The secondary sale of Paytm shares of worth $47.2 million to Canada-based VC firm Discovery Capital at a valuation of $10 billion, has turned some 300 hundred former and existing Paytm employees into millionaires.
Among rupee millionaires, is an office boy, who got an opportunity to sell his shares and became richer by Rs 20 lakh.
In the recent secondary sale of shares, some 200 of Paytm’s employees liquidate their vested employee stock ownership plan (ESOP) and earned around Rs 300 crore. An ESOP is a benefit plan to enable employees to acquire shares in the company.
This is the company’s second sale of ESOP units after a Rs 200 crore cash out by staff in mid-2017. Since then, the company’s employees have earned around Rs 500 crore through such sales.
Some 20-25 people made over $1 million each (about Rs 6-7 crore) in the latest sale aimed at rewarding staff, according to the Mint report.
With the current valuation, the fintech platform is the second decacorn in the Indian startup ecosystem after Flipkart.
ESOP buy back in Indian startups
Paytm, however, is not the only Indian company which has brought its employees so much money through ESOPs.
In 2016, PayU acquired Citrus Pay for about Rs 860 crore, in one of the biggest deals in the Indian financial technology space. The deal brought Rs 43 crore to its 50 employees and about 15 employees got over Rs 1 crore. The most interesting benefactor was an office boy who made Rs 50 lakh as returns on ESOPs.
Late last year, Online e-commerce platform Flipkart repurchased employee stock options (ESOPs) of worth $100 million from over 3,000 present and past employees, including Myntra and Jabong.
In the past, the Softbank Vision Fund-backed company has bought ESOPs from its employees. This is the fourth instance in the past five years.