BackRahul Yadav’s stock gift creates awkward dichotomy for Housing.com
Though Yadav has strengthened his bond with current employees, he has hurt the company's attractiveness as an employer
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Bengaluru: The controversy-courting actions of Rahul Yadav, chief executive officer of Housing.com, have created an awkward dichotomy for the online real estate portal.
On the one hand, by giving away his stock to employees, Yadav has strengthened his bond with current employees, giving the impression that he’s trying to create a siege mentality at the start-up.
At the same time, Housing.com’s attractiveness as an employer, especially for senior talent, has been hurt by Yadav’s behaviour and his uneasy relationship with the board, according to two people familiar with the matter.
Yadav seems to be playing a high-stakes game of poker with his investors, employees and pretty much everyone else.
Last week, the 26-year-old entrepreneur withdrew his resignation and was reinstated as CEO after reaching an uneasy truce with investors.
Just days before, he had written a resignation letter, pouring scorn on Housing.com’s investors, saying they weren’t “intellectually capable enough to have any sensible discussion".
On Wednesday, Yadav told his employees that his resignation last week was a gambit to bend the company’s dissenting investors to his will.
At the same meeting, he cemented his status as a cult hero among the start-up’s employees by saying he would relinquish all his Housing.com stock worth about ₹ 150-200 crore to the company’s 2,000-plus employees.
On average, that’s a potential bounty of ₹ 10 lakh for every employee (as per the current staff count, which is increasing).
This unprecedented act of generosity by Yadav needs to be approved by Housing’s board, which comprises executives from the company’s main investors SoftBank, Helion Venture Advisers and Nexus Venture Partners.
Whether the board approves Yadav’s decision or not, it will endear the entrepreneur to his employees; this, in turn, will improve Yadav’s bargaining power with investors, who over the past few months have considered removing the CEO they can’t seem to rein in.
“This whole public war is making it difficult for Housing to attract new talent," said one of the two people cited earlier. “Some potential senior new hires are saying that they will wait it out and see how this plays out before joining Housing. All the reports about Housing investors being unhappy with Yadav and the company’s high burn rate are harming their image. It gives an impression that currently there may not be stability over there."
Ajay Nair, human resources head at Housing, said events of the past few weeks haven’t hurt the company’s ability to attract senior talent. “There’s been a mixed bag of responses (from potential new hires). One category has said they are very impressed with Rahul’s attitude and the fact that he has a head of his own, cares so deeply about the business and the employees. The other side comprises the talented people we want and who are concerned about what has happened. With them, it’s a matter of sitting down and explaining that this issue wasn’t meant to blow out of proportion. We explain our long-term business plan to them and show them how they can add value to us and vice-versa," said Nair.
“As an organization, we offer senior talent four key things. One is the level of transparency. Over here, you can speak your mind without the fear of retribution. Two is that we help people build their entrepreneurial skills. Rather than box people into just one or two areas, we encourage lateral career moves within the organization. Third, we encourage delegation. If you have to grow, then you need very smart people around you who can take up responsibility. Fourth, we have a strong focus on accountability."
Note: The potential average bonus to Housing.com employees as a result of Rahul Yadav giving away his stock in the company has been updated in this version of the story
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