I am one of the co-founders of Recruiting portal www.reffster.com incubated in Sept 2007 and have recently divested from the website, though not from the e recruiting idea. My co-founders and I have a copy each of the software /IPR and while my ex partners will henceforth run reffster .com, at some stage I plan to use a modified version of the software on a different Business model idea. Simultaneously there is a best practise oriented partnership brewing with another set of senior professionals, which includes Strategic HR outsourcing, Exec Search and other Talent Aquisition and Retention initiatives.
It has been 6 months of entrepreneurial experience following 24-years of  corporate life that took me through various Functional roles and General management experience in PepsiCo. These 6 months, however, have given me the headiest experience of my life with ample adrenaline rush and roller coasters. I thought I should share my learnings from the e-recruiting domain as well as on how ideal partnerships should be formed in start-ups if more than one co founder exists.
Let me first share my impression of what I believe is necessary for the success of any new recruitment portal in the market. The key for any new portals’s success in my opinion will lie in a service offerring where clients perceive significant value vs. alternative existing channels of recruiting. Presently alternatives as we all know range from subscription based portal models (where Reach largely depends on those who put their Resumes on the net — where the client at times has to wade through thousands of Resumes), to brick and mortar value added Search where often the “right fit” candidate materialises only if the company is willing to pay high fees to quality recruiters. Most portals are not expected to “physically” value add (as Search consultants do by screening candidates) though there are niche portals in the US that offer a concierge service to subscription based high-end candidates with no charge to companies .Â
The key to success for any new portal in my opinion will lie in providing “value added” services of reaching AND screening candidates vs Job descriptions and Ideal candidate Profiles –done entirely through technology play. Without cutting edge technology , a portal which also aims to physically value-add will not be able to handle scale –something that in my opinion is desirable for any mass oriented portal in todays globalised world. If a new portal aims to replicate Naukri, Monster or Times–all very successful ‘vanilla’ platform models– that would not work since the space is already clutterred. If it aims to go beyond ‘vanilla’ and also value add that recruiting vendors do, then that will limit scalability with clients. Therefore a  100% Tech enabled value add led by new-age technology that matches Profiles with job descriptions to get ‘the right fit’, could be an idea that is innovative — and if another idea on the Sources of Revenue (from candidates rather than companies) is implemented, perhaps disruptive as well to the way existing portals operate.
Let me share what I believe are best practises in partnering with other co founders. There is undoubtedly a need to have shared values apart from only shared interests between co founders. Chemistry too is essential! Also  –whether it is a bunch of college mates getting together or professionals getting together — co founders ideally need to have complementary skill sets which will ensure an effective relay race as the business starts off, churning of ideas and leveraging of each others strengths. All this is well known. In addition , I would urge all budding entrepreneurs who plan to partner to also spend quality time–as they would do building up their business plans — to carve out strategic and operational Roles at the outset. I would strongly advise co-founders to work out a Founders agreement during the incubation phase where future situations and how they would be tackled are thought through. Perhaps –and it would be interesting to get reader comments – it may not be a bad idea to also have a “First among equals” leadership Role assigned to one of the co founders at the outset for operational and strategic business decisions that will need to be taken after the launch( eg a casting vote in Board meetings) , though there would obviously be guardrails in place to ensure that consensus is enshrined for key strategic decisions e.g. exits, new partners, changes to Founders agreement etc. I know of successful SMEs who have co founders largely of the same age/experience who assign the “First among equals” Role by rotation each year through majority vote. The Founders agreement should be incorporated as part of the Articles of association of the Pvt Ltd. If well thought out governance procedures, Roles for each co founder and way forward for future situations has been well defined before the launch, it would definitely help the start up team during the ups and downs of the roller coaster that every start-up inevitably faces. The VC/seedfund fraternity would also welcome it.
I can be contacted at rjatar@gmail.com.
Ranjit Jatar
- Software Architect - November 22, 2009
- THE EXPERIENCE OF STARTING A NEW E RECRUITING PORTAL - April 23, 2008
Accounting/Consultancy /Law firms typically have many partners. While some outfits with multiple partners are old and have a natural org structure created because the partners extend well beyond the founding partners ( am quite sure a 30 yr old joining in as a partner with a Rajat Gupta around would not expect to be ‘equated ‘ with him internally), there are lots of firms which are new in the services arena where a group of like minded professionals have got together … How does their board function? How does one ensure that when there is difference of opinion on a strategic business decision, a decision is taken? Can someone from the VC fraternity advise on best practices? Or ideally someone who already runs a successful firm with multiple founding partners advise?
In all these posts, and several others that I’ve read in the past couple of months, I’ve heard a huge lot about ‘Founders’, but never hear (or way too little) about ‘Mentors’, ‘Advisors’, ‘Advisory Board’ etc. A non-polarized independent authority (ideally), who has gone through the pain of starting up, forming a team, and having some reasonable degree of success … would be a wonderful “sounding-board”.
I hear of a lot of “incubators”, but how many of those do really provide these ‘Mentors’, ‘Advisors’ to guide and hand-hold the startups, especially durign their first 3-6 months ? Is it that, they “high perceived cost” (in terms of %age equity that you need to part with), to get such Advisors / Mentors is keeping Founders away ?? Or is there a huge dearth of such Advisors / Mentors ?
Recruitment Portal –
A new thing which can be thought of is…the recruitment agency can go 1 step ahead and advise about location. The schools, colleges, house rents, child cares, malls, cinemas etc, so that the person gets a feeling that you are doing more than just recruitment. MNC’s do dish out a standard 2 pager about the locality but it is mostly outdated.
When I relocated the MNC gave me a mentor who helped me out, but the HR was hopeless.
Organisation –
Designation should be meant only for external work in a Startup. Internally it should be the first line of George Orwells Animal Kingdom “All **** are equal”. NOT the some are more equal.
As Mr. Anand points out, you need external designations, for signing cheques, lease agreements, other deals, customer visits, receiving phone calls etc
Rgds
Vyaas
Ranjit – A new concept in a placement portal is indeed interesting, especially when India is expected to face tremendous skill shortage in different industries. Hope you succeed in this and if possible tie it up with skill building
Iqbal, I’m with you on the “Chuck designations”, but eventually or rather quite soon the need is there. Lets say that the bank gives you a loan. Someone is supposed to sign on behalf of the bank. Its not going to be that every founder (hopefully it stops with 2) is going to sign – or has to.
Lets say a lease agreement has to be signed. Someone needs to be put in charge.
Usually the person whose signature goes all over the place also ends up being the most liable (atleast in people’s minds) and ends up playing the lead role.
Working in an incubator, I see this happening way early in companies. So yep, in theory its lovely to say, “Chuck those titles and go do your work”, and I wish it was as simple as that, but it isnt. I’ve seen instances where there were two founders and they couldnt make up their mind so they brought in a third guy (who also brought in some money) to “lead”. It spelt disaster from day one.
Probably a founder’s agreement would bring these issues to light before its too late. Term is liberally, but perhaps more than the agreement the discussions and commitments made in the process might help a lot more.