Techies return ‘home’ as startup dreams turn sour

Illustration: Rahul Awasthi Thousands of software professionals who jumped ship to catch the startup wave are turning back to shore, according to staffing firms and technology services companies that are rehiring these engineers.Lured by attractive employee stock option plans and the thrill of joining a startup team, scores of mid-career professionals had switched from large technology companies such as Wipro, Capgemini and Infosys to join new ventures launched in the boom years since 2014.But many soon found that several promising ventures didn’t take off, anticipated returns didn’t materialise and the relentless work pressure of startups took a toll.”The demand for the product that the (startup) was building was changing, and it was only work-in-progress,” said Akshay Jain, 39, a software engineer who quit his job at a large Indian IT firm in 2018 to join a startup that was building products for the real estate industry.Frustrated by the delay and with no clear visibility on launch timelines, Jain left the startup late last year. He soon returned to work for the captive unit of an MNC.Jain’s experience mirrors that of a large number of peers.India has seen the emergence of 8,900-9,300 technology startups in the past five years, according to a study in November 2019 by Nasscom and researcher Zinnov. Many of these startups attracted engineers with experience of having built software products and managing complex IT systems for large companies in areas such as finance, banking and retail.“The demand for the product that the (startup) was building was changing, and it was only work-in-progress,” said Akshay Jain, 39, a software engineer who quit his job at a large Indian IT firm in 2018 to join a startup that was building products for the real estate industry.Frustrated by the delay and with no clear visibility on launch timelines, Jain left the startup late last year. He soon returned to work for the captive unit of an MNC.Jain’s experience mirrors that of a large number of peers.India has seen the emergence of 8,900-9,300 technology startups in the past five years, according to a study in November 2019 by Nasscom and researcher Zinnov. Many of these startups attracted engineers with experience of having built software products and managing complex IT systems for large companies in areas such as finance, banking and retail.Staffing agencies feel these professionals were lured with higher salaries and the promise of exponential returns in the value of promised stock options as record amounts of venture and private equity investments flowed into new-age startups between 2014 and 2019.The fintech boom after demonetisation — in November 2016 — also spurred demand for engineers with experience of working with large banking clients.“Good money, equity and an opportunity to do something new saw a lot of programmers join startups or start on their own,” said Guruprasad Srinivasan, chief operating officer at business services and staffing major Quess Corp.But only a few of those who had made the shift were successful, he said. “Many who could not raise capital (for their startups) or ensure growth had to come back for employment,” Srinivasan said.In the past year, Quess has seen a sharp uptick in the number of resumes from mid-career technology professionals and the company’s internal technology team has hired around 200 mid and senior software programmers from startups.The trend is being mirrored in Wipro, where attrition in recent years was due in large part to the exodus to startups. “Earlier, a lot of our people were leaving to not only join competition but also to work with startups,” said Wipro chief human resources officer Saurabh Govil. “They are now coming back to traditional companies.”Difficult to scale upSkills that were in high demand at tech startups include coding, big data analytics and data science, machine learning, artificial intelligence and internet of things. These skills are also in demand at large IT companies, said analysts.Kamal Karanth, cofounder of staffing agency Xpheno, said “one of the key motivating factors for such professionals to join startups was equity and ownership of a new journey”.“But now they see it is difficult to scale up,” Karanth said. “In my previous job, I was clear where we will head in the next one year. Even though we were putting extra hours, a lot of our efforts (at the startup) seemed pointless as the company had not evaluated the right market fit for our solution,” said Shankar M, a software programmer who left a startup about six months ago.The reverse flow of talent is not because startups have lost their luster, said staffing professionals, who view the current trend as temporary.“It is not because the technology startups have become uncool. But an uncertainty has set in as they focus on profitability and growth. And there is an increasing mortality rate of startups. Initially there was an attraction, but eventually they saw growth challenges,” said Rituparna Chakraborty, cofounder, TeamLease Services.Follow and connect with us on Twitter, Facebook, Linkedin

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s