Edtech Soonicorn Classplus Announces Second ESOP Buyback For Over 150 Employees

Delhi NCR-based edtech SaaS soonicorn Classplus has launched an employee stock ownership plan (ESOP) buyback programme for over 150 employees.

In a statement, Classplus said this is the second ESOP buyback programme by it in three years. Under the latest buyback, employees across roles and business verticals are eligible to sell their vested shares to the startup. 

However, it didn’t disclose the amount that would be spent on buying back the shares. 

Commenting on the development, Classplus cofounder and CEO Mukul Rustagi said, “It’s also a chance for our younger team members to start building wealth early, something we’re really proud to offer. The youngest participant in the buyback is just 23, and the average age of the 150+ eligible people is 28. ESOP buybacks can seem infrequent in our industry, but we’re happy to show that they’re very much a part of Classplus’ plan.” 

As per LinkedIn, the startup’s employee headcount currently stands at 748. Hence, over 20% of its employees are eligible for the ESOP buyback programme. 

Classplus’ first ESOP buyback programme saw over 30 employees participate in it and was worth $1 Mn. 

Classplus said it is the first edtech startup to announce a buyback this year. The development comes at a time when the edtech sector is among the worst hit from the ongoing funding winter. 

Founded by Rustagi and Bhaswat Agarwal in 2018, Classplus is a mobile-first SaaS platform that allows educators and content creators to build online presence, digitise their offline tuition centres, and sell their courses online.

The Tiger Global-backed startup’s net loss jumped 57% to INR 256.6 Cr in FY23 from INR 163.5 Cr in the previous fiscal year. Operating revenue nearly quadrupled to INR 102.04 Cr during the year under review from INR 25.9 Cr in FY22. 

Classplus’ employee benefits accounted for the biggest chunk of its total expenditure of INR 405.2 Cr in FY23. Its employee costs surged 119% year-on-year to INR 228.9 Cr in FY23. 

While Indian startups have laid off thousands of employees over the last two years amid the funding winter, ESOP allocations are expected to pick up this year. According to Inc42’s Indian Startup Founder Survey 2023, about 55% of over 400 Indian startup founders are banking on ESOPs to attract talent.