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BHPian Join Date: Sep 2015 Location: Navi Mumbai
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| ![]() Laid-off employees at food ordering app TinyOwl trapped a cofounder of the company inside the Pune office for over two days, and police were brought in to mediate a settlement, illustrating the flip side of the startup boom in the country. Read more at: http://economictimes.indiatimes.com/...w/49680316.cms 2 things coming out of this news 1) instability - i think seasoned SW proffessionals will be aware of the risks of joining a startups. So this wont be a surprise. I would just expect the companies to honor the terms and conditions of the seperation agreements. Also better plan their hiring better. They wont have hi-fi HR team to manage this and thus the startups may end up hiring lot more during the boom and then fire during down time. 2) I am amazed to read the owners are aged 23 and 25 ! at this age we were just learning the ways of the worlds. and these guys are running product firms. Maturity will come with time to handle these difficult situations.. |
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BHPian Join Date: Apr 2011 Location: Mumbai
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| ![]() I belong to the camp who is just not comfortable investing in start ups and not being able to understand the business models of some of the new start ups. I know many smart VC and PE funds do all kinds of analysis and invest money into start ups but it is sad to really read such things (layoff etc.) Although I do not know the complete facts about this case, I hope no one was physically harmed and the employees who are laid off get their salaries/severance on time. One question - do these new companies have all their HR systems in place? Like are there official contracts which list all the employment terms etc? I though these start ups are usually very informal in all these matters - I may be wrong here. Would love to hear the opinion of experts here. Just wanted to add a link here for opinions: Link Last edited by Saanil : 6th November 2015 at 16:10. |
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Senior - BHPian Join Date: Sep 2009 Location: MH-04
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| ![]() Well, I could share a small story. I had got a call to lead their Food Services Tie ups-Pan India (AVP level) about 6 months back. Since I am a food services professional with over 15 years of experience, the bug to join a start up did hit me. But I am happy that sanity prevailed and I sensed that the start ups are plagued with a couple of issues once the magic wanes: 1) Initial PE infused funds start drying up 2) Difficult to operate at sustainable levels considering the high competition in the e space 3) Companies founded by fresh graduates with ideas are normally not a very safe place to be. Not that I am against the ideas of these young founders. But business acumen is something that is earned through experience. Start up tend to be aggressive in the boom and the flip side of what happened with Tiny Owl is for every one to see. As of now, I count my lucky stars that I did not take the plunge!! |
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Senior - BHPian | ![]() Zomato fired some 300 people recently. Only god knows how they thought scanning Restaurant Menus and having an free app for it was an business idea to generate revenue. Obviously I use Zomato but the question is how are they getting the money. |
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BHPian Join Date: Oct 2012 Location: Bangalore
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| ![]() What went wrong with Zomato and Tiny Owl ? Poor management ? Lack of funds or misuse of funds ? Over hiring? Are these companies trying to automate something so that they can reduce manual intervention and let go of people ? Are other aggregator industries headed the same way? Have investors lost money with such ventures ? Leaves a lot of questions behind. Last edited by girimajiananth : 6th November 2015 at 17:22. |
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Senior - BHPian | ![]() Quote:
Little OT, but what I am amused at is the add free Whatsapp which also doesn't charge anything to its subscribers, I will google on how the group used to survive before FB took over. | |
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BHPian Join Date: Apr 2011 Location: Mumbai
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But yes - only time will tell how much money these start ups will make in time to come. | |
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Team-BHP Support ![]() | ![]() Quote:
These stories are simply a repetition of what happened during the DOT COM bubble in the late 90s. The MO is very predictable. Create a company whose sole aim is to get lots of subscribers. With the right pitch, VCs will jump in with their hoard of cash, which the company will spend on poaching and employing people with right experience for a brief period of time, until either the company goes bust or gets bought by a greater fool. There is very little stability and too much speculation. I often wonder what is the contribution of these fluff service companies to the society. Most of these are nothing but get-rich-quick schemes. At least they are not scamming the public. Last edited by Samurai : 6th November 2015 at 18:20. | |
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Senior - BHPian | ![]() Quote:
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BHPian Join Date: Nov 2011 Location: Bangalore
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Senior - BHPian Join Date: Jul 2006 Location: bangalore
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| ![]() I work closely with startups and their investors and as such I am baffled by the way a startup or a business idea is evaluated and funded. As long as the team involved is from the top B schools or IIT's, they are getting funding, it's like getting a credit card from banks. Even without a viable revenue model, such startups are getting funded. There is a serious dearth of talent pool in India and as such a cash rich startup will be ready to pay any amount to get whatever talent that is available to them. But when the strings get tightened and investors start breathing down their necks, only option is to reduce the headcount and fire them. This is what we are witnessing now. Even the big startups like Flipkart, Ola aren't making money, they are burning money like no tomorrow. A lot of people will be made redundant once Flipkart goes public. Such mindless discounts and offers to lure customers is not sustainable and always backfire at some point. They have only succeeded in changing the spending patterns and platforms to customers, but they have not invested in building customer loyalty which is far more important for a sustainable business. Last edited by speedmiester : 6th November 2015 at 19:50. |
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BHPian Join Date: Oct 2015 Location: New Delhi
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| ![]() There was a similar story of Foodpanda owner cheating on its investors few days back. I think there are many people who are just getting into this online frenzy for duping the investors. Thinking of sites like Foodpanda, tinyowl, myntra and jabong etc., I don't think they are going to get much business (at-least from me) when discount dry up. But yes, these are happy days for consumers as they get huge discount which are not available at stores on a regular day. Happy shopping till it lasts ![]() With Whatsapp, there is always an option of blocking a sender unlike in regular messaging application. The day they are going to remove this feature and let marketing firms bombard you with ads, another Whatsapp will be born. I don't think FB will ever think of killing such a huge data capturing machine by making it a marketing place. They will definitely use this data for marketing purposes at other places. For an e.g. look at Google maps or even Android, they are totally free and Google still makes huge profit by selling ads. |
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BHPian Join Date: Sep 2015 Location: Navi Mumbai
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| ![]() I think a real good niche idea, mature leadership and business acumen is needed for a startup to succeed. Every idea a gentleman has cannot become a FB, Watsapp or a flipkart. Success rate might be > 10% i suppose. Even Flipkart will face the heat from amazon. amazon can run in loss for 2-3 years and flipkat might not be able to withstand that long. Also the blunders like the sale in 2014 will not help. Ewallets is another sector where everyone is offering cashbacks. Not sustainable i think. Startups do offer better work, more freedom to take decisions, less process and this does lure people like us who are fedup with the bureaucracy and slow pace in our bigger orgs. But as arnabchak said we need to weigh all our options and liabilities like home loans etc before making such moves. Other thought comes to my mind is that such liabilities prevent us from signing up for something big ![]() |
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BHPian Join Date: Nov 2011 Location: Bangalore
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