Most Indian startups follow a familiar map. They cluster in Bengaluru, Mumbai or Gurugram, drawn by access to capital, talent and networks that define the country’s startup ecosystem.
Zoho chose a different path.
Operating largely from Tamil Nadu, including towns like Tenkasi, the company has built a global software business without relying on venture capital, chasing an IPO or anchoring itself in India’s biggest tech hubs. As funding tightens and startups face increasing pressure to turn profitable, Zoho’s model is drawing renewed attention.
Bengaluru, Delhi-NCR and Mumbai together account for the majority of startup hiring demand in India, according to TeamLease, on how deeply talent remains tied to metro ecosystems.
The question now is not whether Zoho’s approach works. It is whether others can replicate it.
Outside the startup hubs, by design
Instead of concentrating its workforce in urban centres, Zoho invested in building teams in smaller towns, closer to where much of India’s untapped talent resides.
In Tenkasi, engineers trained through Zoho Schools (its in-house training programme) work on products used globally. The initiative recruits students without formal engineering degrees, trains them, and integrates them into product teams, forming a key part of the company’s talent strategy.
However, that model diverges from broader hiring patterns. Most startups continue to rely on experienced talent pools concentrated in metro cities, where access to skilled professionals remains highest.
A different operating model
Zoho’s divergence goes beyond geography.
Unlike venture-backed startups, it has remained entirely bootstrapped, funding its growth through customer revenue. Today, the company serves more than 100 million users across 45+ products and generates over $1 billion in annual revenue, while remaining privately held and profitable.
That approach has become more relevant as funding conditions shift. Venture funding into Indian startups fell by over 60% in 2023 compared to its 2021 peak, according to Tracxn.
Zoho has built a significant part of its workforce through internal training rather than traditional hiring. According to its training arm, Zoho Schools, the company recruits students without formal engineering degrees, trains them and integrates them into product teams. Around 15% of Zoho’s workforce has come through this route.
Why is the model hard to copy
Despite Zoho’s scale, few startups have adopted its approach in full.
Hiring patterns during the 2020–2022 funding boom reflect why. As capital flowed into the ecosystem, startups rapidly expanded teams to support growth, according to data from platforms such as Naukri.
That environment favoured speed.
Venture-backed companies continue to operate under pressure to scale quickly, often hiring experienced professionals from metro ecosystems rather than investing in long-term training.
“Most startups optimise for speed because that’s what the funding cycle rewards,” said Shweta Gosavi at CIEL HR. “Models like Zoho’s require long-term investment in people, which is harder to sustain.”
There are also practical constraints. Building teams outside established hubs requires training infrastructure, internal processes and management bandwidth that early-stage startups may not have.
A model gaining relevance
Even so, elements of Zoho’s approach are beginning to draw interest.
As funding becomes more selective, startups are under pressure to manage costs and build sustainable operations. Hiring from smaller towns, where costs are typically lower, has emerged as one area of exploration.
“There is definitely more openness now to hiring outside metros, especially after the pandemic,” said Samiksha Wankhede, a senior executive at a recruitment firm. “But most companies are still figuring out how to make it work at scale.”
Beyond geography
Zoho’s experience suggests the shift is not just about location.
Its model combines internal talent development, product ownership and sustained investment in R&D elements that are harder to implement in fast-scaling, venture-backed environments.
The company did not just move out of metro cities; it built systems to support distributed teams and long-term training.
For founders outside traditional startup hubs, Zoho offers a working example of how global products can be built without being anchored in metro ecosystems. At the same time, the model highlights trade-offs, including longer timelines for talent development and scaling.
So, the takeaway?
Zoho also continues to operate largely outside India’s main startup hubs, even as most companies remain concentrated in Bengaluru, Mumbai and Delhi-NCR.
Its model, built without external funding and supported by internal talent development, has seen limited replication so far. Hiring patterns and funding structures continue to favour metro-based ecosystems, according to data from TeamLease and Tracxn.
Zoho shows it is possible to build globally from outside India’s metros, but for most startups, the model remains hard to copy. The shift beyond hubs is happening, but slowly.
