ShareChat to buy back ESOPs worth $19M
ShareChat (regional language social media platform) and Moj’s (a short video app) parent company, Mohalla Tech, will buy back employee stocks worth $19.1 million.
This move by Mohalla came after them making an entry into India’s startup unicorn club after it raised $502 million at a valuation of $2.1 billion.
According to this Bengaluru-based startup, about 200 existing and former employees with vested options will be eligible to participate in this process. Moreover, they are likely to sell up to 100% of their vested shares at their present stock valuation.
ShareChat has reportedly tweaked its vesting policy and has also revised its employee stock ownership plan (ESOP) exercise price from INR 1,551 to INR 1. Previously, this company had an annual vesting schedule with the policy that employees who leave the organization may keep all the vested options including their access to other benefits. Now, according to the new policy, only 25% of ESOPs will vest in the first year, followed by 8.25% every quarter.
“We are presently witnessing an exciting growth journey and following an ambitious plan. Therefore, we have aligned our ESOP policy accordingly to reward our people who will be instrumental in paving the way for the next level of growth,” cofounder Ankush Sachdeva said. “This ESOP buyback is our way of giving back to our employees by helping them in their wealth creation journey,”
So many Indian startups including PhonePe, Udaan, Cred, Paytm, Acko, Licious, and ShareChat have awarded their employees with ESOP buybacks over the past year so. This policy led to wealth creation at a time when the sector has seen a significant uptick due to the Covid-19 pandemic.
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