July 2022 - ESOP Liquidity Dry Up with Pool Expansions

Written By:

Srikanth Prabhu

August 3, 2022

Welcome to the July edition of Fables Of ESOP. While we hope you are enjoying the monsoons (we in Bangalore definitely are… a little too much!), in the world of ESOPs, liquidity seems to be drying up. The funding winter is finally playing catchup with ESOP liquidity pools as well as companies are looking to conserve cash on their books.

While cash has been hard to come by, companies are trying to attract and retain talent by expanding their ESOP pools as well as allocating ESOPs to their employees amidst this slowdown.

Btw did you catchup our conversation on Liquidity matters with Skanda Jayaraman, CEO of Qapita Market place. If not here is the link to the blog.

Let’s do our usual round up of ESOP related news from India and SEA:

ESOP Liquidity Programs

July witnessed 2 new ESOP Liquidity announcements: Synaptic and Biz2Credit.

Synaptic announces their first ESOP Buyback worth $1 million

An alternative data insights company, Synaptic, recently announced their first ESOP Buyback program worth $1 million for its current employees. The program invited eligible employees to sell 25% of their vested options. 14 of their 80 employees participated in the buyback including the two cofounders: Rohit Razdan and Anurag Abbott. The startup had recently raised $20Mn in a Series B round held in May.

Biz2Credit Announces ESOP Liquidity worth $12 million

Biz2Credit is an online marketplace for small business funding. It recently announced its ESOP liquidity program for its Indian employees worth $12.25Mn. This program will benefit more than 500 employees. This comes post the company’s Series B funding of $52 million led by WestBridge capital.

Other Updates

Jar announces a new ESOP Plan worth $13 million: The Gold Savings App, Jar, has introduced a new ESOP plan as it seeks to close its funding round led by Tiger Global. According to reports, the size of the ESOP pool will be worth a little more than $13Mn.

Unacademy: The Edtech has increased its ESOP pool to 286Mn options, which is a 20% increase. This event followed the layoff of 750+ employees including educators which was done to cut costs and survive the funding winter.

Zomato: The food delivery giant has allotted 4,65,51,600 equity shares from its ESOP pool at an exercise price of Rs.1 accounting for close to Rs. 4.66 Cr which is about a 98% discount from the latest stock lows.

Amagi: The Media SaaS startup too has increased its ESOP & SARs pool. This announcement was made after the ESOP buyback that took place in April this year.

Watch: Decoding Liquidity Programs in Private Markets by Skanda Jayaraman, CEO of Qapita Marketplace

We recently also caught up with Skanda who leads Qapita’s newly launched Marketplace which offers Liquidity solutions for employees (ESOPs) and stakeholders through structured programs as per company’s requirements.

In this podcast, Skanda and I discuss to demystify some key questions about running liquidity programs:

👉 How these liquidity programs are executed?

👉What is a buyback program and what is bought back?

👉What is a secondary sale?

Watch it here👇