Bengaluru: Indian unicorns have an image problem: after the funding slowdown and exodus of high-profile executives over the past year, many are increasingly being seen as career graveyards by potential hires, say headhunters.

Not too long ago, senior executives from consumer packaged goods companies, telcos, consulting firms, banks, even Silicon Valley blue-bloods, were scrambling to get onto the new economy bandwagon in India.

“Of late, I haven’t come across many executives who are attracted to e-commerce (and internet firms); it’s not a career of choice any more," said Avdesh Mittal, managing director, digital practice, Asia Pacific, Korn Ferry.

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In the go-go years of 2014 and 2015, such firms attracted hordes of senior talent by offering eye-popping salaries and the opportunity to change the Indian business landscape. The Silicon Valley homecoming soured first. Now, several executives who moved to e-commerce from companies in other businesses are unhappy too (and many have moved on).

“It was earlier seen as a massive wealth creation opportunity, which isn’t the case now. Additionally, the revolving door of senior executives has sent out serious negative signals. People don’t see a well-defined, predictable career path for themselves and the culture makes them question if they will last," added Mittal.

Flipkart Ltd, Snapdeal (Jasper Infotech Pvt. Ltd) and Ola (ANI Technologies Pvt. Ltd) are the worst offenders, in that order. Since the end of 2014, the three have hired some 20 executives at the senior vice-president level (the second highest executive level) from other industries and Silicon Valley, according to Mint research. Of these, 14 have already left, with Flipkart seeing eight exits. If executives at lower levels are included, the record looks worse.

Spokespersons for Flipkart, Ola and Snapdeal didn’t respond to emails seeking comment.

Many companies mess up by hiring people they do not need or not managing the people they hire, according to Venkat Shastry, partner, Heidrick & Struggles. “These companies need to get better at two things: forecasting demand and employee engagement," he said.

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The poor record of consumer internet companies in retaining top talent throws up questions about who is at fault and whether these firms can still attract top executives. Both the start-ups and the executives are at fault, recruiters say.

In 2015, carried away by the billions of dollars in funds they received and dreams of $50-100 billion share listings, the founders of Flipkart and Snapdeal decided to replace their management teams with high-profile executives. It was a costly error, both financially and otherwise.

Some analysts say that if Flipkart had retained at least some of its old management team, it may have come out of the sticky situation in which it found itself in 2015 faster. There’s evidence to back it up.

Last year, Flipkart reverted to type, re-hiring some of the executives who had helped make it India’s outstanding internet company in 2014. In June, it brought back Kalyan Krishnamurthy, a former managing director at Flipkart’s largest investor Tiger Global who had worked at the company for 18 months in his first stint (starting May 2013). Krishnamurthy sidelined most of Flipkart’s high-profile leaders and put together a core team comprising old Flipkart hands. He and his team engineered a surprising turnaround, trumping arch-rival Amazon in the festive season battle in October. In January, Krishnamurthy was elevated to CEO.

“Start-ups need to strike a balance between hiring from outside and promoting internally," said Anshuman Das, managing partner at Longhouse Consulting. “Some companies went overboard by replacing their very capable teams with big names. Most of these big names weren’t good fits."

Will the trend change again?

“People obviously won’t be queuing up like before but there are still a handful for whom it will be both a cultural and financial fit. For this to happen, both the companies and the executives who are looking to come in will need to have mature and honest conversations about the expectations from both parties, the definition of the role and the extent of empowerment," Heidricks’ Shastry said.

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