In April 2011, Yuan called Scheinman to invite him for tea and a demo of his new idea.
Scheinman had also left Cisco that month and was well aware of Yuan’s background in video and collaboration. They’d struck up a friendship while working at Cisco, where Yuan established himself as a strong and reliable operator in addition to his engineering credentials. But for Scheinman to know for sure that he wasn’t backing a closeted lunatic, he made two reference calls on Yuan, including one on his drive to the meeting.
By the time he arrived at Coupa Cafe in Palo Alto, Scheinman says, he had a signed a $250,000 check, and just needed Yuan to tell him what name to put on it because there’s wasn’t yet a company.
As of the market close on Thursday, Scheinman’s investment has multiplied by over 700-fold to just under $176.5 million, though he’s locked up from selling for six months.
“I said, ‘I believe in you and I don’t care what’s in that presentation, because this is about you,'” Scheinman said, in an interview. “He said, ‘For both of our sakes, can I show you the presentation?'”
Yuan says that other investors had committed capital but Scheinman “was the first one to wire transfer the money to the bank.” Scheinman also introduced Yuan to his cousin, Jim Scheinman, founding partner of Maven Ventures.
Jim not only became an investor and adviser, but helped Yuan come up with four possible names for the company: Zippo, Hangtime, Poppy and Zoom. They ended up picking the last one.
For the first two years of Zoom’s history, the company was just a small team – mostly engineers from WebEx. The first version of the product was released in 2013, and there were still so few people outside the engineering group that Yuan took it upon himself to email any user who canceled a subscription.
Yuan said he would try and get them on a Zoom call to talk through their problems and see how he could fix them. Sometimes those users would stick around and even turn into evangelists, Yuan said.