A billionaire who invested his life savings in an industry that didn’t exist in the 90s gives advice on how to get started
Jay Chaudhry never thought he would run a business, amass a fortune or help popularize an entire industry. Not growing up in rural India, not even after moving to the US in 1980 to study engineering and marketing, not even after landing jobs at tech giants IBM and Unisis.
“There is no entrepreneurship in my family of small farmers. So if you ask me, ‘Did I ever think about becoming an entrepreneur in my childhood or early years of my career?’ Not really,” Jay Chaudhry, billionaire founder and CEO of cloud security company Zscaler, tells CNBC Make It.
It took the dot-com boom in Silicon Valley — the wild success stories of tech startups like Netscape — to make Chaudhry think in 1996, “Why not start a company?” He made a rash decision to quit his job as a tech CEO. Atlanta-based IQ Software, and his wife Jioti quit her job as a systems analyst at telecommunications giant BellSouth.
Investment (Freepik)
Together, they invested their life savings — roughly $500,000 — in SecureIT, a cybersecurity software startup they co-founded in 1997. At the time, “maybe less than 5 percent of Fortune 500 companies had firewalls,” says Chaudhri. “Within 18 months, we put up firewalls in about 50 percent of those companies.”
His timing was perfect: In 1998, Chaudhri sold SecureIT to VeriSign in an all-stock deal worth nearly $70 million. Over the next decade, the duo founded two more cybersecurity companies and an e-commerce business, each of which was acquired.
By 2007, they were already wealthy entrepreneurs, and Chaudhri — who was “bored” doing nothing — decided it was time to start “one big company and put 200 percent focus on it,” he says.
That company was Zscaler, which aimed to help companies transition from legacy firewalls to the cloud era. The couple invested $50 million of their own money, Chaudhri says. Today, it brings in $1.6 billion in annual revenue and has a market value of roughly $30 billion.
Forbes estimates Chaudhry’s own net worth at $11.5 billion.
Here he talks about how he risked his family’s savings to follow his gut, how his upbringing influenced his attitude towards money, and the advice he would give to someone looking to quit their job to start a business.
What prompted Chaudhry to invest his entire life’s savings in a startup idea?
“This happened because I like to read and I like technology,” he replies. “In 1996, Netscape had just launched and gone public, and I was fascinated by it. I said, ‘If Netscape co-founder Mark Andreesen could start a company—he was a young guy, right out of college—why shouldn’t I start a company?’
He adds that he talked to his wife several times, and the more they thought about it, the more convinced they were that this decision was the right one. Feeling is one thing. Betting on every dollar is another, he says.
Novac, rast (Freepik)
“It started with us saying: ‘Let’s go for venture capital financing. I had no experience in fundraising and I soon realized that it was not that easy. This was 1996 and Atlanta was not a venture capital mecca, and we kept hearing, ‘Hey, you don’t have any experience.'”
They were disappointed, but their confidence was growing, which led to them deciding to put their life savings on the line.
Source: BIZLife
Photo: YouTube/Screenshot/Freepik
Source: bizlife.rs
