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    InMobi grapples with senior, mid-level attrition amid concerns about future

    Synopsis

    Over the past six months, at least a dozen mid- and –senior-level executives have resigned and InMobi is not gaining any market share.

    ET Bureau
    BENGALURU: Online advertising startup InMobi, one of India’s early ‘unicorns,’ is struggling to retain senior executives amid questions about whether new strategic initiatives are working as well as worries about the future of the company.

    Over the past six months, at least a dozen mid- and –senior-level executives have resigned, and InMobi is not gaining market share in a business dominated by tech’s big daddies Google and Facebook, according to four people aware of developments at the Bengaluru-based company.

    Image article boday
    Apart from finance chief Manish Dugar, who left last month to join Practo, recent exits at the company include Naresh Agarwal, who till January served as vice president of engineering, big data and audience platform; Khushboo Gupta, who heads strategy and operations of the company’s app download business and is currently serving her notice period; and Ravikiran Vadapally who served as VP of finance and resigned in February.

    “It’s not just people at the top who have resigned. The more troubling part for InMobi is that mid-level executives across teams, the employees who could actually bring in a turnaround, have quit the company. What never happened before is happening now and good talent is leaving the company across the board,” said one of the sources mentioned above.
    InMobi, which was founded by Naveen Tewari in 2007 and was the first startup in which Japan’s SoftBank invested, now has some 1,500 employees compared to twice that number at its peak. The Japanese conglomerate, which has since backed Snapdeal and Ola, poured $200 million into InMobi in 2011 but wrote down most of that amount in 2014.

    Other than the recent exits, several key executives have resigned from InMobi in about the past year. M&A head Nimish Joshi went to Ola; InMobi lost Khushboo Maheshwari, who headed commerce; and Debleena Das, who headed talent acquisition, joined venture capital firm Matrix Partners.

    In a statement attributed to Arun Pattabhiraman, the global head of marketing, the company said “every engine at InMobi is focused on ensuring that (it) turns profitable within the next 60-90 days. As part of this exercise, InMobi has taken several steps towards driving cost efficiencies such as pausing moonshot projects and restructuring teams to ensure investments are aligned with the right teams, business verticals and regions.”

    The exits also come during a time when InMobi is struggling to raise funds and chart out a sustainable business model that can adapt to the massive changes that are taking place in the online and mobile advertising space, according to both current and former executives at the company. According to these executives, InMobi, which was estimated to be valued at $1 billion, now generates between around $300 million in annual revenue. InMobi has not registered profits since its founding in 2007, say these executives.

    In September 2015, ET had reported that InMobi had raised $100 million in new debt from a consortium of lenders led by US based Tennenbaum Capital Partners. The company received about $60 million -- of which $40 million was used to pay debt raised the year before.

    InMobi’s challenges have been compounded by the fact that its flagship product Miip -- that targeted global retailers like Walmart -- hasn’t taken off. Miip also took much longer than expected to scale and customers found the product underwhelming, according to at least two customers who have used the product. InMobi, however, said that its product innovations like Miip “have also begun to deliver great results.” “In India alone, Miip today delivers 5000-7000 transactions per day for top ecommerce players, with an average order value of 1,500-2,000 rupees. We will make formal announcements around other interesting developments over the next couple of months,” the statement said.

    Even as InMobi struggled for momentum, the company has started coming down hard on some of its unprofitable and non-revenue generating initiatives.

    According to two of the people quoted above, the company has ditched its plans to build an InMobi app. Another initiative that the company decided to park on the sidelines was its much-touted analytics platform.

    InMobi has also delayed its salary appraisal process for employees across the company this year, according to two of the people mentioned above.

    “Around April, there were discussions around the budgets that needed to be set aside for salary hikes this year, but that process got delayed significantly since the company was dealing with other pressing issues,” said one of the people.

    A company executive, however said that employees would definitely be notified on the appraisal process soon, although “the process has only been delayed slightly.”

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