From big salary hikes and fully-paid family vacations to beer parties and half-yearly promotions, start-ups are going all out to retain employees as appraisal season gets underway.

BusinessLine spoke to a dozen start-ups, including Zopper, Faasos, GoJavas and Mobiqwik, and all of them revealed their pay hike this year will be 25-30 per cent, much higher than the 7-10 per cent in other sectors such as IT, FMCG, infra, media and financial services. This is also above the estimates of multinational HR consultancy Aon Hewitt, which said in a survey in February that e-commerce and start-ups will hand out the best pay hikes this year at 12.4 per cent.

The salary hikes, say experts, are despite the fact that most of the companies are making losses and burning huge piles of cash to grow at a scorching pace.

Foreign funding

Bhavishya Sharma, Director and Founder at Athena Executive Search and Consulting, said times are good for start-ups in India with foreign funding and investment for new ventures soaring high. As per industry reports, start-up investments have increased 300 per cent in the first quarter of 2015 against the same period a year ago.

“This trend is expected to continue for a longer time bringing in new avenues for small ventures. From this perspective, it can be expected that the percentage of salary hike will be better this year. Moreover, it is easier for these firms to scale salary compared with large corporations where many aspects have to be considered,” he added.

In addition to the pay hikes, the fledgling companies are sweetening the deal with beer parties and outdoor trips, among other things, for employees. Harsh Shah, Co-Founder Shopsense, said the company is giving out ESOPs (employee stock ownership plans) and shopping allowance this year, apart from a bonus.

Mobile messaging assistance app Haptik is giving out an anniversary bonus based on tenure and has effected two rounds of lateral promotions across the board.

“We give more frequent raises as opposed to bonuses,” said its founder Aakrit Vaish.

Similarly, online food delivery firm Faasos has handed out bonuses. “As a three-and-a-half-year-old business, quite a few of our employees have been with us since the beginning and contributed tremendously with dedication and hard work and, hence, it makes sense to reward them on a continual basis,” said its co-founder Revant Bhate.

Half-yearly promotions

Talview, online recruitment firm, has given half-yearly promotions to top performers and PepperTap has given ESOPs to most of its 150 employees.

FindYahan is offering family vacations and electronic gadgets based on the milestones employees achieve.

These employee-friendly measures seem to be paying off. Employee churn rate at start-ups is only 5 per cent a year compared with 15 per cent in the IT sector, which at one point was the best employer.