This Startup Is a Silver Lining For Blue-collar Workforce, And Recruiters

Vahan witnessed a rapid surge in adoption by both job seekers and job providers looking to get connected

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By Prabhjeet Bhatla


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The COVID-19 pandemic has, obviously, had an adverse effect on the Indian economy, with millions of jobs lost and daily life getting increasingly difficult for the common man. As many businesses shut down overnight, blue and grey collar employees lost their livelihoods and were left to fend for themselves with very little.

According to a report, more than 1 million blue-collar jobs are estimated to be lost due to the ongoing pandemic. But there is hope. Vahan is leading the way as it has come forward to help the unorganized sector in these trying times.

Vahan's chief executive officer and co-founder Madhav Krishna in an interview with Entrepreneur India, said, "A few years ago, while visiting my home in Delhi from New York, I joined my parents in handing out food to passers-by outside our home. Midway through the service, a kid in ragged clothes came up to us and I served him some pulses and rice. He gave me the brightest smile and then hugged me! It was an epiphany, I teared up. That kid had not been fortunate like me to be born in a middle-class family and was probably going to live his life entrenched in poverty. I asked myself how I could change that. I read about the "ovarian lottery", a term coined by Warren Buffet, which essentially implies that where one is born is a massive determinant of one's success in life. We started Vahan to address exactly that problem, that is, to bring opportunities to people who might not have access to them."

The company's driving belief is that everyone is born with equal potential. What is missing for many people, especially in developing countries such as India, is the opportunity to realize that potential. The platform is addressing that problem at Vahan by helping people get at least a seat at the table.

Vahan has raised capital over three rounds (Angel, Seed, and Series A). The company's series A of $8 million was closed in September 2021 with Khosla Ventures leading the round.

These funds will allow Vahan to scale its recruitment business and build new product offerings for its fast-growing customer base which comprises leading gig-economy companies and blue-collar workers. Vahan has been previously backed by marquee names such as Y Combinator, Khosla Ventures, Founders Fund, Airtel, and many Google and Flipkart executives.

The startup has been said to have witnessed a rapid surge in adoption by both job seekers and job providers looking to get connected. They are now placing 7,000 blue-collar workers a month in over 200 cities in India. Its customers include prominent industry names such as Zomato, Uber, Flipkart, Swiggy, Rapido, Grofer's, Dunzo, and Shadowfax.

One of startup's core values as an organization is user obsession. They claim to strive to build deep user empathy so that they can go on to solve large pain points for its users. To that end, they continuously spend time with blue-collar workers trying to understand their problems. They said to have spoken to hundreds of blue-collar workers to date and have uncovered many problems around jobs, finances, health, community, etc.

According to Krishna, India has over 250 million blue-collar workers and this number is growing with a decline in agricultural employment. Around 7-8 million new college graduates are added to the workforce every year, 60 per cent of whom lack employability skills and end up joining the blue/grey-collar workforce. This presents a massive opportunity for recruitment in the blue-collar space which is an underserved market in India.

With strong tailwinds coming off the pandemic, the highest demand for blue-collar workers is expected from the logistics and e-commerce sectors as building efficient delivery channels is important for Internet businesses. Employers in this segment hire blue-collar workers under a flexi-work or "gig' model. According to a report by ASSOCHAM, India's gig sector is expected to grow to $455 billion at a CAGR of 17 per cent by 2024 and has the potential to grow at least twofold compared with pre-pandemic estimates.

He believes that in the blue-collar recruitment space, one of the biggest challenges is a three-way matching problem, that is, finding the right intersection of what a job seeker wants to do, is capable of doing, and the kind of jobs available in the market. Vahan solves this problem through a combination of developing deep user understanding, product design, and data.

Blue-collar workers are usually first-time Internet users and thus, are not very tech-savvy. To address this challenge, the company focuses heavily on creating products that are simple to use. For instance, its chatbot "Mitra' is integrated into WhatsApp itself. This product obviates the need for job seekers to download a separate app and allows them to apply for jobs in multiple languages.

"Given our growth trajectory, Vahan is on track to become India's largest blue-collar recruitment platform in the next year or so. And that is just the tip of the iceberg. We are building the world's largest and richest digital profile database of blue-collar workers. Our data assets and deep understanding of the target audience will be used to unlock massive value downstream. In the near future, we will help blue-collar workers get access to financial services and even their next upskilling opportunity so that they can grow in their careers and their lives. Our mission is to help people gain control of their economic destiny," Krishna further told Entrepreneur India.

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