Startup hiring stagnant, but hope for revival in next 2 quarters: CIEL HR

How is the overall hiring environment in the IT industry including the GCCs? Have you seen any positive movement of late?

On an overall front, things have become better in the January-March period than last two quarters. If we see a sector-wise view, IT services continue to remain very cautious. The mid-sized IT firms have started taking up the pace a bit. Some of them are taking up (new) contracts. That is the reason that these companies need people. So, talent has gone up slightly, particularly for highly skilled people. The demand is mostly in areas of new skills. That is the reason we are hiring for both contract staffing and also on the permanent side. So, things have little better on the IT side.

Coming to the aspect of hiring in the GCC (Global Capability Centre) space, things continue to remain same. For the last two quarters, GCCs and product companies have been the saviours. When things are quiet in other segments, these segments have emerged as net hirers.

Is there any light at the end of the tunnel in the startup ecosystem?

In the technology startups, things continue to be broadly the same as what it was. Startups, which had received funding, have been hiring. But those are very far and few. This is because the investment climate has not improved. Gone were those days, when hiring was happening even in the pre-revenue stage startups (due to funding). Events in some of the big startups in recent days are impacting the hiring sentiment in the startup space. Hopefully, things should improve in another two quarters.

What are the factors that can push growth revival in the startup industry?

There are many interesting ideas that are coming in the agritech, healthtech, fintech and other areas. So, there is an overall mindset shift. Another factor is that there is availability of risk capital. Despite the funding winter, money is available from both domestic and foreign sources. So, the ecosystem has developed and it will pick up. This ecosystem will be more broad-based. It will not be restricted to fintech, edtech or gaming tech. Now, we see all kinds of interesting ideas coming in all kinds of areas. Experience of all stakeholders on dealing with Indian startups is also getting matured. What works in Silicon Valley, may not work in Bengaluru, or Hyderabad or Gurgaon. So, the Indian experience is also getting gathered. People are understanding from all major failures and successes. Though things are not hunky dory but it will pick up.

How is the hiring environment in other sectors than technology like financial services? Can you throw some light in this aspect?

A lot of hiring is happening in two areas in the BFSI (banking, financial services & insurance) sector. One is at the bottom of the pyramid of the BFSI organisation and the other one is on the IT role of the company. As we know the BFSI organisations have been trying to use new technologies like Generative AI, chatbots, and augmented reality among others. So, they are strengthening their IT teams. Similarly, at the bottom of pyramid, hiring is happening on the frontend- sales, service and operations. As the sector comes with its own set of pressures, the attrition at the bottom level is very high. Similarly, the consumer confidence continues to be high. People are taking up housing, consumer goods, vehicle and other related loans. That is the reason that banks, NBFCs and other firms are adding headcount.

CIEL HR is preparing for going public in the next financial year. Is it on track?

Yes, it is on track. We are planning to file the DRHP (Draft Red Herring Prospectus) in June. We as a company continue to grow at a faster rate than the industry. Among the top 10 companies, we are growing the fastest. And the private placement rounds that we closed earlier, is being invested in pushing our growth. We acquired a few HR tech platforms and we are now integrating that into the company. That process is going well. So, we have an aggressive plan in place. We plan to complete our financial audits of the current year by May and file the DRHP in June-July kind of time frame. That will help us in launching the IPO in October-December kind of time frame. As far as fund raising through IPO is concerned, we aim to raise around Rs 500 crore. Out of that around Rs 100 crore will be through OFS (Offer for Sale) and the rest will be from public. That will help us in further accelerating the growth of the company. A significant portion of the fund raised will be deployed in pushing the growth through inorganic route. We plan to acquire companies that will help us in doing that. Conversation about OFS has also started.

Two years ago, we were completely into staffing. We have now transformed ourselves from a talent acquisition player to a full stack HR services provider. When an organisation needs HR services, we are able to provide a full spectrum of services- right from finding them the talent to helping it to assess their existing talent and skilling them for the future. We also provide all kind of systems for managing their talent. To facilitate such offering, we have acquired HR tech platforms. We have also acquired an IT staffing company.

Will you look at diversifying your services into facilities management space in the future?

As far as diversifying our services are concerned, we are looking at all areas. We are looking at HR tech space and all the adjoining areas of staffing, which give us a higher margin. We think that the entire staffing market is going to be more specialised going forward. So, we started a small unit in our company that is specialised in engineering staffing. Similarly, there is an opportunity in healthcare. So, facilities management is a form of staffing. So, we get a good asset, we may look at acquisition.