The How And Why Of CXO Exodus
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With the growth of eCommerce, a hiring spree began. eCommerce companies once went out of their way to hire (read poach) top executives from other companies, but this was a time when the money was flowing in and ambitions were high. Now that the venture capital is drying up, more and more seats are getting empty with the same people leaving the companies and looking for better prospect.
A recent hit was taken by Snapdeal whose Chief Product Officer, Anand Chandrasekaran, left the company within a year of joining. Before joining Snapdeal in June 2015, Anand was working with Bharti Airtel on the same designation. He was responsible to drive the technology and product vertical for the company through the storm of competition in this industry. The storm isn’t ended yet but this CPO took the decision to leave the eCommerce firm. This is the fourth casualty Snapdeal had to go through in the last six months after losing Srinivas Murthy as Marketing Head and Bhuvan Gupta as vice-president-engineering.
This does not seem to end, InMobi’s Director of Operations Samuel quit the company to join another. Recently, InMobi’s CFO Manish Dugar also left the company to join Practo.
When the startup ecosystem was new, it was exciting to see people leave their jobs to either start their own venture or just join startups. Talent from Silicon Valley was brought home. The trend seems to have taken a full circle with these top executives leaving startups, especially from eCommerce industry, to join MNCs or other even other Startups. The list has become too long to mention here with Punit Soni and Niket Desai leaving Flipkart last month;Sharat Singh quitting Flipkart within six months to join Adobe; Manish Maheshwari joining as CEO of Network 18 digital this month from Flipkart; Vikas Ahuja leaving Myntra for his new job at The Oberoi Group, Deepak Menon, who joined Microsoft from Jabong, and so on.
Is the startup craze wearing out among the top executives? Here’s our analysis.
Can’t take the change?
Every eCommerce company wants to be the next Google or reach where Amazon is today, and hence they take employees from these companies, expecting they’ll do wonders. What is not realized here is that these established companies had an office culture way different than these startups. Every startup begins with a casual work approach, which is great, but as they grow work becomes intense and so do their expectations from these employees. These employees do the best they can with the given resources, but when compared to MNCs they don’t count for that much. And we aren’t talking about money here; these CXOs are well paid. We’re talking about the technology, a trained team and just the ease to do the job at a pace rather than rushing it to make sure investors are happy.
Another step back for these top executives is the redundancy of work which comes with no credit. Work is done at odd hours, the schedule gets more hectic and the hired person begins to feel jittery.
Leaving one startups for another
Entrepreneurship remains a major attraction where the top executives are quitting their jobs not only to join other starups and start afresh, but also to start something of their own. Bitten by the bug of entrepreneurship these top executives leave to embark on their entrepreneurial journey.
Stanford University alum, Anand gave the same reason for calling quits and is looking to launch his startup sometime soon. Anand maintained his entrepreneurial streak as an angel investor via his investments in many Indian startups and is already a co-founder of Aeroprise Inc, the most-deployed solution worldwide for mobile service management. The bug of entrepreneurship seems to have only grown since then.
A few months back, Mukesh Bansal and Ankit Nagori also quit Flipkart to start their own venture.
But is this reason enough to leave?
While the above remain significant reason, what cannot and must not be ignored here is the cash burnout the eCommerce industry is currently facing. With investors marking down valuation of Flipkart, Jabong and Snapdeal, money is tight and there are too many people to feed.
eCommerce firms started with high hopes to get the best talent in town but they didn’t know what was comming. Both Flipkart and Snapdeal faced lower valuation this year. And since they can’t cut down their cost on sales, marketing and technology innovation, to save margins, the only option left is to bring down employee cost.
According to a report in The Hindu, an employee at Snapdeal affected by this said at the condition of anonymity about Snapdeal’s plan to bring down the headcount to 3,000 from 6,000 over the next few months. He added, “There has been no hiring in the last seven months. But laying off people to cut cost is inhuman.” Further, looking for the reason why Ananda quit, the report also mentioned that he was facing internal competition from Rajiv Mangla, Chief Technology Officer (CTO), as Mangla’s and Chandrasekaran’s roles clashed. The great cooks together were trying to save the broth but at the cost of their relations and job.
With low valuations comes job insecurity. Dependent on investor money and how the market reacts to their products, startups play a dicey game and sometimes people who quit their jobs to join a startup have a lot at stake. Now, even after all this, if they don’t get what they want, would these top executives then go find something that makes them happy?