On how young talent allowed itself be misled and spoilt in the nascent Indian startup ecosystem, first published on Frankaffe.
I have been fortunate to have been a part of the startup frenzy that gripped the nation half a decade back and has been on the rise ever since. Flipkart was still new, you could spot Shashank (Practo) in an odd startup event while Kunal Shah (Freecharge) could be seen addressing a fairly smaller crowd.
The stars of today were in the process of being built, and skepticism surrounding the reckless act of being an entrepreneur was slowly fading away. It was easier selling a vision to young employees and interns then, for the bubble was non existent and the mad hope in our eyes seemed very real, something everyone could relate to.
Welcome, the arms race for recruitment
Something changed in late 2014, a lot of new companies had popped up and building a marketplace was the buzzword. Right from gifts to paintings, from t-shirts to home services – young entrepreneurs were building digital platforms that connected sellers to buyers, and they had managed to raise a healthy amount of money.
Talent, as always, was scarce. To ward off the competition and to rope in the best (and more) brains, purse strings were loosened and higher salaries (as compared to the market average) were offered. It seemed okay for a while. Since the strategy was working for customers, it was assumed that it would work for employees as well. Numerous kids jumped good jobs for more money. Some even jumped better profiles for more money. Some received an appraisal three times in a single year just because the company grew.
Understanding what makes an employee, even in a startup
Employees are paid a certain amount every month in return for their services. This compensation comes for the ideas, the initiative and the sheer hard work being put in by the employees. Employee salaries are fairly independent of the company’s growth and the promoters’ compensation – yet good organizations make it a point to reward employees for commendable performance. Responsible companies make it a point to ensure an overall development of every team member, and keep them grounded in reality.
When Mules ask for the high price tag
It is unfair to consistently offer salaries higher than the market to mediocre talent. Especially when the inflow of money is temporary, and higher salaries are being used as a tactic. Especially when it misleads the mediocre talent into thinking that they are actually worth the price. Especially when the companies go bust, the mediocre talent gets laid off, and yet those mules with not even 2 years of experience keep asking for the high price tag.
Responsible companies make ‘growth’ happen
Fresh talent is like a horse, with innate skill but unsure of how to use it. It is easy to hire at face value, and easier to fire a horse that doesn’t know how to run in an open field – because while you expect the horse to run in a certain direction, the horse runs off with admirable agility in another. Bad managers fail to spot the agility. Good managers from responsible companies admire the agility regardless of the direction in which the horse took off.
Good managers are race track builders. Once the track is built, fences fixed, hurdles managed well and track cleared of all pebbles – horses run like the wind, the way you would want them to. There are not many good managers around, so the horses get fired. Never knowing what got them fired.
And horses become mules
Since they were hired at high prices, the horses deem themselves to be prized possessions. Yet, they run in all directions, without a plan, without a structure. At the price they command, responsible companies want the structure to be present. At a lower price, responsible companies are willing to hire the horse and teach the structure. But the horse is now stubborn. Stubborn like a mule. Unbridled, unabashedly overconfident, ruined by the price war of irresponsible companies, you have a self made mule who cannot be a good hire.
The path ahead
Mules would soon realize that it’s better to be a horse again. They might need to accept significant cuts in their expected packages, or they might find companies willing to give hype a chance. What is crucial to note and what makes mule a mule is refusal to understand what is more valuable at this stage in their career.
Experience in a responsible company would make them a lot more money later, than a high paying job in an irresponsible company right now. It is easy for fresh talent to be misled, and that’s where aggressive young organizations have to show restraint. Money cannot buy customer loyalty, money cannot buy talent.