How Spryker aims to get tech talent despite skills shortage

The battle for employees is escalating, partly because medium-sized companies are snatching employees away from startups. How the multi-million start-up Spryker is dealing with this - and what others can learn.

Worth 500 million U.S. dollars, expansion into the U.S.: For the Berlin-based e-commerce startup Spryker, the past few years have been increasingly marked by success. With its construction kit for online stores, the start-up has managed to attract the attention of big names such as the equity firm TCV and later expand to the USA. These could be days of joy, but for Elise Müller the strong growth means above all pressure: Because the HR manager of the start-up, which was founded in 2014, has to get more and more employees on board with more and more orders - and they are harder to get than ever before.

The Great Resignation also reaches German start-ups

The start-up scene, like many other industries, is suffering from several developments that are leading to a major problem. First, they are feeling the so-called "Great Resignation," which can already be better measured in the U.S. than in Germany. The term describes the voluntary resignation of employees who have realized during the pandemic that they want to turn their lives around after all and no longer have any desire for their current job. In the U.S., this is said to have resulted in nearly 60 million employees quitting their jobs between January 2021 and February 2022 alone.

On top of that, there is greater competition, which is likely to be especially noticeable among startups. On the one hand, this is the competition among themselves, on the other hand, it is the German Mittelstand or it is large Dax corporations that are vying for the few programmers and skilled workers. This enormously exacerbates the shortage of skilled workers at startups, thus driving up their costs for finding as well as retaining talent.

"The shortage of skilled workers is becoming the number one obstacle to growth."

Achim Berg, Bitkom

As a result, young companies are desperately seeking employees. For example, a recent survey by the digital association Bitkom showed that tech startups in Germany would very much like to hire new employees; eight out of ten companies are looking, and two-thirds of the startups surveyed have vacant positions. "This can become a problem, says Bitkom President Achim Berg: "The lack of qualified workers is becoming the number one obstacle to growth."

Bonuses, benefits and base salary: companies' offers are becoming more lavish

Elise Müller of Spryker knows all these problems all too well. When she started looking for employees for her startup in 2017, she was still paying 50,000 to 60,000 euros for a good programmer; today, that can be double. In addition, there are more and more "benefits" that a start-up has to offer young applicants. These include a company car or company bicycle, modern office equipment for the home office, the offer to work from anywhere and at flexible times, and the promise of more vacation days. "Benefit packages today are much more lavish than they used to be," says Müller.

At Spryker, while most of the core team from the beginning has remained, turnover has picked up in recent months, the startup's HR director reports. The turnover rate has climbed to 18 percent on average, she says, and even higher in the sales area in particular. "Keeping people in the sales area for a long time is difficult. Big companies in particular, in addition to high salaries, offer even more benefits, even higher bonuses and so on. That of course drives up demands from candidates," says Müller.

For Elise Müller, the battle for the best employees now feels like a big shark tank: Everyone is circling around a few talented people. This is particularly noticeable in Germany, she says, because few new qualified employees are coming on board, especially in the tech sector. Competition on the domestic market is correspondingly fierce, which prompted Spryker to take a step - a smart one in retrospect: Instead of only looking in the DACH region, the startup is also looking in the U.S., the U.K., the entire Asian region, or other countries that many people don't have on their radar for the time being. After all, developers can theoretically work from anywhere and at any time. "We've made our talent funnel bigger, so to speak," Müller says.

The wave of layoffs at startups offers opportunities for companies that are doing well through the crisis

To be sure, he says, the cost of international recruiting is naturally greater, because you might also need headhunters, people who can handle the bureaucracy and who also have to fly employees and staff into headquarters from time to time. But the step was worth it, Müller believes. In addition, the international search also has the advantage that unfilled positions can be filled more quickly by poaching. Unlike in Germany, there is not always a three- or six-month notice period, so new employees can start their new jobs more quickly.

A positive factor for the start-up is the current situation at other companies, which currently have to terminate their employees. This means that more employees who were previously tied to one company are coming onto the market again. "Here we look around quite specifically, also on platforms such as Linkedin," says Spryker personnel manager Müller. Time and again, acquaintances, HR managers or companies in the network would refer to talents who had just become available, or one would read about layoffs. It is not uncommon for employees to then post lists online of who is currently looking for a job. "We then write to the employees directly or send them a link to the career site. These are new approaches, but of course we have to take them," says Müller.