Continuing with last year’s trend, this year too, we saw 15 Indian startups to have rolled out ESOP buyback initiatives.
Last year we saw different sized startups initiating ESOP buybacks, in turn, raising funds for the growth of their businesses. Earlier in 2021, names such as– Swiggy, Unacademy, FirstCry and Zerodha opted for ESOP buybacks and rewarded their employees.
Along with raising funds, ESOP programmes essentially help retain talent in the startups, thus, building the organisation’s commitment to the employees.
Shares granted under the ESOP programme act as an additional income source for the employees who can either encash them if the startup is unlisted or convert into stocks in bourses when the same is listed.
In Q1 2022, 15 startups ranging from edtech to foodtech to crypto have raised funds through ESOP buyback programmes. Here are the Indian startups that initiated ESOP programmes and also, bought a portion of allotted shares.
Indian Startup Employees & The ESOP Buybacks In 2022
Pine Labs
IPO-bound fintech startup Pine Labs announced INR 100 Cr ESOP ($13.1 Mn) buyback. The unicorn did not disclose any details of the ESOP buyback programme. In continuation to that, the fintech startup announced a $50 Mn funding round led by private equity company Vitruvian Partners at valuation of over $5 Bn. The funding round also comprised a $15 Mn ESOP buyback.
Earlier in 2020, Pine Labs allocated worth $14 Mn ESOPs to its CTO, CFO and many others.
It is persistently raising funds in the present year. In January 2022, it raised $20 Mn in the funding round from commercial bank SBI while in February this year, it received $150 Mn from Alpha Wave Ventures.
CoinSwitch Kuber
Crypto unicorn CoinSwitch has lately completed a $2.5 Mn ESOP buyback plan. The startup did not disclose any details of the ESOP buyback plan.
According to an Inc42 report, the number is expected to be small since most of the hiring activities have happened over the last year and ESOPs that were given to most employees are yet to vest, said a CoinSwitch spokesperson to Inc42.
In October 2021, CoinSwitch sealed its Series C funding round at $260 Mn at a valuation of $1.9 Bn. The funding round was led by Coinbase Ventures and Andreessen Horowitz (a16z).
The crypto startup counts Tiger Global, Ribbit Capital, Coinbase Ventures, Sequoia Capital and Paradigm as its investors.
Rebel Foods
Foodtech unicorn Rebel Foods recently announced a $10 Mn ESOP plan for 150 current and former employees.
According to Roc filings accessed by Inc42, Rebel Foods’ former and current employees participated in this ESOP buyback.
As per the recent resolution passed by the shareholders of Rebel Foods, the startup would buy back 7,270 equity shares from its employees at a price of INR 86,019 per share.
In 2020, Rebel Foods became a unicorn after raising $175 Mn in its Series F funding round. The round was led by Qatar Investment Authority (QIA) in participation with Coatue and Evolvence. The round helped Rebel’s valuation soar to $1.4 Bn.
The foodtech unicorn has earmarked $150 Mn for strategic investments, brand acquisitions and to expand its footprints to foreign countries.
NoBroker
Proptech unicorn NoBroker completed its ESOP buyback worth INR 32.2 Cr ($4.2 Mn). As part of the buyback program, the startup’s 95 former and current employees were given the opportunity to liquidate their stock options, which constitutes 57% of total employees who currently have ESOPs.
Then, the proptech unicorn was focusing on strengthening the other verticals such as home loans and legal services.
In 2021, the proptech unicorn turned into a unicorn after raising $210 Mn in a Series E funding round from General Atlantic, Tiger Global and Moore Strategic Ventures. The round took the total funding raised by the startup to $424 Mn.
Fleetx.io
SaaS startup Fleetx.io has completed ESOP buyback worth $507K as a part of its Series B funding round. The round was led by IndiaMART.
According to the startup, the ESOPs buyback was rolled out to 45 eligible current and ex-employees, as part of the closure of Fleetx’s Series B funding round.
Founded in 2017 by Vineet Sharma, Abhay Jeet Gupta, Udbhav Rai, Parveen Kataria and Vishal Misra, Fleetx offers IoT and software-based solutions to the logistics companies that safeguard vehicles and also augment operations.
Jupiter
Mumbai and Bengaluru-based neobank startup, Jupiter initiated ESOP buyback for several of its employees across the company. The stock options, obtained from both present and past employees, have amounted to $4 Mn in liquidity transactions.
