NEW DELHI: Anuradha Narsimhan recently quit as marketing head at britanniabse 2.53 %, the country's second-largest biscuit maker, to join A Mahendran's consumer start-up. In return, she gets a sizeable chunk of sweat equity as part of compensation. The package could be close to Rs 15 crore, assuming certain milestones are met, said a person aware of the details. The company being set up by former Godrej Consumer Products managing director Mahendran is funded by Goldman Sachs and Mitsui Global Investment and is working on a range of products such as chocolates, snacks and beverages. Mahendran confirmed the appointment of Narsimhan, 45, who spent seven years at Britannia, but declined to give details related to compensation. "There is an element of sweat equity in senior management roles... They are here to create shareholder value for the company and themselves," he said.
The move reflects an increasing trend— mid-level officials quitting cushy jobs at big firms in exchange for challenging assignments, stakes and equity in start-ups, or milestone-linked compensation packages. Many are giving up top jobs at high-profile companies, regarded as the pinnacle of achievement for managers, because they find their professional lives too humdrum. While the risk of failure is ever present, a start-up offers the prospect of excitement and challenge apart from a more flexible role.
Aside from this, while the take-home amount may be less, dramatically high financial returns are also possible thanks to steep valuations. Nitin Dubey, 32, quit consumer goods and tobacco giant ITCBSE to join Ola Cabs last year, then moved to Qikwell in February as vice president, operations. Qikwell seeks to put patients in touch with doctors.
"The start-up ecosystem in India is the place to be at right now," said Dubey, who was head of pan-India operations for ITC's Aashirvaad atta brand. "At ITC, I was heading one of the manufacturing units at 26, and thought I had done fairly well for myself. But I feel humbled and proud when I see teenagers and really young people getting funding for their ideas and making it big." Dubey may have had to take a cut in overall compensation — he was entitled to stock options at ITC — but the possibility of future gains is high.
"The success of a company would depend on growth, exits and valuations but if those fructify, financial gains could turn out to be way better than ITC," he said. Satinder Dwivedi, 38, moved to Mycity4kids as vice-president, technology, in January after backto-back stints at two multinational IT giants. Mycity4kids is a one-stop resource for all child-related services ranging from finding tutors to the best movies at a nearby theatre. Before that, telecom services operator Vodafone's chief commercial officer Sanjoy Mukerji quit to become one of the founders of iclinic Healthcare, a start-up that organises health-care camps.