Kamal Karanth and Anil Kumar have been childhood friends, classmates and even colleagues at one point in their careers. So, it was only natural that the duo ended up founding a start-up. Having worked in the staffing industry for over 17 years, the duo spotted an emerging opportunity. With the engineering sector moving up the innovation and R&D curve, there is going to be higher demand for skilled and specialised technicians. Based on this premise, the duo launched a strategic talent firm, Xpheno, in April 2017, by investing around 3.5 crore.
The start-up provides skilled technicians in the field of engineering, IT and healthcare on a contract basis to corporates. The workforce is hired, trained and deployed by Xpheno. Once the contract is over, the staff is redeployed on other projects as per client demand.
Based on the skill requirement needed, Xpheno trains its workforce. In automotive engineering, hires are trained in skills such as battery management, keeping in mind the evolving future around electric vehicles. In technology, angular script and mobile UI is a big draw, while in emerging technologies the focus is on artificial intelligence and virtual reality. In healthcare, the focus is on healthcare technicians and biostatisticians. “We are eyeing sectors where we think private jobs are higher and penetration is relatively easier for us,” says Karanth, adding that timely supply management is where companies need help. According to the Indian Staffing Federation, the flexi staffing industry in India is worth $3.04 billion and expected to grow at 14-16% per annum till FY21.
While the workforce is on Xpheno’s rolls, clients pay the company based on the candidate’s skillset, experience and tenure of engagement. The payment could vary from hourly fees to monthly charges, with the company clocking average revenue of 1.7 lakh per client. The workforce currently comprises young engineers drawing salary in the 80,000-1 lakh bracket. Xpheno has 30 automotive engineering companies as its clients and has deployed 25 technicians with 14 clients over the past two months. Assuming an average ticket size of 1.7 lakh, its revenue till date is around 24 lakh.
Currently, Xpheno operates only in Bangalore, but plans to open offices in Delhi, Mumbai, Hyderabad and Chennai. The 30-member team is eyeing a customer base of 100 in six months. “Our high-margin businesses will start clocking revenues from January which will take care of this growth we are planning," says Kumar.
Despite competition from bigger players such as Teamlease, the duo believe the DNA of Xpheno lies in its specialisation. “The customers slot companies according to specialisation. So, typically, if they want a delivery boy or a similar job profile they will approach a Teamlease. While they do offer services like we do, their numbers would still be in single digits,” says Karanth.