Razorpay to buy back ESOPs for the third time worth $10 Million

FinTech Unicorn Razorpay has announced that it will buy back ESOPs from its employees. Under this scheme, employees will have an option to sell 33% of their vested stocks to the company. According to Harshil Mathur, Co-Founder and CEO, Razorpay, this is their third buyback since the start of the company. “Typically, anyone who has spent more than a year with us holds these stocks. It is a good opportunity for wealth creation among our staff," he said. Before this, Razorpay bought back ESOPs worth $10 million in two announcements.

The buyback of $10 million or ₹73 crore shares will be from 750 existing and former employees. The buyers in the process are Sequoia Capital India and GIC, two of Razorpay's key investors, the company’s statement said. Though the size for sale for every person may differ, the average ranges at INR 12 lakh per person. The company has over 1,300 employees and is planning to hire another 650.

About the last two Razorpay ESOP buybacks

In November 2018, Razorpay had announced its first ESOP encashment for 140 employees. At that time, Tiger Global Management led the buyback at a 50% premium of the company’s valuation. A year later, Razorpay allowed 400 employees to sell their ESOPs. The company has so far awarded ESOPs to 1000 employees and this time, every employee, irrespective of ranks is eligible for the buyback. “The compensation rolls out to all our employees, be it software engineers, product managers, customer experience agents, or administrative staff. I believe there’s no better time than now to recognise the team for all their efforts and have trusted us in this journey,” adds Harshil.

Razorpay became India’s sixth unicorn in 2020 after it raised $100 million (about Rs 731 crore) in a funding round co-led by Singapore’s sovereign wealth fund GIC and Sequoia Capital India. Razorpay helps businesses modernise their financial infrastructure by providing intelligent automated payment. It also provides banking solutions to manage their entire money flow.

The latest of Unicorn Startups currently powers payments for over 5 million businesses. Its customers include Airtel, BookMyShow, Facebook, Ola, Zomato, Swiggy, Cred, ICICI Prudential among others. The company also aims to double business by the end of this year.