Zoom, a startup founded by WebEx and Cisco veterans that wanted to make high quality video conferencing and virtual meetings accessible to everyone, instead of just those with the budgets to invest in expensive hardware and even more expensive software, today announced a new $6 million Series A round of funding, supplied by Qualcomm Ventures, Yahoo founder Jerry Yang, WebEx founder Subrah Iyar and former Cisco SVP and General Counsel Dan Scheinman.
In tandem with the funding announcement, Zoom is also launching their version 1.0 product, which includes the introduction of their first paid offerings as well as the addition of a number of impressive new features. The new Zoom offers the same high quality multi-person video conferencing that’s easy to get set up and runs on all platforms, including desktop and mobile via its iOS and Android apps, but it bumps up the total number of participants to an industry-leading 40, provides high quality screen sharing, meeting recording, and more. That’s all included free on the basic plan, with a 20 minute time limit for meetings of more than two people, or including as part of tiered business and enterprise plans that run $9.99 per month and don’t carry limits.
So far, Zoom has done well since its launch in August. The service has had over 400,000 participants, played hot to 140,000 meetings, and had 1,000 businesses using it so far. That, and the pedigree of the founding team, is likely what’s attracting the early investor dollars, which include the $6 million raised today and a previous $3 million seed round the company is making public via TechCrunch today. Investors see the value in providing this kind of product at this kind of price, Zoom Head of Product Nick Chong explained in an interview.
“We see two markets, education market being one really key focus because of how full-featured it is and the price point,” Chong said. “The second one is the market that traditionally can’t afford this sort of system, the SMB market. There are a lot of SMBs in the range of 100 to 500 people, they can’t afford this kind of quality tool, so they either don’t have one or they use lower-quality tools like Skype.”
Having used Zoom multiple times myself, including during my interview with Nick, I’d have to say the company has their target market exactly right. To say it’s better than Skype for video-conferencing would be an understatement. The screen sharing is good enough that you can watch an HD video on YouTube remotely and it doesn’t stutter or pixelate. Video and audio are also excellent, and with Chong I was using my notoriously flaky at-home Wi-Fi connection, which often causes big problems when I’m doing voice-only calls on Skype, let alone video.
It’s the combination of pricing and product that makes Zoom special, and the company is also aggressively targeting the education market with a special pricing plan that gives colleges and schools access to all the product’s features for $0.99 per month. That was a late pricing plan change that will likely help the startup win over a lot of educational customers who previously may not have had any kind of similar system in place.
I’m not generally inclined to use the “D” word, and likely have only done so once or twice since joining TechCrunch, but what Zoom is doing has the potential to be the very definition of disruptive in the online meeting space. FuzeBox comes close in terms of innovation, but Zoom is undercutting them considerably on pricing, and the quality is really something that has to be seen to be believed, especially when it comes to features like screen sharing of images, documents and other content from mobile and tablet devices.
I asked Chong what the chances are that Zoom could cash out, given that it’s likely Cisco, WebEx and every other incumbent will be looking to get them out of the picture with an acquisition, but he claims the team is in it for the long haul. Here’s hoping they do indeed stick to it.