Research Note: Zscaler, Cloud-Native Zero Trust Platform
Company
Zscaler was founded in 2008 by Jay Chaudhry, who continues to serve as CEO and Chairman, bringing his extensive cybersecurity experience from founding several successful security companies including SecureIT, CipherTrust, and AirDefense. The company's mission is to revolutionize enterprise security by providing a cloud-native zero trust platform that securely connects users, devices, and applications over any network, while processing over 400 billion daily transactions through its security cloud. Zscaler has secured strong financial backing and went public in March 2018 (NASDAQ: ZS), reaching a market capitalization of over $25 billion and reporting revenue of $1.62 billion in fiscal year 2023. The company is headquartered in San Jose, California, and has grown to over 5,000 employees globally, serving thousands of customers including more than 40% of the Fortune 500 companies.
Strengths
Zscaler dominates the SASE market with its extensive cloud-native security platform, processing over 400 billion daily transactions and leveraging advanced AI/ML capabilities for threat detection and prevention. Their Zero Trust Exchange platform provides comprehensive security coverage through more than 150 global data centers, ensuring low-latency access and consistent policy enforcement worldwide. The acquisition of TrustPath has significantly enhanced their AI/ML capabilities, particularly in advanced threat detection and automated response mechanisms. Their cloud-first approach eliminates traditional network security complexities while providing superior scalability and performance through their globally distributed architecture. Zscaler's integrated platform combines advanced threat protection, data security, and zero trust network access in a unified solution.
Weaknesses
The platform's cloud-native approach may present challenges for organizations with significant on-premises infrastructure requirements or specific regulatory constraints. Some customers report that the complex pricing structure and multiple management consoles can create administrative overhead and potential confusion. The transition from traditional security architectures to Zscaler's cloud-native model often requires significant organizational change management and user adaptation. Implementation complexity can be high, particularly for large enterprises with diverse security requirements and legacy systems. Technical support response times and documentation quality have been cited as areas needing improvement by some customers.
Bottom Line
Zscaler's position as a market leader is reinforced by its robust cloud-native architecture, comprehensive security capabilities, and proven ability to handle massive scale. Their focus on zero trust architecture and cloud-first security aligns perfectly with current enterprise digital transformation initiatives and hybrid workforce requirements. While the platform requires careful planning for implementation and may present challenges for organizations heavily invested in traditional security architectures, its benefits in terms of security, scalability, and performance make it a compelling choice for enterprises seeking to modernize their security infrastructure. For CIO purchasers, Zscaler represents a strategic investment in next-generation security architecture that can support long-term digital transformation goals while providing immediate security and performance benefits.
Client Experiences: Organizations using Zscaler report significant improvements in security posture and operational efficiency, with many citing up to 90% reduction in security incidents after implementation. Customer testimonials highlight the platform's ability to support rapid digital transformation initiatives while maintaining robust security controls, particularly during the global shift to remote work. The company's success is demonstrated by its growing customer base, which includes more than 40% of Fortune 500 companies, with a reported 90% customer satisfaction rate. Enterprise clients particularly value the platform's ability to provide consistent security policies and performance across their global operations. The platform's scalability and performance capabilities have been proven through processing over 400 billion daily transactions for its global customer base.