Thrifty In­dian Star­tups Eye Lo­cal Ta­lent

The days of ex­trav­a­gant of­fers for global ta­lent are gone as cos come un­der pres­sure to tighten purse strings

The Economic Times - - Careers: The Fast Track -

Sreer­adha D Basu & Dev­ina Sen­gupta

Mum­bai: Star­tups in In­dia are no longer rush­ing to splurge up to $700,000 a year on ex­ec­u­tives from abroad. The num­ber of such of­fers has dried up as much as 60-70% in the past few months, ac­cord­ing to head­hunters, who said the drive to con­tain costs has forced star­tups to rely mainly on lo­cal ta­lent for fill­ing se­nior po­si­tions. The cut­back has been the sharpest at big­ger firms such as Flip­kart, Snapdeal and Zo­mato, head­hunters said.

ET spoke to more than eight hir­ing firms in­clud­ing RGF Ex­ec­u­tive Search, Long­house Con­sult­ing, EMA Part­ners, Transearch, The Head Hunters, Michael Page In­dia, Hei­drick & Strug­gles and Basil Ad­vi­sors.

“A com­pany that would hire sev­eneight (ex­ec­u­tives) from abroad has slashed its hir­ing to two-three at the most,” said Anshuman Das, man­ag­ing part­ner of search firm Long­house Con­sult­ing, which spe­cialises in e-com­merce re­cruit­ment.

Gone are the days, Das said, when big­ger e-com­merce play­ers would hire even vice pres­i­dents for .₹ 1-1.5 crore plus stock op­tions that would be worth an­other .₹ 1 crore a year.

“There was a lot of noise on e-com­merce com­pa­nies hir­ing from abroad and though not all were suc­cess­ful, at least they were en­ter­tained. Now even for that en­ter­tain­ment there is no money,” he said.

The shift is also be­cause in­vestors want com­pa­nies to fo­cus on unit eco­nom­ics and not prod­ucts as was the case ear­lier. There­fore, de­mand for tech­nol­ogy spe­cial­ists has come down, re­cruiters said. “A cou­ple of years ago, one ex­pected e-com­merce in In­dia to grow the same way that it did in the West. Firms hired those who have been part of the growth in the West. How­ever, that growth did not hap­pen in In­dia and there­fore the global re­cruit­ments had to be stopped,” said Vinod Mu­rali, man­ag­ing di­rec­tor of In­noVen Cap­i­tal In­dia, a ven­ture cap­i­tal debt fund.

At an­other ex­ec­u­tive search firm, The Head Hunters, CEO Kris Lak­sh­mikanth, who was mak­ing three trips to the US till last year to re­cruit ta­lent, said firms have clamped down on such hir­ing. “The odd

one that hap­pens now, clients want within $200,000. The best ta­lent is way be­yond the bud­gets in to­day’s ecom­merce sce­nario,” he said.

Such ex­ec­u­tives were ear­lier hired at highs of $600,000-700,000 and more, in­clud­ing ESOPs. Ear­lier, Lak­sh­mikanth said, the founder of a big ecom­merce firm would ask him to short­list at least half a dozen can­di­dates from Google and Ama­zon’s US of­fices for his key team. Now such de­mands have dried up, he said.

Just a year ago, star­tups in In­dia were of­fer­ing match­ing dol­lar salaries and fast-track ca­reer op­por­tu­ni­ties to lure ta­lent from the Sil­i­con Val­ley. An ET story in 2015 had high­lighted how two of Google’s engi­neer­ing vice-pres­i­dents–Peeyush Ran­jan and Pu­nit Soni – re­lo­cated from San Fran­cisco Bay Area to Flip­kart

at $5-6 mil­lion an­nual pack­ages.

Pu­nit Soni, chief prod­uct of­fi­cer of Flip­kart quit ear­lier this month. Peeyush Ran­jan and Saiki­ran Kr­ish­na­murthy, two other high-pro­file ex­ec­u­tives re­cruited from abroad still with Flip­kart and have been as­signed ad­di­tional re­spon­si­bil­i­ties.

Flip­kart de­clined to com­ment on emailed queries from ET.

The shift has led to groom­ing of more lo­cal ex­ec­u­tives who can take up se­nior posts. In case of re­cruit­ments from abroad, em­ploy­ers are now look­ing at peo­ple with lower ex­pe­ri­ence lev­els and there­fore lower salaries as well. Ni­lay Khandelwal, re­gional di­rec­tor at Michael Page In­dia said the younger star­tups and e-com­merce firms still pre­fer their top can­di­dates from the Bay Area but are now in­creas­ingly hir­ing on con­tracts which can be re­newed at the em­ployer’s dis­cre­tion.

There are re­ports of job cuts, re­sult­ing from the rapid au­toma­tion be­ing in­tro­duced at lead­ing star­tups to han­dle rou­tine tasks. In the back­drop of this slump, big-ticket re­cruit­ments are be­ing avoided.

Basil Ad­vi­sors’ founder Prateek Sri­vas­tava said hir­ing de­ci­sions are be­ing de­ferred and time taken to close a hire stretched. In a few cases, he said, ex­ec­u­tives from abroad have been hired on con­tracts stip­u­lat­ing a cer­tain num­ber of hours per week, where they are al­lowed to work for other em­ploy­ers as well.

Geetika Me­hta, di­rec­tor-hu­man re­sources at Ur­ban Lad­der said, “We hire can­di­dates based on fit­ment of skill sets from a role and cul­ture per­spec­tive. In the last few months, we have not seen any ta­lent from global mar­kets rel­e­vant for us. How­ever, a num­ber of em­ploy­ees in our tech team are from Bay area.”

Em­ployee costs at lead­ing star­tups ac­count for about 35% of over­all cash burn rates, say in­dus­try an­a­lysts. In­stead of en­tic­ing with money and growth, clients are now ask­ing the search firms to bring in only those who are keen to re­turn to In­dia any­way, said GC Jayaprakash, ex­ec­u­tive di­rec­tor at RGF Ex­ec­u­tive Search. Re­cently, when a po­ten­tial hire from the Sil­i­con Val­ley said he would think about re­lo­cat­ing if the of­fer was ex­cit­ing enough, the com­pany told RGF to let go of the chase.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.