Zoom’s founder & CEO: Driving its $1B Valuation with Triangles, Happiness and Handshakes

We had a chance to sit down with Eric Yuan, the CEO of Zoom for an interview.  For those of you not familiar, Eric first imagined video conferencing as an 18-year-old engineering student in his native Beijing, envisioning it as a way to see his girlfriend without a 10 hour train ride. Decades later that vision became Zoom, the company Yuan founded after leaving WebEx/Cisco where he was VP of Engineering, vowing to provide a better experience to unhappy WebEx customers.  Below are our questions:

1. Where did you grow up? Tell us about your early years.

I grew up in Shandong province, China and my mother, father, and grandparents were very present in my daily life. Just as I spoil my children now with affection and attention, my parents spoiled me when I was younger. And just like many young people that I knew when I grew up, I wanted to become a scientist, and really never thought about founding my own business. Ultimately, I went to college in China and received my Master’s degree there.

2. You have strong educational credentials; how important do you think education is in today’s workforce and for today’s entrepreneurs?

I received my Master’s degree in China and am a graduate of the Stanford University Executive MBA Program (c/o 2006). Education is vitally important to developing your communication and critical thinking skills, but nothing beats real-world experience. Ultimately you need to have the self-learning capacity required to go through traditional education, and that will help you develop those skills, but you can skip a college education if you already have those skills.

3. You’ve held several professional roles — including founding Zoom and also being one of the first several founding engineers at WebEx. Which work experience do you believe was most valuable and what were some of the most important lessons you learned?

I think that each work experience I’ve had was valuable and each taught me something. When I joined WebEx in 1997, we only had a dozen people, but the business grew rapidly and the company went IPO within several years. That experience was most valuable as I learned how to build a business from a small start-up to a public company.

I also learned another valuable lesson while I was at WebEx. As I mentioned, it went public while I was there, and we had a huge celebration. Then, after spending ten years with WebEx, it was acquired by Cisco, an event that all the employees were thrilled about and celebrated. Those events taught me an important lesson about process vs. outcome. It took many years to reach the endpoint for each of those transactions, and I felt that with each, everyone was very focused on the outcome. One of the most important lessons I learned from those experiences is that the process should be celebrated as enthusiastically as the outcome. If you don’t enjoy the process – in essence, the act of coming to work every day – no matter how good the endpoint is, that’s not a great outcome. From those years, I learned the importance of enjoying the full spectrum of the process, and to feel happy every day. I’ve brought that to our culture here at Zoom. I’m very focused on making sure my employees find their work rewarding and their workplace a positive environment on a day-to-day basis, not just on those occasions that we reach a major milestone.

4. You left China in 1997 and went to work at WebEx. Why did you want to come to the US?

In the early 1990’s I was living in Beijing and running my own HR/Financial software company. At that time, the Internet was rapidly growing in the U.S. and companies like AOL, Yahoo and Netscape were taking off, yet very few people were aware of the Internet in China. I really wanted to be on the first wave of the Internet innovation because I thought it had huge potential and I did not want to be left behind.

5. Why did you leave Cisco to start Zoom?

I was a Corporate Vice President of Engineering at Cisco – responsible for Cisco’s collaboration software development. After I had been there for several years and spent a lot of time talking to customers, I found that most of them were not happy. I felt very badly about that and embarrassed. I spent a lot of time thinking about the problems the customers had and realized it would be very hard to take the existing solution and fix their problems. Instead, I knew it was essential to build a new, better video conferencing solution from the ground up, so I left Cisco to found Zoom. When I did leave, many of the top WebEx engineers joined me.

6. What would you say are your biggest accomplishments?

I think my biggest accomplishment has been creating a culture of happiness at Zoom. I am very proud of that. I want all of our employees to look forward to coming to work and delivering happiness to each other. My team and I have implemented several program to help accomplish this. First, one of our core values is “Care.” We want our employees to care about the community, our company, our teammates, our customers and ourselves. I didn’t want this philosophy to be a one-off that is explained in employee training and then never discussed again, so it is posted on the wall of Zoom’s lobby in every location, it is a common refrain in our all hands meetings, and it is the core of our work. If we resonate that value, it will drive our employee’s behavior every day.

We also have a Chief Happiness Officer (who is also a sales person). She has her own team called the “Happy Crew,” which consists of roughly 25 reps who are in different job functions and locations within Zoom, but who have volunteered to help execute on driving culture. She works with the happiness team to plan events such as outings and volunteer days, and Fun Fridays (which are often themed dress up days). As a company we recognize one employee each quarter who goes above and beyond to deliver happiness internally and externally.

We also build our happiness and caring culture starting with the hiring process. At that point, we evaluate candidates on whether we believe they could deliver happiness for others and embrace the value of Care. If they embrace our core value of Care, enjoy working at Zoom and want to deliver happiness, then they will be self-motivated and will work harder for their teammates and their customer. It’s a circle.

What I learned is that your business should be fine if you build a happiness culture where employees enjoy delivering happiness to customers and to each other.

7. What were the biggest challenges in your career?

When we started developing the platform for Zoom, my goal was to get a product to customers in one year. Instead, it took us twice the time, and while I had hoped we could get there faster, I knew it was best to take the time we needed. We kept our heads down, and kept improving the product to be 100% sure we got it right. We knew that if our product wasn’t solid before we got it out to customers that we would have to go back and fix problems, and word-of-mouth about bad experiences in the meantime could have been fatally damaging to our then-fledgling company. Our philosophy is that as long as we are selling the product, we should have a high confidence rate that the first customers will be happy. For those reasons, our product development took two years instead of one.

8. Is there any one experience or person in your life that shaped your career and outlook the most? If so, tell us about it.

My father really helped me shape my career as my father always told me I need to think about how to contribute to society. When I was young, I didn’t quite understand what he meant to me. After I had more and more experience in the business world, I realized that if i can contribute to society to deliver happiness to others, I will feel very happy too.

9. What advice would you give to aspiring entrepreneurs?

I would advise them to apply a framework I use to guide them as they pursue their dreams and build their companies. The framework is based on something I call my “Daily Triangles”. Each morning, I reflect on my strengths, weaknesses and motivation-level, and each evening on caring for community, co-workers and self. This framework helps me stay focused on what is important to me and to the happiness of those around me, and provides me with reminders of what it will take to achieve my dreams.

I would also tell entrepreneurs to just do it! If you have an idea, don’t hesitate, don’t be afraid of failure. If you fail, just try again.

10. What do you think are the most important qualities in a successful CEO?

Successful CEOs have a self-learning and self-motivated attitude. The business world is changing rapidly, so you have to like to learn new things – new technologies and new skills. Also, to build a successful business is a long journey and quite often it’s very lonely. So you need to motivate yourself to overcome all kinds of hurdles and have the energy to move forward as you can’t count on somebody else to motivate you every day.

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