Founder(s)Eric Yuan Key people Eric Yuan (Chairman & CEO)Kelly Steckelberg (CFO) Peter Gasser (Director) ServicesVideotelephonyOnline chattiness telephone systemsRevenue $622 million (2019) Net income $21 million (2019) Total assets $1.289 billion (2019) Total equity $833 million (2019)Employees2,532 (2020)URL zoom .us Eric Yuan, a former Cisco engineer and executive, founded Zoom in 2011, and launched its software in 2013. Zoom's aggressive revenue growth, and perceived ease-of-use and reliability of its software, resulted in a $1 billion valuation in 2017, making it a unicorn company.
Zoom headquarters in San Jose, California Zoom was founded by Eric Yuan, a former corporate vice president for Cisco Webex. He left Cisco in April 2011 with 40 engineers to start a new company, originally named Stable, Inc. The company had trouble finding investors because many people thought the videotelephony market was already saturated.
In June 2011, the company raised $3 million of seed money from WebEx founder Sub rah Iyar, former Cisco SVP and General Counsel Dan Chairman, and venture capitalists Matt OCK, SVC, and Bill Tai. In May 2012, the company changed its name to Zoom, influenced by Teacher Hurd's children's book Zoom City.
In September 2012, Zoom launched a beta version that could host conferences with up to 15 video participants. In November 2012, the company signed Stanford University as its first customer.
The service was launched in January 2013 after the company raised a $6 million Series A round from Qualcomm Ventures, Yahoo! Founder Jerry Yang, WebEx founder Sub rah Iyar, and former Cisco SVP and General Counsel Dan Chairman.
Zoom launched version 1.0 of the program allowing the maximum number of participants per conference to be 25. In July 2013, Zoom established partnerships with B2B collaboration software providers, such as Red booth (then Team box), and also created a program named Works with Zoom, which established partnerships with Logitech, Radio, and Unfocus.
In September 2013, the company raised $6.5 million in a Series B round from Horizon Ventures, and existing investors. In April 2020, the app's CEO, Eric Yuan, announced Zoom's daily users have ballooned to more than 200 million.
On February 4, 2015, the company received US$ 30 million in Series C funding from investors including Emergence Capital, Horizons Ventures (Li Washing), Qualcomm Ventures, Jerry Yang, and Patrick Soon-Shiong. At that time, Zoom had 40 million users, with 65,000 organizations subscribed and a total of 1 billion meeting minutes since it was established.
Over the course of 2015 and 2016, the company integrated its software with Slack, Salesforce, and Skype for Business. With version 2.5 in October 2015, Zoom increased the maximum number of participants allowed per conference to 50 and later to 1,000 for business customers.
In November 2015, former president of RingCentral David Berman was named president of the company, and Peter Gasser, the founder and CEO of Geneva Systems, joined Zoom's board of directors. In January 2017, the company raised US$100 million in Series D funding from Sequoia Capital at a US$1 billion valuation, making it a so-called unicorn.
In April 2017, Zoom launched a scalable telehealth product allowing doctors to host remote consultations with patients. In May, Zoom announced integration with Polycom's conferencing systems, enabling features such as multiple screen and device meetings, HD and wireless screen sharing, and calendar integration with Microsoft Outlook, Google Calendar, and ICL.
From September 25–27, 2017, Zoom hosted Zoophobia 2017, its first annual user conference. At this 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.
The company was valued at US$16 billion by the end of its first day of trading. Prior to the IPO, Dropbox invested $5 million in Zoom.
During the COVID-19 pandemic, Zoom saw a major increase in usage for remote work, distance education, and online social relations. Thousands of educational institutions switched to online classes using Zoom.
On one day in March 2020, the Zoom app was downloaded 2.13 million times. Daily meeting participants rose from about 10 million in December 2019 to more than 300 million daily meeting participants in April 2020.
This led to an increase in the company's stock price in early 2020, despite a general stock market downturn. By June 2020, the company was valued at over $67 billion.
On May 7, 2021, Zoom announced that it had acquired Key base, a company specializing in end-to-end encryption. In June 2020, the company hired its first chief diversity officer, Damien Hooper-Campbell.
In July 2020, Zoom announced its first hardware as a service product, bundling its videoconferencing software with third-party hardware by TEN, Neat, Poly, and Yea link, and running on the ServiceNow platform. It will begin with Zoom Rooms and Zoom Phone offerings, with those services available to US customers, who can acquire hardware from Zoom for a fixed monthly cost.
