Covid19 Tech Impact
Latest updates & innovations, in-depth resources, live webinars and guides to help businesses navigate through the impact of the COVID19 pandemic on India's economy.
Talks about wartime CEOs and the advisories are brewing on social media as entrepreneurs grapple with the need to save cash to keep the business afloat. The pandemic of coronavirus has highlighted the community action adopted by Indian startups which are reevaluating how to solve for coronavirus while also helping each other survive the storm and expected slowdown.
At a time when more than 1.3 Bn people have been confined to their homes, the mobilisation of the startup community is inspiring. The impact of coronavirus on the economy has been acute, so much so that industry experts have recommended startup founders to act like wartime CEOs with an undivided focus on survival.
This war-like situation has inspired a new culture of community action in the startup ecosystem. From growth-stage to early-stage ventures, from seasoned to first-time founders, from enablers to investors — everyone has contributed in different ways to strengthen this effort.
At the same time, entrepreneurs have taken charge of managing cash flows, by even foregoing their salaries. Over the last month, we have seen several entrepreneurs announcing that they won’t draw a salary for the next few months. While some have donated their pay towards funds, others have foregone their salary to support the company’s runway issues.
Here are the entrepreneurs who have foregone their salary in the fight against coronavirus and ensuring their businesses weather the storm.
Vijay Shekhar Sharma, Paytm
Paytm founder and chief Vijay Shekhar Sharma has said that he will not draw a salary for the next two months to help those employees impacted by the pandemic.
In a tweet, Sharma said that he is committing the money to any needs of Paytm office help or staff. He said that he was inspired by Marriott International president and CEO Arne Sorenson who also made a similar commitment for the rest of the year to mitigate the impact of Covid-19.
Sorenson said that Marriott Executive Chairman Bill Marriott Jr. and he will receive no salary for the rest of 2020, and the Marriott International executive team will take 50% pay cuts. The company has also stopped all hotel initiatives and suspended brand marketing and advertising.
Deep Kalra and Rajesh Magow, MakeMyTrip
Online travel aggregator MakeMyTrip (MMT) founder and executive chairman Deep Kalra and CEO Rajesh Magow shared a revival plan with the company’s employees.
MakeMyTrip is also planning to undertake multiple tough measures to minimise the overall expenses. The company is also reducing the costs on employee front as well and to set an example both Kalra and Magow are not taking any salaries effective April 2020.
Rest of the leadership team have also offered to take approximately 50% in their compensation. “All of the above makes us confident that we would together be able to weather this storm and come out stronger,” MakeMyTrip’s top executives said.
Bhavish Aggarwal, Ola
Bengaluru-headquartered cab aggregator Ola said that Bhavish Aggarwal, cofounder and CEO will forgo a year’s salary. The company set up a Drive the Driver Fund to offer relief to the driver community. For this, Ola group and employees have also contributed INR 20 Cr to the fund.
The funds will be used for emergency support and essential supplies. Drivers and their families will also have access to free medical consultation.
Ritesh Agarwal, OYO
Gurugram-headquartered hospitality unicorn OYO has announced founder and group CEO Ritesh Agarwal has foregone his salary for the year. The company’s executive leadership team has taken a voluntary pay cut starting at 25%, with many opting for an additional uncapped amount, and some going up to 50% to enable building the runway for the company. This would be effective from April 2020.
The company has also set up a global Welfare fund towards benefit and welfare of the employees at OYO properties, asset partners and their staff members impacted by Covid-19. The OYO leadership team and company are further contributing INR 2.5 Cr to the Indian PM CARES fund.
Ritesh Malik, Innov8
Inspired by Sharma’s tweet, Innov8 founder Ritesh Malik also tweeted that he will be buying masks, hand sanitizers and testing kits from his salary to support ground staff at Innov8, OYO workflow.
“This is an unprecedented crisis & all of us can contribute something,” Malik added.
Sriharsha Majety, Swiggy
Online food delivery platform Swiggy said that its cofounder and CEO, Sriharsha Majety, has decided to give up on 50% of his annual salary to contribute towards a relief fund for delivery partners.
The company is looking to raise INR 10 Cr for a special relief fund to provide financial and medical stability to all its delivery partners and their family members. So, far the company has already raised INR 4 Cr from the founders, senior leaders, employees and the investors of Swiggy.
“Our industry is built on the efforts of our delivery partners. It is in times like these, that we come together to appreciate and support those who are putting their lives at risk to serve others,” said Sriharsha Majety, CEO, Swiggy.
Aloke Bajpai and Rajnish Kumar, ixigo
Travel aggregator ixigo also announced that the founders have foregone their salary till the travel business gains stability while ensuring no employee is laid-off.
Aloke Bajpai, cofounder and CEO, ixigo said that Rajnish Kumar and him took a decision to forego their entire salary immediately and for as long as required to get things back on track.
The company’s leadership team agreed on taking a 60%+ pay-cut graded by pay, and for the rest of the company, mutually agreed pay cut level would be a function of the actual compensation level varying from 20% to 50% pay cuts.
The company will reinstate the salaries as soon as the situation improves and will also convert the accumulated salary deductions over the hardship period into equivalent ESOPs so that everyone benefits from future upside when the going gets better again.
Vivekananda Hallekere, Arun G, and Varun Agni; Bounce
Bengaluru-based scooter rental startup announced an organisation-wide, temporary salary deduction to tide over the current uncertainty.
The three founders, Vivekananda Hallekere, Varun Agni and Anil Giriraj announced a 100% pay cut in their salary; while the rest of staff have agreed to forgo 20-60% of their compensation.
The company said that this would ensure that no jobs are lost irrespective of the economic situation, and the company improves its runway to over 30 months. Bounce said it is also looking at paying the due salary as soon as the macro-economic indicators return to normalcy.
In lieu of the interim salary cut, employees will get ESOPS so that everyone benefits from future upside when the going gets better again.
Jitendra Chouksey, FITTR
Pune-based fitness platform FITTR is taking a slew of measures to sustain itself amid the coronavirus-led economic slowdown and help the government in the battle against Covid-19. To start with, founder Jitendra Chouksey is taking no salary until the crisis is over. The startup has also announced that it’ll not layoff any employees.
Inc42 is also working towards #StartupsVsCovid19 platform to enable founders and startup ecosystem stakeholders gain access to expert advice and useful content and resources on managing their business and operations in the time of economic uncertainty. In this direction, we have already hosted the first episode of our series of live #AskMeAnything sessions.