Start-ups see big cos eating into talent pool

Start-ups see big cos eating into talent pool

Bangalore: Anurag Dod, Vishnu G.S. and Lalit Bhise, all founders of technology start-ups, have one gripe about the revival in the sector.

Dod, founder and chief executive of, a home-grown search engine that considers itself a Google rival, says his team of 60 has shrunk in recent months as larger, established IT firms on the bounce are eating into his pool of talent. He wouldn’t say how may have left.

Interchain Solutions Pvt. Ltd, a navigation devices maker founded in 2006, has lost four of its 30 people since September. Vishnu, co-founder and chief technology officer, says it’s been tough to hold on to people in an improved job market.

His former employees have left for global firms such as investment bank Goldman Sachs or software firm Trilogy Enterprises Inc., both US firms. Filling the skill gaps thrown up by the exits would take at least three months, he says.

IT professionals sought start-up firms during the downturn as Indian outsourcers and global technology firms started cutting jobs and slowed hiring, even if it meant limited budgets, fewer perks, uncertain business models and more work.

The recovery is turning the tide. “Some of the global companies are revamping, (and on a) more aggressive hiring spree. They are attracting (talent) from start-ups, even mid-sized companies," said Dod. He wouldn’t reveal how many people left his firm in recent months but said they typically had two or three years of experience.

Nasscom, or the National Association of Software and Services Companies, India’s software lobby, expects double-digit export growth to return next year as the outsourcing climate improves. It had earlier forecast a 4-7% growth in business, the slowest for the industry, in the current fiscal.

“Hiring has become easier as people are more ready to move both from start-ups as well as other large companies," says Nandita Gurjar, senior vice-president and head of human resources at Infosys Technologies Ltd, India’s second largest software exporter. But Gurjar hasn’t noticed a flight of talent from start-ups in significant numbers to larger firms. “For this to happen, the overall hiring has to really pick up," she says, adding that she expects this to happen in the next quarter.

Bhise, founder of Mobisy Technologies Pvt. Ltd, a mobile technology start-up that has lost two senior executives from its team of 10 to larger firms, says the exits are also taking place because the employees are facing pressure from their families to earn more. “Today, people want to go to safety," says Kris Lakshmikanth, founder, chief executive officer and managing director of search firm Head Hunters India Pvt. Ltd.

Not everyone buys the theory of start-ups wilting under an improving economy. Serial entrepreneur Tiger Ramesh, founder of engineering firm Vignani Solutions Pvt. Ltd, his fourth start-up in a decade, says other reasons could be to blame, such as a firm’s work culture or a technology that has not been able to sustain the interest of the employees. “Probably, the work is not cool or challenging for the professional. Maybe the vision of the company is not articulated well," says Ramesh.

Srikrishna S., principal at Longhouse Consulting, the executive search arm of recruitment firm Careernet Technologies Pvt. Ltd, says he has seen middle- to senior-level exits in at least three start-ups, to larger companies or multinational firms in the past three months, but he isn’t blaming just the recovery. “Start-ups which have cut corners and not given employees what they promised will lose talent."