Established startup companies have eased up on their salary increments this year, but another bunch of smaller startups have taken their place to dole out hikes of up to 40%.
They are backing it up with incentives such as ESOPs, cars, holiday trips, gift vouchers, birthday bonuses etc. Some have even given employees interest-free loans and a few, two-week paid vacations to all employees.
CareOnGo, a health app, claimed increments are 30% better than industry standards for its data analytics and product distribution teams. “What has really helped us attract talent are the ESOPs (employee stock options) offered to key people,” said co-founder Ritu Singh.
At FitCircle, a chat-based health and fitness startup, the average hike is in the range of 20% to 25%. The company also has a scheme of twice-a-year performance appraisals that opens promotion avenues after six months.
Digital marketing startup Pulp Strategy has awarded employees with hikes of up to 40%. “The hikes to top performers are about 40% whereas the overall hike is in the 15% to 25% range, in addition to a healthy bonus payout,” said company founder Ambika Sharma.
However, salaries cannot be the sole basis on which an employee stays on in a company, she said. The best way is to make key employees an integral part of the start-up core.
“Talent retention is more than just a salary hike. While hikes are important there are also elements of, perks, incentives, environmental factors of flexibility, organisational support which good talent appreciates and reciprocates,” felt Sharma.
According o headhunters, Flipkart and Snapdeal have tightened the budgets for salary hikes this year. Mails sent to Flipkart and Snapdeal did not fetch any response.
“Startups (should) adopt financial prudence and not portray to be excessive flamboyant... Learn from the failure case-studies,” said Rituparna Chakraborty, co-founder of staffing firm Teamlease Services.
Smaller startups are taking lessons from case studies of failed stories such as Tiny Owl and Peppertap, and the funds crunch many companies including India’s largest e-commerce firm, Flipkart, is facing, fledgling companies are adopting prudence.
At e-wallet firm Oxigen, the appraisal process is still underway, but the company is confident it will match or exceed figures of the previous year .“There is no question of hikes being lesser this year... Prudence is always a wise methodology for a growing company ,” said Meher Sarid, president, corporate affairs, Oxigen Services.