Following Zoom’s unveiling of Zapps last month – a name that has been thoughtfully updated to Zoom Apps – the venture capital community on Twitter quickly began to consider the possibility of Zoom evolving beyond its current success as a video conferencing provider to become a significant platform for startup development. This development particularly resonated with Josh Constine, formerly of TechCrunch and presently an investor at SignalFire, who posted that Zoom’s new “Zapps” application platform has the potential to dramatically elevate or diminish the prospects of numerous startups.

The surge in Zoom’s popularity during the pandemic, and its establishment as a vital resource for both professional and educational settings, naturally leads to the concept of leveraging a video conferencing platform to create a complementary suite of tools. Even as the pandemic subsides, the lessons learned regarding remote work indicate that the demand for solutions like Zoom will persist well beyond the return to traditional schools and workplaces.

We are already observing encouraging startups, including Mmhmm, Docket, and ClassEdu, specifically designed to integrate with Zoom, and these companies are attracting considerable investment. Indeed, certain investors anticipate that Zoom could evolve into the next major hub for startup activity.

Expanding the Capabilities of Video Communication

Salesforce established a precedent over ten years ago that ultimately benefited Zoom by making its platform accessible to developers and subsequently introducing the AppExchange as a means of distribution. These concepts were groundbreaking when first implemented. Currently, Zoom is actively developing along similar lines.

Jim Scheinman, a founding managing partner at Maven Ventures and an initial investor in Zoom (also recognized for suggesting the company’s name), consistently envisioned the service as having the potential to function as a platform for development. “I have consistently stated publicly, even before it was widely recognized, that Zoom represents the next significant open platform capable of supporting businesses valued at a billion dollars or more,” Scheinman explained.

He recounts discussions with Zoom’s leadership regarding the possibility of opening the platform to outside developers several years prior to their initial public offering. While not a primary focus at the time, the COVID-19 pandemic brought this concept into sharper relief. “Following the IPO and the onset of COVID-19, coupled with Zoom’s substantial growth among both enterprise and individual users, it became evident that an application marketplace is now essential for Zoom’s continued expansion, presenting a considerable opportunity for emerging startups to grow rapidly,” he noted.

Jason Green, founder and managing director at Emergence Capital (another early investor in both Zoom and Salesforce), concurred: “Zoom recognizes that enhancing the core Zoom platform with added functionality tailored to specific applications presents an opportunity to cultivate a partner ecosystem mirroring the one Salesforce previously built with AppExchange.”

Building the platform

For a platform to achieve success among developers, it must first attract a significant number of users – a threshold Zoom has demonstrably surpassed. It also necessitates a comprehensive suite of developer tools for connecting to the platform’s various services. This substantial user base then serves as an immediate potential customer base for new applications. Lastly, a mechanism for distributing these applications through a marketplace is essential.

Zoom has been actively developing these developer resources and has appointed Ross Mayfield, a seasoned professional with experience in two collaboration-focused startups, to lead the developer program. He emphasizes that the Zoom Apps development toolkit is engineered for adaptability, allowing developers to construct applications according to their preferred methods.

Initially, Zoom has introduced WebViews, a method for integrating functionality directly within the Zoom application. To facilitate the creation of WebViews within Zoom, the company developed a JS Kit, which, alongside existing Zoom APIs, empowers developers to build features seamlessly into the Zoom user experience. “We are providing developers with considerable freedom in designing the experiences they create with WebViews, in addition to leveraging our extensive API set – both current and newly developed – to enhance the platform,” he stated.

The company also provides the option of embedding the Zoom experience within external applications using an SDK and APIs. Alternatively, developers can create chatbots that interact with Zoom in a similar fashion to bots used within Slack.

He explains that the concluding element, following the provision of application development tools for Zoom, is an application store or marketplace. Zoom’s strategy allows users to directly add an application from within a meeting, where it is visible to other participants, a feature Mayfield notes fosters organic promotion. “We have launched the App Store within the Zoom environment, enabling users to search, browse, discover, add, authorize, and utilize an app instantly, even during a meeting,” Mayfield clarified.

