The Startup PM Recruitment Scam in India

So you are a Product Manager looking for an opportunity to work in a small team, and you see a job ad for a startup. It says that they need a product manager and the job description is really exciting. You immediately customize your CV and shoot it over to the recruiter and start preparing for the interview call. Unfortunately, in the vast majority of cases in India, it is a scam.

An employment scam in the simplest form is a recruitment event where there is no intent to hire a candidate. It can be related to a general recruitment drive, where the intent is to obtain payments from candidates. This practice is illegal and widely covered in Indian media, here are one, two and three stories from the past month alone.

The Startup PM Recruitment Scam

A related scam that has come up now is in the field of Product Manager recruitment by startups in India. The way it works is this:

  1. The startup release an ad seeking resumes for PM roles
  2. It keep the job requirements vague to attract widest variety of resumes
  3. Candidates are shortlisted if:
    1. They are working for or have recently worked for a competitor
    2. They have useful domain knowledge or are from a top college (IIT/IIM/ISB)
    3. The hiring manager is curious about them, their salary etc
  4. After getting shortlisted, the candidates are called for an interview

The interview is actually an opportunity for the hiring manager to learn about the competitor, to get ideas for implementation in his firm and to research how other firms are solving problems in a specific domain (e.g. web analytics experiment design in e-commerce).

How to identify a fake interview?

A huge red flag in such interviews is the focus on questions such as “identify 3 issues with our current website/product and how you would solve them”, or “work with us as a paid consultant for 2-3 days to identify a new market opportunity in the VAS space” or “write-up a detailed proposal on how you would introduce a service into the Indian market” or “find 2 ways to improve our product/feature”. The idea behind these questions is not to test the candidate, but to actually get new ideas for product development.

After the interview, the candidate gets a polite rejection letter and the cycle restarts with the next candidate. This is completely unethical, and a startup e-commerce firm in Bangalore, a matrimony portal and some product development startups are known to indulge in this practice. A quick scan at the company reviews on will reveal which firms use candidate interviews for ideation only.

Also, in case your compensation comes up in the shortlisting process, and you know that you are highly paid (you can check this on, etc) as compared to the hiring company then it is very likely that you are going to have a fake interview, which will not proceed beyond a phone call.

How do you avoid this?

It is pretty simple actually, if called for an interview you must:

  1. Review the feedback of other candidates called for interviews
  2. Decline all questions related to the live product, or analysis of a new opportunity in the same domain
  3. Explain that you cannot reveal confidential details about their competitor (your former employer), and they should focus on your skills and expertise
  4. Insist that they focus on case studies or other methods of interview (competency based interview etc) at this time
  5. If they want to work with you for a short while to check the “fit”, then ask for a 3-month, consulting assignment at a reasonable pay. This will give you time to search other jobs, and keep you working in the same domain

The pressure to agree

In this slowing economy, when interviews are hard to come by, it is very hard to not agree to almost anything asked by the recruiter. Just remain confident that the people who are actually hiring, will hire you in a professional, ethical manner, and if you are seeing these red flags, then you are extremely unlikely to be hired anyways. Maintain your poise and calm and this will actually help you in the long run.

In a future post, I will explain why this scam is less prevalent in established firms.


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