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BabaJob.com,
the Indian Social Networking Start-up:
Differentiating with the Bottom of the Pyramid

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“It (BabaJob.com) is an important innovation because it opens up the marketplace to people of
socioeconomic levels who may not have the widest array of jobs available to them.”1

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– Steve Pogorzelski, President, International division of Monster.com
“BabaJob.com seeks to bring the social-networking revolution popularised by Facebook and MySpace to
people who do not even have computers (the world’s poor). And the start-up is just one example of an
unanticipated byproduct of the outsourcing boom: many of the hundreds of multinationals and hundreds of
thousands of technology workers who are working here are turning their talents to fighting the grinding
poverty that surrounds them.”2
– Sean Blagsvedt, CEO, BabaLife.com & BabaJob.com
tC
BabaJob.com, a Bangalore-based startup, is a unique Internet site. What makes it stand out is that it runs on a
model of providing jobs to the highly unorganised workforce, comprising economically poor people like drivers, maids
and helpers through social networking3. Founded by Sean Blagsvedt4 and funded by his stepfather Ira Weise,
BabaJob.com generally caters to those with low monthly incomes. Altruistic use of technology, for the uplifment of the
world’s poor, powers the jobsite. And it is just not a plain job portal. It goes beyond that and integrates features of social
networking (Annexure I) with job referral for better usability. But there are some major drawbacks like fraudsters
stealing member data, circulation of malicious code in the social network and sometimes hiding true information of the
jobseeker by the referral in order to get them job. Moreover, it is quite uncertain that this type of job site is going to
sustain over the long run.

India’s Informal Employment Sector: Potential Untapped

No

Very less is known about India’s informal sector, which has been a storehouse of untapped potential. A vast
majority of poor and low-income workers are not aware of how to secure their own income using basic skills. Most
often, they are clueless about using the skills they have tacitly acquired.
India is one of the most populous countries in the world next to China.According to 2000–2001 census, India supports
more than 15% of the world population. It had a population of around 1,029 million then, estimated risen to 1,112 million
in 2006 and projected to go up to 2,400 million by 2026. Out of India’s more than 396.76 million workforce, 362.08 million
(91.3 %) are engaged in informal or unorganised employment in 2000–2001. Besides, the employment in the unorganised
sector has increased from 369.0 million in 1999–2000 to 432.66 million in 2004–2005; whereas employment in the
organised sector has declined from 27.96 million in 1999–2000 to 26.44 million in 2004–2005. It has been seen that the
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1
Giridhardas Anand, “In India, Poverty Inspires Technology Workers to Altruism”, http://www.nytimes.com/2007/10/30/technology/30poor.html?_r=1&oref=slogin
2
Ibid.
3
Social networks are the relationships that tie us together. Social networks on the web are growing dramatically in size and number.
4
Sean Blagsvedt has worked 8 years for Microsoft Research in US as a programme manager. In 2004, he came to Bangalore as the third founding member of the Microsoft
Research India and joined Microsoft Bangalore office heading the Programme Management and Advanced Prototyping team – focusing on technology in emerging markets and
new strategies in the mobile phone space.

This case study was written by Jayanta Kumar Barman under the direction of R Muthukumar, IBSCDC. It is intended to be used as the
basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was
compiled from published sources.

© 2008, IBSCDC.
No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without
the permission of the copyright owner.
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BabaJob.com, the Indian Social Networking Start-up: Differentiating with the Bottom of the Pyramid

labour force in the unorganised sector has been increasing at a rate of around 4% in during 2000-2001. A closer look at
the growth patterns in employment shows that over the years, the growth of informal employment has always surpassed
the growth of total employment, indicating a faster growth of employment in the informal sector (Exhibit I).

Exhibit I

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India’s Average Annual Employment Growth Rates in the ‘Organised’ (Formal), and
‘Unorganised’ (Informal) Sectors (1973–1978 to 2000–2001)

Sector Average Annual Rate of Growth of Employment (in %)

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1973–1978 1978–1983 1983–1988 1988–1991 1991–1994 1994–2000 2000–2001
Organised Sector 2.57 2.61 1.42 1.32 0.81 0.35 -0.61
Unorganised Sector 2.94 2.34 1.26 2.12 3.13 1.17 4.03
Total 2.91 2.36 1.28 2.06 2.94 1.11 3.70
Note: Workers employed in agricultural and allied activities are included in both the organised sector (plantations and state
farms) and in the unorganised sector. tC
Source: http://www.saarc-sec.org/data/pubs/rpp2005/pdfs/Tables/Table-4.7.pdf

