THE GREAT CRASH

AS FUNDS DRY UP AND UNICORN VALUATIONS DROP PERILOUSLY, THE INDIAN START-UP STORY IS BEGINNING TO LOSE ITS SHEEN

- M.G. ARUN

Harshad Punia's world came crashing down in February this year. The 28-year-old MBA grad in digital marketing from Rohtak in Haryana, whose name we have changed on request, was close to completing two years at a Bengaluru-based social media platform when he and 600 others were handed the pink slip. "There was an e-mail from the founder-CEO telling us the company was laying off 20 per cent of its staff as it was finding it tough to raise new funds," says Punia. "Our IDs were locked, and we were given a month's notice, along with a month's salary." Punia had just got married in December 2022, and his wife, who was working in a short video app arm of the same company, was laid off too on the same day. "It was a terrible feeling. I always used to wonder why start-ups like the one I worked for splurged on all sorts of perks-food coupons, vacation allowances, big raises for new joiners...a long-term, stable job would have been so much more preferable," says Punia, who considers himself lucky to have landed another job after just a month (even as some of his friends remain jobless). However, his wife, having burnt her fingers once in a corporate job, is trying her hand at freelancing from home.

Until a year ago, start-up professionals like Punia were the toast of India Inc. They were much sought after, and those with experience handling big responsibilities (even in small firms) were lured with substantially higher salaries. In the edtech sector, the educators' or teachers were often hired at twice their old salaries, say sources, with several other perks thrown in, creating an unequal staff structure. But all that seems a dream now as the Indian start-up ecosystem-purportedly the third largest in the world after the US and China with 84,012 'recognised' firms as on November 2022 (per government estimates), giving direct jobs to 860,000 people stares at one of its biggest challenges yet.