Meesho, the four-year-old startup and leader in the social commerce segment in the country has announced its first-ever employee stock ownership plan (ESOP) buyback programme to the tune of $1 million. The startup falls into the rare group that has undertaken an ESOP buyback so early into its existence.
Meesho, founded by IIT-Delhi graduates Vidit Aatrey and Sanjeev Barnwal in December 2015, has more than 800 employees on its payroll.
“The growth of Meesho would not have been possible without our biggest asset which is our people. This is a gesture on our part to express our gratitude to them,” said Sanjeev.
The ESOP buyback programme of Meesho saw 60 percent of eligible employees exercising the option to sell up to 30 percent of their vested shares. There were around 35 people within the company who were eligible for this programme, and only 20 opted for it.
“This also proves that ESOPs have real value in attracting future talent as well as a retention tool,” said Sanjeev.
Naspers, the South Africa-headquartered internet and media giant, which is an existing investor in Meesho, has bought these shares. Meesho employees were also upbeat about this decision.
Ravleen Shravanth, VP - Strategy to Execution, Meesho, said, “Joining a startup is a high-risk, high-return decision. When I joined Meesho, I was the 40th employee, with a lot of things to build from scratch, busy weekends, and long hours. Since joining, I have seen the company grow 20X and the ESOP buyback is a validation of the decision two years ago. It validates that employees are co-owners in the company’s growth, and with Meesho's promising growth trajectory, the value of ESOPs is only going to go north.”
Meesho has raised around $215 million in funding since its inception from investors including Facebook, Sequoia Capital, Y Combinator, SAIF Partners, etc.
Over the last 15 months since closing its Series B, C, and D rounds of funding, Meesho has clocked 20x growth since 2018.
Sudhanshu Shekhar, VP - Growth and Marketing, Meesho, said, “This was unexpected because there are very few instances of ESOP buybacks in the Indian scenario. A buyback either happens when a company goes public or there is an exit. So this shows that Meesho ESOPs are more than a piece of paper and offer real value.”
Social commerce is projected as a big contributor to the growth of ecommerce in the country. According to a study by Nielsen, the social commerce market in India is worth $70 billion. Meesho has more than 2.6 million members on its network and has created channels to transact across various platforms like WhatsApp, Facebook, and Instagram.
Going forward, Meesho is keen to retain its talent. And, according to Sanjeev, it will continue with its share buyback programmes.
(Edited by Suman Singh)