India‘s labour force is basically segregated into self-employed, wage and salary earners, casual labour and the
unemployed. The self-employed are most loosely connected to labour market because of the possibilities of work sharing
and work spreading in a self-employed enterprise in the total labour-force. Non-contractual casual labourers – like daily
wageworkers, maids, helpers, mechanics and cooks – are closely connected to the labour market, on a day-to-day basis
and are recognised as the economy’s unorganised or informal workforce. Contractual and hired employment (with the
same employer and/or in the same job) on a ‘regular’ basis is covered in the wage and salary workers and is called as
organised or formal workforce.
No

Getting a job in the formal workforce is easier than in the informal sector. Because there are various ways such as jobs
through labour office, through private job agency, reading advertisements, assistance of friends, and applied to employers
directly. On the other hand, jobs in the informal sector are not an easy one as workforce obtain it through the word of
mouth from various sets of people. These emphasises the relevance of creating personal contacts and networking.
In a growing population, where jobseekers outnumber the available jobs, it has become imperative to be at the
right place and at the right time. This is where ‘networking’ comes into play.
Earlier, physical networks helped people stay in touch. But now the virtual networks – like social networking sites and
online forums – have become ubiquitous. Such social networking bonds people with similar interests or in similar professions.
But these trends have invariably overlooked what the management professor C.K. Prahalad called the Bottom Of
Pyramid (BOP) – comprising more than 65% of the world’s population or nearly 4 billion people with purchasing power
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of less than $2000 a year.5 Despite its big size, it is largely untapped and unserved by MNCs. Companies assume that
this segment is too poor to spend any thing more than for their basic needs. Inadequate infrastructure, illiteracy,
currency fluctuations, red tape, etc., make it difficult to build a profitable business serving the poor.

BabaJob.com: Unique Way of getting Job through Social Networking

As the Internet touches most of our lives, novel ways like social networking sites are being used to land in a dream
job. Even recruiters search profiles on these to get the right candidate. But most such jobs are high-end one.

5
Prahlad C.K. and Hammond Allen, “What works: Serving the poor, profitability”, http://www.digitaldividend.org/pdf/serving_profitably.pdf

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BabaJob.com, the Indian Social Networking Start-up: Differentiating with the Bottom of the Pyramid

Now to cater to the low-end jobseekers BabaJob.com was created. Its business model is different than other social
networking sites. It is a job-site for the economically poor, who get jobs through its social networking site BabaLife.com.
This links up employers with employees, their friends and relatives; and can be accessed through the web or mobile
interface. For which enables functions like blogging, photo- and video-sharing in English, Hindi and two local Indian
languages, Tamil and Kannada. It allows controlling postings in the blog post (because sometimes an employer does not
need to know the availability of the jobseeker) and it also allows users to see who is reading what they posted. BabaLife.com

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is also keeping the user informed about jobs whenever any other user posts a new job or is looking for one, so that a user
also has an opportunity to earn INR 200 as a ‘connector’ between an employer and employee.
The idea of developing such a job site originates when Sean Blagsvedt came to India to work at Microsoft India

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office. He was working on a new technology that can positively change the social and economical lives of the
world’s 4 billion poorest people. Then, his colleague Aishwarya Ratan made a presentation on a research paper.6
This sensitised Sean about India’s poverty. This eye-opening research can be summed up as:
a) In India, most families become poor when the primary earner, generally the father, falls ill and cannot work
b) But the study had a positive side too. Many were getting out of the poverty trap as family members were
doing different jobs; a farmer may work elsewhere when he is idle and his daughter may get a well-paid job
in the city. These diversified incomes help a lot
tC
c) The study also revealed that the poor remained poor because they did not know where to find a right paying job.
Another critical observation of the study was that the poor people were not poor because there were not income
resources but because they are unable to find the desired job.
BabaJob.com was launched to use social networking for the poor. It caters to lower-end aspirants like drivers,
housemaids, cooks, caretakers, watchmen, helpers, delivery boys, etc. But how can these poor people access the
web or a mobile phone, the ways in which BabaJob.com helps find jobs. For this, the site’s model includes a mentor7
who acts as a channel between the site and the poor. These mentors are paid for helping the poor find the right jobs.
Initially, job listings can be posted for free but later as the database expands, some nominal amount can be charged.
BabaJob.com has restricted an unlimited access to the employer as it may happen that the employer will interview
No

