Funding issues force startups to withdraw job offers at IITs

MUMBAI: Startups are sending shivers down the spines of students at the top Indian Institutes of Technology. Once the most sought-after for placements, some startups have started withdrawing job offers at IITs in Delhi, Mumbai, Roorkee and Guwahati because they've either shut shop or are closing some operations.

Others are delaying joining dates as uncertainty, a funding slowdown and pressure on profitability force them to go slow on hiring, according to placement managers at these campuses.

At IIT Delhi, two startups withdrew job offers after they closed down, while another two made offers but could not keep the commitments, said Anishya Madan, industrial liaison officer, training and placement at the institute.

"This is not a good sign. This leads to a lot of uncertainty," she said. She refused to share the names of the startups that withdrew the offers.

Ecommerce companies such as Ola are finding it difficult to take on students they've hired and are delaying the process, according to IIT officials. Startups that have withdrawn offers at IITs include Zimply Home Shopping and PepperTap.

"While one startup withdrew offers given to six students, a few others are saying they will come up with later joining dates as some businesses they had hired for are not doing well," said Ayush Lakhotia, placement coordinator at IIT Bombay. "There is a lot of suspicion and concern among students this time when it comes to startups," he said.

Cab aggregator Ola did not immediately respond to an email seeking comment. PepperTap has shut operations. Zimply Home Shopping officials could not be reached.

Although several new startups visited the top IIT campuses this year, the number of hires by companies such as Flipkart, Ola and Snapdeal has dropped significantly from a year earlier as investors put pressure on companies to save costs and improve cash flows, the placement officials said.

"In January, Zimply Home Shopping said they are ceasing operations in certain cities and cost-cutting. They had taken five students from IIT Guwahati but withdrew all five offers," said Harish Bohara, student coordinator of placements at IIT Guwahati.

InMobi and Roadrunnr have delayed joining dates to October and December, respectively. Roadrunnr, a hyperlocal delivery startup, has stated it is expanding, while mobile advertising platform InMobi hasn't provided any reason, according to Bohara.

All students have been allowed to sit for placements again and most of them have been selected elsewhere, he said. At IIT Roorkee, three startups changed offers made to students. One cancelled the offer in the first week of February and the other two delayed the hiring of 10 students.

"Normal date of joining is in July. They have so far delayed it till November. Students are pretty tense. There is a slowdown in startup market and established startups are going down. Students are now looking for backup," said Himanshu Bansal, placement coordinator at IIT Roorkee.

"We have not seen this in our campus so far, but I'm hearing about it from other IITs," said Babu Vishwanath, professor of mechanical engineering at IIT Madras. Placements at IIT Madras were delayed due to floods in December. Top ecommerce firms including Flipkart, Ola and Snapdeal backed out after registering to visit.

Institutes and students are reaching out to executive search firms for assistance. "We are getting calls from tier I and II institutes as many students have had offers withdrawn," said Kris Lakshmikanth, CEO of The Head Hunters. "Most joining dates are in June. That is the time this will explode," said recruitment agency officials.

Source: techgig.com