IITs decision to ban startups on campus, a bad precedent?

When IITs decided to blacklist 31 startups that delayed or canceled job offers to their students, the news was not received without criticism. Many analysts and investors felt that IIT was probably too staunch and could have avoided a knee-jerk action as the decision by the prestigious institute may not make much difference to these companies, some of which have wound up like PepperTap and others which have frozen hiring, says Livemint.

“It is a knee-jerk reaction and completely unwarranted. What has been done by start-ups this year, have been done by many IT companies in the past such as deferred placements. Nobody thought of blacklisting them. If students are good, they will find opportunities in other organizations as well,” says Harish H.V., a partner at consulting firm Grant Thornton.

Speaking to the same publication, Dinesh Sharma, founder of ConsultLane, one of the blacklisted companies echoed the sentiment, “When the whole country is talking about Start-up India, you can’t just blacklist them. The worst thing is that they have not given us a single chance of hearing.”

Last placement season, some 140 students of IITs were affected because of few companies revoking offers or delaying the joining date by months which prompted the decision to ban those startups from campus placement for a year.

“Our main motive is to avoid any such deferral or offer being revoked situation...,” said DipeshChauhan, placement manager at IIT-Bombay.

For Kaustubha Mohanty, convener of the All IIT Placement Committee (AIPC) and professor at IIT Guwahati, said he does not see any impact on their placement process. “We are making sure that only serious players are in for placements. We understand the market dynamics... but we cannot get carried away by just the start-up wave,” Mohanty said.

Startups and investors, however, feel that IITs are not only making their students risk-averse but it’s also against the entrepreneurial lessons that students are taught at their institutes. Analysts also believe that the subdued start-up environment will absorb it anyway without much impact.

Citing an anonymous investor, Livemint says, “Considering the current sentiment (slowdown in funding), most companies will have a low hiring plan, that is clearly given. The general sentiment is to be cautious.” He also added that not many start-ups will be affected by the move, especially not the ones who have acquired the status of unicorns. “If it is a rock-star start-up, despite a blacklisting by the colleges, students would still want to go and work. If they advertise, they will get people,” he said.