Retaining talent? New startups award up to 40% hike, paid vacation
From paid vacation to interest-free loans, startups are offering their best to recognise employees and retain talent. There have been mixed salary hikes in the startup world. While the raise at popular ones has sunk this year, some newer ones have been able to dole out up to 40% hike.business Updated: Jun 01, 2016 17:36 IST
From paid vacation to interest-free loans, startups are offering their best to recognise employees and retain talent. There have been mixed salary hikes in the startup world. While the raise at popular ones has sunk this year, some newer ones have been able to dole out up to 40% hike.
Companies such as hyperlocal portal Zopper.com, health portal Buzz4Health, mobile wallet firm Oxigen, digital marketing firm Pulp Strategy, and medical app CareOnGo, among several others, have awarded employees decent hikes.
Some firms have also offered incentives, including employee stock ownership plans (ESOPs), cars, holiday trips, gift vouchers, birthday bonuses etc. A few companies have also allowed employees to take interest-free loans apart from offering annual paid vacation of two weeks once a year.
Healthcare app CareOnGo said it has doled out 30% more hike than the industry standards in data analytics and product distribution team. “In addition to giving greater hikes, what has really helped us in attracting the right talent are the ESOPs offered to the key people,” said Ritu Singh, co-founder of CareOnGo.
At FitCircle, a chat-based health and fitness startup, the average 20-25% hike has been awarded to its employees.
Apart from the salary hikes, startups have also awarded promotions after intervals of six months.
Digital marketing startup Pulp Strategy has awarded employees with up to 40% hike. “The hikes to top performers are about 40%, whereas the overall hike varies within 15-25% in addition to a healthy bonus payout,” said Ambika Sharma, founder of Pulp Strategy. “We have also offered cars, holiday trips, gift vouchers, bonuses among other perks in the system. We allow for interest-free loans, and annual paid vacation of two weeks once a year to all the employees. We also have an ESOPs for employees.”
According to headhunters, ecommerce giants Flipkart and Snapdeal have tightened the salary hike budgets this year. Mails sent to Flipkart and Snapdeal did not fetch any response.
“The only advice to startups is to adopt financial prudence and don’t portray to be excessively flamboyant...Learn from the failure case-studies,” said Rituparna Chakraborty, co-founder of staffing firm Teamlease Services.
“The startups, including logistics and ecommerce firms, have employed about 75,000 people in the last few years where the salary paid is anywhere between Rs 15,000 to Rs 10 lakh per month,” estimated Chakraborty, who is also the president of the Indian Staffing Federation.
The smaller startups are taking lessons from the case studies of failed ones such as Tiny Owl and Pepper Tap. Considering the fund crunch that many startups, including country’s largest e-commerce firm Flipkart is facing, young startups are adopting prudence.
At wallet firm Oxigen appraisal process is still underway, but the company is confident to dole out hikes higher, or at par, with the hikes doled out last 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.
Fashion portal Voonik.com has added odd 350 employees to its team in last one year. “From odd 100 employees, we today employ 450... We have to be more prudent while announcing hikes, but we don’t think these will be less than last year,” said Sameer Nandan, head, HR, Voonik.com. “To retain talent, we are paying slightly above the market parity.”
Rohit Verma, CEO of a big data analytics startup, iPredictt Data Labs, said,” We have been prudent in our approach as it helps us to plan ahead keeping worst case scenarios in mind. We have awarded the star performers with hikes up to 30% this year.”
It is imperative for startups to develop a stronger connection between the employees and the company, which are best formed by making the 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,” Sharma pointed.