several jobseekers by paying for one jobseeker’s appointment and this will hamper the revenue source. As of now, the
site covers only Bangalore’s poor but soon it plans to expand outside. It helps jobseekers with monthly incomes equal
to or less than INR 10,000 in a month.
The company’s business model is entirely based on sharing the money paid by the employer with the mentors and
this eased the hiring process. Jobseekers, if they can, are allowed to register and profile themselves on the site. they
can even give their mentor’s phone number, if they do not have one. Mentors arrange and schedule the interview,
once they are sure that the jobseeker’s skills match the requirements of the employer whose identity is not revealed in
the process. The site gives an option to the employer to make their advertisement appear on the home page of his/her
friends and relatives. But if an employer chooses to restrict the appearance, the employer might restricting the applicant
pool. By selecting the desired option, the employer’s advertisement can be seen by the applicable groups. Thereafter,
whoever wants to respond to the advertisement has to send an email to BabaJob.com and then that email will be
forwarded to the concerned advertiser. The process ensures that an employer will not get any unwanted call. If the
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jobseeker fits an employer’s requirement, then the employer will contact the jobseeker. But if the employer wants
faster recruitment process, then the employer has to give their contact number so that the jobseeker can contact
immediately. The job site helps the employer to know who is willing to work and also the person’s identity if the
jobseeker has relevant experience in the employer’s network. Henceforth, higher the number of people invited by the
employer, the better the site will be to hire a new jobseeker.

6
Krishna Anirudh, “Escaping Poverty and Becoming Poor: Who Gains, Who Loses, and Why?”, http://www.pubpol.duke.edu/krishna/documents/Krishna_Rajasthan_poverty.pdf, 2003
7
A mentor is an individual, volunteer, past employer, a web-café operator or a charity, a NGO, etc. They first register as a mentor. And then collect a jobseeker’s personal and
employment data, making a profile out of it. A mentor can be any one who can access a computer and stays in touch with the informal workforce.

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BabaJob.com, the Indian Social Networking Start-up: Differentiating with the Bottom of the Pyramid

Problems in Information Inaccuracy, Privacy, Security and Trust: Will it sustain?

Developing a website to reach the poor poses special challenges. First of all, most of the poor can hardly access
the web. So a website wanting to serve the poor sounds unusual. Even if this were not the case, then being on the web
is quite a murky affair. Social networking sites are accused of breeding pedophiles, spammers, hackers, etc. They
pose as genuine friends, break into the network and later corrupt it.

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The most common web-based scam is ‘phishing’ where hackers create fake websites similar to the original one,
luring users to provide sensitive personal information. With this information in the hands of the hackers, anything can
be done. Even spyware can steal such information.

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One prominent disadvantage of an online social networking system is the accuracy of the information provided
by the jobseeker. BabaJob.com claims it does not investigate the accuracy. It states it is not involved in the hiring
process, beyond linking the employer and the jobseeker. It clarifies that the mentor is neither responsible for
investigating a jobseeker’s employment history nor liable for any wrongdoings by the jobseeker; but it will definitely
impact the earnings and reputation of the mentor. But it plans to give comparative ratings to the mentors, based on
the performance of their registered jobseekers. Many employers would not want to let their children, parents and
gardens be cared by someone unknown. So employers are asked to contact former employers to assess a jobseeker;
even checking their police records is encouraged.tC
Another major drawback is that references may give false information about the referred jobseekers. Maybe
because they are affiliated with them. But is this tolerable? Moreover, is this model sustainable or is it a fad and even
worse (a bubble 2.08 )?
No
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8
Bubble 2.0 (also known as Web 2.0) can be termed as a second generation of web based communities or hosted services such as social networking sites, blogs, wikis, podcasts,
and peer-to-peer networking.

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BabaJob.com, the Indian Social Networking Start-up: Differentiating with the Bottom of the Pyramid

Annexure I
Types of Social Networks and their Business Benefits

Type of Community Typical Reason Why Companies Deploy Social Networks

Customer • Increase Web traffic with persistent engagement

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• Drive marketing leverage by provoking customer-to-customer
communication and viral marketing
• Gather real-time input from customers on their needs and wants

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• Provide peer-to-peer customer support (lowering customer support
costs)
• Increase brand awareness and loyalty
• Solicit customer-driven innovation.
Employee • Enhance teamwork
• Discover new ideas and accelerate innovation
tC • Encourage cross-functional inputs to drive better decision-making
• Create a company culture of sharing and learning
• Increase communication by leveraging intra employee
communications to a broader audience
• Increase retention and connection between the company and
employees.
Partner (channel partners, • Coordinate communications, accelerating cross company
developers, and consultants) performance
No

• Increase sales through real-time market intelligence and

collaboration
• Encourage co innovation to better serve joint customers and
markets
• Create an interdependent ecosystem of partners that drives
increased revenue for all participants.
Source: “The Business Value of Social Networking Applications”, http://www.hivelive.com/files/hl_idc_spotlight.pdf, October 2007
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