According to its statement, 21 former and present employees have been benefited through these transactions.
Prior to this, the startup bagged $87 Mn in Series C funding round led by Tiger Global, while QED Investors, Sequoia India and Matrix Partners also participated in the round.
Cars24
Used car marketplace Cars24 announced an annual ESOP buyback worth INR 75 Cr to reward its employees. According to its statement, It has consistently led annual ESOP buyback initiatives for the last four years, for its employees both existing and former. Also, the value of total ESOP buyback for the startup till date stands at INR 113 Cr.
Earlier in December 2021, the auto ecommerce platform had bagged $400 Mn in its Series G funding round led by Alpha Wave Global. It joined the unicorn club in 2020 after raising $200 Mn in the funding round. So far, it has raised $1.3 Bn in funding.
LEAD
Edtech startup, LEAD initiated ESOP buyback worth $3 Mn for its employees. This comes after its recent Series E funding round worth $100 Mn led by WestBridge Capital and GSV Ventures.
The funding round aided the edtech startup to reach at a valuation of $1.1 Bn, thus, entering the unicorn club and becoming the first Indian edtech unicorn of the year.
This move will help the startup retain talent and also, gain from the program. The edtech startup asserts that nearly 20% of its employees own ESOPs.
slice
Fintech unicorn, slice announced its first ESOP buyback worth $8.6 Mn. The startup informed that nearly 60, both former and existing employees holding vested stocks in the startup were eligible for the buyback. The startup further stated that in this particular ESOP buyback exercise, around INR 1.2 Cr was paid out to eligible and existing employees.
In late 2021, the fintech startup joined the unicorn club after raising $220 Mn in its Series B funding round led by Tiger Global and Insight Partners. The round also saw participation from other investors such as Advent International’s Sunley House Capital, Moore Strategic Ventures, Anfa, Gunopsy among others. Its existing investors Blume Ventures and 8i too participated in the round.
Bizongo
Supply chain startup, Bizongo concluded its ESOP monetisation program. As part of the buyback program, nearly $3.7 Mn worth of ESOP was liquidated.
The startup informed that of the total 102 current and former employees eligible for the scheme, 70% opted for the buyback. Bizongo had kept the total ESOP pool at $4.8 Mn. The ESOPs were offered to employees depending on different stages of their tenure.
FarEye
Logistics management startup FarEye announced an ESOP buyback program worth $1.22 Mn. It is reportedly the second buyback to date. Earlier in January 2021, it initiated an ESOP buyback worth $739K.
In the previous year, the startup garnered $100 Mn in its Series E funding round led by Dragoneer Investment Group and TCV. A portion of the capital infusion was used to expand its software platform capabilities and attract talent.
Trell
Social commerce startup Trell concluded ESOP buyback worth $1.6 Mn. Earlier in August 2020, it had raised $11.4 Mn in a Series A funding round led by KTB Network.
The startup has raised an aggregate of more than $62 Mn in venture capital from investors including Mirae Asset Ventures, H&M Group, Samsung Ventures, LB Investments and others.
Porter
Intra-city logistics startup, Porter initiated ESOP worth $5 Mn. A statement from the startup said that the ESOP programme is designed for 80% senior and mid-management and 20% for lower management.
Earlier in 2021, the startup raised nearly $100 Mn in Series E funding round. It has raised more than $131 Mn in funding to date.
HomeLane
HomeLane announced an INR 27 Cr ESOP buyback program, marking its second such program according to the startup. In the previous year, it bagged $50 Mn in Series E funding round led by IIFL AMC’s late-stage tech fund, OIJIF II (Oman India Joint Investment Fund) and existing investor Stride Ventures.
The startup said, many of its employees invested their gains in homes, cars, retirement funds and also donated to causes they believe in.
Ninjacart
Indian agritech startup, Ninjacart concluded ESOP buyback worth over INR 100 Cr. Both current and former employees of the startup with vested ESOPs as of December last year, are eligible to participate.
In late 2021, the startup garnered $145 Mn from Walmart-backed Flipkart, valuing it at between $700 Mn and $800 Mn. The startup is also expanding its footprint into the FMCG segment, procuring from big brands and selling to store owners and other resellers.
[This is a running article and we will be updating it with more ESOP buybacks, as and when they are announced]
