Demand for Indian talent on the rise among global firms

India remains the talent hub for the world. Some reports indicate the country provides 16 per cent of the total global talent to the technology industry. Global enterprises, therefore, are increasingly looking at hiring Indian talent for business growth. However, these firms have to face a lot of legal challenges in order to take an employee on their roll. So, many Employer of Record (EOR) companies are trying to solve the situation. EOR is a third-party organisation contracted to take responsibility for paying employees including dealing with payroll, taxes, visa and sponsorship applications, benefits and insurance among others.

Rapid is one such home-grown EOR firm that is witnessing sound demand for its services from global clients. In a conversation with Bizz Buzz, Navin Rungta, Founder of Rapid said that global enterprises can seamlessly hire right talent from India without worrying over the compliance hassles through Rapid. The startup, which has acquired many global clients within a short span of time, is also at expanding its footprints to several other geographies in the coming years. The firm is looking at raising capital from investors in order to fund its future growth, he said

How is overall talent environment in India? Why global firms are interested in hiring talent from India?

India is growing multi-fold. When we are talking about funding winter, India received $27 billion in the first six months. It means the country received around $1 billion every week. So, global companies are coming to India in a major way. Moreover, a lot of companies used to hire from Ukraine, which is now facing a war. There is also resistance among US firms to hire from China. These factors are working in favour of India. India has already emerged as a talent hub because of diverse set of talent availability and price at which companies are able to hire these talents. From emerging technologies like AI, ML, data analytics to cloud computing and blockchain, India has abundant talent pool.

What is the motivation behind setting up Rapid? Can you throw some light on this aspect?

Rapid is an employer of records platform. If any global company that wants to hire talent in India, majority of the talent prefers to be hired as an employee. Majority of staffers of global technology firms are employees and not contractors. Around 90 per cent of talent prefers an employment model and not a contract model. Now, if you have to hire talent in India, then that company has to have a local legal entity. Otherwise, that company can’t roll out an offer letter. What Rapid does is, it eliminates the need of having a local entity just for hiring talent. Now, companies can go ahead and choose what talent they want to work with and hire them on Rapid’s payroll. We manage all the backend functions like payroll, local compliance, background verification and many other such tasks. India as a geography has some challenges in terms of complexity of the laws. When a company wants to set up its own entity, it has to understand the law of the land. It takes a lot of time and energy. Also, non-compliance leads to legal and financial risks. In our model foreign firms don’t have to open a legal entity in India. It, therefore, takes away the pain arising from compliance in India. It gives the company the opportunity to only focus on the human resources. Whom to hire, what skillsets and what experience are the only things, they look outs. Moreover, initial incorporation to getting started, takes somewhere between 9-12 months. So, a foreign firm has to wait for a year to hire their first employee. However, with our model, these firms are able to start from day one. So, a platform like Rapid allows foreign firms to engage Indian talent in a very efficient, economical and rapid manner. There are many global brands operating in this space but we are the only Indian brand that offers such services.

What kind of risks global firms face if they hire talent under contractor model in India?

Meanwhile, there are a lot of challenges that are seen in the contractor model. As most human resources prefer to be employees, it is always a challenge to hire a good talent under contractor model. Secondly, if the contractor is working full-time with a company, it is against the definition of being a contractor. In this case, a contractor can demand all employee benefits. That is the risk companies face. Thirdly, companies run the risk of running a permanent establishment in India if they follow contractor model. In that case, they have to file the tax returns. Basically, they have to pay some portion of their income in India. These are the other risks that come up with.

How are you different from your global competitors? Can you elaborate on this aspect?

All our competitors provide very basic solution in the employer of record space. That went well during the Covid period as majority of employees are working remotely. That has changed now. Most companies have started operating from physical offices. Since, we bring lot of experience in the compliance space in India, we know the nuances better. All our competitors support remote working. They don’t support in-person working. Because, every office space they lease for their clients, they have to comply with local laws. This is not possible for most of them as they operate in more than 100 geographies. We are the only company that allows a firm to lease an office space. Tracking of assets, movement of assets and other related matters are done by us. We also allow customisation of policies and cultures that create a brand recall within employees. These are the unique differentiators, we bring to the table.

How is the response so far for your services among global clients?

We are doing pretty well and we have acquired number of clients within a short span of time. The response is great. This niche is growing. We are working on a lot of partnerships. We are working with investors, incubators, communities, and other stakeholders. Our structure is clear. We are here to facilitate all kind of services that the clients require. We take care of all compliance things. Our model is very scalable. In 2-3 years, we will have the largest pie in this space. Also, we are looking at expanding our services to 2-3 geographies. We are a team of around 13 people and will expand our team as we grow.

Are your adequately funded now? Are you looking at raising capital to fund your future growth?

We have raised a small ticket from friends and families right now. We are looking to raise a pre-seed round. We are in talks with a few angel investors and trying to get them onboard.