Three senior executives of fintech startup BharatPe, which aggregates QR codes for offline stores, who have blamed the startup’s aggressive work culture and lack of decision-making authority, have left the company, said three people aware of the matter, requesting anonymity.
Subhasis Beura, head of New Brands and Commerce; Pavan Pathak, Senior Vice President, Products; and, Aviral Gupta, Head of Investor Relations and Financial Planning, are leaving the two-year-old startup, only months after a series of senior-level appointments and exits.
In fact, some of the key leaders left this year without even bothering to wait for their ESOPs to vest the minimum period after which they can be sold, indicating how badly they wanted to leave, according to sources.
Beura and Pathak have been with BharatPe for close to 18 months, while Gupta has been there for nearly two years.
When Moneycontrol asked the company specifically about the exits, it did not comment, citing employee confidentiality.
However, in a statement to Moneycontrol on Monday evening, CEO Ashneer Grover said: “At BharatPe, attrition has been very much under control. We have seen negligible leadership exits at BharatPe over the last two years. A few team members who decided to move on in the past, did so to pursue more senior opportunities or start their entrepreneurial journey. In fact, working for 18-24 months with a fast-growth company like BharatPe considerably helps professionals enhance their skill sets. This makes them a highly desired asset across companies.”
How big is BharatPe
BharatPe, valued at $500 million earlier this year, with investors such as Sequoia Capital, hedge fund Coatue Management and Insight Partners, has been one of the most talked-about entrants in the payments space. It recently started lending to merchants, and currently disburses about Rs 80 crore a month. Lending is the startup’s main game today, sources say.
BharatPe has a network of over 5 million merchants across 35 cities and processes transactions worth $7 billion every month, the company says. However, beneath this rapid growth lies the festering dissatisfaction among senior executives and a work culture that is becoming increasingly hostile, say sources.
Murmurs of protest
“There is a culture where you hire fast and fire fast. Now, this shouldn’t happen at any level, especially not at senior levels, where leaders want to build teams for the long run,” said one executive, who did not want to be named.
Multiple people Moneycontrol spoke to describe an atmosphere where CEO Grover calls all the shots, and many senior executives with fancy designations have very little real authority.
“It is my way or the highway when it comes to him. With senior people, there should be that room to have a discussion and figure it out, but you never feel like he cares for what you say,” said another senior executive.
There have been situations, many people say, when they felt the pitch for new products or for expanding into new areas being shot down without Grover fully listening.
And this is not the first instance of a leader, or even a series of senior executives leaving the company. Since the beginning of 2020, at least half a dozen people have left the firm, including the head of human resources, head of payroll, chief of staff and vice president of product, among others, according to an Economic Times report.
According to the report, employees’ problems with BharatPe include being forced to come to office during COVID-19, not being paid an appraised salary, and a hire-fast, fire-fast culture.
Employees also complain about salaries being deducted for system errors or for not punching in, not providing health insurance, and loud arguments filled with abuses heard in the New Delhi office, its headquarters.
According to a former senior employee, more such exits are expected.
“You have a lot of venture capital (VC) money in the bank, and the core business is at least promising, so you can keep selling a story to good candidates. But how do you build an organisation when there is a revolving door policy?” the person wonders.
Employees biggest asset: CEO
Grover, however, said in the statement: “For us, our employees are our biggest asset and we immensely value their experience. We are among the few organisations that did two rounds of appraisal this year (recently in October 2020, after doing one in April 2020). We believe that our employees should co-own the organisation, and, hence, we give ESOPs to all key employees. Earlier this year, we also rolled out an ESOP buyback scheme to buy back the first set of vested ESOPs for employees wishing to cash out some of their shareholding.”
ESOP, or employee stock option plan, is a system under which the employees of a company are generally given the right to acquire the shares of the company. Under such a scheme, the employees are granted some rights, called stock options, to get the shares of the company for free or at a concessional rate, at a predetermined price or the price to be determined on the prefixed method, as compared to the potential market rate.
Current, former employees challenge company claims
However, one former and one current employee contested the appraisal narrative and said only about 1 percent employees really got a pay raise in April, while the others were all warned about the COVID-19 pandemic and the importance of saving money.
“BharatPe has a culture of experimentation and we encourage leaders and teams to take their own decisions. This decentralisation of power works well, and is one of the key reasons why the company has grown at such a rapid pace to become one of the largest fintech companies in just 2.5 years,” he added.
However, one employee acknowledged that Grover is trying to be less hands on, and has hired a slew of C-Suite executives- some as a replacement and some to take over new functions. It has hired a Chief Business Officer (Nishant Jain), Chief Operating Officer (Dhruv Bahl) and Chief Product Officer (Ankur Jain) in the last six months or so.
Current and former employees, as well as investors, say the company needs to fix its culture to make the most of the growth it has witnessed so far. “Even if BharatPe thinks becoming less aggressive as an organisation will hit growth a bit, maybe they should consider it because startups and their employees need to play the long game, and not burn out fast,” said an investor in the space, requesting anonymity.Pratik Bhakta contributed to this story