Startup ventures find it very difficult to get key employees on board. There are a number of things they can do to get the right people to join them
When Dhruv Agarwala and Kartik Varma set out to realize their dream of starting a financial planning business a year ago, there were challenges lined up for them at each step of their entrepreneurial journey.
From registering the company – iTrust – to grappling with skyrocketing real estate prices, it was more than just a bumpy ride for these Harvard graduates.
|Things That Work|
|2. Help from your investors|
|3. Stock and profit sharing|
|4. Association with a credible brand|
|5. Discuss the dream threadbare. Get them to share your passion|
|6. Offer autonomy and growth opportunities|
|7. Be upfront and honest about challenges|
After setting up a modest office in Gurgaon, the duo soon discovered that getting the right people on board to help drive their dream was even tougher. “We have had instances of people who have come to this place, and called the headhunter and said, ‘I don’t want to interview, I don’t like the place,’” says Agarwala. A swanky office was not the only thing that prospective employees were seeking. Salary expectations made things more difficult. “Most people looked for about 25-40% jump in salaries even if they were changing jobs after just three months,” says Varma. Some, who did turn up for initial interviews were apprehensive whether “we are going to get funded or not.” Thus the hunt for the CTO took about three months, still not that bad by any standard. Many startups go through much longer time and interview cycles before they find the right people.
In a country where even established hotshot employers are finding it difficult to attract and retain talent, it is no wonder that startups are finding the quest even harder. For instance, a top retail chain, looking for its head of merchandising with 10 years of experience, had a hard time getting a matching profile in India. It had to finally recruit from Southeast Asia.
The issues for all startups are similar—untested idea, simple office, minimal support systems, modest salaries to offer without the icing of perks, and zero brand name, not to count unknown promoters who are yet to line up funds.
|Entrepreneurs should be sensitive to employee needs and also ensure that rewards are proactively disbursed during the employee’s tenure with the organization. |
— Madhu Bhojwani, CEO, EmmayHR Services
Talent crunch is hurting companies badly and startups are no exception. Analysts believe there is not enough talent available to keep pace with the requirements of one of the world’s fastest growing economies. “With the gap between demand and supply for talent widening, candidate expectations have changed dramatically, with employer brand visibility and market benchmarked compensation taking centrestage,” says Madhu Bhojwani, CEO, EmmayHR Services.
However, Gita Dang, Senior Client Partner, Head Global Technology Markets, Korn / Ferry International feels that it is erroneous of startups to feel that they are in competition with established big-brand companies. “The profiles of people who aspire to join startups are typically those who don’t want to be part of an established big-brand company. In fact, the real competition for a startup is from other startups, which have the ability to attract and retain these candidates.”
There is also another angle to this story. Top managers in big-brand companies usually baulk at the idea of moving to startups, possibly due to their low appetite for risk having got used to comfort zones, be it as small a thing as someone to carry your bag into office, or five star hotel rooms and airport pickups. Even if they finally get ready to take the plunge, and when it comes to discussing compensation, they try to hedge against the perceived risks. “People in big-brand companies do not want to take risk. Even if they do; they demand higher compensation to protect themselves in any eventuality,” agrees Animesh Dasgupta, Practice Head, Executive Access. “Compensation is essentially a risk-reward combination. Many people in large, established organizations have a need for predictability—they have a low risk-reward profile,” says Dang.
written by Manish Grover, June 02, 2011
written by Kapil, February 16, 2009
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