Unacademy becomes the seventh firm in the Indian startup ecosystem to go for ESOP buyback in 2020

Last week, edtech Unicorn Unacademy has announced an ESOP buyback plan. All vested ESOP till December 10 will be counted for the current and existing employees. The ESOP buyback will be in the range of Rs 25-30 crore. Talking about the development, Unacademy’s co-founder and CEO, Gaurav Munjal said, “Employees with currently vested ESOP value of Rs 40 lakh and more can liquidate 25% of vested options. Employees with vested ESOP value between Rs 10 lakh to 40 lakh will be able to liquidate around Rs 10 lakh while employees with currently vested ESOPs values of less than Rs 10 lakh can liquidate 100%.”

The buyback will also allow exited employees to participate and sell anywhere between 25% to a full 100% of their ESOPs to the company. Tina Balachandran, VP, HR at Unacademy, talked about the development in the Unicorn via a tweet.

At @unacademy we celebrate the hard work and passion of Unacademians everyday. I am elated to share we have announced another ESOPs Buyback round for all eligible employees. This is our way of paying it forward to every Unacademian.

— Tina Balachandran (@TinaBalachandr1) October 15, 2020

Other startups who have initiated ESOP buyback

Unacademy, with this ESOP buyback plan, has become the seventh startup in the ecosystem to go for ESOP buyback. Earlier, Zerodha, FirstCry, BharatPe, Urban Company, MPL and Meesho have allowed their employees to liquidate their vested ESOP.

Zerodha had bought Rs 60-65 crore worth ESOPs; FirstCry is allowing its employees to liquidate worth Rs 31 crore ESOP. On the other hand, Meesho had provided ESOP buyback worth Rs 7 crore. Later, MPL had also announced ESOPs buyback worth Rs 24 crore or $3.2 million. Earlier in August, Urban Company had facilitated an ESOP repurchase worth INR 37 Cr where, investor VyCapital, brought the company's ESOPs. Even before that, BharatPe gave the option to employees to sell shares from their first vesting back to BharatPe.

Further, the ecosystem saw new startups introducing ESOPs. It included Paytm, Oyo, Zomato, Byju’s, Pine Labs, ShareChat, Shuttl, Fleetx and Jodo. The buybacks assume more significance when they happen in a year where many Indian startups have witnessed a financial crunch amid the Covid-19 pandemic.