would have been laid off at least 3-4 times.
"In India, we aren't used to that concept. So when it came here, people were shocked," he said.
He said those who had observed Silicon Valley have come to terms with the fact that "when things go crazy, it is inevitable that they will crash".
"GFC was shocking, the entire world financial system nearly collapsed.
"Nobody predicted SVB's collapse. So many start-ups are seeking government help now.
"Until a month ago, these guys would have been asking for a free market and all that.
"They have all turned around now, saying please bail us out," Vembu said.
Feature Presentation: Ashish Narsale/Rediff.com
