For 15 years, Zoho has run a training facility in India as an alternative to traditional higher education, designed to make students more serious and not force them to roll up debt. Now, the same philosophy is coming to their new headquarters in Austin.

AUSTIN – While the big news at cloud software suite vendor Zoho’s Zoholics event here was a new eCommerce platform and new apps for Zoho One, the company also announced news of significant importance to its host city. They are moving their head offices to  Austin, and are bringing a branch of Zoho University to the new 100,000 square foot campus.

Zoho University is a distinct type of training program rooted in the company’s own unique culture and the founder’s ideas about skills training and debt.

“People pay a lot of money in college chasing a lifestyle, which is something that I strongly disagree with,” said Sridhar Vembu, Zoho’s CEO. “We believe that you learn the most from doing, and that most education for a skilled person comes on the job. A formal college education today also imposes an extreme amount of debt, with $100,000 being typical. So we decided to take the matter into our own hands.”

Zoho University was the result.

Rajendran Dandapani, Head of Engineering at Zoho, in addition to the duties of his job title, also has responsibility for Zoho University. Senior Zoho executives handling multiple roles seems to be something of a company tradition at Zoho, and that’s the case here as well, so Zoho University’s being managed as a side project is not a reflection on its importance.

“We are on a crusade against academic credentialism,” Dandapani said.

The actual origin of Zoho University came from a 2004 poll of employees on how useful their college experience had been.

“A minority had said it was good,” Dandapani said. “More said that it was good but they fooled around too much. More said that it was a waste of time, and the largest group said that it was a massive time waste and the teachers were no good.” Dandapani interpreted the shot at the teachers, in a technical curriculum, to likely mean that the curriculum was out of date.

“There was a perception that because teaching paid less than working for technology companies, the teachers were not very good,” he said. “But the real problem seems to have been that it was older languages that made up most of the curriculum, and that the newer developer languages were taught only a little or not at all.

“The survey respondents said that they learned almost everything on the job,” Dandapani stated.

In addition to these concerns around the inherent value of a university degree, Dandapani said that the existing system of recruitment did not work to the advantage of Zoho, which was then a smaller company, which even in India was less well known.

“There were no first day placements for us with the top-tier colleges,” he indicated. “Our recruitment was mainly by word of mouth. Those colleges and institutions that we did work with were mainly the newer ones.

As a result, Zoho established Zoho University, a two year program it set up itself as an alternative to a degree.

“We started small, with six students, two teachers and three subjects,” Dandapani said. In the 14 years since then, they have graduated 745 students, of whom 720 still work for the company. They make up 15 per cent of Zoho’s engineers.

There is a strong bias towards the underprivileged in those who were admitted. 85 per cent of the total are from families who live below the poverty line. 70 per cent are first generation learners, and only 10 per cent have a parent who graduated university. 60 per cent learn in English, and 40 per cent in one of India’s many local languages. 70 per cent are male.

The curriculum philosophy has evolved since the beginning, but the core ideas remain, and make Zoho University very different from a university, or even a community college or a trade school.

To begin with, there is no diploma of any kind, which the company thinks encourages learning, since the goal isn’t simply to acquire a credential.

“Because we don’t offer a degree – just a skill, the students will put genuine interest in it,” Dandapani said.

This also creates an a more responsible attitude than in colleges.

“They spend 7-8 hours a day in class and we pay them,” Vembu noted. “They know its like a job and they have to show up. Otherwise they will be fired.”

The curriculum, which is taught by software engineers, consists of three components. One, of course, is technology. Another is what Dandapani called business English, to differentiate it from grammar or Shakespeare. The third is problem solving skills, with mathematics skills relevant for software engineering, not for higher calculus.

“We have added in technology design since we began, and are considering adding in marketing,” Dandapani said.

“We also teach them how to spend free time productively,” he added.

Initially, Zoho University started by charging no fees, but that has evolved, to paying the students a stipend.

“We provide the stipend from Day One, and when they are finished, we hire them, and we pay them the same salary package of a four-year college grad,” Dandapani said. “Most earn on Day One more than their family’s whole income.”

Since the program’s inception, manager involvement, which was absent initially, has now been added in early on. The program has moved from providing a free lunch to a free breakfast, lunch and dinner. Trimonthly exams were also a part of the original curriculum, and they have been eliminated.”

“Why this works is that there are no exams,” Dandapani stated. “Instead, students are continuously monitored by a small student-teacher ratio.” The ideal is fewer than ten students in a class, and the learning is self paced, and assisted by students further along in the program.  When the students complete their courses, they are not deployed into Zoho through an interview process, but rather by project-based recruitment into teams.

Whether the Austin branch of Zoho University will have the same curriculum as in India, or whether it will be adapted to reflect local circumstances and workforce requirements has not been decided.

“We don’t have a model for Austin.” Dandapani said. “It’s something that we will innovate along the way, using 15 years of running this as a guide. We will look at the local demographics of employees in deciding this.”

Zoho also plans to set up a Zoho University Campus in Japan.

“This is something that we are encouraging other employers to follow as well,” Vembu said.