'This Is Naked Greed, Nothing Less': Zoho's Founder Sridhar Vembu Slams Corporate Greed, Questions Layoffs & Stock Buybacks At Financially Stable Firms

Sridhar Vembu, the founder of Zoho, in a recent post shared on the social media platform X, formerly Twitter shared a post that appeared to be a sharp critique, expressed his disapproval of companies priotritise shareholder interests at the expense of employee security, especially when financially stable.

Although Vembu did not mention Freshworks by name, his comments came a day after the company announced layoffs of 660 employees and a $400 million stock buyback.

Taking to the platform X, Vembu posted “A company that has $1 billion cash, which is about 1.5 times its annual revenue, and is actually still growing at a decent 20% rate and making a cash profit, laying off 12-13% of its workforce should not expect any loyalty from its employees ever. And, to add insult to injury, when it can afford $400 million in a stock buyback.”

"I can understand the unfortunate reality of layoffs when a business is struggling or declining and making a loss. This is not that situation, this is naked greed, nothing less," he added.

A company that has $1 billion cash, which is about 1.5 times its annual revenue, and is actually still growing at a decent 20% rate and making a cash profit, laying off 12-13% of its workforce should not expect any loyalty from its employees ever. And to add insult to injury,…

— Sridhar Vembu (@svembu) November 7, 2024

Vembu Asks Key Questions about Leadership

Vembu questioned whether leadership had the foresight to invest in other areas of the business instead of opting for layoffs. “Don’t you have the vision and imagination to invest $400 million in another line of business where you can deploy those people you hired but don’t want anymore?" Vembu asked. He challenged the company's empathy and strategic thinking, asking, "Are you so lacking in curiosity, vision, and imagination?”

"This behavior, sadly, has become all too common in the US corporate world and we are importing it in India. It has only resulted in large scale employee cynicism in the US and we are importing that too," he wrote further.

"This is why we choose to remain private. We put our customers and employees first. Shareholders should come last,” he added

Netizens Reaction

Vembu’s post garnered a conversation among netizens.

Many expressed their support for his views, with one user commenting, “Laying people off to make more money when you already have plenty should be criticized.”

Another user shared, "You need to develop an environment of trust with your employees that gets broken through these actions."

Screengrab of the comments