Disposable vs. Indispensable Perks

Do Southeast Asian start-ups really need ping pong tables?

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BY Marishka M. Cabrera - 02 Dec 2016

startup perks

PHOTO CREDIT: Getty Images

Apart from the opportunity to work in an exciting, potentially game-changing, fast-paced environment, the start-up world is known for its perks—free-flowing snacks, ping pong tables, massages, and the like.

These perks not only help attract talent. They also ensure that employees are productive and happy. But which of these benefits actually add value to the company as a whole?


Disposable vs. indispensable perks

 As a rule of thumb, start-up perks that improve the cohesiveness and culture within the company should be considered. Says Justin Hall, principal at venture capital firm Golden Gate Ventures, “Company outings, team lunches, flexible hours, and other opportunities to combine work and play are all start-up perks that can really improve morale, productivity, and retention.”

He adds that it depends on how well the founders and the management team weave in those perks into the overall narrative of the company.

For Jared Polites, a PR and marketing consultant for start-ups, beneficial perks include team gatherings and retreats, as well as the chance to work with the founders or management often. The flexibility to work on diverse projects is also a plus.

The are, however, perks that start-ups can do without.

“I have literally never seen anyone playing video games whenever I walk into a start-up or tech company, and I could count on one hand the number of times I’ve seen people playing ping pong or foosball,” notes Hall.

His office has a PS4, but it hardly gets any play. He says while people are coming around to the idea of nap rooms and free food, many are still “a little to shy to break out a game of Overwatch or Fallout while at the office.”


It takes more to attract and retain talent

Beyond the games and casual attire, it takes more to attract and retain talent.

Polites says in both the U.S. and Southeast Asia, there is a talent shortage, particularly with developers. As such, start-ups need proper incentives, including financial and personal growth, as well as ownership potential.

Without financial incentives, top talent will be reluctant to pass up stable, well-paying firms and choose the start-up path. In an article, he suggests, “If you are an early-stage startup without funding, give equity. If you are funded, set aside a standard employee stock option pool that is hedged and or adjusted with growth to avoid dilution. If you can’t do either, offer frequent raises with outstanding performance.”

Polites, who has worked with Bangkok-based aCommerce and venture capital firm Ardent Capital, says most of his previous co-workers would have rather had stock options or the chance to substitute salary for options.

“Traditionally speaking, start-ups are where people go to work extremely long hours in exchange for equity or options and the chance of cashing out with the founders,” he explains. However, this is a rare situation, especially in Asia, for those who are not among the co-founders or the first 10 hires.

“Stock option plans are not common in the region yet,” he says.

Go back to the essence. He advises entrepreneurs to develop an ESOP or employee stock option plan immediately after closing the first round of funding, and then add in smaller incentives later. Also, give employees the chance to test different projects and the flexibility to adapt into roles.

“Without these incentives, it is ridiculous to impose 12-hour work days and try to force the passion that founders feel onto the employee base,” says Polites.

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