Green observes that Zoom is addressing all the crucial components of a thriving platform with its current strategy. He contends that, beyond the tools themselves, Zoom must clearly define its future innovation areas to avoid hindering startups building on the platform, while simultaneously providing support for their success.

“Zoom must clearly articulate its planned areas of innovation to enable entrepreneurs to identify opportunities where they won’t directly compete with Zoom, and they need to assist companies in promoting and monetizing their products, making it simpler to establish valuable customer connections and generate revenue over time,” he said.

Building promising startups

Now that all the necessary components are available, businesses are beginning to develop Zoom Apps. Docket, a company that recently secured victory in the Zoom Apps Marketplace competition at Zoomtopia – Zoom’s annual customer event – is one such app currently featured in the Zoom Apps Marketplace.

Our increasing reliance on video conferencing has revealed that meetings encompass more than just online discussions. Meetings are surrounded by supporting information, and Docket aims to provide comprehensive management of this aspect. According to Docket’s founder and CEO, Darin Brown, in a statement to TechCrunch, “Docket empowers teams to create and distribute meeting agendas, preserve meeting records and materials in a readily searchable archive, and monitor tasks and subsequent actions until they are finalized.”

Although Docket doesn’t operate solely within Zoom, Brown explains that creating a Zoom App was a straightforward choice. “A central element of our expansion plan is to integrate with the platforms our users already utilize, and a significant portion of Docket’s clientele rely on Zoom for their video conferencing needs,” he stated. He further noted that Zoom’s streamlined access to the product and its App Store model are simplifying the onboarding process for new users and reducing potential obstacles.

Consequently, Brown expressed his eagerness to be among the first to embrace the platform, acknowledging that some challenges are to be expected as the developer tools are refined. “Early adoption not only provides increased visibility to Zoom’s user base but also enables us to establish a strong working relationship with Zoom and contribute to the platform’s evolution in a manner that would be beyond the reach of a company of Docket’s size,” he explained.

Careful Consideration for New Investments

Investors are consistently seeking promising new ventures, and seasoned investors like Green and Scheinman recognize substantial opportunities in the initial stages for companies developing solutions on the Zoom platform. Scheinman, in particular, was an early investor in Docket.

“Following the Zoom App Marketplace challenge, we’ve completed six investments in startups either constructed on the Zoom platform or collaborating with Zoom. The [Zoomtopia] competition provided valuable insight into the types of applications developers aimed to create on Zoom, and we identified certain concepts we felt were essential. Consequently, we began seeking to invest in the strongest teams focused on these areas,” Scheinman explained.

Green notes that his firm has previously invested in several startups built on the Salesforce platform that ultimately achieved successful exits, including Veeva, ServiceMAX, and SteelBrick. He anticipates comparable potential within the Zoom ecosystem and is making initial investments accordingly.

“Our first investment in a company leveraging the Zoom platform is ClassEDU, an application specifically designed for the education sector. It was established by Michael Chasen, formerly the CEO of Blackboard, a leading SaaS provider serving the education market. [ … ] We are currently evaluating other companies and anticipate making announcements shortly,” he stated. It is also noteworthy that Maven has also invested in ClassEDU.

Green expresses confidence in investing in these nascent startups due to his belief in Zoom’s potential as a thriving platform. However, he cautions startups that this approach carries inherent risks. “Launching a startup is inherently risky, and utilizing platforms can mitigate some of the initial challenges of bringing a product to market. However, it can also introduce long-term risks if not carefully managed. The key is to develop sufficient proprietary technology and a competitive advantage on top of the platform to prevent replication by the platform itself,” he said.

Green further adds, “Spreading investments across multiple platforms over time can also be beneficial. While it becomes more difficult when a venture is performing well, diverting resources from a successful project to hedge against potential issues is a difficult decision for companies with limited resources where maintaining focus is crucial.”

Currently, Zoom is central to both the professional and educational landscapes, largely driven by the pandemic. However, there is a strong expectation that Zoom will continue to provide a valuable service even after the pandemic subsides, particularly in a hybrid work environment. By providing a platform for application development that enhances its meeting software, Zoom has the potential to become a significant new ecosystem for startups. Several prominent venture capitalists are clearly optimistic about this possibility. Only time will reveal whether their assessment is accurate.