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One-in-four employees in startups leave within a year. What should startups do to retain employees?

Research by Glassdoor found that organizations with a strong onboarding process improve new hire retention by 82 percent and productivity by over 70 percent.

Finding the right product-market fit within a stipulated time frame is a crucial part of startup survival. Thus, having a talented engineering team on board will be decisive in your startup success.

That being said, another significant aspect of startup survival & success is being able to retain this pivotal talent. Failure to retain talent is never an option for bootstrapped startups as they can’t afford to extend their runway like their well-established counterparts.

The most frustrating part of failing to retain talent is going through the process of finding the best talent all over again. So, putting talent retention on the back seat is NEVER an option for you (NOT even after you rehire). Then why not do it right in the first place? After all, talent retention is cheaper and more manageable when compared with replacement!


Why do employees leave?

In most tech startups, employees leave majorly due to the following reasons:

  • Seeking higher compensation (71%)

  • Looking for better working conditions (47%)

  • Searching more responsibility (32%)

  • Seeking more opportunities to express creativity (26%).

Established organizations have an eye out for good employees, and with better offers rolling out each day, these employees are quick to switch jobs.


Why do startups struggle with talent retention?

Talent retention for startups running on a limited budget is a different ball game altogether.

  • It is hard to find employees who are quick learners and can adapt to rapidly changing technologies and business environments.

  • Startups lack resources, and their business models may not be proven. Hence, stable revenues are out of sight, due to which they can’t afford to pay handsomely or offer lucrative perks like their well-established counterparts.


How can startups overcome this challenge?

A distributed team is an optimal solution to overcome talent retention challenges.

For example, you might hire 5 team members in the US and 10 team members at a cost-effective offshore location. If an onsite employee leaves your startup, your offshore team members will compensate for the losses and delivery timelines won’t be affected.

Thus, the attrition rate won’t affect the project deliverables drastically as it would have with only an onsite team.

Building an offshore software development team will further ensure that the work is well-distributed between your onshore & offshore teams, preventing employee burnout. This will create a win-win situation for you and your employees.

Salary of a software engineer in India

(6 to 8 years of experience) - $17,111 to $22,138

Salary of a software developer in the U.S.

(6 to 8 years of experience) - $95,000 to $140,000

With an offshore team in India, you wouldn’t have to think twice when it comes to promotions & increments, although you are running on a bootstrapped budget. This will make your employees feel rewarded.


Employee Testimonial

At Braves, we cherish a high employee retention rate, which is well over 85 percent. Hear from our employees why they love working with Braves…

Employee 1: Quentin Sebastian

Tenure: 10+ years

Designation: Talent Sourcer Lead

I started my journey with Braves almost a decade ago as an Associate Recruiter, and I’m presently working as a Talent Sourcer Lead. I have seen this organization transform and grow into what it currently is. One of our proven formulas that boosts employee retention is the “pull” hiring strategy that we utilize. Also, developing employee-centric policies has always been our key focus at Braves. Even during the COVID 19 pandemic, we didn’t lay off a single employee, nor did we refrain from giving appraisals to deserving employees. Thus, we don’t just say that our employees are our biggest assets; we also live by it.

Employee 2: Shrikrishna Kulkarni

Tenure: 6+ years

Designation: Infrastructure Architect

My journey with Braves started as a Deployment Engineer, and I’m presently working as an Infrastructure Architect. The company has an excellent work environment. Here, I learned to work independently and take full responsibility for the assigned tasks. This has contributed significantly to my professional growth! Furthermore, the company rewarded me for my work during every appraisal cycle. The processes at Braves are very well-structured and highly organized, which contributes significantly to the excellent work-life balance that I have. The high employee retention rate at Braves is also a key contributing factor to 100 percent client retention. I feel rewarded to be a part of the Braves family!


Braves helps global technology companies incubate their dedicated offshore development teams in India. The team in India is an extension of the onshore team and works collaboratively to achieve their goals.

With 17+ years of experience in technology recruitment in the US and India, we know how to build a team of high performers. Our fully managed operations model along with people driven policies has helped clients scale their teams with a high employee retention rate of 85%.

Get in touch with us to find out more.


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