By September 2020, Zoom's stock price had increased 569% over the course of the year, lifting its market cap to $129 billion. On July 3–4, using Zoom Webinar, the International Association of Constitutional Law organized the first “round-the-clock and round-the-globe” event that traveled through time zones, featuring 52 speakers from 28 countries.
Soon after, a format of conferences which “virtually travel the globe with the sun from East to West”, became common, some of them running for several days. After gaining 635% in 2020, Zoom became the most well-known video conferencing app used during the COVID-19 pandemic.
In October 2020, Zoom's market cap crossed $140 billion, valuing the company more than 130 year old ExxonMobil. However, in November, after announcing the efficiency of the COVID-19 vaccine, Zoom's stock price dropped more than 15%.
Zoom has been criticized for “security lapses and poor design choices” that have resulted in heightened scrutiny of its software. The company has also been criticized for its privacy and corporate data sharing policies.
Security researchers and reporters have criticized the company for its lack of transparency and poor encryption practices. Zoom initially claimed to use end-to-end encryption in its marketing materials, but later clarified it meant “from Zoom end point to Zoom end point” (meaning effectively between Zoom servers and Zoom clients), which The Intercept described as misleading and “dishonest”.
On April 1, 2021, Zoom announced a 90-day freeze on releasing new features, to focus on fixing privacy and security issues on Zoom. On July 1, 2021, Yuan wrote a blog post detailing efforts taken by the company to address security and privacy concerns, stating that they released 100 new safety features over the 90-day period.
Those efforts include end-to-end encryption for all users, turning on meeting passwords by default, giving users the ability to choose which data centers calls are routed from, consulting with security experts, forming a CIO council, an improved bug bounty program, and working with third parties to help test security. Yuan also stated that Zoom would be releasing a transparency report later in 2020.
On November 9, 2021, a settlement was reached, requiring the company to implement additional security measures. On December 19, 2020, a former Zoom executive was charged by the U.S. Department of Justice with conspiracy to commit interstate harassment and unlawful conspiracy to transfer a means of identification.
The charges are related to the alleged disruptions to video meetings commemorating the 1989 Tiananmen Square massacre. Federal prosecutors in Brooklyn, NY, said that Xinjiang “Julien” Jin, 39, was a San Jose, CA -based company's main liaison with intelligence and law enforcement agencies of China.
Zoom said in a statement that it had terminated Jin's employment for violating company policies and was cooperating with the prosecutors. Jin is not in custody because he currently lives in China.
In April 2020, Citizen Lab warned that having much of Zoom's research and development in China could “open up Zoom to pressure from Chinese authorities.” In June 2020, Zoom was criticized for closing multiple accounts of U.S. and Hong-Kong based groups, including that of Zhou Census and two other human rights activists, who were commemorating the 1989 Tiananmen Square protests.
Zoom subsequently admitted to shutting down activist accounts at the request of the Chinese government. In response, a bi-partisan group of U.S. senators requested clarification of the incident from the company.
Partially in response to criticisms of its blocking of the activists accounts as well as expressions of concern by the United States Justice Department, Zoom moved to cease direct sale of its product in mainland China in late August 2020. In September 2020, Zoom, following lobbying by the Jewish coalition group “End Jewish Hatred”, prevented San Francisco State University from using its video conferencing software to host former Palestinian militant and hijacker Leila Khaled, a member of the Popular Front for the Liberation of Palestine (PULP).
In justifying its decision, Zoom cited the PULP's designation as a terrorist organization by the United States Government and its efforts to comply with U.S. export control, sanctions, and anti-terrorism laws. Facebook and YouTube also joined Zoom in denying their platforms to the conference organizers.
Professor Rabat Ibrahim Abdulhamid, one of the conference organizers, criticized Zoom for censoring Palestinian voices. In January 2020, Zoom had over 2,500 employees, with 1,396 in the United States and 1,136 in international locations.
It is reported that 700 employees within a subsidiary work in China and develop Zoom software. In May 2020, Zoom announced plans to open new research and development centers in Pittsburgh and Phoenix, with plans to hire up to 500 engineers between the two cities over the next few years.
In July 2020, Zoom announced the opening of a new technology center in Bangalore, India, to host engineering, IT, and business operations roles. In August 2020, Zoom opened a new data center in Singapore.
