Fintech startup PhonePe buys back Rs 135 cr worth ESOPs
Fintech startup PhonePe spun off from Flipkart, said its founders will not be participating in the ESOP buyback.
Fintech startupon Friday announced an employee stock options (ESOPs) buyback worth Rs 135 crore based on seniority.
All current employees can sell up to 25 percent of their vested stock, PhonePe said, adding the company's top leadership can sell up to 10 percent. The founders will not be participating in the buyback, the startup added.
"Almost 75 percent of our current workforce is eligible to participate in the current buyback offer, and for most, it's the first time in their careers that they've either owned ESOPs or had a chance to liquidate them," said Manmeet Sandhu, Head of HR, PhonePe.
Earlier this year,had launched a $200 million stock option plan for its 2,200 full-time employees to help them benefit from the growth the startup saw last year when digital payments hit new highs due to the pandemic.
Traditionally a wealth creation tool used by startups to retain top talent and offer incentives to senior executives, ESOPs had been one of the ways how companies last year compensated employees amid furloughs and salary cuts.
These days, top startups are offering generous ESOPs to new hires and top talent, along with a slew of other incentives, including ticket matches to cricket matches abroad, laptops, tablets, bikes, etc.
In recent times, startups such as, , , , and have all sought to buy back their ESOPs to create more liquidity for their employees.
Recently, PhonePe received an insurance broking license from the Insurance Regulatory and Development Authority of India (IRDAI), which will enable it to sell insurance products from all insurance companies in India.
The move is expected to propel PhonePe to become a significant player in the insurance ecosystem because of the number of users it can reach.
Earlier, the startup had a limited insurance 'corporate agent' license, which allowed PhonePe to partner with only three insurance companies per category. With the general broking license, it will be able to offer more insurance products to its users, it added.
Edited by Suman Singh