Cash crunch, exits: Indian unicorns’ image problem
Indian unicorns have an image problem: after the funding slowdown and exodus of highprofile executives over the past year, many are increasingly being seen as career graveyards by senior executives in non-internet companies, say head-hunters.
Not too long ago, these executives, from consumer packaged goods companies, telcos, consulting firms, banks, even Silicon Valley blue-bloods, were scrambling to get onto the new economy bandwagon in India.
“Of late, I haven’t come across many executives who are attracted to e-commerce (and Internet startups); it’s clearly not a career of choice any more,” said Avdesh Mittal, managing director, digital practice, Asia Pacific, at Korn Ferry.
In the go-go years of 2014 and 2015, such firms attracted hordes of senior talent from telecom, retail and consumer goods companies in India and from tech companies in Silicon Valley by offering eye-popping salaries, and the opportunity to change the Indian business landscape.
The Silicon Valley homecoming soured first. Now, several executives who moved to e-commerce from companies in other businesses are unhappy too (and many have moved on).
“It was earlier seen as a masfor sive wealth creation opportunity, which isn’t the case now. The revolving door of senior executives has sent out serious negative signals to potential highquality talent. People don’t see a well-defined, predictable career path for themselves at consumer Internet companies,” said Mittal.
Flipkart Ltd, Snapdeal (Jasper Infotech Pvt Ltd) and Ola (ANI Technologies Pvt Ltd) are the worst offenders, in that order. Since the end of 2014, these three companies have hired some 20 executives at the senior vicepresident level (the second highest executive level) from other industries and Silicon Valley, according to Mint research. Of these, 14 executives have left, with Flipkart by itself accounting eight exits. If executives a lower levels are included, the record looks worse.
Spokespersons for Flipkart Ola and Snapdeal didn’t respond to e-mails seeking comment.
“Companies need to have strong processes for employee engagement. This is where the likes of Unilever and P&G excel,” said Venkat Shastry, partner Heidrick and Struggles.
“Startups need to strike a bal ance between hiring from outside and promoting internally,” said Anshuman Das, partner at Long house Consulting. “Some compa nies went overboard by replacing their very capable teams with big names. Most of these big names weren’t good fits.”
So can these firms still attract top executives? Recruiters are divided.
Some say that unless start-ups bring in so-called professiona CEOS in place of entrepreneurs, i will be tough for them to recrui top executives.
“People obviously won’t be queuing up like before but there are still a handful for whom it wil be both a culture and a financia fit. For this to happen, both the companies and the executives who are looking to come in wil need to have mature and honest conversations about the expecta tions from both parties, the defi nition of the role and the extent o empowerment,” Heidricks’ Shas try said.