Part of Zoom's product development team is based in China, where an average entry-level tech salary is one-third of American salaries, which is a key driver of its profitability. Zoom's research and development costs are 10 percent of its total revenue and less than half of the median percentage among its peers.
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Zoom nearly reaches $16 billion in value after first day of trading”. ^ Zoom Video Communications, Inc. to Join the NASDAQ-100 Index Beginning April 30, 2021”.
“As schooling rapidly moves online across the country, concerns rise about student data privacy”. Zoom responds to its privacy (and porn) problems”.
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^ “Team box Adds High-Definition Video Conferencing, Market Looks for Deeper Collaboration”. ^ “Radio and Zoom Video Communications Partner to Bring Collaboration to The Enterprise”.
Zoom Beefs Up Video Conferencing Strategy with New Partners”. ^ Zoom Video Communications Partners with Industry-Leading Technology Providers” (Press release).
^ Zoom's daily participants jumped from 10 million to over 200 million in 3 months (Updated)”. “Fast-Growing Zoom Raises $30 Million for Online Video Conferencing”.
^ Zoom Announces Native Skype for Business Interoperability” (Press release). Zoom Doubles Capacity of Video Conferencing Service to 50".
“Skype vs. Zoom : Which video chat app is best for working from home?” ^ Zoom Names New President David Berman and Board Member Peter Gasser” (Press release).
“This Silicon Valley CEO can't stand the word 'unicorn “. Zoom video conferencing service raises $100 million from Sequoia on billion-dollar valuation”.
Zoom Introduces New Telehealth Solution”. ^ Zoom Launches Industry's First Scalable Cloud-Based Video Telehealth Solution” (Press release).
Zoom booms as demand for video-conferencing tech grows”. “Students and teachers struggle with remote education due to coronavirus”.
^ Dervish, Sarah; Sales, Vanessa (March 10, 2021). “Colleges and Universities Cancel Classes and Move Online Amid Coronavirus Fears”.
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Zoom has added more videoconferencing users this year than in all of 2019 thanks to coronavirus, Bernstein says”. Zoom's A Lifeline During COVID-19: This Is Why It's Also A Privacy Risk”.
Zoom's Biggest Rivals Are Coming for It”. Zoom admits it doesn't have 300 million users, corrects misleading claims”.
“Security News This Week: Zoom Security Gets a Boost With Key base Acquisition”. ' We'll Do All We Can to Promote Free Speech,' Says Zoom CEO Eric Yuan After Criticism on Encryption and Privacy”.
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This includes videos, transcripts that can be generated automatically, documents shared on screen, and the names of everyone on a call. Zoom is a work-from-home privacy disaster waiting to happen”.
^ Lee, Micah; Grader, Yael (March 31, 2021). “ Zoom Meetings Aren't End-to-End Encrypted, Despite Misleading Marketing”.
Currently, it is not possible to enable E2E encryption for Zoom video meetings. ^ Hakim, Danny; Singer, Natasha (March 30, 2021).
“New York Attorney General Looks Into Zoom's Privacy Practices”. Zoom strikes a deal with NY AG office, closing the inquiry into its security problems”.
“U.S. FTC indicates it is looking at Zoom privacy woes”. ^ “FTC Requires Zoom to Enhance its Security Practices as Part of Settlement”.
^ Zoom Communications: Agreement Containing Consent Order Archived November 16, 2021, at the Payback Machine, FTC.gov ^ Grant, Nico (December 19, 2020). “ Zoom employee allegedly disrupted meetings commemorating Tiananmen Square massacre”.
^ “China-Based Executive at U.S. Telecommunications Company Charged with Disrupting Video Meetings Commemorating Tiananmen Square Massacre”. U.S. Attorney for the Eastern District of New York.
Zoom censors video talks on Hong Kong and Tiananmen, drawing criticism”. We regret It is not in Zoom’s power to change the laws of governments opposed to free speech.
Zoom admits to shutting down activist accounts at the request of the Chinese government ^ Ponnudurai, Parameswaran (June 12, 2021). “US Lawmakers Call For Answers on Zoom Shut-down of Dissident Accounts”.
Zoom criticized for cancelling webinar with Palestinian activist Leila Khaled”. Zoom will open offices in Pittsburgh and Phoenix with plans to hire up to 500 engineers”.
“Glassdoor Just Announced the 100 Best Places to Work for 2019 (Is Your Company on the List?)” Zoom, one of the most anticipated tech IPOs of the year, has one key profit driver: engineers in China”.