Simplilearn concludes maiden ESOP buyback

After raising $250 million from global private equity firm Blackstone earlier this year, Bengaluru-headquartered edtech platform Simplilearn has announced the conclusion of its first Employee Stock Ownership Plan (ESOP) buyback plan of Rs 48.74 crore. 

All active employees who held vested shares as part of the ESOP plan were eligible for the buyback, though only 65 percent of them participated in the event.

“We opened up the buyback for active employees to buy back 25 percent of their vested ESOPs from our 2012 plan and also gave them shares from the new ESOP plan to almost match what they had sold. We have also announced a new ESOP pool for all future hires,” Krishna Kumar, Co-founder and Chief Executive Officer of Simplilearn told Yourstory. 

He added that the buyback was carried out at the same share value offered to early investors Helion, Kalaari and Mayfield Fund. Shares allotted at the face value of Rs 10 under the ESOP plan were bought back at Rs 63,500.

Blackstone acquired a controlling stake in Simplilearn as part of the Series C funding in July this year, valuing the company at $350 million. Nearly 70 percent of the capital was used to give exits to the early investors in the company. 

Krishna adds that the current buyback will help in attracting talent as the company looks to ramp up numbers in the US where it has nearly 15 employees and in India. The company plans on hiring 150-200 employees and currently has 1,610 people on its rolls. 

“Hiring good talent has always been a challenge and it is not new to the current market. The current event and the new ESOP plan also gives assurance to our employees that it is not just paper money we are talking about,” he added.

Simplilearn offers reskilling bootcamps targeted at students and mid-career professionals, in partnership with universities in India, US, corporations and leading industry via live online classes. The company was founded in 2010.

Multiple companies have announced ESOP buyback plans this year, riding the wave of hyper-funding. Many of them have also introduced innovative vesting structures to retain and attract talent in a competitive hiring scenario. Fresh meat and meat products brand Licious recently announced its continuous liquidity plan, as did Teachmint earlier this year.